<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JUNE 17, 1994
REGISTRATION NO. [ ]
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- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------------------
THE HERTZ CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
<TABLE>
<S> <C> <C>
Delaware 13-1938568
(STATE OR OTHER JURISDICTION (I.R.S. EMPLOYER
OF INCORPORATION OR IDENTIFICATION NO.)
ORGANIZATION)
</TABLE>
225 Brae Boulevard
Park Ridge, New Jersey 07656-0713
(201) 307-2000
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
PAUL M. TSCHIRHART, ESQ.
Senior Vice President and General Counsel
The Hertz Corporation
225 Brae Boulevard
Park Ridge, New Jersey 07656-0713
(201) 307-2000
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF AGENT FOR SERVICE)
------------------------------------
Copy to:
JOSEPH McLAUGHLIN, ESQ.
Brown & Wood
One World Trade Center, 58th Floor
New York, New York 10048
(212) 839-5300
(Counsel for the Underwriters)
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, check the following box. /X/
CALCULATION OF REGISTRATION FEE
<TABLE>
<S> <C> <C> <C> <C>
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TITLE OF EACH PROPOSED MAXIMUM
CLASS OF AMOUNT PROPOSED MAXIMUM AGGREGATE AMOUNT OF
SECURITIES TO BE OFFERING PRICE OFFERING REGISTRATION
TO BE REGISTERED REGISTERED(1) PER UNIT(2) PRICE(2) FEE
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Debt Securities... $1,000,000,000 100% $1,000,000,000 $344,830
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</TABLE>
(1) Such amount in U.S. dollars or the equivalent thereof in foreign currencies
as shall result in an aggregate initial public offering price for all
securities of $1,000,000,000.
(2) Estimated solely for the purpose 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 SECURITIES AND EXCHANGE COMMISSION, ACTING
PURSUANT TO SAID SECTION 8(A), MAY DETERMINE.
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<PAGE> 2
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR
MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT
BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR
THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE
SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE
UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS
OF ANY SUCH STATE.
SUBJECT TO COMPLETION DATED JUNE 17, 1994
PROSPECTUS [LOGO]
THE HERTZ CORPORATION
DEBT SECURITIES
------------------------
The Hertz Corporation (the "Corporation") may offer from time to time in
one or more series its unsecured debt securities (the "Debt Securities"), which
may be senior (the "Senior Debt Securities"), senior subordinated (the "Senior
Subordinated Debt Securities") or junior subordinated (the "Junior Subordinated
Debt Securities") in priority of payment. The aggregate offering price of Debt
Securities offered hereby will not exceed $1,000,000,000. The Debt Securities
may be offered as separate series in amounts, at prices and on terms to be
determined at the time of sale and to be set forth in supplements to this
Prospectus.
The Debt Securities may be denominated in and sold for U.S. dollars,
foreign currency or ECU, and principal of and any interest on the Debt
Securities may likewise be payable in U.S. dollars, foreign currency or ECU. The
currency for which the Debt Securities may be purchased and the currency in
which principal of and any interest on the Debt Securities may be payable will
be specifically designated by the Corporation. The specific designation,
priority of payment, aggregate principal amount, authorized denominations,
maturity, rate or method of calculation and time of payment of any interest,
purchase price, any redemption terms, other special terms, and any listing on a
securities exchange of the Debt Securities in respect of which this Prospectus
is being delivered, and the net proceeds to the Corporation from the sale
thereof, will be set forth in an accompanying Prospectus Supplement (the
"Prospectus Supplement").
------------------------
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 Debt Securities will be sold directly or through agents designated from
time to time or through underwriters or dealers or a group of underwriters. If
agents of the Corporation or underwriters are involved in the sale of the Debt
Securities in respect of which this Prospectus is being delivered, the names of
such agents or underwriters and any applicable commissions or discounts shall be
set forth in the Prospectus Supplement with respect to such Debt Securities.
, 1994
<PAGE> 3
AVAILABLE INFORMATION
The Corporation 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 filed by the Corporation can
be inspected and copied at the public reference facilities maintained by the
Commission at Judiciary Plaza, 450 5th Street, N.W., Washington, D.C. 20549, and
at the following Regional Offices of the Commission: Chicago Regional Office,
Northwestern Atrium Center, 500 West Madison Street, Suite 1400, Chicago,
Illinois 60621; and New York Regional Office, Seven World Trade Center, New
York, New York 10048. Copies of such materials can be obtained from the Public
Reference Section of the Commission at Judiciary Plaza, 450 5th Street, N.W.,
Washington, D.C. 20549 at prescribed rates. Copies of such materials may also be
inspected and copied at the offices of the New York Stock Exchange, Inc., 20
Broad Street, New York, New York 10005.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Corporation's Annual Report on Form 10-K for the year ended December
31, 1993, its Quarterly Report on Form 10-Q for the quarter ended March 31, 1994
and the Current Reports on Form 8-K dated February 3, 1994, February 9, 1994 and
April 5, 1994 are hereby incorporated by reference into this Prospectus.
All documents subsequently filed by the Corporation pursuant to Section
13(a), 13(c), 14 or 15(d) of the Exchange Act prior to the termination of the
offering of the Debt Securities shall be deemed to be incorporated by reference
in this Prospectus and to be a part hereof from the date of filing of such
documents. Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Prospectus and the Prospectus Supplement to the extent that
a statement contained herein, therein or in any other subsequently filed
document which also is incorporated or deemed to be incorporated by reference
herein modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus or the Prospectus Supplement.
The Corporation will provide without charge to each person to whom this
Prospectus is delivered, on written or oral request of such person, a copy
(without exhibits) of any or all documents incorporated by reference into this
Prospectus. Requests for such copies should be directed to The Hertz
Corporation, Attention: Investor Relations, at its mailing address or its
telephone number.
The mailing address of the Corporation's principal executive office is 225
Brae Boulevard, Park Ridge, New Jersey 07656-0713 and its telephone number is
(201) 307-2000.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATION NOT CONTAINED IN THIS PROSPECTUS AND THE PROSPECTUS SUPPLEMENT
AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED
UPON AS HAVING BEEN AUTHORIZED. THE DELIVERY OF THIS PROSPECTUS AND ANY
PROSPECTUS SUPPLEMENT AT ANY TIME DOES NOT IMPLY THAT INFORMATION HEREIN OR
THEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE OF ANY PROSPECTUS
SUPPLEMENT.
2
<PAGE> 4
THE CORPORATION
The Corporation and its subsidiaries ("Hertz"), affiliates, independent
licensees and associates are engaged principally in the business of renting
automobiles and renting and leasing trucks, without drivers, to customers in the
United States and in over 140 foreign countries. Collectively, they operate what
the Corporation believes is the largest rent a car business in the world and one
of the largest one-way truck rental businesses in the United States. In
addition, through its wholly-owned subsidiary, Hertz Equipment Rental
Corporation ("HERC"), the Corporation operates what it believes to be the
largest rental, lease and sale of construction and materials handling equipment
business in the United States. Other activities of Hertz include the sale of its
used vehicles; the leasing of automobiles, primarily in Europe, Australia and
New Zealand; operating car dealerships in Belgium; and providing claim
management and telecommunication services in the United States.
The Corporation, which was incorporated in Delaware in 1967, is a successor
to corporations which were engaged in the automobile and truck leasing and
rental business since 1924. UAL Corporation ("UAL") (formerly Allegis
Corporation) purchased all of the Corporation's outstanding capital stock from
RCA Corporation ("RCA") on August 30, 1985. Park Ridge Corporation ("Park
Ridge") purchased all of the Corporation's outstanding capital stock from UAL on
December 30, 1987. On July 19, 1993, Park Ridge (which had no material assets
other than the Corporation) was merged with and into the Corporation, with the
prior stockholders of Park Ridge becoming the stockholders of the Corporation.
In March 1994, Ford Motor Company ("Ford") acquired the Corporation's common
stock owned by Commerzbank Aktiengesellschaft. On April 29, 1994, Ford purchased
all of the common stock of the Corporation owned by Park Ridge Limited
Partnership. The Corporation then redeemed the preferred and common stock of the
Corporation owned by AB Volvo, borrowing the funds to pay for the redemption. In
addition, a subordinated promissory note of the Corporation held by Ford Motor
Credit Company ("FMCC") was exchanged for an equivalent amount of preferred
stock of the Corporation.
Currently, 100% of the outstanding common stock of the Corporation is owned
by Ford and 100% of the outstanding preferred stock of the Corporation is owned
by FMCC. The Debt Securities will not be obligations of, or guaranteed by,
either stockholder of the Corporation. The terms of the Corporation's debt
agreements limit the payment of cash dividends. At March 31, 1994, $50 million
of consolidated shareholders' equity was free of such limitations.
USE OF PROCEEDS
The net proceeds from the sale of the Debt Securities will be added to the
general funds of the Corporation. It is anticipated that the proceeds will be
used for general corporate purposes and to reduce short-term borrowings. The
Corporation expects to issue additional long-term and short-term debt, subject
to the covenants contained in its debt agreements, and the proportionate amounts
of each can be expected to vary from time to time as a result of business
requirements, market conditions and other factors. At March 31, 1994, the
Corporation was permitted to issue up to an additional $1,401 million of senior
debt and an additional $238 million of senior subordinated debt under the most
restrictive covenants contained in its existing financing agreements.
3
<PAGE> 5
SELECTED FINANCIAL DATA OF THE CORPORATION
(IN MILLIONS OF DOLLARS)
The following table presents selected consolidated financial information of
the Corporation, which is unaudited for the three months ended March 31, 1994
and 1993, and which is extracted from the audited financial statements for the
years ended December 31, 1993, 1992, 1991, 1990 and 1989. The operating results
for the three months ended March 31, 1994 and 1993 include all adjustments
(consisting only of normal recurring adjustments) that the Corporation considers
necessary for a fair presentation of the results for such interim periods. The
interim results are not necessarily an indication of the results for the full
year. The information in the table and the notes thereto should be read in
conjunction with the financial statements and the related notes thereto
contained in the Corporation's Annual Report on Form 10-K for the year ended
December 31, 1993, and its Quarterly Report on Form 10-Q for the quarter ended
March 31, 1994.
<TABLE>
<CAPTION>
Three Months
Ended
March 31, Years Ended December 31,
--------------- --------------------------------------------------
1994 1993 1993 1992 1991 1990 1989
------ ------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C> <C>
(Unaudited)
REVENUES.................................... $ 695 $ 636 $2,855 $2,816 $2,626 $2,667 $2,253
------ ------ ------ ------ ------ ------ ------
EXPENSES:
Direct operating.......................... 407 396 1,647 1,627 1,486 1,470 1,239
Depreciation of revenue earning
equipment............................... 149 124 524(a) 497(b) 493 526 463
Selling, general and administrative....... 85 79 336 353 339 348 290
Interest, net of interest income of $1,
$9, $11, $4, $10, $25 and $20........... 56 51 246 307 304 300 253
------ ------ ------ ------ ------ ------ ------
697 650 2,753 2,784 2,622 2,644 2,245
------ ------ ------ ------ ------ ------ ------
INCOME (LOSS) BEFORE INCOME TAXES........... (2) (14) 102 32 4(b) 23 8
PROVISION (BENEFIT) FOR TAXES ON INCOME..... (1) (7) 49(a) 22(b) (1)(b) (11)(c) (1)
------ ------ ------ ------ ------ ------ ------
INCOME (LOSS) BEFORE CUMULATIVE EFFECT OF
CHANGES IN ACCOUNTING PRINCIPLES.......... (1) (7) 53 10 5 34 9
CUMULATIVE EFFECT ON PRIOR YEARS OF CHANGES
IN METHOD OF ACCOUNTING FOR --
Postretirement Benefits (d)............... -- -- -- (4) -- -- --
Vehicle Warranties (e).................... -- -- -- -- (4) -- --
Income Taxes (f).......................... -- -- -- -- -- -- (2)
------ ------ ------ ------ ------ ------ ------
NET INCOME (LOSS)........................... $ (1) $ (7) $ 53 $ 6 $ 1 $ 34 $ 7
------ ------ ------ ------ ------ ------ ------
------ ------ ------ ------ ------ ------ ------
Ratio of Earnings to Fixed Charges (g)...... .98 .83 1.3 1.1 1.0 1.1 1.0
Balance Sheet Data at End of Period:
Total Assets.............................. $5,541 $4,695 $4,688 $4,222 $4,294 $4,334 $4,152
Total Debt................................ 3,713 3,075 2,940 2,550 2,702 2,798 2,716
Shareholders' Equity...................... 622 572 617 580 599 600 542
Ratio of Total Debt to Shareholders'
Equity.................................. 6.0 5.4 4.8 4.4 4.5 4.7 5.0
</TABLE>
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(a) Depreciation of revenue earning equipment for the year 1993 includes net
credits of $28.1 million as compared to net credits of $16.9 million in
1992, primarily attributable to higher proceeds received in 1993 on disposal
of the equipment. The tax provision for the year 1993 includes a $1.1
million charge relating to the increase in net deferred tax liabilities as
of January 1, 1993 due to changes in the tax laws enacted in August 1993,
and a $2.0 million credit resulting from adjustments made to tax accruals in
connection with tax audit evaluations and the effects of prior years' tax
sharing arrangements between the Corporation and its former parent
companies, UAL and RCA.
Effective January 1, 1993, the Corporation adopted the provisions of
Statement of Financial Accounting Standards No. 109, Accounting for Income
Taxes, which did not have a material effect on the Corporation's
consolidated financial position, results of operations or cash flows.
(b) Depreciation of revenue earning equipment for the year 1992 includes net
credits of $16.9 million as compared to net charges of $5.4 million in
1991, primarily attributable to higher proceeds received in 1992 on
disposal of the equipment and the elimination of losses incurred in 1991
due to the increase in
4
<PAGE> 6
1992 of "non-risk" vehicles acquired which are returned to the vehicle
manufacturers at pre-established prices.
The tax provision includes credits of $9.8 million, $16.7 million, and
$38.8 million for the years 1992, 1991 and 1990, respectively, resulting
from adjustments made to tax accruals in connection with tax audit
evaluations and the effects of prior years' tax sharing arrangements
between the Corporation and its former parent companies, UAL and RCA, and
the reversal of tax accruals no longer required and benefits realized
relating to certain foreign operations. The tax provision for the year 1991
also includes benefits of $5.5 million related to the close down and sale
of certain unprofitable foreign operations.
The decrease in income before income taxes for the year ended December 31,
1991, as compared to the prior year, was due to provisions made in 1991 of
approximately $20 million primarily incurred to close down certain
unprofitable foreign operations and depreciation adjustments made to
residual values of certain vehicles, $15 million of lower interest income
in 1991 primarily relating to refunds of prior years' income taxes, and the
adverse effects of the decrease in travel due to the war in the Persian
Gulf and a slowdown in the economy. The decrease was partly offset by net
credits of $8.9 million relating to the sale and disposition of certain
properties.
(c) The tax provision for the year 1990 includes credit adjustments of $38.8
million, resulting from adjustments made to tax accruals in connection with
tax audit evaluations and the effects of prior years' tax sharing
arrangements between the Corporation and its former parent companies, UAL
and RCA.
(d) Effective January 1, 1992, the Corporation adopted the provisions of
Statement of Financial Accounting Standards No. 106, Employers' Accounting
for Postretirement Benefits Other than Pensions ("FAS No. 106"), which
requires that postretirement health care and other non-pension benefits be
accrued during the years the employee renders the necessary service. Prior
to 1992, the Corporation accrued for such benefits on a pay-as-you-go
basis. As of January 1, 1992, the Corporation recorded a cumulative
decrease in net income of $4.3 million (net of $2.7 million tax benefit) as
a result of implementing FAS No. 106.
(e) Effective January 1, 1991, the Corporation adopted the provisions of FASB
Technical Bulletin No. 90-1, Accounting for Separately Priced Extended
Warranty and Product Maintenance Contracts ("FAS No. 90-1"), which requires
that proceeds received from warranty contracts should be deferred and
recognized in income on a straight line basis over the contract period, and
costs of services performed under the contract should be charged to expense
as incurred. Prior to 1991, when vehicles were sold under an extended
warranty contract, the proceeds received by the Corporation under such
contract, net of estimated costs to be incurred in fulfilling obligations
under those contracts, were recorded in income when the sale occurred. As
of January 1, 1991, the Corporation recorded a cumulative decrease in net
income of $3.5 million (net of $2.2 million tax benefit) as a result of
implementing FAS No. 90-1.
(f) Effective January 1, 1989, the Corporation adopted the provisions of
Statement of Financial Accounting Standards No. 96, Accounting for Income
Taxes ("FAS No. 96"), which requires the use of the liability method in
accounting for income taxes. Deferred tax assets and liabilities are
recorded based on the differences between the financial statement and tax
bases of assets and liabilities and the tax rates in effect when these
differences are expected to reverse. In addition, deferred tax amounts are
recorded with respect to assets and liabilities acquired in business
combinations prior to adoption, when prior years' financial statements are
not restated to reflect adoption of FAS No. 96. The cumulative decrease in
net income as a result of implementing FAS No. 96 was $2 million.
(g) Earnings have been calculated by adding interest expense and the portion of
rentals estimated to represent the interest factor to income before income
taxes. Fixed charges include interest charges (including capitalized
interest) and the portion of rentals estimated to represent the interest
factor. For the three months ended March 31, 1994 and 1993, an additional
$2.0 million and $14.3 million of income before income taxes, respectively,
would have been required to reflect a ratio of 1.0x.
CERTAIN RELATIONSHIPS
Hertz is a party to a cooperative advertising agreement with Ford (see
"Item 1 -- Business -- Advertising" in the Corporation's Annual Report on Form
10-K for the year ended December 31, 1993). In addition, for each of the five
years ended December 31, 1993, Hertz' domestic revenue earning vehicles
consisted of approximately 70% Ford products and 2% Volvo products. In its
foreign operations, Hertz utilizes vehicles manufactured abroad by subsidiaries
of Ford (which for the five years ended December 31, 1993 represented in the
aggregate approximately 40% of Hertz' fleet) and by other manufacturers. Ford
products are acquired from dealers who are independent from Ford. The
percentages of Ford and Volvo products
5
<PAGE> 7
acquired by Hertz are expected to continue at approximately this level in the
future, pursuant to long-term supply contracts between the Corporation and Ford
and the Corporation and Volvo. Hertz will purchase or lease the vehicles from
Ford dealers and Volvo.
In 1992, the Corporation entered into a lease agreement with a third party
lessor providing for the lease of vehicles purchased by the third party lessor
under a repurchase program offered by Ford. Under the lease, which is accounted
for as an operating lease, the Corporation makes payments equal to the monthly
depreciation and all expenses (including interest) of the third party lessor and
is responsible for the remaining net cost on any vehicles that become ineligible
under the repurchase program. At March 31, 1994, the net cost of the vehicles
leased under this agreement was approximately $389 million.
On June 8, 1994, the Corporation and Ford entered into a revolving loan
agreement under which Hertz may borrow from Ford from time to time in amounts of
up to $250 million outstanding at any one time. Obligations of the Corporation
under the agreement would rank pari passu with the Corporation's Senior Debt
Securities. This agreement by its terms expires on June 30, 1999, on which date
any amounts then outstanding thereunder are required to be repaid.
DESCRIPTION OF DEBT SECURITIES
The Senior Debt Securities are to be issued under an indenture, dated as of
April 1, 1986, between the Corporation and Chemical Bank (successor by merger to
Manufacturers Hanover Trust Company), as Trustee (the "Senior Trustee"), as
amended by the First Supplemental Indenture, dated as of April 2, 1990, between
the Corporation and the Senior Trustee (such indenture, as amended, the "Senior
Indenture"). The Senior Subordinated Debt Securities are to be issued under an
indenture, dated as of June 1, 1989 (the "Senior Subordinated Indenture"),
between the Corporation and The Bank of New York, as Trustee (the "Senior
Subordinated Trustee"). The Junior Subordinated Debt Securities are to be issued
under an indenture, dated as of July 1, 1993 (the "Junior Subordinated
Indenture"), between the Corporation and Citibank, N.A., as trustee (the "Junior
Subordinated Trustee").
A copy of the Senior Indenture, the Senior Subordinated Indenture and the
Junior Subordinated Indenture are exhibits to the Registration Statement of
which this Prospectus forms a part. The Senior Indenture, the Senior
Subordinated Indenture and the Junior Subordinated Indenture are sometimes
referred to collectively as the "Indentures" and the Senior Trustee, the Senior
Subordinated Trustee and the Junior Subordinated Trustee are sometimes referred
to collectively as the "Trustees."
The following summaries of certain provisions of the Indentures do not
purport to be complete and are subject to and are qualified in their entirety by
reference to all the provisions of the Indentures, including the definitions
therein of certain terms. References to Sections are applicable to each
Indenture, except (i) references to sections included under the caption
"Subordination of Senior Subordinated Debt Securities" are applicable to the
Senior Subordinated Indenture only, (ii) references to sections included under
the caption "Subordination of Junior Subordinated Debt Securities" are
applicable to the Junior Subordinated Indenture only and (iii) as otherwise
expressly provided. The following sets forth certain general terms and
provisions of the Senior Debt Securities, the Senior Subordinated Debt
Securities and the Junior Subordinated Debt Securities (together the "Debt
Securities") offered hereby. Further terms of the Debt Securities shall be set
forth in applicable Prospectus Supplements.
GENERAL
The Debt Securities to be offered by this Prospectus are limited to
$1,000,000,000 in aggregate principal amount. However, the Indentures do not
limit the amount of Debt Securities which can be issued thereunder and provide
that additional securities may be issued thereunder up to the aggregate
principal amount which may be authorized from time to time by the Corporation.
(Section 301)
While the covenants contained in each Indenture may provide limited
protection to debt holders in the event of a highly leveraged transaction
involving the Corporation, the Indentures do not prohibit the incurrence of
additional Senior, Senior Subordinated or Junior Subordinated Debt. Subject to
certain exceptions described below under "Limitations on Secured Debt,"
outstanding Debt Securities and other qualified indebtedness shall be secured
equally and ratably (subject, however, to applicable priorities of
6
<PAGE> 8
payment) with any additional Secured Debt incurred by the Corporation. (Section
1004) Unless otherwise indicated in the applicable Prospectus Supplement, the
Debt Securities will not have the benefit of any covenant requiring redemption
or repurchase of the Debt Securities by the Corporation, or adjustment to any
terms of the Debt Securities, upon any change in control or recapitalization of
the Corporation.
Reference is made to the applicable Prospectus Supplement for the following
terms of the particular series of Debt Securities being offered thereby: (i) the
designation and any limitation on the aggregate principal amount of the series;
(ii) whether the securities are Senior Debt Securities, Senior Subordinated Debt
Securities, or Junior Subordinated Debt Securities; (iii) the currency or
currencies for which Debt Securities may be purchased and currency or currencies
in which principal and any interest may be payable; (iv) if the currency for
which Debt Securities may be purchased or in which principal and any interest
may be payable is at the purchaser's election, the manner in which such an
election may be made; (v) the percentage of principal amount at which the series
will be issued; (vi) the date or dates on which the principal of the series will
be payable; (vii) the rate or rates per annum, if any, at which the series will
bear interest or the method of calculation thereof; (viii) the date or dates
from which any interest will accrue and the times at which any interest will be
payable; (ix) the place or places where the principal and interest, if any, on
Debt Securities of the series shall be payable; (x) the terms, if any, on which
Debt Securities of the series may be redeemed at the option of the Corporation;
(xi) the obligation, if any, of the Corporation to redeem, purchase or repay
Debt Securities of the series; (xii) the minimum denomination in which Debt
Securities of the series will be issued; (xiii) if other than the principal
amount, the portion of the principal amount of the Debt Securities of the series
that will be payable upon a declaration of acceleration of the maturity thereof;
and (xiv) any other special terms.
Debt Securities may be issued as discounted Debt Securities (bearing no
interest or interest at a rate which at the time of issuance is below market
rates) to be sold at a substantial discount below their stated principal amount.
Federal income tax consequences and other special considerations applicable to
any such discounted Debt Securities will be described in the applicable
Prospectus Supplement relating thereto.
The Debt Securities will be issued only in registered form without coupons
and will be unsecured obligations of the Corporation. The Senior Debt Securities
will rank on a parity with other senior debt securities of the Corporation. The
Senior Subordinated Debt Securities will rank on a parity with other senior
subordinated debt securities and be subordinated in right of payment to the
prior payment in full of Senior Indebtedness (as defined in the Senior
Subordinated Indenture) of the Corporation, as described below under
"Subordination of Senior Subordinated Debt Securities." The Junior Subordinated
Debt Securities will rank on a parity with other junior subordinated debt
securities and be subordinated in right of payment to the prior payment in full
of Senior Indebtedness (as defined in the Junior Subordinated Indenture) of the
Corporation (which term, when used in connection with Junior Subordinated Debt
Securities, includes Senior Debt Securities and Senior Subordinated Debt
Securities), as described under "Subordination of Junior Subordinated Debt
Securities."
Unless otherwise provided in the applicable Prospectus Supplement relating
to a particular series of Debt Securities being offered thereby, principal,
premium, if any, and interest, if any, will be payable at an office or agency to
be maintained by the Corporation in such place or places described in the
applicable Prospectus Supplement, which place is currently contemplated to be in
The City of New York, except that, at the option of the Corporation, interest
may be paid by check mailed to the person entitled thereto. The Debt Securities
may be presented to the corporate trust office of the applicable Trustee for
registration of transfer or exchange. Debt Securities of a particular series may
be exchanged for a like aggregate amount of Debt Securities of such series of
other authorized denominations without service charge, except for any tax or
other governmental charge that may be imposed. (Sections 301, 302, 305 and 1002)
BOOK-ENTRY
If so indicated in the applicable Prospectus Supplement, upon issuance, all
Debt Securities will be represented by one or more fully registered global
securities (the "Global Notes"). In any such case, the Depository Trust Company
(the "Depository"), New York, New York, will act as securities depository for
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such issue of Debt Securities. Any such Debt Securities will be issued as
fully-registered Global Notes registered in the name of Cede & Co. (the
Depository's partnership nominee). One fully-registered Global Note will be
issued for each such issue of Debt Securities, in the aggregate principal amount
of such issue, and will be deposited with the Depository; provided, however,
that if the aggregate principal amount of any such issue exceeds $150 million,
one Global Note will be issued with respect to each $150 million of principal
amount and an additional Global Note will be issued with respect to any
remaining principal amount of such issue.
The Depository has advised the Company as follows: The Depository is a
limited-purpose trust company organized under the New York Banking Law, a
"banking organization" within the meaning of the New York Banking Law, a member
of the Federal Reserve System, a "clearing corporation" within the meaning of
the New York Uniform Commercial Code, and a "clearing agency" registered
pursuant to the provisions of Section 17A of the Securities Exchange Act of
1934. The Depository holds securities that its participants ("Participants")
deposit with the Depository. The Depository also facilitates the settlement
among Participants of securities transactions, such as transfers and pledges, in
deposited securities through electronic computerized book-entry changes in
Participants' accounts, thereby eliminating the need for physical movement of
securities certificates. Participants include securities brokers and dealers,
banks trust companies, clearing corporations, and certain other organizations.
The Depository is owned by a number of its Participants and by the New York
Stock Exchange, Inc., the American Stock Exchange, Inc. and the National
Association of Securities Dealers, Inc. Access to the Depository's book-entry
system is also available to others such as securities brokers and dealers,
banks, and trust companies that clear through or maintain a custodial
relationship with a Participant, either directly or indirectly ("Indirect
Participants"). The Rules applicable to the Depository and its Participants are
on file with the Securities and Exchange Commission.
Purchases of Debt Securities represented by one or more Global Notes under
the Depository's book-entry system must be made by or through Participants,
which will receive a credit for such Debt Securities on the Depository's
records. The ownership interest of each actual purchaser of each Debt Security
(a "Beneficial Owner") is in turn to be recorded on the Participants' and
Indirect Participants' records. Beneficial Owners will not receive written
confirmation from the Depository of their purchases, but each Beneficial Owner
is expected to receive written confirmation providing details of the
transaction, as well as periodic statements of its holdings, from the
Participant or Indirect Participant through which such Beneficial Owner entered
into the transaction. Transfers of ownership interests in such Debt Securities
will be accomplished by entries made on the books of Participants acting on
behalf of Beneficial Owners. Beneficial Owners will not receive certificates
representing their ownership interests in any Debt Securities, except in the
event that use of the book-entry system for the Debt Securities is discontinued.
To facilitate subsequent transfers, all Debt Securities represented by one
or more Global Notes deposited by Participants with the Depository will be
registered in the name of the Depository partnership nominee, Cede & Co. The
deposit of one or more Global Notes with the Depository and their registration
in the name of Cede & Co. effect no change in beneficial ownership. The
Depository will have no knowledge of the actual Beneficial Owners of any Debt
Securities represented by Global Notes; the Depository records will reflect only
the identity of the Participants to whose accounts the Debt Securities
represented by such Global Notes are credited, which may or may not be the
Beneficial Owners. The Participants will remain responsible for keeping account
of their holdings on behalf of their customers.
Conveyance of notices and other communications by the Depository to
Participants, by Participants to Indirect Participants, and by Participants and
Indirect Participants to Beneficial Owners will be governed by arrangements
among them, subject to any statutory or regulatory requirements as may be in
effect from time to time. Neither the Depository nor Cede & Co. will consent or
vote with respect to any Debt Securities represented by one or more Global
Notes.
Principal and interest payments on the Debt Securities represented by one
or more Global Notes will be made to the Depository. The Depository's practice
is to credit Participants' accounts on payable date in accordance with their
respective holdings shown on the Depository's records unless the Depository has
reason to believe that it will not receive payment on payable date. Payments by
Participants to Beneficial Owners will
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be governed by standing instructions and customary practices, as is 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 Participant and not of
the Depository, or the Company, subject to any statutory or regulatory
requirements as may be in effect from time to time. Payment of principal and
interest to the Depository will be the responsibility of the Company,
disbursement of such payments to Participants shall be the responsibility of the
Depository, and disbursement of such payments to the Beneficial Owners shall be
the responsibility of Participants and Indirect Participants.
The Depository may discontinue providing its services as securities
depository with respect to any issue of Debt Securities represented by one or
more Global Notes at any time by giving reasonable notice to the Company. Under
such circumstances, in the event that a successor securities depository is not
obtained, definitive certificates representing Debt Securities will be required
to be printed and delivered. The Company may decide to discontinue use of the
system of book-entry transfers through the Depository (or a successor securities
depository). In such event definitive certificates representing Debt Securities
will be printed and delivered.
The information in this section concerning the Depository's book-entry
system has been obtained from sources that the Company believes to be reliable,
but the Company takes no responsibility for the accuracy thereof.
SUBORDINATION OF SENIOR SUBORDINATED DEBT SECURITIES
Payment of the principal of, premium, if any, and interest on the Senior
Subordinated Debt Securities is expressly subordinated in right of payment, as
set forth in the Senior Subordinated Indenture, to payment when due of all
Senior Indebtedness of the Corporation, as such term is defined with respect to
the Senior Subordinated Debt Securities. (Section 1401) "Senior Indebtedness" is
used under this caption "Subordination of Senior Subordinated Debt Securities"
as defined in the Senior Subordinated Indenture. "Senior Indebtedness" is
defined in the Senior Subordinated Indenture as (a) outstanding indebtedness of
the Corporation listed on Schedule A to the Senior Subordinated Indenture, (b)
any promissory notes (other than any referred to in the foregoing clause (a))
issued by the Corporation pursuant to any agreement between the Corporation and
any bank or banks and any commercial paper issued by the Corporation, (c) all
indebtedness incurred by the Corporation after the date of the Senior
Subordinated Indenture for money borrowed which is, in the discretion of the
Corporation, specifically designated by the Corporation as superior to
subordinated debt (senior debt) of the Corporation in the instruments evidencing
said indebtedness at the time of the issuance thereof, (d) all indebtedness
previously incurred by the Corporation outstanding at the date of the Senior
Subordinated Indenture for money borrowed which is, in the discretion of the
Corporation, specifically designated by the Corporation as Senior Indebtedness
for the purposes of the Senior Subordinated Indenture at the date of the Senior
Subordinated Indenture (all of such indebtedness is set forth on Schedule B
attached to the Senior Subordinated Indenture), (e) indebtedness of the
Corporation for money borrowed from or guaranteed to persons, firms or
corporations which engage in lending money, including, without limitation,
banks, trust companies, insurance companies and other financing institutions and
charitable trusts, pension trusts and other investing organizations, evidenced
by notes or similar obligations, unless such indebtedness shall, in the
instrument evidencing the same, be specifically designated as not being superior
to the Senior Subordinated Debt Securities and (f) any amendments,
modifications, supplements, deferrals, renewals or extensions of any such Senior
Indebtedness. Senior Indebtedness will not include, and the Senior Subordinated
Debt Securities will rank pari passu in right of payment to, the Corporation's
8 3/4% Senior Subordinated Promissory Notes due October 1, 1997, 9 1/8% Senior
Subordinated Notes due August 1, 1996, 10 1/8% Senior Subordinated Notes due
March 1, 1997 and 9 1/2% Senior Subordinated Notes due May 15, 1998. (Section
101)
No payment on account of principal, premium, if any, sinking fund, or
interest on the Senior Subordinated Debt Securities may be made, nor may any
property or assets of the Corporation be applied to the purchase or other
acquisition or retirement of the Senior Subordinated Debt Securities, unless
full payment of amounts then due for principal, premium, if any, sinking fund,
and interest on Senior Indebtedness has been made or duly provided for in money
or money's worth. No payment by the Corporation on account of principal,
premium, if any, sinking fund, or interest on the Senior Subordinated Debt
Securities may be made,
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nor may any property or assets of the Corporation be applied to the purchase or
other acquisition or retirement of the Senior Subordinated Debt Securities, if,
at the time of such payment or application or immediately after giving effect
thereto, (i) there exists under the Senior Indebtedness referred to in clause
(a) of the immediately preceding paragraph or any agreement pursuant to which
any such Senior Indebtedness is issued any default or any condition, event or
act, which with notice or lapse of time, or both, would constitute a default or
(ii) there exists under any other Senior Indebtedness or any agreement pursuant
to which such other Senior Indebtedness is issued any event of default
permitting the holders of such other Senior Indebtedness (or a trustee on behalf
of such holders) to accelerate the maturity thereof; provided, however, that in
the case of such an event of default (other than in payment of such other Senior
Indebtedness when due) the foregoing provisions of this clause (ii) will not
prevent any such payment or application for a period longer than 90 days after
the date on which the holders of such Senior Indebtedness (or such trustee)
shall have first obtained written notice of such event of default from the
Corporation or the holder of any Senior Subordinated Debt Securities, if the
maturity of such other Senior Indebtedness is not so accelerated within such 90
day period. (Section 1402)
Subject to the foregoing, if there shall have occurred any Event of Default
on the Senior Subordinated Debt Securities as described below under "Events of
Default and Notice Thereof", other than with respect to certain events of
bankruptcy, insolvency or reorganization, then unless and until either such
Event of Default shall have been cured or waived or shall have ceased to exist
or the principal of, premium, if any, and interest on all Senior Indebtedness
shall have been paid in full in money or money's worth, no payment shall be made
by the Corporation on account of the principal of, premium, if any, or interest
on the Senior Subordinated Debt Securities or on account of the purchase or
other acquisition of Senior Subordinated Debt Securities, except (a) payments at
the expressed maturity of the Senior Subordinated Debt Securities (subject to
the next paragraph), (b) current interest payments as provided in the Senior
Subordinated Debt Securities, (c) payments for the purpose of curing any such
Event of Default, and (d) payments pursuant to the required sinking fund for the
Senior Subordinated Debt Securities. (Section 1402)
Upon any payment or distribution of assets of the Corporation to creditors
upon any dissolution or winding-up or total or partial liquidation or
reorganization of the Corporation or similar proceeding relating to the
Corporation or its property, whether voluntary or involuntary and whether or not
the Corporation is a party thereto, or in bankruptcy, insolvency, receivership
or other proceedings, all principal, premium, if any, and interest due upon all
Senior Indebtedness must be paid in full before the holders of the Senior
Subordinated Debt Securities are entitled to receive or retain any assets so
paid or distributed. Subject to the payment in full of all Senior Indebtedness,
the holders of the Senior Subordinated Debt Securities are to be subrogated to
the rights of holders of Senior Indebtedness to receive payments or
distributions of assets of the Corporation or other payments applicable to
Senior Indebtedness to the extent of the application to Senior Indebtedness of
moneys or other assets which would have been received by the holders of the
Senior Subordinated Debt Securities but for the subordination provisions
contained in the Senior Subordinated Indenture until the Senior Subordinated
Debt Securities are paid in full. (Sections 1403 and 1405)
At March 31, 1994, the outstanding principal amount of Senior Indebtedness
aggregated approximately $2,228 million and senior subordinated debt aggregated
approximately $250.8 million. The Corporation expects to issue from time to time
additional indebtedness constituting Senior Indebtedness and senior subordinated
debt (see "Use of Proceeds"). None of the Indentures prohibits or limits the
incurrence of additional Senior Indebtedness.
By reason of the subordination provisions contained in the Senior
Subordinated Indenture, in the event of insolvency, creditors of the Corporation
who are holders of Senior Indebtedness, as well as certain general creditors of
the Corporation, may recover more, ratably, than the holders of the Senior
Subordinated Debt Securities.
SUBORDINATION OF JUNIOR SUBORDINATED DEBT SECURITIES
Payment of the principal of, premium, if any, and interest on the Junior
Subordinated Debt Securities is expressly subordinated in right of payment, as
set forth in the Junior Subordinated Indenture, to payment when due of all
Senior Indebtedness of the Corporation, as such term is defined with respect to
the Junior
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Subordinated Debt Securities. (Section 1401) "Senior Indebtedness" is defined in
the Junior Subordinated Indenture as (a) any promissory notes issued by the
Corporation pursuant to any agreement between the Corporation and any bank or
banks and any commercial paper issued by the Corporation, (b) all existing and
future indebtedness for borrowed money of the Corporation (including guarantees
by the Corporation of indebtedness for borrowed money of others), (c) all
obligations of the Corporation specified on Schedule A to the Junior
Subordinated Indenture, (d) indebtedness of the Corporation for money borrowed
from or guaranteed to persons, firms or corporations which engage in lending
money, including, without limitation, banks, trust companies, insurance
companies and other financing institutions and charitable trusts, pension trusts
and other investing organizations, evidenced by notes or similar obligations,
unless such indebtedness shall, in the instrument evidencing the same, be
specifically designated as not being superior to the Junior Subordinated Debt
Securities of any series, (e) all other existing and future obligations of the
Corporation (including but not limited to (x) obligations under interest rate
and currency swaps, caps, collars, options and similar arrangements and (y)
guarantees by the Corporation of obligations of others) that are designated in
the instruments evidencing said obligations as being superior in right of
payment to the Junior Subordinated Debt Securities, and (f) any amendments,
modifications, supplements, deferrals, renewals or extensions of any such Senior
Indebtedness; provided, that Senior Indebtedness shall not include (x) the
Junior Subordinated Debt Securities of any series and (y) any other indebtedness
for borrowed money or other obligation of the Corporation (including guarantees
by the Corporation of such indebtedness of others) which is expressly
subordinated in right of payment to all senior subordinated debt securities that
are or may be outstanding under the Senior Subordinated Indenture. (Section 101)
No payment on account of principal, premium, if any, sinking fund, or
interest on the Junior Subordinated Debt Securities may be made, nor may any
property or assets of the Corporation be applied to the purchase or other
acquisition or retirement of the Junior Subordinated Debt Securities, unless
full payment of amounts then due for principal, premium, if any, sinking fund,
and interest on Senior Indebtedness has been made or duly provided for in money
or money's worth. No payment by the Corporation on account of principal,
premium, if any, sinking fund, or interest on the Junior Subordinated Debt
Securities may be made, nor may any property or assets of the Corporation be
applied to the purchase or other acquisition or retirement of the Junior
Subordinated Debt Securities, if, at the time of such payment or application or
immediately after giving effect thereto, there exists under any Senior
Indebtedness or any agreement pursuant to which such Senior Indebtedness is
issued any event of default permitting the holders of such Senior Indebtedness
(or a trustee on behalf of such holders) to accelerate the maturity thereof;
provided, however, that in the case of such an event of default (other than in
payment of such Senior Indebtedness when due) the foregoing provisions of this
sentence will not prevent any such payment or application for a period longer
than 90 days after the date on which the holders of such Senior Indebtedness (or
such trustee) shall have first obtained written notice of such event of default
from the Corporation or the holder of any Junior Subordinated Debt Securities,
if the maturity of such Senior Indebtedness is not so accelerated within such 90
day period. (Section 1402)
Subject to the foregoing, if there shall have occurred any Event of Default
on the Junior Subordinated Debt Securities as described below under "Events of
Default and Notice Thereof", other than with respect to certain events of
bankruptcy, insolvency or reorganization, then unless and until either such
Event of Default shall have been cured or waived or shall have ceased to exist
or the principal of, premium, if any, and interest on all Senior Indebtedness
shall have been paid in full in money or money's worth, no payment shall be made
by the Corporation on account of the principal of, premium, if any, or interest
on the Junior Subordinated Debt Securities or on account of the purchase or
other acquisition of Junior Subordinated Debt Securities, except (a) payments at
the expressed maturity of the Junior Subordinated Debt Securities (subject to
the next paragraph), (b) current interest payments as provided in the Junior
Subordinated Debt Securities, (c) payments for the purpose of curing any such
Event of Default, and (d) payments pursuant to the required sinking fund for the
Junior Subordinated Debt Securities. (Section 1402)
Upon any payment or distribution of assets of the Corporation to creditors
upon any dissolution or winding-up or total or partial liquidation or
reorganization of the Corporation or similar proceeding relating to the
Corporation or its property, whether voluntary or involuntary and whether or not
the Corporation is a party thereto, or in bankruptcy, insolvency, receivership
or other proceedings, all principal, premium, if any, and
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interest due upon all Senior Indebtedness must be paid in full before the
holders of the Junior Subordinated Debt Securities are entitled to receive or
retain any assets so paid or distributed. Subject to the payment in full of all
Senior Indebtedness, the holders of the Junior Subordinated Debt Securities are
to be subrogated to the rights of holders of Senior Indebtedness to receive
payments or distributions of assets of the Corporation or other payments
applicable to Senior Indebtedness to the extent of the application to Senior
Indebtedness of moneys or other assets which would have been received by the
holders of the Junior Subordinated Debt Securities but for the subordination
provisions contained in the Junior Subordinated Indenture until the Junior
Subordinated Debt Securities are paid in full. (Sections 1403 and 1405)
At March 31, 1994, Junior Subordinated Debt (as defined in the Junior
Subordinated Indenture) aggregated approximately $550 million and Senior
Indebtedness (as defined in the Junior Subordinated Indenture) aggregated
approximately $2,479 million. The Corporation expects to issue from time to time
additional indebtedness constituting Senior Indebtedness (see "Use of
Proceeds"). None of the Indentures prohibits or limits the incurrence of
additional Senior Indebtedness.
By reason of the subordination provisions contained in the Junior
Subordinated Indenture, in the event of insolvency, creditors of the Corporation
who are holders of Senior Indebtedness, as well as certain general creditors of
the Corporation, may recover more, ratably, than the holders of the Junior
Subordinated Debt Securities.
CERTAIN COVENANTS
Dividend Restrictions. Each Indenture provides that the Corporation may
not (a) declare or pay any dividend or make any other distribution (other than
dividends or distributions made in capital stock of the Corporation) on or in
respect of any capital stock of the Corporation, (b) purchase, redeem or
otherwise acquire for value any shares of the capital stock of the Corporation,
except shares acquired upon the conversion thereof into other shares of capital
stock of the Corporation, or (c) permit any Restricted Subsidiary to purchase,
redeem or otherwise acquire for value any shares of capital stock of the
Corporation; if immediately thereafter the aggregate amount of all such
dividends, distributions, purchases, redemptions, acquisitions or payments
(other than dividends or distributions payable in shares of capital stock of the
Corporation) during the period from and after December 31, 1985, plus the amount
of total investments in Unrestricted Subsidiaries made during such period, would
exceed the sum of (1) $185,000,000 plus (or minus in the case of a deficit), (2)
the consolidated net income (or net loss) of the Corporation and its Restricted
Subsidiaries earned subsequent to December 31, 1985, plus (3) the aggregate net
proceeds received by the Corporation in respect of the issue, sale or exchange
after December 31, 1985, of (i) any shares of capital stock of the Corporation
and any rights or warrants entitling the holders to purchase or subscribe for
shares of such capital stock, or (ii) any indebtedness of the Corporation which
is converted into shares of its capital stock after December 31, 1985. (Section
1007)
The foregoing will not prohibit the Corporation from paying any management,
administrative, general overhead or similar charge to any controlling
stockholder or other Affiliate of the Corporation, or paying to any member of
the same consolidated group for tax purposes any amounts in lieu of taxes.
(Section 1007)
Merger or Sale of Assets. The Indentures provide that the Corporation may
not consolidate with, merge into, or sell, convey or transfer its properties and
assets substantially as an entirety to, another Person, if, as a result thereof,
any property owned by the Corporation or a Restricted Subsidiary immediately
prior thereto would become subject to any Security Interest, unless (i)(x) in
the case of the Senior Indenture, the Senior Debt Securities (equally and
ratably with any other indebtedness of the Corporation then entitled thereto)
shall be secured by a prior lien on such property, (y) in the case of the Senior
Subordinated Indenture, the Senior Subordinated Debt Securities (equally and
ratably with any other indebtedness of the Corporation then entitled thereto)
shall be secured equally and ratably with (or prior to) the debt secured by such
Security Interest or (z) in the case of the Junior Subordinated Indenture, the
Junior Subordinated Debt Securities (equally and ratably with any other
indebtedness of the Corporation entitled thereto) shall be secured equally and
ratably with (or prior to) the debt secured by such Security Interest or (ii)
such Security Interest would otherwise be permitted under the Indentures.
(Section 803) (See "Limitations on Secured Debt")
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Limitations on Certain Loans and Advances. Each Indenture provides that
the Corporation may not, and may not permit any Restricted Subsidiary to, make
any loan or advance to any Person owning more than 50% of the outstanding voting
stock of the Corporation or to any Affiliate of such Person (other than the
Corporation or a Restricted Subsidiary) if the aggregate outstanding amount of
Senior Debt of the Corporation and its Restricted Subsidiaries exceeds 400% of
Consolidated Net Worth and Subordinated Debt, as defined in the applicable
Indenture. (Section 1005) The term Senior Debt for purposes of this limitation
shall mean Senior Indebtedness when referring to the Senior Subordinated
Indenture or the Junior Subordinated Indenture as such term is used in each such
Indenture.
Limitations on Secured Debt. Each Indenture provides that the Corporation
will not at any time create, incur, assume or guarantee, and will not cause,
suffer or permit a Restricted Subsidiary to create, incur, assume or guarantee,
any Secured Debt without making effective provisions whereby the Debt Securities
then outstanding under such Indenture and any other indebtedness of or
guaranteed by the Corporation or such Restricted Subsidiary then entitled
thereto, subject to applicable priorities of payment, shall be secured by the
Security Interest securing such Secured Debt equally and ratably with any and
all other obligations and indebtedness thereby secured (subject, however, to
applicable priorities of payment) so long as such Secured Debt remains
outstanding; provided, however, that the foregoing prohibition shall not be
applicable to (a) any Security Interest in favor of the Corporation or a
Restricted Subsidiary; (b) Security Interests existing on April 1, 1986 in the
case of Senior Debt Securities, Security Interests existing on June 1, 1989 in
the case of Senior Subordinated Debt Securities and Security Interests existing
on July 1, 1993 in the case of Junior Subordinated Debt Securities; (c) Security
Interests existing on property at the time it is acquired by the Corporation or
a Restricted Subsidiary, provided such Security Interest is limited to all or
part of the property so acquired; (d)(i) any Security Interest existing on the
property of or on the outstanding shares or indebtedness of a corporation at the
time such corporation shall become a Restricted Subsidiary, or (ii) subject to
the provisions referred to above under "Merger or Sale of Assets," any Security
Interest on property of a corporation existing at the time such corporation is
merged into or consolidated with the Corporation or a Restricted Subsidiary or
at the time of a sale, lease or other disposition of the properties of a
corporation as an entirety or substantially as an entirety to the Corporation or
a Restricted Subsidiary, provided, in each such case, that such Security
Interest does not extend to any property owned prior to such transaction by the
Corporation or any Restricted Subsidiary which was a Restricted Subsidiary prior
to such transaction; (e) mechanics', materialmen's, carriers' or other like
liens, arising in the ordinary course of business; (f) certain tax liens or
assessments, and certain judgment liens; (g) certain Security Interests in favor
of the United States of America or any state or any agency thereof; (h) Security
Interests on Business Equipment; (i) in the case of property (other than Rental
Equipment) acquired after April 1, 1986, as it pertains to Senior Debt
Securities, after June 1, 1989, as it pertains to Senior Subordinated Debt
Securities and after July 1, 1993, as it pertains to Junior Subordinated Debt
Securities, by the Corporation or any Restricted Subsidiary, any Security
Interest which secures an amount not in excess of the purchase price or fair
value of such property at the time of acquisition, whichever, in the opinion of
the Corporation, shall be less, provided that such Security Interest is limited
to the property so acquired; (j) Security Interests on properties financed
through tax-exempt municipal obligations, provided that such Security Interest
is limited to the property so financed; or (k) any refunding, renewal, extension
or replacement (or successive refunding, renewals, extensions, or replacements),
in whole or in part, of any Security Interest referred to in the foregoing
clauses (a) through (j), provided that the principal amount of indebtedness
secured in such refunding, renewal, extension or replacement does not exceed
that secured at the time by such Security Interest and that such renewal,
refunding, extension or replacement of such Security Interest is limited to all
or part of the same property subject to the Security Interest being refunded,
renewed, extended or replaced.
Notwithstanding the foregoing provisions, the Corporation and any one or
more Restricted Subsidiaries may issue, assume, or guarantee Secured Debt which
would otherwise be subject to the foregoing restrictions in an aggregate amount
which, together with all other Secured Debt of the Corporation and its
Restricted Subsidiaries which would otherwise be subject to the foregoing
restrictions (not including Secured Debt permitted to be secured under
subparagraphs (a) through (k) above), and the aggregate value of the Sale and
Leaseback Transactions in existence at such time (not including Sale and
Leaseback Transactions the proceeds of which have been or will be applied in
accordance with subsection (b) under "Limitations on Sales
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and Leasebacks" below), do not at the time of incurrence exceed 10% of
Consolidated Net Worth and Subordinated Debt (as defined in the applicable
Indenture). (Section 1004)
Limitations on Sales and Leasebacks. Each Indenture provides that the
Corporation may not, and may not permit any Restricted Subsidiary to, engage in
any Sale and Leaseback Transaction unless (a) the Corporation or such Restricted
Subsidiary would be entitled, without reference to the provisions of Section
1004 described in subparagraphs (a) through (k) above, to incur Secured Debt in
an amount equal to the amount realized or to be realized upon the sale or
transfer involved in such Sale and Leaseback Transaction, secured by a Security
Interest on the property to be leased without equally and ratably securing the
Debt Securities outstanding under such Indenture as provided under "Limitations
on Secured Debt," or (b) the Corporation or a Restricted Subsidiary shall apply,
within 120 days after such sale or transfer, an amount equal to the fair value
of the property so leased (as determined by the Board of Directors of the
Corporation) to the repayment of Senior Debt of the Corporation or of any
Restricted Subsidiary (other than Senior Debt owed to the Corporation or any
Restricted Subsidiary) then prepayable, on a pro rata basis, according to the
respective principal amounts of Senior Debt then held by the various holders
thereof. (Section 1006) The term Senior Debt for purposes of this limitation
shall mean Senior Indebtedness when referring to the Senior Subordinated
Indenture or the Junior Subordinated Indenture as such term is used in each such
Indenture.
CERTAIN DEFINITIONS
"Business Equipment" shall mean all motor vehicles, tractors and trailers,
construction equipment, factory, commercial and office equipment and other
revenue-earning personalty owned, financed or otherwise held by or for the
Corporation or any of its Restricted Subsidiaries for rental, lease, sale or
disposition in the ordinary course of the business of the Corporation and its
Restricted Subsidiaries, other than Rental Equipment. "Consolidated Net Worth
and Subordinated Debt" shall mean the aggregate of (i) the capital and surplus
accounts of the Corporation and its Restricted Subsidiaries, as shown in the
most recent consolidated balance sheet of the Corporation and its Restricted
Subsidiaries, prepared in accordance with generally accepted accounting
principles, plus (ii) the aggregate outstanding principal amount of Subordinated
Debt (as defined in the Indentures) of the Corporation and its Restricted
Subsidiaries, as reflected on the same consolidated balance sheet. "Principal
Property" shall mean any building, structure or other facility (including land
or fixtures) owned by the Corporation or any Restricted Subsidiary having a
gross book value in excess of 2% of Consolidated Net Worth and Subordinated
Debt, other than any such building, structure or other facility which, in the
opinion of the Board of Directors of the Corporation, is not of material
importance to the total business conducted by the Corporation and its
subsidiaries as an entirety. "Rental Equipment" shall mean all automobiles
owned, financed or otherwise held by the Corporation or any of its Restricted
Subsidiaries which, in the ordinary course of business, are offered for rental
within the United States of America for periods of less than 30 days.
"Restricted Subsidiary" shall mean certain identified Subsidiaries of the
Corporation, and any other Subsidiaries designated after the date of the
Indentures as a Restricted Subsidiary by the Board of Directors of the
Corporation, subject to redesignation by the Board of Directors and to certain
other restrictions. "Sale and Leaseback Transaction" shall mean any sale or
transfer by the Corporation or one or more Restricted Subsidiaries (except a
sale or transfer to the Corporation or one or more Restricted Subsidiaries) of
any Principal Property, made more than 180 days after the later of the
acquisition of such Principal Property or the completion of construction or full
commencement of operations thereof, if such sale or transfer is made with the
intention of, or as part of an arrangement involving, the lease of such
Principal Property to the Corporation or a Restricted Subsidiary (with certain
exceptions). "Secured Debt" shall mean all indebtedness for borrowed money of
the Corporation or a Restricted Subsidiary which is secured by a Security
Interest upon any assets of the Corporation or any Restricted Subsidiary,
including any capital stock or indebtedness of any Restricted Subsidiary.
"Security Interest" shall mean any mortgage, pledge, lien, encumbrance,
conditional sales contract, title retention agreement or other similar
arrangement which secures payment or performance of an obligation. (Section 101)
14
<PAGE> 16
MODIFICATION OF THE INDENTURES
Subject to certain exceptions, each Indenture contains provisions
permitting the Corporation and the Trustee, with the consent of the Holders of
not less than a majority in principal amount of all securities at the time
outstanding, or of the Holders of the then outstanding Debt Securities of each
series to be affected thereby, to modify the Indentures or any supplemental
Indentures or the rights of the Holders of all Debt Securities, or of the Debt
Securities of a particular series, as the case may be; provided that no such
modification shall (i) change the fixed maturity of the principal of, or any
installment of principal or interest on, any Debt Security, or reduce the
principal amount thereof or the rate of interest, if any, thereon, or change the
place of payment or the currency in which any Debt Security or the interest, if
any, thereon is payable, without the consent of the Holder of each Debt Security
affected, or (ii) reduce the aforesaid percentage of Debt Securities the consent
of the holders of which is required for any such modification, without the
consent of the Holder of each Debt Security affected. (Section 902)
EVENTS OF DEFAULT AND NOTICE THEREOF
The following events are defined in each Indenture as Events of Default
with respect to the Debt Securities of a particular series: failure for 30 days
to pay interest on any Debt Securities of such series when due; failure to pay
principal of any Debt Securities of such series when due at maturity, upon
redemption or by declaration; the acceleration of any other indebtedness in
excess of $10 million of the Corporation, including another series of Debt
Securities, under its terms, if such acceleration is not rescinded or annulled
with 10 days after written notice thereof to the Corporation; failure to perform
any other covenant in the Debt Securities of such series or in the applicable
Indenture within 60 days after written notice thereof to the Corporation
specifying the failure and requiring its remedy; certain events of bankruptcy,
insolvency or reorganization and any other Event of Default provided with
respect to the Debt Securities of such series (Section 501). The Corporation is
required to file with each Trustee annually an officer's certificate as to the
absence of certain defaults under the terms of the applicable Indenture.
(Section 1008)
Upon any Event of Default with respect to Debt Securities of a particular
series, the Trustee or the Holders of not less than 25% in aggregate principal
amount of the Debt Securities of such series then outstanding may declare the
principal of all the Debt Securities of such series (or, in the case of any
series of discounted Debt Securities, such lesser principal amount as may be
provided for in such series of discounted Debt Securities) to be due and
payable. (Section 502)
Each Indenture provides that the Holders of not less than a majority in
principal amount of the Debt Securities of any series may on behalf of the
Holders of all of the Debt Securities of such series waive any past default
under such Indenture with respect to such series and its consequences, except a
default (i) in the payment of the principal of or interest, if any, on any of
the Debt Securities of such series or (ii) in respect of a covenant or provision
of such Indenture which, under the terms of such Indenture, cannot be modified
or amended without the consent of the Holders of all of the Debt Securities of
such series affected thereby. The terms of the Senior Indenture do not permit
any such waiver with respect to Debt Securities of any such series subsequent to
the acceleration of principal thereof. (Section 513)
Each Indenture provides that the Trustee may withhold notice to the Holders
of the Debt Securities of any default (except a default in the payment of
principal or interest) if it determines that the withholding of such notice is
in the interest of the Holders of the Debt Securities. (Section 602)
Subject to provisions of each Indenture relating to the duties of the
Trustee in case an Event of Default shall occur and be continuing, the Trustee
will be under no obligation to exercise any of its rights or powers under such
Indenture at the request of any of the Holders of the Debt Securities issued
thereunder, unless they shall have offered to the Trustee reasonable indemnity.
(Sections 601(a) and 603(e)) Subject to such provisions for the indemnification
of the Trustee and to certain other limitations, the Holders of a majority in
principal amount of the Debt Securities of a particular series at the time
outstanding shall have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or exercising
any trust or power conferred on the Trustee, with respect to the Debt Securities
of such series. (Section 512)
15
<PAGE> 17
DEFEASANCE OF DEBT SECURITIES
If the Corporation, at its option, deposits or causes to be deposited with
the Trustee as trust funds, for the purpose hereinafter stated, an amount, in
money or the equivalent in securities of the government which issued the
currency in which the Debt Securities of any then outstanding series are
denominated or securities issued by government agencies backed by the full faith
and credit of such government, sufficient to pay and discharge the entire
indebtedness on the Debt Securities of such series for principal and interest,
if any, to the date or dates of maturity of the Debt Securities of such series,
and if the Corporation has paid or caused to be paid all other sums payable by
it under the Indenture with respect to such series, then the Indenture will
cease to be of further effect with respect to such series (except as to the
Corporation's obligations to compensate, reimburse and indemnify the Trustee
pursuant to the Indenture with respect to such series), and the Corporation will
be deemed to have satisfied and discharged the Indenture with respect to such
series; provided, however, that no series of Senior Subordinated Debt Securities
or Junior Subordinated Debt Securities may be so defeased unless all of the
securities of such series will become due and payable at their Stated Maturity
within one year of such defeasance. (Section 401) In the event of any such
defeasance, holders of such Debt Securities would be able to look only to such
trust funds for payment of principal and premium, if any, and interest, if any
on their Debt Securities.
If securities have been deposited with the Trustee as trust funds, the
Corporation, in order to exercise its option, is required to deliver to the
Trustee an opinion of counsel to the effect that the deposit and related
defeasance (a) will not cause the holders of the Debt Securities of such series
to recognize income, gain or loss for Federal income tax purposes and (b) will
not result in the delisting of the Debt Securities of such series from any
nationally-recognized exchange on which they are listed, if any.
Unless the Prospectus Supplement relating to the applicable Senior
Subordinated Debt Securities or Junior Subordinated Debt Securities (referred to
collectively in this paragraph as "Subordinated Debt Securities") provides
otherwise, the Corporation at its option (a) will be discharged from any and all
obligations in respect of such Subordinated Debt Securities (except for certain
obligations to register the transfer or exchange of Subordinated Debt
Securities, replace stolen, lost or mutilated Subordinated Debt Securities,
maintain paying agencies and hold moneys for payment in trust) or (b) need not
comply with certain restrictive covenants of the applicable Indenture (including
those described above under "Certain Covenants"), if there is deposited with the
applicable Trustee money or, in the case of Subordinated Debt Securities
denominated in U.S. dollars, U.S. Government Obligations or, in the case of
Subordinated Debt Securities 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 (or a
combination of money and U.S. Government Obligations or Foreign Government
Securities, as the case may be) in an amount sufficient to pay in the currency,
currencies or currency unit or units in which such Subordinated Debt Securities
are payable all the principal of, and interest on, such Subordinated Debt
Securities on the dates such payments are due in accordance with the terms of
such Subordinated Debt Securities. Among the conditions to the Corporation
exercising any such option, the Corporation is required to deliver to the
applicable Trustee an opinion of counsel to the effect that the deposit and
related defeasance would not cause the holders of such Subordinated Debt
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 deposit and related defeasance had not
occurred. (Section 403)
THE TRUSTEES
Chemical Bank (successor by merger to Manufacturers Hanover Trust Company),
in addition to acting as Senior Trustee under the Senior Indenture, is trustee
under an Indenture dated as of May 1, 1983 pursuant to which approximately $2.7
million aggregate principal amount of the Corporation's senior debt securities
remained outstanding at March 31, 1994. The Bank of New York is the Senior
Subordinated Trustee under the Senior Subordinated Indenture. Citibank, N.A. is
the Junior Subordinated Trustee under the Junior Subordinated Indenture. Each
Trustee may act as depository for funds of, provide lines of credit to and
perform other services for, the Corporation and its subsidiaries in the normal
course of business.
16
<PAGE> 18
PLAN OF DISTRIBUTION
The Corporation may sell the Debt Securities in any of four ways: (i)
through underwriters or dealers, (ii) directly to a limited number of
institutional purchasers or to a single institutional purchaser, (iii) through
agents or (iv) through a combination of any such methods of sale. The Prospectus
Supplement with respect to the Debt Securities of a particular series sets forth
the terms of the offering of such Debt Securities, including the name or names
of any underwriters or agents, the purchase price of such Debt Securities and
the proceeds to the Corporation from such sale, any underwriting discounts and
other items constituting underwriters' compensation, any initial public offering
price, any discounts or concessions allowed or reallowed or paid to dealers and
any securities exchanges on which such Debt Securities may be listed.
If underwriters are used in the sale of Debt Securities of a particular
series, such Debt 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 Debt Securities of a
particular series may be offered to the public through underwriting syndicates
represented by managing underwriters.
If so indicated in any Prospectus Supplement, the Corporation will
authorize the underwriters and agents to solicit offers by certain institutions
to purchase the Debt Securities described in such Prospectus Supplement from the
Corporation at the public offering price set forth therein pursuant to Delayed
Delivery Contracts ("Contracts"), which will provide for payment and delivery on
the date stated in such Prospectus Supplement. Each of the Contracts will be for
an amount not less than, and unless the Corporation otherwise agrees the
aggregate principal amount of Debt Securities sold pursuant to Contracts shall
be not more than, the respective amounts stated in such Prospectus Supplement.
The underwriters, dealers and agents may be entitled, under agreements
which may be entered into with the Corporation, to indemnification by the
Corporation against certain civil liabilities, including liabilities under the
Securities Act of 1933, or to contribution to payments that the underwriters,
dealers and agents may be required to make in respect thereof.
LEGAL OPINIONS
Certain legal matters in connection with the Securities will be passed upon
for the Corporation by Paul M. Tschirhart, Esq., 225 Brae Boulevard, Park Ridge,
New Jersey, Senior Vice President and General Counsel of the Corporation, and
for any underwriters or agents by Brown & Wood, One World Trade Center, New
York, New York.
EXPERTS
The consolidated financial statements and supporting schedules of the
Corporation included in the Corporation's Annual Report on Form 10-K for the
year ended December 31, 1993, incorporated by reference in this Prospectus and
the Registration Statement of which this Prospectus forms a part, have been
audited by Arthur Andersen & Co., independent public accountants, at December
31, 1993 and 1992 and for each of the three years in the period ended December
31, 1993, as indicated in their reports incorporated by reference herein.
Reference is made to said reports, which include explanatory paragraphs with
respect to the changes in the methods of accounting for postretirement benefits
other than pensions in 1992 and warranty contracts in 1991, as discussed in Note
1 to each of such consolidated financial statements. The consolidated financial
statements and supporting schedules referred to above have been incorporated by
reference herein in reliance upon the authority of said firm as experts in
giving said reports.
17
<PAGE> 19
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth the estimated expenses in connection with
the offering described in this Registration Statement:
<TABLE>
<S> <C>
Securities and Exchange Commission registration fee............ $344,830
Legal fees and expenses*....................................... 90,000
Blue Sky filing fees and expenses*............................. 50,000
Fees and expenses of Trustee*.................................. 52,500
Printing expenses*............................................. 150,000
Accounting fees*............................................... 75,000
Rating Agency fees*............................................ 175,000
Miscellaneous*................................................. 37,670
--------
Total.......................................................... $975,000
========
</TABLE>
- ---------------
*Estimated.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the General Corporation Law of Delaware provides that a
corporation has the power to indemnify a director, officer, employee or agent of
the corporation and certain other persons serving at the request of the
corporation in related capacities against amounts paid and expenses incurred in
connection with an action or proceeding to which he is or is threatened to be
made a party by reason of such position, if such person shall have acted in good
faith and in a manner he reasonably believed to be in or not opposed to the best
interests of the corporation, and, in any criminal proceeding, if such person
had no reasonable cause to believe his conduct was unlawful; provided that, in
the case of actions brought by or in the right of the corporation, no
indemnification shall be made with respect to any matter as to which such person
shall have been adjudged to be liable to the corporation unless and only to the
extent that the adjudicating court determines that such indemnification is
proper under the circumstances.
Article IX of the By-Laws of the Corporation provides as follows:
"The Corporation shall indemnify, to the fullest extent permitted under the
laws of the State of Delaware from time to time in effect, any person who was or
is a party or is threatened to be made a party to or is otherwise involved in
any threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative, by reason of the fact that such
person or such person's testator or intestate is or was a director, officer,
employee or agent of the Corporation or any corporation absorbed in a
consolidation or merger with the Corporation, which if its separate existence
had continued, would have had power and authority to indemnify such person, or
by reason of the fact that such person or such person's testator or intestate is
or was serving at the request of the Corporation as director, officer, employee
or agent of any corporation or any partnership, joint venture, trust or other
enterprise or as a fiduciary of any employee benefit plan, against expenses
(including attorneys' fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred by such person in connection with such action,
suit or proceeding.
Costs, charges, and expenses (including attorneys' fees) incurred by an
officer or director of the Corporation in defending any such civil, criminal,
administrative, or investigative action, suit or proceeding shall be paid by the
Corporation in advance of the final disposition of such action, suit, or
proceeding; provided, however, that the payment of such costs, charges, and
expenses incurred by a director or officer in such person's capacity as a
director or officer (and not in any other capacity in which service was or is
rendered while a director or officer) in advance of the final disposition of
such action, suit, or proceeding shall be made
II-1
<PAGE> 20
only upon receipt of an undertaking by or on behalf of the director or officer
to repay all amounts so advanced in the event that it shall ultimately be
determined that such person is not entitled to be indemnified by the Corporation
as authorized under the laws of the State of Delaware from time to time in
effect. Such costs, charges, and expenses (including attorneys' fees) incurred
by other employees and agents may be so paid upon such terms and conditions, if
any, as the Board deems appropriate.
The right of indemnification provided hereunder shall not be deemed
exclusive of any other right to which any person may be entitled under the
Certificate of Incorporation or otherwise, or of any other indemnification that
may lawfully be granted to any person in addition to the indemnification
provided hereunder. Indemnification provided hereunder shall continue as to a
person who has ceased to be a director, officer, employee or agent of the
Corporation and, in the case of death of a person indemnified, inure to the
benefit of such person's heirs, executors or other lawful representatives.
The indemnification provided or permitted under this Article IX shall apply
in respect of any costs, charges and expenses (including attorneys' fees)
whether or not the claim or cause of action in respect thereof occurred or arose
before or after the effective date of this Article IX.
The right of indemnification provided hereunder shall be a contract right
and any repeal or modification of the foregoing provisions of this Article IX
shall not adversely affect any right or protection hereunder of any person in
respect of any act or omission occurring prior to the time of such repeal or
modification."
The Corporation carries directors' and officers' liability insurance that
covers certain liabilities and expenses of the Corporation's directors and
officers.
Reference is also made to the indemnification provisions in the form of
Underwriting Agreement Basic Provisions and the form of Distribution Agreement
filed as Exhibits 1(a) and 1(b), respectively, to this Registration Statement
and to undertaking "(c)" in Item 17 of this Registration Statement.
ITEM 16. EXHIBITS.
<TABLE>
<S> <C>
1(a) Form of Terms Agreement (including Underwriting Agreement Basic Provisions).*
1(b) Form of Distribution Agreement.*
4(a) Indenture dated as of April 1, 1986 between the Corporation and Chemical Bank,
as successor by merger to Manufacturers Hanover Trust Company, as Trustee
(incorporated herein by reference from the Corporation's Registration Statement
No. 33-4725 on Form S-3). The form or forms of Debt Securities with respect to
each particular offering of Debt Securities to be registered hereunder will be
filed as an exhibit to a Current Report on Form 8-K and shall be deemed
incorporated herein by reference.**
4(b) First Supplemental Indenture dated as of April 2, 1990 between the Corporation
and Chemical Bank, as successor by merger to Manufacturers Hanover Trust
Company, as Trustee (incorporated herein by reference from the Corporation's
Current Report on Form 8-K dated April 5, 1990).**
4(c) Indenture dated as of June 1, 1989 between the Corporation and The Bank of New
York, as Trustee (incorporated herein by reference from the Corporation's
Registration Statement No. 33-29319 on Form S-3). The form or forms of Debt
Securities with respect to each particular offering of Debt Securities to be
registered hereunder will be filed as an exhibit to a Current Report on Form 8-K
and shall be deemed incorporated herein by reference.**
</TABLE>
II-2
<PAGE> 21
<TABLE>
<S> <C>
4(d) Form of Indenture dated as of July 1, 1993 between the Corporation and Citibank,
N.A., as Trustee. The form or forms of Debt Securities with respect to each
particular offering of Debt Securities to be registered hereunder will be filed
as an exhibit to a Current Report on Form 8-K and shall be deemed incorporated
herein by reference (incorporated herein by reference from the Corporation's
Registration Statement No. 33-62902 on Form S-3).**
5 Opinion and consent of Paul M. Tschirhart, Esq.*
12(a) Computation of Consolidated Ratio of Earnings to Fixed Charges of the
Corporation for each of the five years in the period ended December 31, 1993
(incorporated herein by reference to Exhibit 12 to the Corporation's Annual
Report on Form 10-K for the year ended December 31, 1993.**
23(a) Consent of Arthur Andersen & Co.*
23(b) Consent of Paul M. Tschirhart, Esq., included in Exhibit 5.*
24 Powers of Attorney (contained on signature page).*
25(a) Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of
Chemical Bank.*
25(b) Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of The
Bank of New York.*
25(c) Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of
Citibank, N.A.*
</TABLE>
- ---------------
*Filed herewith.
**Incorporated by reference.
ITEM 17. UNDERTAKINGS.
(a) 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:
(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;
(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;
provided, however, that paragraphs (1)(i) and (1)(ii) do not apply if the
registration statement is on Form S-3 or Form S-8 and the information required
to be included in a post-effective amendment by those paragraphs is contained in
periodic reports filed by the registrant pursuant to Section 13 or Section 15(d)
of the Securities Exchange Act of 1934 that are incorporated by reference in the
registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
II-3
<PAGE> 22
(b) The registrant hereby undertakes that, for purposes of determining any
liability under the Securities Act of 1933, each filing of the registrant's
annual report pursuant to Section 13(a) or Section 15(d) of the Securities
Exchange Act of 1934 that is incorporated by reference in 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.
(c) 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 foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
II-4
<PAGE> 23
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 Borough of Park Ridge, and State of New Jersey, on the 17th
day of June, 1994.
THE HERTZ CORPORATION
By: /s/ WILLIAM SIDER
-------------------------------
WILLIAM SIDER
Executive Vice President and
Chief Financial Officer
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints William Sider, Paul M. Tschirhart and Robert H.
Rillings, and each of them, his true and lawful attorneys-in-fact and agents,
with full power of substitution and resubstitution, for him and in his name,
place and stead, in any and all capacities, to sign this Registration Statement
and any amendments thereof, and to file the same, with all exhibits thereto and
other documents in connection therewith, with the Securities and Exchange
Commission, granting unto said attorneys-in-fact and agents, and each of them,
full power and authority to do and perform each and every act and thing
requisite and necessary to be done in and about the premises, as fully to all
intents and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents or any of them, or their
or his substitute or substitutes, may lawfully do or cause to be done by virtue
thereof.
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 dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
- ------------------------------------- ------------------------------------ -------------------
<C> <S> <C>
/s/ FRANK A. OLSON Chairman of the Board, Chief June 17, 1994
- ------------------------------------- Executive Officer & Director
FRANK A. OLSON (Principal Executive Officer)
/s/ CRAIG R. KOCH President & Chief Operating Officer June 17, 1994
- -------------------------------------
CRAIG R. KOCH
/s/ WILLIAM SIDER Executive Vice President, Chief June 17, 1994
- ------------------------------------- Financial Officer & Director
WILLIAM SIDER (Principal Financial Officer)
/s/ LEO A. MASSAD, JR. Staff Vice President & Controller June 17, 1994
- ------------------------------------- (Principal Accounting Officer)
LEO A. MASSAD, JR.
/s/ MALCOLM S. MACDONALD Director June 17, 1994
- -------------------------------------
MALCOLM S. MACDONALD
/s/ TERRENCE F. MARRS Director June 17, 1994
- -------------------------------------
TERRENCE F. MARRS
/s/ DAVID N. MCCAMMON Director June 17, 1994
- -------------------------------------
DAVID N. MCCAMMON
/s/ PETER J. PESTILLO Director June 17, 1994
- -------------------------------------
PETER J. PESTILLO
</TABLE>
II-5
<PAGE> 24
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
SEQUENTIALLY
EXHIBIT NUMBERED
NUMBER EXHIBIT PAGES
- ------- ------------------------------------------------------------------------- ------------
<C> <S> <C>
1(a) Form of Terms Agreement (including Underwriting Agreement Basic
Provisions).*
1(b) Form of Distribution Agreement.*
4(a) Indenture dated as of April 1, 1986 between the Corporation and Chemical
Bank, as successor by merger to Manufacturers Hanover Trust Company, as
Trustee (incorporated herein by reference from the Corporation's
Registration Statement No. 33-4725 on Form S-3). The form or forms of
Debt Securities with respect to each particular offering of Debt
Securities to be registered hereunder will be filed as an exhibit to a
Current Report on Form 8-K and shall be deemed incorporated herein by
reference.**
4(b) First Supplemental Indenture dated as of April 2, 1990 between the
Corporation and Chemical Bank, as successor by merger to Manufacturers
Hanover Trust Company, as Trustee (incorporated herein by reference from
the Corporation's Current Report on Form 8-K dated April 5, 1990).**
4(c) Indenture dated as of June 1, 1989 between the Corporation and The Bank
of New York, as Trustee (incorporated herein by reference from the
Corporation's Registration Statement No. 33-29319 on Form S-3). The form
or forms of Debt Securities with respect to each particular offering of
Debt Securities to be registered hereunder will be filed as an exhibit to
a Current Report on Form 8-K and shall be deemed incorporated herein by
reference.**
4(d) Form of Indenture dated as of July 1, 1993 between the Corporation and
Citibank, N.A., as Trustee (incorporated herein by reference from the
Corporation's Registration Statement No. 33-62902 on Form S-3). The form
or forms of Debt Securities with respect to each particular offering of
Debt Securities to be registered hereunder will be filed as an exhibit to
a Current Report on Form 8-K and shall be deemed incorporated herein by
reference.**
5 Opinion and consent of Paul M. Tschirhart, Esq.*
12(a) Computation of Consolidated Ratio of Earnings to Fixed Charges of the
Corporation for each of the five years in the period ended December 31,
1993 (incorporated herein by reference to Exhibit 12 to the Corporation's
Annual Report on Form 10-K for the year ended December 31, 1993).**
23(a) Consent of Arthur Andersen & Co.*
23(b) Consent of Paul M. Tschirhart, Esq., included in Exhibit 5.*
24 Powers of Attorney (contained on signature page).*
25(a) Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939
of Chemical Bank.*
</TABLE>
II-6
<PAGE> 25
<TABLE>
<CAPTION>
SEQUENTIALLY
EXHIBIT NUMBERED
NUMBER EXHIBIT PAGES
- ------- ------------------------------------------------------------------------- ------------
<C> <S> <C>
25(b) Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939
of The Bank of New York.*
25(c) Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939
of Citibank, N.A.*
</TABLE>
- ---------------
*Filed herewith.
**Incorporated by reference.
II-7
<PAGE> 1
EXHIBIT 1(a)
------------
THE HERTZ CORPORATION
DEBT SECURITIES
UNDERWRITING AGREEMENT BASIC PROVISIONS
THE HERTZ CORPORATION, a Delaware corporation (the "Company"), may issue
and sell from time to time series of its senior and/or senior subordinated
and/or junior subordinated debt securities registered under the registration
statement referred to in Paragraph 1(a) hereof (the "Securities"). The
Securities may have varying designations, priorities of payment, denominations,
interest rates and payment dates (if any), maturities, redemption provisions and
selling prices, with all such terms for any particular series of Securities sold
pursuant to the terms hereof (together with any other terms relating to such
series) to be determined and set forth in a Terms Agreement of the type referred
to in Paragraph 2 hereof (a "Terms Agreement") relating to the series and
incorporating by reference the basic provisions set forth herein.
With respect to any particular Terms Agreement, the Terms Agreement,
together with the provisions hereof incorporated therein by reference, is herein
referred to as this "Agreement". Terms defined in the Terms Agreement, unless
defined herein, are used herein as therein defined.
1. The Company represents, warrants and agrees that:
(a) The registration statement on Form S-3 (No. 33-62902) with respect
to the Securities and the offering thereof from time to time in accordance
with Rule 415 under the Act (as hereinafter defined) has been prepared by
the Company in conformity with the requirements of the Securities Act of
1933, as amended (the "Act"), and the rules and regulations (the "Rules and
Regulations") of the Securities and Exchange Commission (the "Commission")
thereunder and the Registration Statement (as hereinafter defined) has
become effective, and the Indentures (as hereinafter defined) have been
qualified under the Trust Indenture Act (as hereinafter defined). As used
in this Agreement, (i) "Preliminary Prospectus" means any preliminary
prospectus supplement to the prospectus (including all documents
incorporated therein by reference) relating to that registration statement,
or amendments or supplements thereof, including any prospectus filed with
the Commission pursuant to Rule 424 of the Rules and Regulations, which
describes the Underwritten Securities and the offering thereof and is used
prior to the filing of the Prospectus; (ii) "Registration Statement" means
that registration statement, as such may be amended or supplemented at the
date of the Terms Agreement; (iii) "Basic Prospectus" means the prospectus
(including all documents incorporated therein by reference) relating to the
Registration Statement in the form in which such prospectus has most
recently been filed, or transmitted for filing, with the Commission on or
prior to the date of the Terms Agreement; and (iv) "Prospectus" means the
Basic Prospectus, together with any related prospectus amendment or
supplement (including in each case all documents incorporated therein by
reference) specifically relating to the Underwritten Securities (as defined
in the applicable Terms Agreement), as filed with the Commission pursuant
to paragraph (b) or (c) of Rule 424 of the Rules and Regulations on or
after the date of the Terms Agreement, provided that if a previously
unfiled form of prospectus with an issue date later than the issue date of
the Basic Prospectus is to be filed with the Commission together with a
prospectus supplement relating to the Underwritten Securities, then
"Prospectus" means such new form of prospectus together with such
prospectus supplement (and amendments thereto) as filed with the Commission
on or after the date of
<PAGE> 2
the Terms Agreement (including in each case all documents incorporated
therein by reference). The Commission has not issued any order
preventing or suspending the use of any Prospectus and, to the
knowledge of the Company, no proceedings for such purpose are pending
before or threatened by the Commission.
(b) The Registration Statement and the Prospectus contain, and (in the
case of any amendment or supplement to any such document, or any material
incorporated by reference in any such document, filed with the Commission
after the date as of which this representation is being made) will contain,
at all times during the period specified in Paragraph 7(c) hereof, all
statements which are required by the Act, the Securities Exchange Act of
1934, as amended (the "Exchange Act"), the Trust Indenture Act of 1939, as
amended (the "Trust Indenture Act"), and the rules and regulations of the
Commission under such Acts; the indentures, including any amendments and
supplements thereto, pursuant to which the Securities will be issued (the
"Indentures" or separately "each Indenture") will conform with the
requirements of the Trust Indenture Act and the rules and regulations of
the Commission thereunder; and the Registration Statement and the
Prospectus do not, and (in the case of any amendment or supplement to any
such document, or any material incorporated by reference in any such
document, filed with the Commission after the date as of which this
representation is being made) will not at any time during the period
specified in Paragraph 7(c) hereof, contain any untrue statement of a
material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein not misleading;
provided that the Company makes no representation or warranty as to the
part of the Registration Statement that consists of the Statement of
Eligibility and Qualification under the Trust Indenture Act of 1939 (Form
T-1) of either Trustee or as to information contained in or omitted from
the Registration Statement or the Prospectus in reliance upon and in
conformity with written information furnished to the Company through the
representative or representatives identified in the Terms Agreement (the
"Representative") by or on behalf of any Underwriter specifically for
inclusion therein.
(c) Neither the Company nor any of its subsidiaries (as defined in
Paragraph 14 hereof) is in violation of the provisions of the Certificate
of Incorporation, as amended, or the By-Laws of the Company or in default
under any material loan agreement, indenture or other financing instrument
to which the Company or any of its subsidiaries is now or on the Delivery
Date (as defined in Paragraph 6 hereof) will be a party or by which the
Company or any of its subsidiaries is or will be bound; and neither the
execution, delivery and performance of this Agreement and any Delayed
Delivery Contracts (as defined in Paragraph 3 hereof), the sale of the
Securities nor compliance by the Company with all of the provisions of each
Indenture and the Underwritten Securities will conflict with or result in a
breach of any of the provisions of, or constitute a default under, or
result in the creation or imposition of any lien, charge or encumbrance
upon any of the property or assets of the Company or any of its
subsidiaries pursuant to the terms of, any material agreement, instrument
or indenture to which the Company or any of its subsidiaries is now or on
the Delivery Date will be a party or by which the Company or any of its
subsidiaries is now or will on such Delivery Date be bound or will result
in a violation of the provisions of the Certificate of Incorporation, as
amended, or the By-Laws of the Company or any order, rule or regulation of
any court or other governmental body; and except as required by the Act,
the Trust Indenture Act, the Exchange Act and applicable state securities
laws, no consent, authorization or order of, or filing with, any court or
governmental body is required for the execution, delivery and performance
by the Company of this Agreement, the Delayed Delivery Contracts, if any,
and each Indenture.
(d) Except as contemplated herein, or as set forth in or contemplated
by the Registration Statement and the Prospectus, or as the result of
current operations in the ordinary course of business, the Company,
subsequent to the dates as of which information is given in the
Registration Statement and the Prospectus and prior to the Delivery Date,
will not have incurred any material liabilities or obligations, direct or
contingent; and, except as set forth in or contemplated by the Registration
Statement and the Prospectus, there will have been, subsequent to the dates
as of which information is given in the Registration Statement and the
Prospectus and prior to the Delivery Date, no material adverse change in
the condition, financial or otherwise, of the Company or of the Company and
its subsidiaries taken as a whole
2
<PAGE> 3
or in the results of operations or prospects of the Company or of the
Company and its subsidiaries taken as a whole.
(e) Each of Arthur Andersen & Co., whose report appears in the
Company's Annual Report on Form 10-K for the year ended December 31, 1993,
which is incorporated by reference in the Prospectus, and Coopers & Lybrand
are independent public accountants as required by the Act and the Rules and
Regulations.
(f) This Agreement has been duly authorized, executed and delivered by
the Company. On the Delivery Date (i) the applicable Indenture will have
been validly authorized, executed and delivered by the Company and will
constitute the legally binding obligation of the Company, (ii) the
Underwritten Securities will have been validly authorized and, upon payment
therefor as provided in this Agreement, will be validly issued and
outstanding, and will constitute legally binding obligations of the Company
entitled to the benefits of the applicable Indenture, and (iii) the
Underwritten Securities and each Indenture will conform to the descriptions
thereof contained in the Prospectus.
(g) The Company has been duly incorporated and is validly existing and
in good standing as a corporation under the laws of the State of Delaware,
is qualified to do business and is in good standing in all jurisdictions in
which the failure to so qualify and be in good standing would materially
adversely affect the business or financial condition of the Company and has
the power and authority to own or hold its properties and to conduct the
business in which it is engaged.
(h) As of December 31, 1993, Hertz International, Ltd., Hertz
Equipment Rental Corporation, Hertz Claim Management Corporation and Hertz
Canada Limited were the only subsidiaries of the Company that constitute a
"significant subsidiary" of the Company within the meaning of Rule 1-02 of
Regulation S-X of the Commission. Each such subsidiary (each such
subsidiary or the subsidiaries so disclosed in the most recent Form 10-K of
the Company hereinafter referred to as a "Significant Subsidiary") has been
duly incorporated and is validly existing and in good standing as a
corporation under the laws of the jurisdiction of its incorporation, is
qualified to do business and is in good standing in each jurisdiction in
which the failure to so qualify and be in good standing would materially
adversely affect its business or financial condition and has the power and
authority to own or hold its properties and to conduct the business in
which it is engaged. The Company owns, directly or indirectly, free and
clear of liens and encumbrances, all of the outstanding capital stock of
each Significant Subsidiary, except to the extent set forth in the
Prospectus.
(i) Neither the Company nor any subsidiary has any material litigation
or governmental proceedings pending or, to its knowledge, threatened of a
character which in the opinion of the Company would affect any transaction
contemplated by this Agreement or would be required to be disclosed in the
Registration Statement, other than that which is disclosed in each
Prospectus.
(j) The financial statements incorporated by reference in the
Registration Statement or in any Preliminary Prospectus or Prospectus
present, or (in the case of any amendment or supplement to any such
document, or any material incorporated by reference in any such document,
filed with the Commission after the date as of which this representation is
being made) will present fairly, at all times during the period specified
in Paragraph 7(c) hereof, the financial condition and results of operations
of the entities purported to be shown thereby, at the dates and for the
periods indicated, and have been, and (in the case of any amendment or
supplement to any such document, or any material incorporated by reference
in any such document, filed with the Commission after the date as of which
this representation is being made) will be at all times during the period
specified in Paragraph 7(c) hereof, prepared in conformity with generally
accepted accounting principles applied on a consistent basis throughout the
periods involved.
(k) The documents incorporated by reference into any Preliminary
Prospectus or Prospectus have been and (in the case of any amendment or
supplement to any such document, or any material incorporated by reference
in any such document, filed with the Commission after the date as of which
3
<PAGE> 4
this representation is being made) will be at all times during the
period specified in Paragraph 7(c) hereof, prepared by the Company in
conformity with the applicable requirements of the Act and the Rules
and Regulations and the Exchange Act and the rules and regulations of
the Commission thereunder and such documents have been, or (in the case
of any amendment or supplement to any such document, or any material
incorporated by reference in any such document, filed with the
Commission after the date as of which this representation is being
made) will be at all times during the period specified in Paragraph
7(c) hereof, timely filed as required thereby.
(l) There are no contracts or other documents which are required to be
filed as exhibits to the Registration Statement by the Act or by the Rules
and Regulations, or which were required to be filed as exhibits to any
document incorporated by reference in any Prospectus by the Exchange Act or
the rules and regulations of the Commission thereunder, which have not been
filed as exhibits to the Registration Statement or to such document or
incorporated therein by reference as permitted by the Rules and Regulations
or the rules and regulations of the Commission under the Exchange Act as
required.
2. The obligation of the Underwriters to purchase, and the Company to sell,
the Underwritten Securities is evidenced by a Terms Agreement delivered at the
time the Company determines to sell the Underwritten Securities substantially in
the form of Exhibit A attached hereto. The Terms Agreement specifies the firm or
firms which will be Underwriters, the principal amount of the Underwritten
Securities to be purchased by each Underwriter, the purchase price to be paid by
the Underwriters for the Underwritten Securities, the public offering price, if
any, of the Underwritten Securities, whether the Underwriters are authorized to
solicit institutional investors to purchase Underwritten Securities pursuant to
Delayed Delivery Contracts (as defined in Paragraph 3 hereof), certain terms
thereof and the Underwriters' compensation therefor and any terms of the
Underwritten Securities not already specified in the applicable Indenture
(including but not limited to, designations, priorities of payment,
denominations, interest rates and payment dates, maturity, redemption provisions
and sinking fund requirements).
3. Any offer to purchase Underwritten Securities by institutional investors
solicited by the Underwriters for delayed delivery shall be made pursuant to
contracts substantially in the form of Exhibit B attached hereto, with such
changes therein as the Company and the Representative may approve (the "Delayed
Delivery Contracts"). The Company shall have the right, in its sole discretion,
to approve or disapprove each such institutional investor. Underwritten
Securities which are subject to Delayed Delivery Contracts are herein sometimes
called "Delayed Delivery Underwritten Securities" and Underwritten Securities
which are not subject to Delayed Delivery Contracts are herein sometimes called
"Immediate Delivery Underwritten Securities."
Contemporaneously with the purchase on the Delivery Date by the
Underwriters of the Immediate Delivery Underwritten Securities pursuant to this
Agreement, the Company will pay to the Representative by certified or official
bank check payable in same-day funds settled to, or upon, the order of the
Company for the account of the Underwriters, the compensation specified in the
Terms Agreement for arranging the sale of Delayed Delivery Underwritten
Securities. The Underwriters shall have no responsibility with respect to the
validity or performance of any Delayed Delivery Contracts.
For the purpose of determining the principal amount of Immediate Delivery
Underwritten Securities to be purchased by each Underwriter, there shall be
deducted from the principal amount of Underwritten Securities to be purchased by
such Underwriter as set forth in the Terms Agreement that portion of the
aggregate principal amount of Delayed Delivery Underwritten Securities that the
principal amount of Underwritten Securities to be purchased by such Underwriter
as set forth in the Terms Agreement bears to the aggregate principal amount of
the Underwritten Securities set forth there to be purchased by all of the
Underwriters (in each case as adjusted by the Representative to avoid fractions
of the minimum principal amount in which the Underwritten Securities may be
issued), except to the extent that the Representative
4
<PAGE> 5
determines, in its discretion, that such deduction shall be otherwise than in
such proportion and so advises the Company.
4. The Company shall not be obligated to deliver any Underwritten
Securities except upon payment for all Immediate Delivery Underwritten
Securities to be purchased pursuant to this Agreement as hereinafter provided.
5. If any Underwriter defaults in the performance of its obligations under
this Agreement, the remaining non-defaulting Underwriters shall be obligated to
purchase the Immediate Delivery Underwritten Securities which the defaulting
Underwriter agreed but failed to purchase in the respective proportions which
the principal amount of Underwritten Securities set forth in the Terms Agreement
to be purchased by each remaining non-defaulting Underwriter bears to the
aggregate principal amount of Underwritten Securities set forth in the Terms
Agreement to be purchased by all the remaining non-defaulting Underwriters;
provided that the remaining non-defaulting Underwriters shall not be obligated
to purchase any Immediate Delivery Underwritten Securities if the aggregate
principal amount of Immediate Delivery Underwritten Securities which the
defaulting Underwriter or Underwriters agreed but failed to purchase exceeds
9.09% of the total principal amount of Underwritten Securities, and any
remaining non-defaulting Underwriter shall not be obligated to purchase more
than 110% of the principal amount of Underwritten Securities set forth in the
Terms Agreements to be purchased by it. If the foregoing maximums are exceeded,
the remaining non-defaulting Underwriters, or those other underwriters
satisfactory to the Representative who so agree, shall have the right, but shall
not be obligated, to purchase, in such proportion as may be agreed upon among
them, all the Immediate Delivery Underwritten Securities. If the remaining
Underwriters or other underwriters satisfactory to the Representative do not
elect to purchase the Immediate Delivery Underwritten Securities which the
defaulting Underwriter or Underwriters agreed but failed to purchase, this
Agreement shall terminate without liability on the part of any non-defaulting
Underwriter or the Company, except that the Company will continue to be liable
for the payment of expenses as set forth in Paragraph 7(j) hereof.
Nothing contained in this Paragraph 5 shall relieve a defaulting
Underwriter of any liability it may have to the Company for damages caused by
its default. If other Underwriters are obligated or agree to purchase the
Immediate Delivery Underwritten Securities of a defaulting or withdrawing
Underwriter, either the Representative or the Company may postpone the Delivery
Date for up to seven full business days in order to effect any changes that in
the opinion of counsel for the Company or counsel for the Underwriters may be
necessary in the Registration Statement, any Prospectus or in any other document
or arrangement.
6. Delivery of and payment for the Immediate Delivery Underwritten
Securities shall be made at the place designated in the Terms Agreement, at
10:00 A.M., New York City time, on the fifth business day following the date of
the Terms Agreement, or at such other location, time and date as shall be
determined by agreement between the Representative and the Company. This date
and time are sometimes referred to as the "Delivery Date". On the Delivery Date
the Company shall deliver the Immediate Delivery Underwritten Securities to the
Representative for the account of each Underwriter against payment to or upon
the order of the Company of the purchase price by wire or internal bank transfer
to an account specified by the Company payable in same-day funds settled through
the New York Clearing House; provided, however, that the Company and the
Underwriters may agree upon other or additional settlement procedures in the
applicable Terms Agreement. Time shall be of the essence, and delivery at the
time and place specified pursuant to this Agreement is a further condition of
the obligation of each Underwriter hereunder. Upon delivery, the Immediate
Delivery Underwritten Securities shall be in definitive fully registered form
and in such denominations and registered in such names as the Representative
shall request in writing not less than two full business days prior to the
Delivery Date. For the purpose of expediting the checking and packaging of the
Immediate Delivery Underwritten Securities, the Company shall make the Immediate
Delivery Underwritten Securities available for inspection by the Representative
in New York, New York, not later than 2:00 P.M., New York City time, on the
business day prior to the Delivery Date.
5
<PAGE> 6
7. The Company agrees:
(a) To furnish promptly to the Representative a conformed copy of and
to counsel for the Underwriters a signed copy of the Registration Statement
as originally filed and each amendment or supplement thereto filed prior to
the date of the Terms Agreement or relating to or covering the Underwritten
Securities, and all consents and exhibits filed therewith, and a copy of
each Prospectus filed with the Commission, including all documents
incorporated therein by reference;
(b) To deliver promptly to the Representative such number of the
following documents as the Representative may reasonably request: (i)
conformed copies of the Registration Statement (excluding exhibits other
than the computation of the ratio of earnings to fixed charges, the
applicable Indenture and this Agreement), (ii) each Preliminary Prospectus,
(iii) each Prospectus and (iv) any documents incorporated by reference in
any Prospectus;
(c) To file with the Commission, during such period following the date
of the Terms Agreement that, in the opinion of counsel for the
Underwriters, a Prospectus is required by law to be delivered, any
amendment or supplement to the Registration Statement or any Prospectus
that may, in the judgment of the Company or the Representative, be required
by the Act or requested by the Commission and approved by the
Representative;
(d) Reasonably in advance of the filing with the Commission during the
period referred to in (c) above of: (i) any amendment or supplement to the
Registration Statement, (ii) the Prospectus or any amendment or supplement
thereto or (iii) any document incorporated by reference in any of the
foregoing or any amendment or supplement to any such incorporated document,
to furnish a copy thereof to the Representative and to counsel for the
Underwriters and, unless in the opinion of counsel for the Company such
particular filing is required by law, obtain the consent of the
Representative to the filing;
(e) To advise the Representative immediately (i) when any
post-effective amendment to the Registration Statement becomes effective,
(ii) of any request or proposed request by the Commission for an amendment
or supplement to the Registration Statement (insofar as the amendment or
supplement relates to or covers the Underwritten Securities), to the
Prospectus, to any document incorporated by reference in any of the
foregoing or for any additional information, (iii) of the issuance by the
Commission of any stop order suspending the effectiveness of the
Registration Statement or any order directed to the Prospectus or to the
accuracy or the adequacy of any document incorporated therein by reference
or the initiation or threat of any stop order proceeding or of any
challenge to the accuracy or adequacy of any document incorporated by
reference in the Prospectus, (iv) of receipt by the Company of any
notification with respect to the suspension of the qualification of the
Securities for sale in any jurisdiction or the initiation or threat of any
proceeding for that purpose and (v) of the happening of any event which
makes untrue any statement of a material fact made in the Registration
Statement or the Prospectus or which requires the making of a change in the
Registration Statement or the Prospectus in order to make any material
statement therein not misleading;
(f) If, during the period referred to in (c) above, the Commission
shall issue a stop order suspending the effectiveness of the Registration
Statement, to make every reasonable effort to obtain the lifting of that
order at the earliest possible time;
(g) As soon as practicable, to make generally available to its
security holders and to deliver to the Representative an earnings
statement, conforming with the requirements of Section 11(a) of the Act,
covering a period of at least twelve months beginning after the effective
date (as such term is defined in Rule 158 of the Rules and Regulations) of
the Registration Statement;
(h) For a period of three years after the Delivery Date, to furnish to
the Representative copies of all public reports and all reports and
financial statements furnished by the Company to any national securities
exchange (an "Exchange") pursuant to requirements of or agreements with any
such Exchange, or to the Commission pursuant to the Exchange Act or any
rule or regulation of the Commission thereunder;
6
<PAGE> 7
(i) To endeavor, with the reasonable cooperation of the
Representative, to qualify the Underwritten Securities for offer and sale
under the securities or "Blue Sky" laws of such jurisdictions as the
Representative may reasonably request; provided, however, that the Company
shall not be obligated, solely for this purpose, to qualify as a foreign
corporation or as a dealer in securities or to execute or file any general
consent to service of process under the laws of any jurisdiction in which
it is not now subject to such service;
(j) To pay the costs incident to the authorization, issuance, sale and
delivery of the Underwritten Securities and any taxes payable in that
connection; the costs incident to the preparation, printing and filing
under the Act of the Registration Statement and any amendments, supplements
and exhibits thereto; the costs incident to the preparation, printing and
filing of any document and any amendments and exhibits thereto required to
be filed by the Company under the Exchange Act; the costs of distributing
the Registration Statement as originally filed and each amendment and
post-effective amendment thereof (including exhibits), any Preliminary
Prospectus, each Prospectus and any documents incorporated by reference in
any of the foregoing documents; the costs of printing each Indenture, this
Agreement and any Delayed Delivery Contracts; when Securities are to be
listed on a securities exchange, the costs of listing such Securities upon
such securities exchange; the costs of any filings with the National
Association of Securities Dealers, Inc.; fees paid to rating agencies in
connection with the rating of the Securities, including the Underwritten
Securities; the fees and expenses of qualifying the Securities, including
the Underwritten Securities, under the securities laws of the several
jurisdictions as provided in this Paragraph and of preparing and printing a
Blue Sky Memorandum, and a memorandum concerning the legality of the
Securities, including the Underwritten Securities, as an investment
(including fees of counsel to the Underwriters not in excess of $10,000 in
connection therewith); and all other costs and expenses incident to the
performance of the Company's obligations under this Agreement; provided,
however, that, except as provided in this Paragraph and in Paragraph 11
hereof, the Underwriters shall pay their own costs and expenses, including
the fees and expenses of their counsel, any transfer taxes on the
Underwritten Securities which they may sell and the expenses of advertising
any offering of the Underwritten Securities made by the Underwriters;
(k) Until the termination of the offering of the Underwritten
Securities, to timely file all documents, and any amendments to previously
filed documents, required to be filed by the Company pursuant to Section
13(a), 13(c), 14 or 15(d) of the Exchange Act; and
(l) During the period beginning on the date of the Terms Agreement and
continuing to the Delivery Date, without consent of the Representative, not
to offer, sell, contract to sell or otherwise dispose of any debt
securities of the Company with maturities longer than one year, other than
Underwritten Securities to the Underwriters or medium-term notes
distributed by the Company's agents.
8. (a) The Company shall indemnify and hold harmless each Underwriter, each
other person, if any, participating with the Underwriters in the distribution of
the Underwritten Securities who is an "underwriter" within the meaning of
Section 2(11) of the Act with respect to the distribution of the Underwritten
Securities (the "Participants") and each person, if any, who controls any
Underwriter within the meaning of the Act from and against any loss, claim,
damage or liability, as incurred, joint or several, and any action in respect
thereof, to which that Underwriter, Participant or controlling person may become
subject, under the Act or otherwise, insofar as such loss, claim, damage,
liability or action arises out of, or is based upon, any untrue statement or
alleged untrue statement of a material fact contained in any Preliminary
Prospectus, the Registration Statement or any Prospectus, or arises out of, or
is based upon, the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, and shall reimburse each Underwriter, Participant and such
controlling person for any legal and other expenses reasonably incurred, as
incurred, by that Underwriter, Participant or controlling person in
investigating or defending or preparing to defend against any such loss, claim,
damage, liability or action; provided that the Company shall not be liable in
any such case to the extent that any such loss, claim, damage, liability or
action arises out of, or is based upon, any untrue statement or alleged untrue
statement or omission or alleged omission made in any Preliminary Prospectus,
the Registration Statement or any Prospectus in reliance upon and in conformity
with written information furnished to the Company through the Representa-
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<PAGE> 8
tive by or on behalf of any Underwriter specifically for inclusion therein;
provided further that the foregoing indemnity with respect to any Preliminary
Prospectus shall not inure to the benefit of any Underwriter, Participant or
controlling person from whom the person asserting any such losses, claims,
damages or liabilities purchased Underwritten Securities if such untrue
statement or omission or alleged untrue statement or omission made in such
Preliminary Prospectus is eliminated or remedied in the Prospectus (as amended
or supplemented if the Company shall have furnished any amendments or
supplements thereto) and, if required by law, a copy of the Prospectus (as so
amended or supplemented) shall not have been furnished to such person at or
prior to the written confirmation of the sale of such Underwritten Securities to
such person. The foregoing indemnity agreement is in addition to any liability
which the Company may otherwise have to any Underwriter or controlling person.
(b) Each Underwriter shall indemnify and hold harmless the Company, each of
its directors, each of its officers who signed the Registration Statement and
any person who controls the Company within the meaning of the Act from and
against any loss, claim, damage or liability, as incurred, joint or several, and
any action in respect thereof, to which the Company or any such director,
officer or controlling person may become subject, under the Act or otherwise,
insofar as such loss, claim, damage, liability or action, arises out of, or is
based upon, any untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Prospectus, the Registration Statement or any
Prospectus, or arises out of, or is based upon, the omission or alleged omission
to state therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, but in each case only to the extent
that the untrue statement or alleged untrue statement or omission or alleged
omission was made in reliance upon and in conformity with written information
furnished to the Company through the Representative by or on behalf of that
Underwriter specifically for inclusion therein, and shall reimburse the Company
for any legal and other expenses reasonably incurred, as incurred, by the
Company or any such director, officer or controlling person in investigating or
defending or preparing to defend against any such loss, claim, damage, liability
or action. The foregoing indemnity agreement is in addition to any liability
which any Underwriter may otherwise have to the Company or any of its directors,
officers or controlling persons.
(c) Promptly after receipt by an indemnified party under this Paragraph of
notice of any claim or the commencement of any action, the indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under this Paragraph, notify the indemnifying party in writing of the
claim or the commencement of that action, provided that the failure to notify
the indemnifying party shall not relieve it from any liability which it may have
to an indemnified party otherwise than under this Paragraph. If any such claim
or action shall be brought against an indemnified party, and it shall notify the
indemnifying party thereof, the indemnifying party shall be entitled to
participate therein, and, to the extent that it wishes, jointly with any other
similarly notified indemnifying party, to assume the defense thereof with
counsel satisfactory to the indemnified party. After notice from the
indemnifying party to the indemnified party of its election to assume the
defense of such claim or action, the indemnifying party shall not be liable to
the indemnified party under this Paragraph for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than reasonable costs of investigation; provided that the
Representative shall have the right to employ counsel to represent the
Representative, those other Underwriters and Participants and their respective
controlling persons who may be subject to liability arising out of any claim in
respect of which indemnity may be sought by the Underwriters against the Company
under this Paragraph if, in the reasonable judgment of the Representative, it is
advisable for the Representative, those Underwriters, Participants and
controlling persons to be represented by separate counsel due to actual or
potential different interests between the indemnified party and the indemnifying
party, and in that event the fees and expenses of such separate counsel shall be
paid by the Company as incurred. It is understood that the indemnifying party
shall not, in connection with any proceeding or related proceedings in the same
jurisdiction, be liable for the reasonable fees and expenses of more than one
separate counsel for all such indemnified parties. The indemnifying party shall
not be liable for any settlement of any proceeding effected without its written
consent, but, if settled with such consent or if there be a final judgment for
the plaintiff, the indemnifying party agrees to indemnify the indemnified party
from and against any loss or liability by reason of such settlement or judgment.
8
<PAGE> 9
(d) If the indemnification provided for in this Paragraph 8 shall for any
reason be unavailable to an indemnified party under Paragraph 8(a) or 8(b)
hereof in respect of any loss, claim, damage or liability, or any action in
respect thereof, referred to therein, then each indemnifying party shall, in
lieu of indemnifying such indemnified party, contribute to the amount paid or
payable by such indemnified party as a result of such loss, claim, damage or
liability, or action in respect thereof, (i) in such proportion as shall be
appropriate to reflect the relative benefits received by the Company on the one
hand and the Underwriters and Participants on the other from the offering of the
Underwritten Securities or (ii) if the allocation provided by clause (i) above
is not permitted by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause (i) above but also
the relative fault of the Company on the one hand and the Underwriters and
Participants on the other with respect to the statements or omissions which
resulted in such loss, claim, damage or liability, or action in respect thereof,
as well as any other relevant equitable considerations. The relative benefits
received by the Company on the one hand and the Underwriters and Participants on
the other with respect to such offering shall be deemed to be in the same
proportion as the total net proceeds from the offering of the Underwritten
Securities (before deducting expenses) received by the Company bear to the total
underwriting discounts and commissions received by the Underwriters and the
Participants with respect to such offering. The relative fault shall be
determined by reference to whether the untrue or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact relates
to information supplied by the Company or the Underwriters, the intent of the
parties and their relative knowledge, access to information and opportunity to
correct or prevent such statement or omission. The Company and the Underwriters
agree that it would not be just and equitable if contributions pursuant to this
Paragraph 8(d) were to be determined by pro rata allocation (even if the
Underwriters and the Participants were treated as one entity for such purpose)
or by any other method of allocation which does not take into account the
equitable considerations referred to herein. The amount paid or payable by an
indemnified party as a result of the loss, claim, damage or liability, or action
in respect thereof, referred to above in this Paragraph 8(d) shall be deemed to
include, for purposes of this Paragraph 8(d), any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such action or claim. Notwithstanding the provisions of this
Paragraph 8(d), no Underwriter shall be required to contribute any amount in
excess of the amount by which the total price at which the Underwritten
Securities underwritten by it and distributed to the public were offered to the
public exceeds the amount of any damages which such Underwriter has otherwise
paid or became liable to pay by reason of any untrue or alleged untrue statement
or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations to contribute as provided in
this Paragraph 8(d) are several in proportion to their respective underwriting
obligations and not joint.
(e) The indemnity agreements contained in this Paragraph and the
representations, warranties and agreements of the Company in Paragraph 1 and
Paragraph 7 hereof shall survive the delivery of the Underwritten Securities and
shall remain in full force and effect, regardless of any termination or
cancellation of this Agreement or any investigation made by or on behalf of any
indemnified party.
9. The obligations of the Underwriters under this Agreement may be
terminated by the Representative, in its absolute discretion, by notice given to
and received by the Company prior to the delivery of and payment for the
Immediate Delivery Underwritten Securities, if, during the period beginning on
the date of the Terms Agreement to and including the Delivery Date, (a) trading
in securities of the Company on the New York Stock Exchange is suspended, or
minimum prices are established on such Exchange, or (b) a banking moratorium is
declared by either Federal or New York State authorities, or (c) there has
occurred any declaration of war or national emergency by the United States or
any outbreak or escalation of hostilities or other calamity or crisis the effect
of which on the financial markets of the United States is such as to make it
impracticable to market the Underwritten Securities or enforce contracts for the
sale of the Underwritten Securities, or (d) since the respective dates as of
which information is given in the Prospectus as amended or supplemented, there
shall not have occurred any material adverse change, or any development
involving a prospective material adverse change, in or affecting particularly
the business or assets of the Company and its subsidiaries considered as a
whole, or any material adverse change in the financial position or results of
operations of the Company and its subsidiaries considered as a whole, otherwise
than as set forth or
9
<PAGE> 10
contemplated in the Prospectus as amended or supplemented, the effect of which
in any such case is to make it impracticable or inadvisable in the reasonable
judgment of the Representative to market the Underwritten Securities, or (e)
trading generally shall have been suspended or materially limited on or by, as
the case may be, either the New York Stock Exchange or the American Stock
Exchange the effect of which, in the reasonable judgment of the Representative,
is to make it impracticable to market the Underwritten Securities.
10. The respective obligations of the Underwriters under this Agreement
with respect to the Underwritten Securities are subject to the accuracy, on the
date of the Terms Agreement and on the Delivery Date, of the representations and
warranties of the Company contained herein, to performance by the Company of its
obligations hereunder, and to each of the following additional terms and
conditions applicable to the Underwritten Securities:
(a) At or before the Delivery Date, no stop order suspending the
effectiveness of the Registration Statement nor any order directed to any
document incorporated by reference in any Prospectus shall have been issued
and prior to that time no stop order proceeding shall have been initiated
or threatened by the Commission, and no challenge shall have been made to
the accuracy or adequacy of any document incorporated by reference in any
Prospectus and any request of the Commission for inclusion of any
additional information shall have been complied with; and, after the date
of the Terms Agreement the Company shall not have filed with the Commission
any amendment or supplement to the Registration Statement or any Prospectus
(or any document incorporated by reference therein) to which the
Representative shall have reasonably objected after having received
reasonable notice thereof.
(b) No Underwriter shall have discovered and disclosed to the Company
on or prior to the Delivery Date that the Registration Statement or any
Prospectus contains an untrue statement of a fact which, in the opinion of
counsel for the Underwriters, is material or omits to state a fact which,
in the opinion of such counsel, is material and is required to be stated
therein or is necessary to make the statements therein not misleading.
(c) All corporate proceedings and other legal matters incident to the
authorization, form and validity of this Agreement, the Underwritten
Securities and the Indenture and the form of the Registration Statement,
each Prospectus and all other legal matters relating to this Agreement and
the transactions contemplated hereby shall be satisfactory in all respects
to counsel for the Underwriters, and the Company shall have furnished to
such counsel all documents and information that they may reasonably request
to enable them to pass upon such matters.
(d) The Company shall have furnished to the Representative, on the
Delivery Date, a certificate of the Company, dated as of the Delivery Date,
signed by its Chairman or its President or a Vice President and its
Treasurer or an Assistant Treasurer as follows:
(i) The representations, warranties and agreements of the Company
in Paragraph 1 are true and correct as of the Delivery Date; the Company
has complied with all its agreements contained herein; and the
conditions set forth in Paragraph 10(a) have been fulfilled; and
(ii) They have carefully examined the Registration Statement and
each Prospectus and, in their opinion, (A) as of the date of each
Prospectus, the Registration Statement and the Prospectus did not
include any untrue statement of a material fact and did not omit to
state a material fact required to be stated therein or necessary to make
the statements therein not misleading, and (B) since the date of each
Prospectus, no event has occurred which should have been set forth in a
supplement to or amendment of the Prospectus which has not been set
forth in such a supplement or amendment.
(e) The Company shall have furnished to the Representative, on the
Delivery Date, the opinion of Paul M. Tschirhart, Esq., Senior Vice
President, Secretary and General Counsel of the Company, addressed to the
Underwriters and dated the Delivery Date, to the effect that:
(i) The Company has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the State of
Delaware, is duly qualified and in good standing as a foreign
corporation under the laws of each of the several jurisdictions in which
the failure to so qualify and
10
<PAGE> 11
be in good standing would materially adversely affect the business or
financial condition of the Company and its consolidated subsidiaries
as a whole and has the corporate power and authority to own or hold
its properties and to conduct the business in which it is engaged;
(ii) Each Significant Subsidiary has been duly incorporated and is
validly existing and in good standing as a corporation under the laws of
the jurisdiction of its incorporation, is qualified to do business and
is in good standing in each jurisdiction in which the failure to so
qualify and be in good standing would materially adversely affect the
business or financial condition of the Company and its consolidated
subsidiaries as a whole and has the corporate power and authority to own
or hold its properties and to conduct the business in which it is
engaged; and, to the best of such counsel's knowledge, the Company owns,
directly or indirectly, free and clear of liens and encumbrances, all of
the outstanding capital stock of each Significant Subsidiary, except to
the extent set forth in the Prospectus;
(iii) The applicable Indenture has been validly authorized, duly
executed and delivered by the Company and duly qualified under the Trust
Indenture Act, and is a valid and binding instrument of the Company
enforceable in accordance with its terms except as limited by general
principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law) and by bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium or other
laws affecting enforcement of creditors' rights generally;
(iv) The Immediate Delivery Underwritten Securities have been
validly authorized, duly executed by the proper authorized officers of
the Company, and, assuming they have been duly authenticated by the
applicable Trustee or the authenticating agent and delivered, are the
validly issued, outstanding and legally binding obligations of the
Company;
(v) The Delayed Delivery Underwritten Securities, if any, have been
validly authorized and, when duly executed, authenticated, issued and
delivered and paid for by the respective purchasers thereof under the
related Delayed Delivery Contracts, such Delayed Delivery Underwritten
Securities will be validly issued, outstanding and legally binding
obligations of the Company;
(vi) The Delayed Delivery Contracts, if any, have been validly
authorized, executed and delivered by the Company and, assuming due
authorization, execution and delivery by the purchasers thereunder, are
valid and legally binding obligations of the Company, enforceable in
accordance with their terms, except as limited by general principles of
equity and by bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium or other laws affecting enforcement of
creditors' rights generally;
(vii) The Underwritten Securities and each Indenture conform in all
material respects to the statements concerning them in the Registration
Statement and each Prospectus;
(viii) The Registration Statement is effective under the Act and,
to the knowledge of such counsel, no stop order suspending its
effectiveness has been issued and no proceeding for that purpose is
pending or threatened by the Commission;
(ix) No order directed to any document incorporated by reference in
any Prospectus has been issued and, to the knowledge of such counsel, no
challenge has been made to the accuracy or adequacy of any such
document;
(x) The Registration Statement and the Prospectus (except that no
opinion need be expressed as to the financial statements, schedules and
other financial and statistical data contained therein), as of the
respective effective or issue date of each, appear to comply as to form
in all material respects with the requirements of the Act and the Trust
Indenture Act, and the applicable rules and regulations of the
Commission under said Acts and the documents incorporated by reference
in the Prospectus (except that no opinion need be expressed as to the
financial statements, schedules and other financial and statistical data
contained therein) appear to comply as of their respective dates as
11
<PAGE> 12
to form in all material respects with the requirements of the
Exchange Act and the rules and regulations thereunder;
(xi) Such counsel does not know of any litigation or any
governmental proceeding instituted or threatened against the Company or
any of its subsidiaries which could materially affect the transactions
contemplated by this Agreement or would be required to be disclosed in
any Prospectus which is not disclosed and correctly summarized therein;
(xii) Such counsel does not know of any contracts or other
documents which are required to be filed as exhibits to the Registration
Statement by the Act or by the Rules and Regulations, or which are
required to be filed by the Exchange Act or the rules and regulations of
the Commission thereunder as exhibits to any document incorporated by
reference in the Prospectus, which have not been filed as exhibits to
the Registration Statement or to such document or incorporated therein
by reference as permitted by the Rules and Regulations or the rules and
regulations of the Commission under the Exchange Act; and
(xiii) This Agreement and the Delayed Delivery Contracts, if any,
have been duly authorized, executed and delivered by the Company; the
execution, delivery and performance of this Agreement and the Delayed
Delivery Contracts, if any, and the sale of the Underwritten Securities
and compliance by the Company with the provisions of the Underwritten
Securities and the applicable Indenture will not conflict with, or
result in a breach of any of the provisions of, or constitute a default
under, or result in the creation or imposition of any lien, charge or
encumbrance upon any of the property or assets of the Company or any of
its subsidiaries pursuant to the terms of, any material agreement,
indenture or instrument known to such counsel to which the Company or
any of its subsidiaries is a party or by which the Company or any of its
subsidiaries is bound, or result in a violation of the provisions of the
Certificate of Incorporation, as amended, or By-Laws of the Company or
any order, rule or regulation of any court or other governmental body;
and no consent, authorization or order of, or filing or registration
with, any court or governmental body is required for the execution,
delivery and performance by the Company of this Agreement and the
Delayed Delivery Contracts, if any, and the applicable Indenture, except
such as may be required by the Act, the Trust Indenture Act, the
Exchange Act or state securities laws.
Such counsel shall additionally state that he has participated in
conferences with officers and other representatives of the Company at which
the contents of the Registration Statement and the Prospectus and related
matters were discussed, and although such counsel is not passing upon and
does not assume responsibility for the accuracy, completeness or fairness
of the statements contained in the Registration Statement and the
Prospectus, on the basis of the foregoing (relying as to materiality to a
large extent upon the opinions of officers and other representatives of the
Company), no facts have come to the attention of such counsel which would
lead him to believe that at the time the Registration Statement became
effective (or, if an amendment to the Registration Statement or an Annual
Report on Form 10-K has been filed by the Company with the Commission
subsequent to the effectiveness of the Registration Statement, then at the
time of the most recent such filing) either the Registration Statement or
any such amendment thereto contained an untrue statement of a material fact
or omitted to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, or that the
Prospectus, as amended or supplemented as of its date and at the date of
the opinion, includes an untrue statement of a material fact or omits to
state a material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not misleading
(except that no comment need be expressed as to the financial statements,
schedules and other financial and statistical data contained therein).
(f) The opinion of counsel to the Underwriters, addressed to the
Underwriters and dated the Delivery Date, covering such matters as the
Representative shall reasonably request shall have been furnished to the
Representative on the Delivery Date. Such opinion shall also make the same
statement as set forth in the last paragraph of Paragraph 10(e).
12
<PAGE> 13
(g) The Company shall have furnished to the Representative on the
Delivery Date a letter of Coopers & Lybrand and, to the extent that the
Prospectus contains or incorporates by reference consolidated financial
statements or related financial statement schedules audited by Arthur
Andersen & Co., a letter of Arthur Andersen & Co., each addressed to the
Underwriters and dated the Delivery Date, of the type described in the
American Institute of Certified Public Accountants' Statement on Auditing
Standards No. 38 and covering such specified financial statement items and
other matters as the Representative may reasonably request.
(h) There shall not have been any material information contained in
the letter specified in Paragraph 10(g) which makes it impractical or
inadvisable in the judgment of the Representative to proceed with the
public offering or the delivery of the Underwritten Securities.
All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance satisfactory to counsel
for the Underwriters.
11. If the Underwriters shall decline to purchase the Immediate Delivery
Underwritten Securities for any reason permitted under this Agreement (other
than pursuant to Paragraphs 5 and 9), the sole liability of the Company to the
Underwriters (in addition to any liability it may have under Paragraph 8) will
be to reimburse the Underwriters for the reasonable fees and expenses of their
counsel and for such other out-of-pocket expenses as shall have been incurred by
them in connection with this Agreement and the proposed purchase of Immediate
Delivery Underwritten Securities, and upon demand the Company shall pay the full
amount thereof to the Representative. If this Agreement is terminated pursuant
to Paragraph 5 hereof by reason of the default of one or more Underwriters or is
terminated by the Underwriters pursuant to Paragraph 9 hereof, the Company shall
not be obligated to reimburse any Underwriter on account of those expenses.
12. The Company shall be entitled to act and rely upon any request,
consent, notice or agreement of or by the Underwriters given by the
Representative. Any notice by the Company to the Underwriters shall be
sufficient if given in writing (including facsimile transmission) addressed as
indicated in the Terms Agreement, and any notice by the Underwriters to the
Company shall be sufficient if given in writing or by telegraph addressed to the
Company, at 225 Brae Boulevard, Park Ridge, New Jersey 07656-0713, Attention:
Treasurer.
13. This Agreement shall be binding upon the Underwriters, the Company, and
their respective successors. This Agreement and the terms and provisions hereof
are for the sole benefit of only those persons, except that (a) the
representations, warranties, indemnities and agreements of the Company contained
in this Agreement shall also be deemed to be for the benefit of any Participant
and the person or persons, if any, who control any Underwriter or Participant
within the meaning of Section 15 of the Act, and (b) the indemnity agreement of
the Underwriters contained in Paragraph 8 hereof shall be deemed to be for the
benefit of directors of the Company, officers of the Company who have signed the
Registration Statement and any person controlling the Company. Nothing in this
Agreement is intended or shall be construed to give any person, other than the
persons referred to in this Paragraph, any legal or equitable right, remedy or
claim under or in respect of this Agreement or any provision contained herein.
14. For purposes of this Agreement, (a) "business day" means any day on
which the Exchange is open for trading and (b) "subsidiary" has the meanings set
forth in Rule 405 of the Rules and Regulations.
15. This Agreement shall be governed by and construed in accordance with
the laws of the State of New York applicable to agreements made and to be
performed in such State. The Terms Agreement may be executed in one or more
counterparts, and if executed in more than one counterpart the executed
counterparts shall together constitute a single instrument.
16. In the event that no Underwriter is listed in the Terms Agreement other
than the person or persons who are signatories to the Terms Agreement, all
references to the "Representative" in the Agreement shall be deemed to refer to
the Underwriter or Underwriters named in the Terms Agreement.
13
<PAGE> 14
EXHIBIT A
TERMS AGREEMENT
, 19
THE HERTZ CORPORATION
225 Brae Boulevard
Park Ridge, New Jersey 07656-0713
Dear Sirs:
We (the "Underwriters") understand that The Hertz Corporation, a Delaware
corporation (the "Company"), proposes to issue and sell $ aggregate
principal amount of its (the "Underwritten Securities"). Subject to
the terms and conditions set forth herein or incorporated by reference herein,
the Underwriters offer to purchase, severally and not jointly, the principal
amount of Underwritten Securities set forth below opposite their respective
names at a purchase price of % of the principal amount thereof, together
with interest accrued thereon from , 19 to the Delivery Date:
<TABLE>
<CAPTION>
Principal
Underwriter Amount
------------ ---------
<S> <C>
----------
Total........................................................ $
=========
</TABLE>
<PAGE> 15
The Underwritten Securities, which are to be issued under either (1) an
Indenture dated as of April 1, 1986 between the Company and Chemical Bank,
successor by merger to Manufacturers Hanover Trust Company, as Trustee (the
"Senior Securities"), (2) an Indenture dated as of June 1, 1989 between the
Company and The Bank of New York, as Trustee (the "Senior Subordinated
Securities"), or (3) an Indenture dated as of July 1, 1993 between the Company
and Citibank, N.A., as Trustee (the "Junior Subordinated Securities") shall have
the following terms:
Denomination:
Maturity:
Interest rate:
Interest payment dates:
Price to public:
Closing date and time:
Place of delivery:
Redemption provisions:
Senior Securities/Senior Subordinated Securities/Junior Subordinated
Securities:
[other terms:]
[Delayed Delivery Contracts: None]
[The Delayed Delivery Contracts shall have the following terms:
Delivery date:
[Revisions, if any, to the settlement procedures described in paragraph 6
of the document entitled "The Hertz Corporation -- Debt Securities --
Underwriting Agreement Basic Provisions" (the "Basic Provisions")]
Expiration date:
Compensation to Underwriters:
Minimum principal amount of Underwritten Securities to be sold
pursuant to any Delayed Delivery Contract:
Maximum aggregate principal amount of Underwritten Securities to be sold
pursuant to all Delayed Delivery Contracts:]
All the provisions contained in the Basic Provisions, filed as an exhibit
to the Registration Statement relating to the Underwritten Securities and
attached hereto as Annex A, are herein incorporated by reference in their
entirety and shall be deemed to be a part of this Terms Agreement to the same
extent as if such provisions had been set forth in full herein. Terms defined in
such document are used herein as therein defined.
Any notice by the Company to the Underwriters pursuant to this Terms
Agreement shall be sufficient if given in writing or by telegraph addressed to
[Insert Name and Address of the Representative(s) of the Underwriters].
Very truly yours,
[INSERT NAME[S] OF
REPRESENTATIVE[S]]
By _____________________________
Acting for themselves and
as Representative[s] of the
Underwriters
Accepted:
THE HERTZ CORPORATION
By ___________________
Title:
2
<PAGE> 16
EXHIBIT B
THE HERTZ CORPORATION
[TITLE OF SECURITIES]
DELAYED DELIVERY CONTRACT
, 19
THE HERTZ CORPORATION
225 Brae Boulevard
Park Ridge, New Jersey 07656-0713
Dear Sirs:
The undersigned hereby agrees to purchase from The Hertz Corporation, a
Delaware corporation (the "Company"), and the Company hereby agrees to sell to
the undersigned, $ principal amount of the
Company's above-captioned securities (the "Securities"), offered by
the Company's prospectus dated , 19 , as supplemented by the
prospectus supplement dated , 19 (collectively, the "Prospectus"),
receipt of a copy of which is hereby acknowledged, at a purchase price of % of
the principal amount thereof plus interest accrued from , 19 to the
Delivery Date (as defined in the next paragraph) and on the further terms and
conditions set forth in this Contract.
Payment for and delivery of the Securities to be purchased by the
undersigned shall be made on , 19 , herein called the "Delivery Date."
At 10:00 A.M., New York time, on the Delivery Date, the Securities to be
purchased by the undersigned hereunder will be delivered by the Company to the
undersigned, and the undersigned will accept delivery of such Securities and
will make payment to the Company of the purchase price therefor, at the office
of . Payment will be by certified or official bank check payable
in next-day funds settled through the New York Clearing House to or upon the
order of the Company. The Securities will be delivered in fully registered form
in such authorized denominations and registered in such names as the undersigned
may designate by written or telegraphic communication addressed to the Company
not less than two full business days prior to the Delivery Date, or, if the
undersigned fails to make a timely designation in the foregoing manner, in the
form of one definitive fully registered certificate representing the Securities
in the above principal amount, registered in the name of the undersigned.
This Contract will terminate and be of no further force and effect after
, 19 , unless the Company shall have sold to the Underwriters named in
the Prospectus the Immediate Delivery Underwritten Securities (as defined in the
Underwriting Agreement referred to in the Prospectus) and the Company shall have
mailed or delivered to the undersigned at its address set forth below a notice
to that effect, stating the date of the occurrence thereof, accompanied by
copies of the opinions of counsel for the Company delivered to such Underwriters
pursuant to Paragraphs 10(e) and 10(f) of the Underwriting Agreement Basic
Provisions.
The obligation of the undersigned to accept delivery of and make payment
for the Securities on the Delivery Date will be subject to the condition that
the Securities shall not, on the Delivery Date, be an investment prohibited by
the laws of the jurisdiction to which the undersigned is subject, the
undersigned hereby representing that such an investment is not so prohibited on
the date hereof.
<PAGE> 17
This Contract will inure to the benefit of and be binding upon the parties
hereto and their respective successors but will not be assignable by either
party hereto without the written consent of the other.
It is understood that acceptance of any Delayed Delivery Contract (as
defined in said Underwriting Agreement) is in the Company's sole discretion and,
without limiting the foregoing, need not be on a first-come, first-served basis.
If this Contract is acceptable to the Company, it is requested that the Company
sign the form of acceptance below and mail or deliver one of the counterparts
hereof to the undersigned at its address set forth below. This will become a
binding contract between the Company and the undersigned when such counterpart
is so mailed or delivered.
Very truly yours,
By__________________________
__________________________
Title:
__________________________
__________________________
Address:
Accepted as of , 19
THE HERTZ CORPORATION
By ______________________
Title:
2
<PAGE> 1
EXHIBIT 1(b)
------------
_____________ __, 19__
THE HERTZ CORPORATION
SENIOR MEDIUM-TERM NOTES AND
SENIOR SUBORDINATED MEDIUM-TERM NOTES DUE FROM
9 MONTHS TO 30 YEARS FROM DATE OF ISSUE
DISTRIBUTION AGREEMENT
[Names and addresses of
Agents]
Dear Sirs:
The Hertz Corporation, a Delaware corporation (the "Company"),
confirms its agreement with ________________ and _____________________ (the
"Agents") with respect to the issue and sale by the Company of its Senior
Medium-Term Notes Due From 9 Months to 30 Years from Date of Issue (the "Senior
Notes), a series of the Company's senior debt securities; and, Senior
Subordinated Medium-Term Notes Due From 9 Months to 30 Years From Date of Issue
(the "Senior Subordinated Notes"), a series of the Company's senior
subordinated debt securities (the Senior Notes and Senior Subordinated Notes
shall be referred to herein collectively as the "Notes"). The Senior Notes are
to be issued pursuant to an indenture, dated as of April 1, 1986, as amended,
(the "Senior Indenture") between the Company and Chemical Bank (successor by
merger to Manufacturers Hanover Trust Company), as Trustee (the "Senior
Trustee"). The Senior Subordinated Notes are to be issued pursuant to an
indenture, dated as of June 1, 1989, (the "Senior Subordinated Indenture")
between the Company and The Bank of New York, as Trustee (the "Senior
Subordinated Trustee"). The Senior Indenture and the Senior Subordinated
Indenture are hereafter collectively referred to as the "Indentures". As of
the date hereof, the Company has authorized the issuance of up to $___,000,000
aggregate principal amount of Notes through the Agents pursuant to the terms of
this Agreement. It is understood, however, that the Company may from time to
time authorize the issuance of additional Notes and that such Notes may be
distributed through the Agents pursuant to the terms of this Agreement, all as
though the issuance of such Notes were authorized as of the date hereof.
<PAGE> 2
Subject to the terms and conditions stated herein and subject to the
reservation by the Company of the right to sell Notes directly on its own
behalf and, upon notice to each of you, to enter into agreements substantially
identical hereto with other agents, the Company hereby (i) appoints the Agents
as agents of the Company for the purpose of soliciting purchases of the Notes
from the company by others and (ii) agrees that whenever the Company determines
to sell Notes directly to one or more of the Agents as principal for resale to
others, it will enter into a Terms Agreement relating to such sale in
accordance with the provisions of Section 2(b) hereof.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 33-____) relating to
its debt securities and the offering thereof from time to time in accordance
with Rule 415 under the Securities Act of 1933 (the "1933 Act"). The Notes are
series of the senior and senior subordinated debt securities so registered.
Such registration statement has been declared effective by the Commission, and
each Indenture has been qualified under the Trust Indenture Act of 1939, as
amended (the "1939 Act"). Such registration statement (and any further
registration statements which may be filed by the Company for the purpose of
registering additional senior and senior subordinated debt securities in
connection with which this Agreement is included or incorporated by reference
as an exhibit) and the prospectus filed pursuant to Rule 424 under the 1933
Act, including all documents incorporated therein by reference, as from time to
time amended or supplemented by the filing of documents pursuant to the
Securities Exchange Act of 1934, as amended (the "1934 Act"), the 1933 Act or
otherwise, are referred to herein as the "Registration Statement" and the
"Prospectus", respectively.
SECTION 1. REPRESENTATIONS AND WARRANTIES. (a) The Company
represents and warrants to the Agents as of the date hereof, as of the date of
the delivery of the documents referred to in Section 2(d) hereof (the "Closing
Time"), as of the date of each acceptance by the Company of an offer for the
purchase of Notes (whether through an Agent as agent or to an Agent as
principal), as of the date of each delivery of Notes (whether through an Agent
as agent or to an Agent as principal) (each such delivery to one or more of the
Agents being referred to herein as a Settlement Date"), and as of the times
referred to in Sections 6(a) and 6(b) hereof (in each case, a "Representation
Date"), as follows:
(i) Registration Statement and Prospectus. The Registration
Statement and the Prospectus, at the time the Registration Statement
became effective complied, and as of
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<PAGE> 3
the applicable Representation Date will comply, in all material
respects with the requirements of the 1933 Act and the rules and
regulations thereunder (the "1933 Act Regulations") and the 1939 Act.
The Registration Statement, at the time the Registration Statement
became effective did not, and as of the applicable Representation Date
will not, contain an untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary to
make the statements therein not misleading. The Prospectus, at the
time the Registration Statement became effective did not, and as of
the applicable Representation Date will not, contain an untrue
statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided,
however, that the representations and warranties in this subsection
shall not apply to statements in or omissions from the Registration
Statement or Prospectus made in reliance upon and in conformity with
information furnished to the Company in writing by the Agents
expressly for use in the Registration Statement or Prospectus or to
that part of the Registration Statement which shall constitute the
Statement of Eligibility and Qualification under the Trust Indenture
Act of 1939, as amended (Form T-1), of the Senior Trustee under the
Senior Indenture or the Senior Subordinated Trustee under the Senior
Subordinated Indenture.
(ii) Financial Statements. The financial statements
incorporated by reference in the Registration Statement or in the
Prospectus present, or (in the case of any amendment or supplement to
any such document, or any material incorporated by reference in any
such document, filed with the Commission after the date as of which
this representation is being made) will present at all times during
the period specified in Section 3(a) hereof, fairly, the financial
condition and results of operations of the entities purported to be
shown thereby, at the dates and for the periods indicated, and have
been, and (in the case of any amendment or supplement to any such
document, or any material incorporated by reference in any such
document, filed with the Commission after the date as of which this
representation is being made) will be at all times during the period
specified in Section 3(a) hereof, prepared in conformity with
generally accepted accounting principles applied on a consistent
basis-throughout the periods involved.
(iii) Incorporated Documents. The documents incorporated by
reference in the Prospectus, at the time
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<PAGE> 4
they were or hereafter are filed with the Commission, complied and
will comply in all material respects with the requirements of the 1934
Act and the rules and regulations thereunder (the "1934 Act
Regulations") and, when read together and with the other information
in the Prospects, at the time the Registration Statement became, and
any amendments thereto became, effective, did not and will not contain
an untrue statement of a material fact of omit to state a material
fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were or
are made, not misleading.
(iv) No Material Changes or Material Transactions. Since the
respective date as of which information is given in the Registration
Statement and the Prospectus, except as otherwise stated therein or
contemplated thereby, (A) there has been no material adverse change in
the condition, financial or otherwise, of the Company and its
subsidiaries considered as one enterprise, or in the earnings, affairs
or business prospects of the Company and its subsidiaries considered
as one enterprise, whether or not arising in the ordinary course of
business, (B) there have been no material transactions entered into by
the Company or any of its subsidiaries other than those in the
ordinary course of business.
(v) Due Incorporation and Qualification. The Company has
been duly incorporated and is validly existing in good standing as a
corporation under the laws of the State of Delaware with corporate
power and authority to own, lease and operate its properties and
conduct its business as described in the Registration Statement; and
the Company is duly qualified as a foreign corporation to transact
business and is in good standing in each jurisdiction in which the
failure to so qualify and be in good standing would materially
adversely affect the financial condition of the Company.
(vi) Significant Subsidiary. As of December 31, 1993, Hertz
International, Ltd., Hertz Equipment Rental Corporation and Hertz
Claim Management Corporation were the only subsidiaries of the
Company that constitute a "significant subsidiary" of the Company
within the meaning of Rule 1-02 of Regulation S-X of the
Commission. Each such subsidiary (each such subsidiary or the
subsidiaries so disclosed in the most recent Form 10-K of the
Company being hereinafter referred to as a "Significant Subsidiary")
has been duly incorporated and is validly existing and in good
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<PAGE> 5
standing as a corporation under the laws of the jurisdiction of its
incorporation, is qualified to do business and is in good standing in
each jurisdiction in which the failure to qualify and be in good
standing would materially adversely affect its business or financial
condition and has the power and authority to own or hold its
properties and to conduct the business in which it is engaged; and the
Company owns, directly or indirectly, free and clear of liens and
encumbrances, all of the outstanding capital stock of each Significant
Subsidiary, except to the extent set forth in the Prospectus.
(vii) No Defaults, etc.; Regulatory Approvals. Neither the
Company nor any of its subsidiaries (as defined in Rule 405 under the
1933 Act) is in violation of its charter or by-laws or in default in
the performance or observance of any material obligation, agreement,
covenant or condition contained in any material contract, indenture,
mortgage, loan agreement, note, lease or other instrument to which it
is a party or by which it or any of them or their properties may be
bound; and the execution and delivery of this Agreement, the Senior
Indenture and Senior Subordinated Indenture and each Terms Agreement
and the consummation of the transactions contemplated herein and
therein have been duly authorized by all necessary corporate action
and will not conflict with or constitute a breach of, or default
under, or result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Company or any of its
subsidiaries pursuant to any material contract, indenture, mortgage,
loan agreement, note, lease or other instrument to which the Company
or any of its subsidiaries is a party or by which it or any of them
may be bound or to which any of the property or assets of the Company
or any of its subsidiaries is subject, nor will such action result in
any violation of the provisions of the charter or by-laws of the
Company or, to the best of the Company's knowledge, any law,
administrative regulation or administrative or court decree; and no
consent, approval, authorization or order of any court or governmental
authority or agency is required for the consummation by the Company of
the transactions contemplated by this Agreement, except such as may be
required under the 1933 Act, the 1939 Act, the 1933 Act Regulations or
state securities or Blue Sky laws.
(viii) Legal Proceedings; Contracts. Except as set forth in
the Prospectus, there is no action, suit or proceeding before or by
any court or governmental agency or body, domestic or foreign, now
pending, or, to the knowledge of the Company, threatened against or
affecting, the Company
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<PAGE> 6
or any of its subsidiaries, which might result, in the reasonable
judgment of the Company, in any material adverse change in the
condition, financial or otherwise, of the Company and its subsidiaries
considered as one enterprise, or in the earnings, affairs or business
prospects of the Company and its subsidiaries considered as one
enterprise, or might materially and adversely affect the properties or
assets thereof or might materially and adversely affect the
consummation of this Agreement, and there are no material contracts or
documents of the Company or any of its subsidiaries which are required
to be filed as exhibits to the Registration Statement by the 1933 Act
or by the 1933 Act Regulations which have not been so filed.
(ix) Authorization and Validity of Notes. The Notes have
been duly authorized for issuance and sale pursuant to- this Agreement
and, when issued, authenticated and delivered pursuant to the
provisions of this Agreement and the applicable Indenture against
payment of the consideration therefor in accordance with this
Agreement, the Notes will be valid and legally binding obligations of
the Company enforceable in accordance with their terms, except as
enforcement thereof may be limited by general principles of equity or
by bankruptcy, insolvency, reorganization or other laws relating to or
affecting creditors' rights generally, and will be entitled to the
benefits of the applicable Indenture; and the Notes and each Indenture
conform in all material respects to all statements relating thereto
contained in the Prospectus.
(b) Additional Certifications. Any certificate signed by an officer
of the Company and delivered to the Agents or to the Agents' counsel in
connection with an offering of Notes shall be deemed a representation and
warranty by the Company to the Agents as to the matters covered thereby.
SECTION 2. SOLICITATIONS AS AGENTS; PURCHASES AS PRINCIPALS. (a)
Solicitations as Agents. On the basis of the representations and warranties
herein contained, but subject to the terms and conditions herein set forth, the
Agents agree, as agents of the Company (as the context requires, the term
"Agents" shall include the singular as well as the plural and shall refer to
the firms to whom this Agreement is addressed whether acting as agent or as
principal), to use their best efforts to solicit offers to purchase the Notes
upon the terms and conditions set forth in the Prospectus, as amended or
supplemented from time to time.
The Company reserves the right, in its sole discretion, to suspend
solicitation of purchases of the Notes commencing at any
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<PAGE> 7
time for any period of time or permanently. Upon receipt of instructions from
the Company, the Agents will forthwith suspend solicitation of purchases from
the Company until such time as the Company has advised them that such
solicitation may be resumed.
The Company agrees to pay each of the Agents a commission, in the form
of a discount, equal to the following percentage of the principal amount of
each Note sold by the Company as a result of a solicitation made by such Agent
upon settlement:
<TABLE>
<CAPTION>
Term Commission Rate
---- ---------------
<S> <C>
From 9 months but less than one year .075%
From 1 year but less than 18 months .100%
From 18 months but less than 2 years .125%
From 2 years but less than 3 years .175%
From 3 years but less than 4 years .250%
From 4 years but less than 5 years .300%
From 5 years but less than 6 years .350%
From 6 years but less than 7 years .375%
From 7 years but less than 8 years .400%
From 8 years but less than 9 years .425%
From 9 years but less than 10 years .450%
From 10 years but less than 15 years .475%
From 15 years but less than 20 years .550%
From 20 years but less than 30 years .600%
</TABLE>
Unless otherwise specified in the Prospectus, the Agents, when acting
as agents, are authorized to solicit orders for the Notes only in denominations
of $1,000 or more (in integral multiples of $1,000 approved by the Company) at
a purchase price to be agreed upon between the Agents and the Company and as
shall be set forth in the applicable Prospectus. The Agents shall communicate
to the Company, orally or in writing, each reasonable offer to purchase Notes
received by the Agents as agents. The Company shall have the sole right to
accept offers to purchase the Notes and may reject any such offer in whole or
in part. The Agents shall have the right to reject any offer to purchase the
Notes received by them in whole or in part, and any such rejection shall not be
deemed a breach of their agreements contained herein.
(b) Purchases as Principals. Each sale of Notes to the Agents as
principal shall be made in accordance with the terms of this Agreement and a
separate agreement to be entered into between the Company and the Agents which
will provide for the sale of such Notes to, and the purchase and reoffering
thereof by, the Agents. Each such separate agreement (which may be an oral
agreement confirmed in writing as described below) is herein
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<PAGE> 8
referred to as a "Terms Agreement. The Agents' commitment to purchase Notes
pursuant to any Terms Agreement shall be deemed to have been made on the basis
of the representations and warranties of the Company herein contained and shall
be subject to the terms and conditions herein set forth. Each Terms Agreement
shall specify the principal amount of Notes to be purchased by the Agents
pursuant thereto, whether the Notes are Senior Notes or Senior Subordinated
Notes, the price to be paid to the Company for such Notes, the initial public
offering price, if any, at which the Notes are proposed to be reoffered, the
interest rate and related terms of such Notes and the time and place of
delivery of and payment for such Notes. The Agents are authorized to utilize
a selling group or dealer group in connection with the reoffering of any Notes
purchased by the Agents as principal and may allow or reallow all or a portion
of any discount received from the Company to members of such selling group or
such dealers. Terms Agreements whether oral (and confirmed in writing, which
may be by facsimile transmission) or in writing, shall be with respect to
such information (as applicable) as is specified in Exhibit A hereto.
(c) Administrative Procedures. Administrative procedures respecting
the sale of Notes shall be agreed upon from time to time by the Agents and the
Company (the "Procedures"). The Agents and the Company agree to perform the
respective duties and obligations specifically provided to be performed by them
herein and in the Procedures.
(d) Delivery of Documents. The documents required to be delivered by
Section 5 hereof shall be delivered at the offices of _______________________,
on the date hereof, or at such other time or place as the Agents and the
Company may agree upon in writing.
SECTION 3. COVENANTS OF THE COMPANY. The Company covenants with the
Agents as follows:
(a) Revisions of Prospectus -- Material Changes. If at any
time when the Prospectus is required by the 1933 Act to be delivered
in connection with sales of the Notes any event shall occur or
condition exist as a result of which it is necessary, in the
reasonable opinion of the Agents' counsel or counsel for the Company,
to further amend or supplement the Prospectus in order that the
Prospectus will not include an untrue statement of a material fact or
omit to state any material fact necessary in order to make the
statements therein not misleading in the light of the circumstances
existing at the time it is delivered to a purchaser, or if it shall be
necessary, in the reasonable opinion of either such counsel, at any
such time to amend or supplement the Registration Statement or the
Prospectus in order to comply with the requirements of the 1933 Act or
the 1933 Act Regulations, immediate notice shall be given by the
Company, and confirmed in writing, to the Agents to cease the
solicitation of offers to purchase the Notes in the
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<PAGE> 9
Agents' capacity as agents of the Company and to cease sales of any
Notes the Agents may then own as principal, and the Company will
promptly prepare and file with the Commission such amendment or
supplement, whether by filing documents pursuant to the 1934 Act, the
1933 Act or otherwise, as may be necessary to correct such untrue
statement or omission or to make the Registration Statement comply
with such requirements.
(b) Prospectus Revisions -- Periodic Financial Information.
On or prior to the date on which there shall be released to the
general public interim financial statement information related to the
Company with respect to each of the first three quarters of any fiscal
year or preliminary financial statement information with respect to
any fiscal year, the Company shall furnish such information to the
Agents, confirmed in writing, and shall cause the Prospectus to be
amended or supplemented to include or incorporate by reference capsule
financial information with respect to the results of operations of the
Company for the period between the end of the preceding fiscal year
and the end of such quarter or for such fiscal year, as the case may
be, and corresponding information for the comparable period of the
preceding fiscal year, as well as such other information and
explanations as shall be necessary for an understanding of such
amounts or as shall be required by the 1933 Act or the 1933 Act
Regulations; provided, however, that if on the date of such release
the Agents shall have suspended solicitation of purchases of the Notes
in the Agents' capacity as agents of the Company pursuant to a
request from the Company, and shall not then hold any Notes as
principal, the Company shall not be obligated so to amend or
supplement the Prospectus until such time as the Company shall
determine that solicitation of purchases of the Notes should be
resumed or shall subsequently enter into a new Terms Agreement with
the Agents.
(c) Prospectus Revisions -- Audited Financial Information.
On or prior to the date on which there shall be released to the
general public financial information included in or derived from the
audited financial statements of the Company for the preceding fiscal
year, the Company shall cause the Registration Statement and the
Prospectus to be amended to include or incorporate by reference such
audited financial statements and the report or reports of the
independent accountants with respect thereto, as well as such other
information and explanations as shall be necessary for an
understanding of such financial statements or as shall be required by
the 1933 Act or the 1933 Act Regulations; provided, however, that if
on the date of such
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<PAGE> 10
release the Agents shall have suspended solicitation of purchases of
the Notes in their capacity as agents pursuant to a request from the
Company, and shall not then hold any Notes as principal, the Company
shall not be obligated so to amend or supplement the Prospectus until
such time as the Company shall determine that solicitation of
purchases of the Notes should be resumed or shall subsequently enter
into a new Terms Agreement with the Agents.
(d) Release of Earnings Statements. The Company will make
generally available to its security holders, in each case as soon as
practicable, earnings statements (in form complying with the
provisions of Section 11(a) of the 1933 Act, which need not be
certified by independent certified public accountants unless required
by the 1933 Act or the 1933 Act Regulations) covering (i) a
twelve-month period beginning not later than the first day of the
fiscal quarter next following the date of this Agreement and (ii) a
twelve-month period beginning not later than the first day of each of
the Company's fiscal quarters next following the date of any sale of
Notes and the date of each filing under the 1934 Act of an Annual
Report on Form 10-K of the Company.
(e) Notice of Certain Filings. The Company will give the
Agents notice of its intention to file any amendment to the
Registration Statement or any amendment or supplement to the
Prospectus, whether by the filing of documents pursuant to the 1934
Act, the 1933 Act or otherwise, and will furnish the Agents with
copies of any such amendment or supplement or other documents proposed
to be filed a reasonable time in advance of filing.
(f) Other Notice Provisions. The Company will notify the
Agents immediately, and confirm the notice in writing, (i) of the
effectiveness of any amendment to the Registration Statement, (ii) of
the mailing or the delivery to the Commission for filing of any
supplement to the Prospectus or any document to be filed pursuant to
the 1934 Act which will be incorporated by reference in the
Prospectus, (iii) of the receipt of any comments from the Commission
with respect to the Registration Statement or the Prospectus, (iv) of
any request by the Commission for any amendment to the Registration
Statement or any amendment or supplement to the Prospectus or for
additional information, and (v) of the issuance by the Commission of
any stop order suspending the effectiveness of the Registration
Statement or the initiation of any proceedings for that purpose. The
Company will make every reasonable effort to prevent the issuance of
any stop order and, if any stop order is issued,
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<PAGE> 11
to obtain the lifting thereof at the earliest possible moment.
(g) Copies of Registration Statement. The Company will
deliver to the Agents as many signed and conformed copies of the
Registration Statement (as originally filed) and of each amendment
thereto (including exhibits filed therewith or incorporated by
reference therein and documents incorporated by reference in the
Prospectus) as the Agents reasonably request.
(h) Copies of Prospectus. The Company will furnish to the
Agents as many copies of the Prospectus (as amended or supplemented)
as the Agents shall reasonably request.
(i) Copies of Financial Reports. The Company will furnish to
the Agents at the earliest time the Company makes the same available
to others, copies of its annual reports and other financial reports
furnished or made available to lenders or to the public generally.
(j) Blue Sky Qualifications. The Company will endeavor, in
cooperation with the Agents, to qualify the Notes for offering and
sale under the applicable securities laws of such states and other
jurisdictions of the United States as the Agents may designate, and
will maintain such qualifications in effect for as long as may be
required for the distribution of the Notes; provided, however, that
the Company shall not be obligated to file any general consent to
service of process or to qualify as a foreign corporation in any
jurisdiction in which it is not so qualified. The Company will file
such statements and reports as may be required by the laws of each
jurisdiction in which the Notes have been qualified as above provided.
(k) 1934 Act Filings. The Company, during the period when
the Prospectus is required to be delivered under the 1933 Act, will
file promptly all documents required to be filed with the Commission
pursuant to Section 13(a), 13(c), 14 or 15(d) of the 1934 Act.
(l) Stand-off Agreement. Between the date of any Terms
Agreement and the settlement date with respect to the Notes covered
thereby, the Company will not, without the Agents' prior consent,
enter into any agreement relating to the sale of any debt securities
of the Company with similar maturities to any underwriter or agent
purchasing such debt securities as Principal.
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<PAGE> 12
SECTION 4. PAYMENT OF EXPENSES. The Company will pay all expenses
incident to the performance of its obligations under this Agreement, including:
(i) the preparation and filing of the Registration
Statement and all amendments thereto;
(ii) the preparation, issuance and delivery of the Notes;
(iii) the fees and disbursements of the Company's
accountants and of the Trustee and its counsel;
(iv) the qualification of the Notes under securities laws in
accordance with the provisions of Section 3(j) hereof, including
filing fees and the reasonable fees (not in excess of $10,000) and
disbursements of the Agents' counsel in connection therewith and in
connection with the preparation of any Blue Sky Survey and any Legal
Investment Survey;
(v) all of the Agents' out-of-pocket expenses (other than
attorney's fees and expenses) incurred as agents of the Company,
including advertising expenses incurred with the approval of the
Company;
(vi) the printing and delivery to the Agents in quantities
as hereinabove stated of copies of the Registration Statement and all
amendments thereto, and of the Prospectus and any amendments or
supplements thereto;
(vii) the printing and delivery to the Agents of copies of
the applicable Indenture and any Blue Sky Survey and any Legal
Investment Survey;
(viii) any fees charged by rating agencies for the rating of
the Notes; and
(ix) the fees and expenses, if any, incurred with respect
to any filing with the National Association of Securities Dealers, Inc.
SECTION 5. CONDITIONS OF OBLIGATIONS. The Agents' obligations to
solicit offers to purchase the Notes as agents of the Company and the Agents'
obligations to purchase Notes pursuant to any Terms Agreement will be subject
to the accuracy of the representations and warranties on the part of the
Company herein, to the accuracy of the statements of the Company's officers
made in any certificate furnished pursuant to the provisions hereof, to the
performance and observance by the
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<PAGE> 13
Company of all covenants and agreements herein contained on its part to be
performed and observed and to the following additional conditions precedent:
(a) At Closing Time the Agents shall have received the following
documents.
(1) Opinion of Paul M. Tschirhart. The Agents shall have
received the favorable opinion, dated as of Closing Time, of Paul M.
Tschirhart, Esq., Senior Vice President and General Counsel of the Company, in
form and substance satisfactory to the Agents and the Agents' counsel, to the
effect that:
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Delaware.
(ii) The Company has corporate power and authority to own,
lease and operate its properties and conduct its business as described
in the Registration Statement.
(iii) To the best of such counsel's knowledge, the Company is
duly qualified as a foreign corporation to transact business and is
in good standing in each jurisdiction in which the failure so to
qualify and be in good standing would materially adversely affect its
or business financial condition.
(iv) Each Significant Subsidiary has been duly incorporated
and is validly existing and in good standing as a corporation under the
laws of the jurisdiction of its incorporation, is qualified to do
business and is in good standing in each jurisdiction in which the
failure to so qualify and be in good standing would materially
adversely affect the business or financial condition of the Company
and its consolidated subsidiaries as a whole and has the corporate
power and authority to own or hold its properties and to conduct the
business in which it is engaged; and, to the best of such counsel's
knowledge, the Company owns, directly or indirectly, free and clear of
liens and encumbrances, all of the outstanding capital stock of each
Significant Subsidiary, except to the extent set forth in the
Prospectus.
(v) This Agreement (and, if the opinion is being given
pursuant to Section 6(c) hereof on account of the Company having
entered into a Terms Agreement, the applicable Terms Agreement) has
been duly authorized, executed and delivered by the Company.
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<PAGE> 14
(vi) The applicable Indenture has been duly and validly
authorized, executed and delivered by the Company and (assuming each
Indenture has been duly authorized, executed and delivered by the
Trustee) constitutes the valid and binding agreement of the Company,
enforceable in accordance with its terms, except as enforcement
thereof may be limited by general principles of equity or by
bankruptcy, insolvency, reorganization or other laws relating to or
affecting creditors' rights generally.
(vii) The Notes are in the form contemplated by the applicable
Indenture, have been duly and validly authorized by all necessary
corporate action and, when executed and authenticated as specified in
the applicable Indenture and delivered against payment of the
consideration therefor in accordance with this Agreement, will be
valid and binding obligations of the Company, enforceable in
accordance with their terms, except as enforcement thereof may be
limited by general principles of equity or by bankruptcy, insolvency,
reorganization or other laws relating to or affecting creditors'
rights generally, and will be entitled to the benefits of the
applicable Indenture.
(viii) The Notes and the applicable Indenture conform in all
material respects to the statements concerning them in the
Registration Statement and the Prospectus.
(ix) The applicable Indenture is qualified under the 1939
Act.
(x) The Registration Statement is effective under the 1933
Act and, to the best of such counsel's knowledge, no stop order
suspending the effectiveness of the Registration Statement has been
issued under the 1933 Act or proceedings therefor initiated or
threatened by the Commission.
(xi) The Registration Statement (other than the financial
statements, schedules and other financial and statistical data
included therein, as to which no opinion need be rendered) complies as
to form in all material respects with the requirements of the 1933
Act, the 1939 Act and the 1933 Act Regulations.
(xii) To the best of such counsel's knowledge, there are no
legal or governmental proceedings pending or threatened which are
required to be disclosed in the Registration Statement, other than
those disclosed therein.
(xiii) To the best of such counsel's knowledge, there are no
contracts or other documents which are required to be
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<PAGE> 15
filed as exhibits to the Registration Statement by the 1933 Act or the
1933 Act Regulations, or which are required to be filed by the 1934
Act or the rules and regulations of the Commission thereunder as
exhibits to any document incorporated by reference in the Prospectus,
which have not been filed as exhibits to the Registration Statement or
to such document or incorporated therein by reference as permitted by
the 1933 Act Regulations or the 1934 Act Regulations.
(xiv) No consent, approval, authorization, or order of any
court or governmental authority or agency is required in connection the
with sale of the Notes, except such as may be required under the 1933
Act, the 1934 Act, the 1939 Act and state securities laws; and, to the
best of such counsel's knowledge, the execution and delivery of this
Agreement (and, if the opinion is being given pursuant to Section 6(c)
hereof on account of the Company having entered into a Terms
Agreement, the applicable Terms Agreement) and the applicable
Indenture and the consummation of the transactions contemplated herein
and therein will not conflict with or constitute a breach of, or
default under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company or
any subsidiary pursuant to, any material contract, indenture,
mortgage, loan agreement, note, lease or other material instrument
known to him and to which the Company or any of its subsidiaries is a
party or by which it or any of them may be bound or to which any of
the property or assets of the Company or any of its subsidiaries is
subject, or any law, administrative regulation or administrative or
court decree known to him to be applicable to the Company of any court
or governmental agency, authority or body or any arbitrator having
jurisdiction over the Company; nor will such action result in any
violation of the provisions of the charter or by-laws of the Company.
Such counsel shall additionally state that he has participated in conferences
with officers and other representatives of the Company at which the contents of
the Registration Statement and the Prospectus and related matters were
discussed, and although such counsel is not passing upon and does not assume
responsibility for the accuracy, completeness or fairness of the statements
contained in the Registration Statement and the Prospectus, on the basis of the
foregoing (relying as to materiality to a large extent upon the opinions of
officers and other representatives of the Company), no facts have come to the
attention of such counsel which would lead him to believe that at the time the
Registration Statement became effective (or, if the opinion is being given
pursuant to Section 6(c) hereof and an
15
<PAGE> 16
amendment to the Registration Statement or an Annual Report on Form 10-K has
been filed by the Company with the Commission subsequent to the effectiveness
of the Registration Statement, then at the time of the most recent such filing)
either the Registration Statement or any amendment thereto contained an untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not misleading, or
that the Prospectus, as amended or supplemented as of its date and at the date
of the opinion, contains an untrue statement of a material fact or omits to
state a material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading (except
that no comment need be expressed as to the financial statements, schedules and
other financial and statistical data contained therein).
(2) Opinion of Counsel to the Agents. The Agents shall have received
the opinion of counsel to the Agents covering such matters as the Agents shall
reasonably request. Such counsel shall additionally state that they have
participated in conferences with officers and other representatives of the
Company and counsel for the Company, with representatives of the current and
former independent public accountants for the Company and with officers and
other representatives of the Agents, at which the contents of the Registration
Statement and the Prospectus and related matters were discussed, and although
such counsel are not passing upon and do not assume responsibility for the
accuracy, completeness or fairness of the statements contained in the
Registration Statement and the Prospectus, on the basis of the foregoing
(relying as to materiality to a large extent upon the opinions of officers and
representatives of the Company), no facts have come to the attention of such
counsel which would lead them to believe that at the time the Registration
Statement became effective (or, if the opinion is being given pursuant to
Section 6(c) hereof and an amendment to the Registration Statement or an Annual
Report on Form 10-R has been filed by the Company with the Commission
subsequent to the effectiveness of the Registration Statement, then at the time
of the most recent such filing) either the Registration Statement or any
amendment thereto contained an untrue statement of a material fact or omitted
to state a material fact required to be stated therein or necessary to make the
statements therein not misleading, or that the Prospectus, as amended or
supplemented as of its date and at the date of the opinion, contains an untrue
statement of a material fact or omits to state a material fact necessary in
order to make the statements therein, in light of the circumstances under which
they were made, not misleading (except that no comment need be expressed as to
the financial statements, schedules and other financial and statistical data
contained therein).
16
<PAGE> 17
(b) Officer's Certificate. At Closing Time there shall not have
been, since the respective dates as of which information is given in the
Registration Statement and the Prospectus, any material adverse change in the
condition, financial or otherwise, of the Company and its subsidiaries
considered as one enterprise, or in the results of operations or prospects of
the Company and its subsidiaries considered as one enterprise, whether or not
arising in the ordinary course of business, and the Agents shall have received
a certificate of the President, the Treasurer or a Vice President of the
Company, dated as of Closing Time, to the effect (i) that there has been no
such material adverse change, (ii) that the other representations and
warranties of the Company contained in Section 1 hereof are true and correct
with the same force and effect as though expressly made at and as of Closing
Time, (iii) that the Company has complied with all agreements and satisfied all
conditions on its part to be performed or satisfied at or prior to Closing
Time, and (iv) that to his knowledge no stop order suspending the effectiveness
of the Registration Statement has been issued and no proceedings for that
purpose have been initiated or threatened by the Commission.
(c) Comfort Letter. At Closing Time the Agents shall have received a
letter from Messrs. Coopers & Lybrand addressed to the Agents and dated as of
the Closing Time, of the type described in the American Institute of Certified
Public Accountants' Statement on Auditing Standards No. 38 and covering such
specified financial statement items and other matters as the Agents may
reasonably request.
(d) Other Documents. At Closing Time the Agents' counsel shall have
been furnished with such documents and opinions as they may reasonably require
for the purpose of enabling them to pass upon the issuance and sale of the
Notes as herein contemplated and related proceedings, or in order to evidence
the accuracy and completeness of any of the representations and warranties, or
the fulfillment of any of the conditions, herein contained; and all proceedings
taken by the Company in connection with the issuance and sale of the Notes as
herein contemplated shall be satisfactory in form and substance to the Agents
and to the Agents' counsel.
If any condition specified in this Section shall not have been
fulfilled, this Agreement may be terminated by the Agents by notice to the
Company at any time at or prior to Closing Time, and such termination shall be
without liability of any party to any other party except as provided in Section
4.
SECTION 6. ADDITIONAL COVENANTS OF THE COMPANY. The Company
covenants and agrees that:
17
<PAGE> 18
(a) Reaffirmations of Representations and Warranties. Each
acceptance by it of an offer for the purchase of Notes, and each sale
of Notes to the Agents pursuant to a Terms Agreement, shall be deemed
to be an affirmation that the representations and warranties of the
Company contained in this Agreement and in any certificate theretofore
delivered to the Agents pursuant hereto are true and correct at the
time of such acceptance or sale, as the case may be, and an
undertaking that such representations and warranties will be true and
correct at the time of delivery to the purchaser or his agent, or the
Agents, of the Note or Notes relating to such acceptance or sale, as
the case may be, as though made at and as of each such time (and it is
understood that such representations and warranties shall relate to
the Registration Statement and the Prospectus as amended and
supplemented to each such time).
(b) Certificates. Each time that the Registration Statement
or the Prospectus shall be amended or supplemented (other than by an
amendment or supplement providing solely for a change in the interest
rates of the Notes or a change in the principal amount of Notes
remaining to be sold or similar changes) or the Company files with the
Commission any document incorporated by reference into the Prospectus
or, if so indicated in the applicable Terms Agreement, the Company
sells Notes to the Agents pursuant to a Terms Agreement, the Company
shall furnish or cause to be furnished to the Agents forthwith a
certificate in form satisfactory to the Agents to the effect that the
statements contained in the certificate referred to in Section 5(b)
hereof which was last furnished to them are true and correct at the
time of such amendment or supplement or filing or sale, as the case
may be, as though made at and as of such time (except that such
statements shall be deemed to relate to the Registration Statement and
the Prospectus as amended and supplemented to such time) or, in lieu
of such certificate, a certificate of the same tenor as the
certificate referred to in said Section 5(b), modified as necessary to
relate to the Registration Statement and the Prospectus as amended and
supplemented to the time of delivery of such certificate.
(c) Opinions. Each time that the Registration Statement or
the Prospectus shall be amended or supplemented or the Company files
with the Commission any document incorporated by reference into the
Prospectus (other than by an amendment or supplement (i) providing
solely for a change in the interest rates of the Notes or a change in
the principal amount of Notes remaining to be sold or similar changes
or (ii) setting forth or incorporating by reference
18
<PAGE> 19
financial statements or other information as of and for a fiscal
quarter, provided, however, in the case of clause (ii) above, that an
opinion of counsel shall be furnished upon the Agents' request) or, if
so indicated in the applicable Terms Agreement, the Company sells
Notes to the Agents pursuant to a Terms Agreement, the Company shall
furnish or cause to be furnished forthwith to the Agents and to the
Agents' counsel a written opinion of Paul M. Tschirhart, Esq., Senior
Vice President and General Counsel of the Company, or other counsel
satisfactory to the Agents and a written opinion of the Agents'
counsel and (in connection with sales of securities pursuant to Terms
Agreements only, however), dated the date of delivery of such
opinions, in form satisfactory to the Agents, of the same tenor as the
opinions referred to in Section 5(a) hereof but modified, as
necessary, to relate to the Registration Statement and the Prospectus
as amended and supplemented to the time of delivery of such opinions
or, in lieu of such opinions, counsel last furnishing either such
opinion to the Agents shall furnish the Agents a letter to the effect
that the Agents may rely on such last opinion to the same extent as
though such opinion or letter were dated the date of such letter
authorizing reliance (except that statements in such last opinion
shall be deemed to relate to the Registration Statement and the
Prospectus as amended and supplemented to the time of delivery of such
letters authorizing reliance).
(d) Comfort Letters. Each time that the Registration
Statement or the Prospectus shall be amended or supplemented to
include additional financial information or the Company files with the
Commission any document incorporated by reference into the Prospectus
which contains additional financial information or, if so indicated in
the applicable Terms Agreement, the Company sells Notes to the Agents
pursuant to a Terms Agreement, the Company shall cause Coopers &
Lybrand forthwith to furnish the Agents a letter, dated the date of
filing of such amendment, supplement or document with the Commission,
or the date of such sale, as the case may be, in form satisfactory to
the Agents, of the same tenor as the letter referred to in Section
5(c) hereof but modified to relate to the Registration Statement and
Prospectus, as amended and supplemented to the date of such letters,
with such changes as may be necessary to reflect changes in the
financial statements and other information derived from the accounting
records of the Company; provided, however, that if the Registration
Statement or the Prospectus is amended or supplemented solely to
include financial information as of and for a fiscal quarter, Coopers
& Lybrand may limit the scope of such letter to the
19
<PAGE> 20
unaudited financial statements included in such amendment or
supplement unless any other information included therein of an
accounting, financial or statistical nature is of such a nature that
in the Agents reasonable judgment, such letter should cover such other
information.
SECTION 7. INDEMNIFICATION. (a) Indemnification of Agents. The
Company agrees to indemnify and hold harmless each Agent and each person, if
any, who controls each Agent within the meaning of Section 15 of the 1933 Act
as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement
or alleged untrue statement of a material fact contained in the
Registration Statement (or any amendment thereto), or the omission or
alleged omission therefrom of a material fact required to be stated
therein or necessary to make the statements therein not misleading or
arising out of any untrue statement or alleged untrue statement of a
material fact contained in the Prospectus (or any amendment or
supplement thereto) or the omission or alleged omission therefrom of a
material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not
misleading, unless such untrue statement or omission or such alleged
untrue statement or omission was made in reliance upon and in
conformity with written information furnished to the Company by the
Agents expressly for use in the Registration Statement (or any
amendment thereto) or the Prospectus (or any amendment or supplement
thereto);
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount
paid in settlement of any litigation, or investigation or proceeding
by any governmental agency or body, commenced or threatened, or of any
claim whatsoever based upon any such untrue statement or omission, or
any such alleged untrue statement or omission (except as made in
reliance upon and in conformity with information furnished by the
Agents as aforesaid) if such settlement is effected with the written
consent of the Company; and
(iii) against any and all expense whatsoever (including the
fees and disbursements of counsel chosen by the Agents), as incurred,
reasonably incurred in investigating, preparing or defending against
any litigation, or investigation or proceeding by any governmental
agency or body, commenced or threatened, or any claim whatsoever based
upon any such untrue statement or omission, or any such alleged untrue
statement or omission (except as made in reliance upon and
20
<PAGE> 21
in conformity with information furnished by the Agents as aforesaid),
to the extent that any such expense is not paid under (i) or (ii)
above.
(b) Indemnification of Company. Each Agent agrees to indemnify and
hold harmless the Company, its directors, each of its officers who signed the
Registration Statement, and each person, if any, who controls the Company
within the meaning of Section 15 of the 1933 Act against any and all loss,
liability, claim, damage and expense described in the indemnity contained in
subsection (a) of this Section, as incurred, but only with respect to untrue
statements or omissions, or alleged untrue statements or omissions, made in the
Registration Statement (or any amendment thereto) or the Prospectus (or any
amendment or supplement thereto) in reliance upon and in conformity with
written information furnished to the Company by such Agent expressly for use in
the Registration Statement (or any amendment thereto) or the Prospectus (or any
amendment or supplement thereto).
(c) General. Promptly after receipt by an indemnified party under
this Section of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made against
the indemnifying party under this Section, notify the indemnifying party in
writing of the claim or the commencement of that action, provided that the
failure to notify the indemnifying party shall not relieve it from any
liability which it may have to an indemnified party otherwise than under this
Section.
If any such claim or action shall be brought against an indemnified party, and
it shall notify the indemnifying party thereof, the indemnifying party shall be
entitled to participate therein, and, to the extent that it wishes, jointly
with any other similarly notified indemnifying party, to assume the defense
thereof with counsel satisfactory to the indemnified party. After notice from
the indemnifying party of the indemnified party of its election to assume the
defense of such claim or action, the indemnifying party shall not be liable to
the indemnified party under this Section for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than reasonable costs of investigation; provided that the Agents
shall have the right to employ counsel to represent the Agents and their
respective controlling persons who may be subject to liability arising out of
any claim in respect of which indemnity may be sought by the Agents against the
Company under this Section if, in the reasonable judgment of the Agents, it is
advisable for the Agents and their controlling persons to be represented by
separate counsel due to actual or potential different interests between
21
<PAGE> 22
the indemnified party and the indemnifying party, and in that event the fees
and expenses of such separate counsel shall be paid by the Company. It is
understood that the indemnifying party shall not, in connection with any
proceeding or related proceedings in the same jurisdiction, be liable for the
reasonable fees and expenses of more than one separate counsel for all such
indemnified parties. The indemnifying party shall not be liable for any
settlement of any proceeding effected without its written consent, but, if
settled with such consent or if there be a final judgment for the plaintiff,
the indemnifying party agrees to indemnify the indemnified party from and
against any loss or liability by reason of such settlement or judgment.
SECTION 8. CONTRIBUTION. In order to provide for just and equitable
contribution in circumstances in which the indemnity agreement provided for in
Section 7 hereof is for any reason held to be unavailable to the Agents other
than in accordance with its terms, the Company and the Agents shall contribute
to the aggregate losses, liabilities, claims, damages and expenses of the
nature contemplated by said indemnity agreement incurred by the Company and one
or more Agents, as incurred, in such proportions that the Agents are
responsible for that portion represented by the percentage that the total
commissions and underwriting discounts received by them to the date of such
liability bears to the total sales price received by the Company from the sale
of Notes to the date of such ability, and the Company is responsible for the
balance; provided, however, that no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the 1933 Act) shall
be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. For purposes of this Section, each Person, if
any, who controls an Agent within the meaning of Section 15 of the 1933 Act
shall have the same rights to contribution as such Agent and each director of
the Company, each officer of the company who signed the Registration Statement,
and each person, if any, who controls the Company within the meaning of Section
15 of the 1933 Act shall have the same rights to contribution as the Company.
SECTION 9. STATUS OF THE AGENTS. In soliciting purchases of the
Notes from the Company, the Agents are acting solely as agents for the Company
and not as principal. Each Agent will make reasonable efforts to assist the
Company in obtaining performance by each purchaser whose offer to purchase
Notes from the Company has been solicited by the Agent and accepted by the
Company but such Agent shall not have any liability to the Company in the event
any such purchase is not consummated for any reason.
22
<PAGE> 23
SECTION 10. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE
DELIVERY. All representations, warranties and agreements contained in this
Agreement, or contained in certificates of officers of the Company submitted
pursuant hereto, shall remain operative and in full force and effect,
regardless of any investigation made by or on behalf of the Agents or any
controlling person, or by or on behalf of the Company, and shall survive each
delivery of and payment for any of the Notes.
SECTION 11. TERMINATION. This Agreement may be terminated for any
reason, at any time by either party hereto upon the giving of thirty days'
written notice of such termination to the other party hereto. Such of the
Agents as may be named in any Terms Agreement may also terminate such Terms
Agreement, immediately upon notice to the Company, at any time (i) if there has
occurred any declaration of war or national emergency by the United States or
any outbreak or escalation of hostilities or other calamity or crisis the
effect of which on the financial markets of the United States is such as to
make it, in the Agents' judgment, impracticable to market the Notes or enforce
contracts for the sale of the Notes, or (ii) if trading in securities of the
Company on the New York Stock Exchange is suspended, or minimum prices are
established on such Exchange, or trading generally shall have been suspended or
materially limited on or by, as the case may be, either the New York Stock
Exchange or the American Stock Exchange, the effect of which, in the judgment
of the Agents, is to make it impracticable to market the Notes, or if a banking
moratorium has been declared by either Federal or New York authorities or if a
banking moratorium shall have been declared by the relevant authorities in the
country or countries of origin of any foreign currency or currencies in which
the Notes are denominated or payable, or (iii) there shall have occurred any
downgrading, or any notice shall have been given of (a) any intended or
potential downgrading of, or (b) any possible change that does not indicate an
improvement in, the rating accorded any securities of or guaranteed by the
Company, by Moody's Investors Service, Inc. or Standard & Poor's Corporation.
In the event of any such termination, neither party will have any liability to
the other party hereto, except that (i) the Agents shall be entitled to any
commissions earned in accordance with the third paragraph of Section 2(a)
hereof, (ii) if at the time of termination (A) any Agent shall own any of the
Notes with the intention of reselling them or (B) an offer to purchase any of
the Notes has been accepted by the Company but the time of delivery to the
purchaser or his agent of the Note or Notes relating thereto has not occurred,
the covenants set forth in Sections 3 and 6 hereof shall remain in effect until
such Notes are so resold or delivered, as the case may be, and (iii) the
provisions of Section 4 hereof, the indemnity agreement set forth in Section 7
hereof, the contribution provisions set forth
23
<PAGE> 24
in Section 8 hereof, and the provisions of Sections 10 and 14 hereof shall
remain in effect.
SECTION 12. NOTICES. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the Agents
shall be directed to them c/o their respective addresses set forth on the first
page hereof to the attention of [________________________________] and if to
[_______] to the attention of and, if to [_______], [______________________];
notices to the Company shall be directed to it at The Hertz Corporation, 225
Brae Boulevard, Park Ridge, New Jersey 07656, Attention: Treasurer.
SECTION 13. PARTIES. This Agreement and any Terms Agreement shall
inure to the benefit of and be binding upon the Agents and the Company and
their respective successors. Nothing expressed or mentioned in this Agreement
or any Terms Agreement is intended or shall be construed to give any person,
firm or corporation, other than the parties hereto and their respective
successors and the controlling persons and officers and directors referred to
in Section 7 and 8 hereof and their heirs and legal representatives, any legal
or equitable right, remedy or claim under or in respect of this Agreement or
any Terms Agreement or any provision herein or therein contained. This
Agreement and any Terms Agreement and all conditions and provisions hereof and
thereof are intended to be for the sole and exclusive benefit of the parties
hereto and their respective successors and said controlling persons and
officers and directors and their heirs and legal representatives, and for the
benefit of no other person, firm or corporation. No purchaser of Notes shall
be deemed to be a successor by reason merely of such purchase.
SECTION 14. GOVERNING LAW. This Agreement and the rights and
obligations of the parties created hereby shall be governed by the laws of the
State of New York applicable to agreements made and to be performed in such
state.
24
<PAGE> 25
If the foregoing is in accordance with the Agents' understanding of
our agreement, please sign and return to the Company a counterpart hereof,
whereupon this instrument along with all counterparts will become a binding
agreement between the Agents and the Company in accordance with its terms.
Very truly yours,
THE HERTZ CORPORATION
By_______________________
Title:
Confirmed and Accepted,
as of the date first above written:
[Name of Agent]
By______________________
Title:
[Name of Agent]
By______________________
Title:
25
<PAGE> 26
Exhibit A
The Hertz Corporation
(A Delaware corporation)
Medium-Term Notes and
Senior Subordinated Medium-Term Notes
The following terms, if applicable, shall be agreed to by the Agent
and the company pursuant to each Terms Agreement:
Senior Notes or Senior Subordinated Notes
Principal Amount: $____________
(or principal amount of foreign currency)
Interest Rate:
If Fixed Rate Note, Interest Rate:
If Floating Rate Note:
Interest Rate Basis:
Initial Interest Rate:
Initial Interest Reset Date:
Spread or Spread Multiplier, if any:
Interest Rate Reset Month(s):
Interest Payment Month(s):
Index Maturity:
Maximum Interest Rate, if any:
Minimum Interest Rate, if any:
Interest Rate Reset Period:
Interest Payment Period:
Interest Payment Date:
Calculation Agent:
If Redeemable:
Initial Redemption Date:
Initial Redemption Percentage:
Annual Redemption Percentage Reduction:
Date of Maturity:
Purchase Price: ___ %
Settlement Date and Time:
Currency of Denomination:
Denominations (if currency is other than U.S. dollar):
Currency of Payment:
Additional Terms:
Also, agreement as to whether the following will be required:
Officer's Certificate pursuant to Section 6(b)
of the Distribution Agreement.
Legal Opinion pursuant to Section 6(c) of the
Distribution Agreement.
Comfort Letter pursuant to Section 6(d) of the
Distribution Agreement.
<PAGE> 1
EXHIBIT 5
---------
June 17, 1994
The Hertz Corporation
225 Brae Boulevard
Park Ridge, New Jersey 07656
Dear Sirs:
As Senior Vice President and General Counsel of The Hertz Corporation, a
Delaware corporation ("Hertz"), I have examined or considered and am familiar
with the Certificate of Incorporation, as amended, of Hertz, the By-Laws, as
amended, of Hertz, and a telegram from the Secretary of State of the State of
Delaware as to the good standing of Hertz in Delaware. I am also familiar with
the corporate resolutions duly adopted by the Board of Directors of Hertz on
April 7, 1994 authorizing the filing with the Securities and Exchange Commission
of a Registration Statement on Form S-3 (the "Registration Statement") covering
a maximum of $1,000,000,000 aggregate principal amount of debt securities (the
"Securities") of Hertz issuable under one or more Indentures in such form and
with such terms and provisions as the Special Finance Committee of Hertz or the
officer executing the same may approve, and to be offered on a continuous or
delayed basis pursuant to Rule 415 under the Securities Act of 1933, as amended.
I have also examined originals or copies certified or otherwise identified to my
satisfaction of such corporate records and other documents as I have deemed
necessary or appropriate for purposes of this opinion.
Based on the foregoing, I am of the opinion that:
(1) Hertz is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware; and
(2) When the Board of Directors of Hertz or an authorized committee
thereof has designated the type, terms and amount of Securities to
be issued as contemplated by the Registration Statement, and such
Securities have been duly executed on behalf of Hertz,
authenticated by the Trustee under the applicable Indenture and
issued and paid for in accordance with the corporate proceedings
of said Board of Directors or authorized committee, the Securities
will constitute valid and binding obligations of Hertz in
accordance with their terms and will be entitled to the benefits
of the applicable Indenture (subject, as to the enforcement of
remedies, to the application of general principles of equity and
of bankruptcy, reorganization, fraudulent transfer, insolvency,
moratorium or other similar laws relating to or affecting
creditors' rights generally from time to time in effect).
I know that I am referred to under the heading "Legal Opinions" in the
Registration Statement on Form S-3 filed with the Securities and Exchange
Commission, and consent thereto and to the filing of this opinion by Hertz as an
Exhibit to the Registration Statement.
Very truly yours,
(signature)
Paul M. Tschirhart
Senior Vice President
and General Counsel
<PAGE> 1
EXHIBIT 23(a)
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation
by reference in this registration statement of our report dated February 7, 1994
included in The Hertz Corporation's Annual Report on Form 10-K for the year
ended December 31, 1993, and to all references to our Firm included in this
registration statement.
ARTHUR ANDERSEN & CO.
June 17, 1994
New York, New York
<PAGE> 1
EXHIBIT 25(a)
-------------
-------------------------------------------------------------------
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) ----
--------------------------------
CHEMICAL BANK
(Exact name of trustee as specified in its charter)
<TABLE>
<S> <C>
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)
</TABLE>
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)
-------------------------------------------------------
THE HERTZ CORPORATION
(Exact name of obligor as specified in its charter)
<TABLE>
<S> <C>
Delaware 13-1938568
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification No.)
225 Brae Boulevard
Park Ridge, New Jersey 07656-0713
(Address of principal executive offices) (Zip Code)
</TABLE>
-------------------------------------------
Debt Securities
(Title of the indenture securities)
------------------------------------------------------------
<PAGE> 2
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 and 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> 3
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 and December 2, 1991 (see Exhibit 1 to
Form T-1 filed in connection with Registration Statement No. 33-50010, 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).
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. 33-46892, 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).
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, Chemical 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 15TH day of JUNE, 1994.
CHEMICAL BANK
By /s/ T. C. Monahan
------------------------------
T. C. Monahan
Assistant Vice President
- 3 -
<PAGE> 4
Exhibit 7 to Form T-1
Bank Call Notice
RESERVE DISTRICT NO. 2
CONSOLIDATED REPORT OF CONDITION OF
Chemical 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 March 31, 1994, published 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 .................................. $ 5,741
Interest-bearing balances .......................... 3,768
Securities ............................................
Held to maturity securities............................ 7,503
Available for sale securities.......................... 15,662
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 ................................. 2,514
Securities purchased under agreements to resell .... 995
Loans and lease financing receivables:
Loans and leases, net of unearned income $61,140
Less: Allowance for loan and lease losses 2,315
Less: Allocated transfer risk reserve ... 115
------
Loans and leases, net of unearned income,
allowance, and reserve ............................. 58,710
Assets held in trading accounts ....................... 26,249
Premises and fixed assets (including capitalized
leases)............................................. 1,310
Other real estate owned ............................... 642
Investments in unconsolidated subsidiaries and
associated companies................................ 120
Customer's liability to this bank on acceptance
outstanding ........................................ 1,093
Intangible assets ..................................... 549
Other assets .......................................... 7,807
-----
TOTAL ASSETS .......................................... $132,663
=========
</TABLE>
- 4 -
<PAGE> 5
LIABILITIES
<TABLE>
<S> <C>
Deposits
In domestic offices ................................ $49,180
Noninterest-bearing .........................$16,896
Interest-bearing ............................ 32,284
------
In foreign offices, Edge and Agreement subsidiaries,
and IBF's .......................................... 25,612
Noninterest-bearing .........................$ 128
Interest-bearing ............................ 25,484
------
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 ............................ 10,710
Securities sold under agreements to repurchase ..... 1,789
Demand notes issued to the U.S. Treasury .............. 1,493
Trading liabilities ................................... 14,745
Other Borrowed money:
with original maturity of one year or less ......... 6,331
with original maturity of more than one year ....... 1,031
Mortgage indebtedness and obligations under capitalized
leases ............................................. 21
Bank's liability on acceptances executed and outstanding 1,096
Subordinated notes and debentures ..................... 3,500
Other liabilities ..................................... 9,562
TOTAL LIABILITIES ..................................... 125,070
-------
EQUITY CAPITAL
Common stock .......................................... 620
Surplus ............................................... 4,501
Undivided profits and capital reserves ................ 2,684
Less: Net unrealized loss on marketable equity
securities...................................... (210)
Cumulative foreign currency translation adjustments ... (2)
TOTAL EQUITY CAPITAL .................................. 7,593
------
TOTAL LIABILITIES, LIMITED-LIFE PREFERRED
STOCK AND EQUITY CAPITAL .......................... $132,663
==========
</TABLE>
I, Joseph L. Sclafani, S.V.P. & Controller of the
above-named bank, do hereby declare that this Report of
Condition is true and correct to the best of my knowledge
and belief.
JOSEPH L. SCLAFANI
We, the undersigned directors, attest to the correctness
of this statement of resources and liabilities. We
declare that it has been examined by us, and to the best
of our knowledge and belief has been prepared in confor-
mance with the instructions and is true and correct.
WALTER V. SHIPLEY )
EDWARD D. MILLER )DIRECTORS
WILLIAM B. HARRISON )
- 5 -
<PAGE> 1
EXHIBIT 25(b)
-------------
================================================================================
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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 BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
48 Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
--------------------
THE HERTZ CORPORATION
(Exact name of obligor as specified in its charter)
Delaware 13-1938568
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
225 Brae Boulevard
Park Ridge, New Jersey 07656-0713
(Address of principal executive offices) (Zip code)
--------------------
Debt Securities
(Title of the indenture securities)
================================================================================
<PAGE> 2
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.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
Name Address
- --------------------------------------------------------------------------------
<S> <C>
Superintendent of Banks of the State of 2 Rector Street, New York,
New York N.Y. 10006, and Albany, N.Y.
12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York,
N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20549
New York Clearing House Association New York, New York
</TABLE>
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
2. Affiliations with Obligor.
If the obligor is an affiliate of the trustee, describe each such affilia-
tion.
None. (See Note on page 3.)
16. List of Exhibits.
Exhibits identified in parentheses below, on file with the Commission, are
incorporated herein by reference as an exhibit hereto, pursuant to Rule
7a-29 under the Trust Indenture Act of 1939 (the "Act") and Rule 24 of the
Commission's Rules of Practice.
1. A copy of the Organization Certificate of The Bank of New York
(formerly Irving Trust Company) as now in effect, which contains the
authority to commence business and a grant of powers to exercise
corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1
filed with Registration Statement No. 33-6215, Exhibits 1a and 1b to
Form T-1 filed with Registration Statement No. 33-21672 and Exhibit 1
to Form T-1 filed with Registration Statement No. 33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1
filed with Registration Statement No. 33-31019.)
-2-
<PAGE> 3
6. The consent of the Trustee required by Section 321(b) of the Act.
(Exhibit 6 to Form T-1 filed with Registration Statement No.
33-44051.)
7. A copy of the latest report of condition of the Trustee published
pursuant to law or to the requirements of its supervising or examining
authority.
NOTE
Inasmuch as this Form T-1 is filed prior to the ascertainment by the
Trustee of all facts on which to base a responsive answer to Item 2, the answer
to said Item is based on incomplete information.
Item 2 may, however, be considered as correct unless amended by an
amendment to this Form T-1.
- 3 -
<PAGE> 4
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New
York, 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 14th day of June, 1994.
THE BANK OF NEW YORK
By: /s/MARY JANE MORRISSEY
----------------------------------
Name: Mary Jane Morrissey
Title: Assistant Vice President
-4-
<PAGE> 5
Exhibit 7
Consolidated Report of Condition of
THE BANK OF NEW YORK
of 48 Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System, at the close of business
March 31, 1994, published 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 Thousands
<S> <C>
Cash and balances due from depos-
itory institutions:
Noninterest-bearing balances and
currency and coin .................. $ 2,984,207
Interest-bearing balances .......... 652,882
Securities:
Held-to-maturity securities ........ 1,554,924
Available-for-sale securities ...... 2,323,498
Federal funds sold in domestic
offices of the bank ................ 861,621
Loans and lease financing
receivables:
Loans and leases, net of unearned
income .................25,419,340
LESS: Allowance for loan and
lease losses ..............736,749
LESS: Allocated transfer risk
reserve .....................29,510
Loans and leases, net of unearned
income, allowance, and reserve 24,653,081
Assets held in trading accounts ...... 2,269,729
Premises and fixed assets (including
capitalized leases) ................ 649,048
Other real estate owned .............. 63,724
Investments in unconsolidated
subsidiaries and associated
companies .......................... 166,985
Customers' liability to this bank on
acceptances outstanding ............ 1,068,405
Intangible assets .................... 83,775
-----------
Other assets ......................... 1,519,064
Total assets ......................... $38,850,943
===========
LIABILITIES
Deposits:
In domestic offices ................ $19,552,324
Noninterest-bearing .......7,628,562
Interest-bearing .........11,923,762
In foreign offices, Edge and
Agreement subsidiaries, and IBFs ... 9,092,181
Noninterest-bearing ..........58,771
Interest-bearing ..........9,033,410
Federal funds purchased and secu-
rities sold under agreements to re-
purchase in domestic offices of
the bank and of its Edge and
Agreement subsidiaries, and in
IBFs:
Federal funds purchased ............ 1,459,117
Securities sold under agreements
to repurchase .................... 95,459
Demand notes issued to the U.S.
Treasury ........................... 289,163
Trading liabilities .................. 968,864
Other borrowed money:
With original maturity of one year
or less .......................... 896,720
With original maturity of more than
one year ......................... 33,969
Bank's liability on acceptances exe-
cuted and outstanding .............. 1,069,639
Subordinated notes and debentures .... 1,064,780
Other liabilities .................... 1,368,384
-----------
Total liabilities .................... 35,890,600
-----------
EQUITY CAPITAL
Perpetual preferred stock and related
surplus ........................... 75,000
Common stock ........................ 942,284
Surplus ............................. 525,666
Undivided profits and capital
reserves .......................... 1,429,219
Net unrealized holding gains
(losses) on available-for-sale
securities ........................ ( 6,246)
Cumulative foreign currency transla-
tion adjustments .................. ( 5,580)
-----------
Total equity capital ................ 2,960,343
-----------
Total liabilities, limited-life pre-
ferred stock, and equity capital .. $38,850,943
===========
</TABLE>
I, Robert E. Keilman, Senior Vice President and Comptroller of
the above-named bank do hereby declare that this Report of
Condition has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and
is true to the best of my knowledge and belief.
Robert E. Keilman
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 instructions issued by the Board of Governors
of the Federal Reserve System and is true and correct.
)
Alan R. Griffith )
Thomas A. Renyi ) Directors
J. Carter Bacot )
)
<PAGE> 1
EXHIBIT 25(c)
-------------
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) -----
----------------------------------------
CITIBANK, N.A.
(Exact name of trustee as specified in its charter)
13-5266470
(I.R.S. employer
identification no.)
399 Park Avenue, New York, New York 10043
(Address of principal executive office) (Zip Code)
----------------------------------------
THE HERTZ CORPORATION
(Exact name of obligor as specified in its charter)
Delaware 13-1938568
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
225 Brae Boulevard
Park Ridge, New Jersey 07656-0713
(Address of Principal Executive Offices) (Zip Code)
----------------------------------------
Debt Securities
(Title of the indenture securities)
<PAGE> 2
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.
Name Address
Comptroller of the Currency, Washington, D.C.
Federal Reserve Bank of New York New York, NY
Federal Deposit Insurance Corporation Washington, D.C.
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. AFFILIATIONS WITH OBLIGOR.
If the obligor is an affiliate of the trustee, describe each
such affiliation.
None.
Item 16. LIST OF EXHIBITS.
Exhibit 1 - Copy of Articles of Association of the Trustee,
as now in effect. (Exhibit 1 to T-1 to Registration Statement
No. 2-79983)
Exhibit 2 - Copy of certificate of authority of the Trustee
to commence business.. (Exhibit 2 to T-1 to Registration
Statement No. 2-29577)
Exhibit 3 - Copy of authorization of the Trustee to exercise
corporate trust powers. (Exhibit 3 to T-1 to Registration
Statement No. 2-55519)
Exhibit 4 - Copy of existing By-Laws of the Trustee.
(Exhibit 4 to T-1 to Registration Statement No. 33-34988)
Exhibit 5 - Not applicable.
Exhibit 6 - The consent of the Trustee required by Section
321(b) of the Trust Indenture Act of 1939. (Exhibit 6 to T-1
to Registration Statement No. 33-19227.)
<PAGE> 3
Exhibit 7 - Copy of the latest Report of Condition of
Citibank, N.A (as of March 31, 1993 - attached).
Exhibit 8 - Not applicable.
Exhibit 9 - Not applicable.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, the
Trustee, Citibank, N.A., a national banking association organized and existing
under the laws of the United States of America, has duly caused this statement
of eligibility to be signed on its behalf by the undersigned, thereunto duly
authorized, all in The City of New York and State of New York, on the 14th day
of June, 1994.
CITIBANK, N.A.
By /s/Eugene J. Jaworski
--------------------
Eugene J. Jaworski
Vice President
3
<PAGE> 4
Charter No. 1461
Comptroller of the Currency
Northeastern District
REPORT OF CONDITION
CONSOLIDATING
DOMESTIC AND FOREIGN
SUBSIDIARIES OF
CITIBANK, N. A.
OF NEW YORK IN THE STATE OF NEW YORK, AT THE CLOSE OF
BUSINESS ON MARCH 31, 1994, PUBLISHED IN RESPONSE
TO CALL MADE BY COMPTROLLER OF THE CURRENCY, UNDER
TITLE 12. UNITED STATES CODE, SECTION 161. CHARTER
NUMBER 1461 COMPTROLLER OF THE CURRENCY NORTH-
EASTERN DISTRICT.
<TABLE>
<CAPTION>
ASSETS
THOUSANDS
OF DOLLARS
<S> <C> <C>
Cash and balances due from de-
pository institutions:
Noninterest-bearing balances
and currency and coin . . . . . . . . . . . . . . . . . . . . . . . . . $6,452,000
Interest-bearing balances . . . . . . . . . . . . . . . . . . . . . . . 7,339,000
Securities:
Held-to-maturity securities . . . . . . . . . . . . . . . . . . . . . . 3,923,000
Available-for-sale securities . . . . . . . . . . . . . . . . . . . . . 9,604,000
Federal funds sold and securities
purchased under agreements to
resell in domestic offices of the
bank and of its Edge and Agree-
ment subsidiaries, and in IBFs:
Federal funds sold . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,416,000
Securities purchased under
agreements to resell . . . . . . . . . . . . . . . . . . . . . . . . . . 3,128,000
Loans and lease financing receiv-
ables:
Loans and leases net of un-
earned income . . . . . . . . . . . . . . . $116,456,000
LESS: Allowance for loan
and lease losses . . . . . . . . . . . . . 3,578,000
------------
Loans and leases, net of un-
earned income and allowance . . . . . . . . . . . . . . . . . . . . . . 112,878,000
Assets held in trading accounts . . . . . . . . . . . . . . . . . . . . . . . . . 38,412,000
Premises and fixed assets (includ-
ing capitalized leases) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,107,000
Other real estate owned . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,170,000
Investments in unconsolidated
subsidiaries and associated com-
panies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,008,000
Customers' liability to this bank
on acceptances outstanding . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,368,000
Intangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15,000
Other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,397,000
------------
TOTAL ASSETS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $199,217,000
============
LIABILITIES
Deposits:
In domestic offices . . . . . . . . . . . . . . . . . . . . . . . . . . $ 34,936,000
Noninterest-
bearing . . . . . . . . . . . . . . $12,668,000
Interest-
bearing . . . . . . . . . . . . . . 22,268,000
----------
In foreign offices, Edge and
Agreement subsidiaries, and
IBFs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100,380,000
Noninterest-
bearing . . . . . . . . . . . . . . $ 6,932,000
Interest-
bearing . . . . . . . . . . . . . . 93,448,000
----------
Federal funds purchased and se-
curities sold under agreements
to repurchase in domestic offices
of the bank and of its Edge and
Agreement subsidiaries, and in
IBFs:
Federal funds purchased . . . . . . . . . . . . . . . . . . . . . . . . 2,556,000
Securities sold under agree-
ments to repurchase . . . . . . . . . . . . . . . . . . . . . . . . . . 1,568,000
Trading liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21,074,000
Other borrowed money:
With original maturity of one
year or less . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,837,000
With original maturity of more
than one year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,844,000
Mortgage indebtedness and obli-
gations under capitalized leases . . . . . . . . . . . . . . . . . . . . . . . . 220,000
Bank's liability on acceptances ex-
ecuted and outstanding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,386,000
Notes and debentures subordi-
nated to deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,700,000
Other liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,121,000
------------
TOTAL LIABILITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $187,622,000
------------
EQUITY CAPITAL
Common stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 751,000
Surplus . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,928,000
Undivided profits and capital re-
serves . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,373,000
Net unrealized holding gains (losses)
on available-for-sale securities . . . . . . . . . . . . . . . . . . . . . . . . 191,000
Cumulative foreign currency
translation adjustments . . . . . . . . . . . . . . . . . . . . . . . . . . . . (648,000)
------------
TOTAL EQUITY CAPITAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 11,595,000
------------
TOTAL LIABILITIES AND
EQUITY CAPITAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $199,217,000
============
</TABLE>
I, Roger W. Trupin, Controller of the above-
named bank do hereby declare that this
Report of Condition is true and correct to the
best of my knowledge and belief.
ROGER W. TRUPIN
We, the undersigned directors, attest to
the correctness of this Report of Condition.
We declare that it has been examined by us,
and to the best of our knowledge and belief
has been prepared in conformance with the
instructions and is true and correct.
PAUL J. COLLINS )
PEPYUAN CHIA ) Directors
CHRISTOPHER J. STEFFEN )
