<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
MARCH 7, 1996
Date of Report (Date of earliest event reported)
HOUGHTON MIFFLIN COMPANY
(Exact name of Registrant as specified in its charter)
MASSACHUSETTS 1-5406 04-1456030
(State or other jurisdiction (Commission File Number) (I.R.S. Employer
or incorporation) Identification Number)
222 BERKELEY STREET
BOSTON, MA 02116
(617) 351-5000
(Address including zip code and telephone number
including area code of Registrant's principal
executive offices)
<PAGE> 2
INFORMATION INCLUDED IN THE REPORT
Item 5. Other Events
On March 6, 1996, Houghton Mifflin Company (the "Company") commenced a
program for the offer of Medium-Term Notes due from nine months to thirty years
from the date of issuance ("Medium-Term Notes") in the principal amount of up to
$175,000,000. The Medium-Term Notes are part of the $300,000,000 in debt
securities registered by the Company pursuant to a Registration Statement, as
amended ("Registration Statement"), filed with the Securities and Exchange
Commission ("Commission") on Form S-3 (Registration No. 33-64903) pursuant to
Rule 415 promulgated by the Commission under the Securities Act of 1933, as
amended (the "Act"). A Prospectus Supplement dated March 6, 1996 and Prospectus
dated January 5, 1996 relating to the Medium-Term Notes has been filed with the
Commission pursuant to Rule 424(b) under the Act. The issuance and sale of the
Medium-Term Notes may be made from time to time in various amounts with varying
terms pursuant to an Indenture dated as of March 15, 1994, as supplemented by a
First Supplemental Indenture dated as of July 27, 1995 (together, the
"Indenture") between the Company and State Street Bank and Trust Company, as
successor trustee (herein called the "Trustee," which term includes any
successor trustee under the Indenture) to The First National Bank of Boston. The
form of the Indenture was previously filed as an exhibit to the Company's
Registration Statement on Form S-3 (Registration No. 33-51700). The form of the
First Supplemental Indenture was previously filed as an exhibit to the Company's
Registration Statement.
The Medium-Term Notes will be distributed pursuant to a Distribution
Agreement among the Company and certain agents. The form of the Distribution
Agreement is attached hereto as Exhibit 1 and incorporated by reference herein.
The Medium-Term Notes may bear fixed or floating rates of interest and will be
issued substantially in the forms attached hereto as Exhibits 4.1 and 4.2,
respectively, and incorporated by reference herein. State Street Bank and Trust
Company (the "Calculation Agent") may perform certain services in connection
with the issuance of Medium-Term Notes bearing floating rates of interest, if
any, pursuant to a Calculation Agent Agreement between the Company and the
Calculation Agent. The form of the Calculation Agent Agreement is attached
hereto as Exhibit 4.3 and incorporated by reference herein.
Item 7. Financial Statements and Exhibits
(c) Exhibits
1 Form of Distribution Agreement.
4.1 Form of Fixed Rate Medium-Term Note.
4.2 Form of Floating Rate Medium-Term Note.
4.3 Form of Calculation Agent Agreement.
<PAGE> 3
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
HOUGHTON MIFFLIN COMPANY
By: /s/ Nader F. Darehshori
------------------------
Nader F. Darehshori
Chairman of the Board, President and Chief
Executive Officer
DATE: March 7, 1996
2
<PAGE> 4
<TABLE>
INDEX TO EXHIBITS
<CAPTION>
SEQUENTIALLY
EXHIBIT NUMBERED
- ------- PAGE
----
<S> <C>
1 Form of Distribution Agreement.............................
4.1 Form of Fixed Rate Medium-Term Note........................
4.2 Form of Floating Rate Medium-Term Note.....................
4.3 Form of Calculation Agent Agreement. ......................
</TABLE>
3
<PAGE> 1
Exhibit 1
HOUGHTON MIFFLIN COMPANY
$175,000,000
Medium-Term Notes
Due from 9 Months to 30 Years from Date of Issue
DISTRIBUTION AGREEMENT
March 6, 1996
J.P. MORGAN SECURITIES INC.
60 Wall Street
New York, New York 10260
CS FIRST BOSTON CORPORATION
Park Avenue Plaza
55 East 52nd Street
New York, New York 10055
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Merrill Lynch World Headquarters
World Financial Center
North Tower, 10th Center
New York, New York 10281-1310
Ladies and Gentlemen:
Houghton Mifflin Company, a Massachusetts corporation (the "Company"),
confirms its agreement with each of you with respect to the issuance and sale
from time to time by the Company of its Medium-Term Notes due from 9 months to
30 years from date of issue (the "Securities") in an aggregate initial offering
price of up to $175,000,000 and agrees with each of you (individually, an
"Agent", and collectively, the "Agents", which term shall include any additional
agents appointed pursuant to Section 13 hereof) as set forth in this Agreement.
The Securities will be issued under the Indenture dated as of March 15, 1994, as
supplemented by the First Supplemental Indenture dated as of July 27, 1995
(together, the "Indenture"), between the Company and State Street Bank and Trust
Company (the "Trustee"), as successor trustee to The First National Bank of
Boston. The Securities shall have the maturities, interest rates, redemption
provisions, if any, and other terms set forth in the Prospectus (as hereinafter
defined) as it may be amended or supplemented from time to time. The Securities
will be issued, and the terms and rights thereof established, from time to time
by the Company in accordance with the Indenture.
<PAGE> 2
On the basis of the representations and warranties herein contained, but
subject to the terms and conditions stated herein and to the reservation by the
Company of the right (A) to sell Securities directly to investors (other than
broker-dealers) on its own behalf and (B) to accept (but not solicit) offers to
purchase Securities from time to time through one or more additional agents or
dealers, acting as either principal or agent, on substantially the same terms
(including, but not limited to, the commission schedule set forth in Section
2(a) hereof) as those applicable to sales of Securities to or through the Agents
pursuant to this Agreement, the Company hereby (i) appoints the Agents as the
exclusive agents of the Company for the purpose of soliciting and receiving
offers to purchase the Securities from the Company by others pursuant to Section
2(a) hereof and (ii) agrees that, except as otherwise contemplated herein,
whenever it determines to sell the Securities directly to any Agent as
principal, it will enter into a separate agreement, which may be oral, confirmed
in writing by the applicable Agent (each such agreement a "Terms Agreement"),
substantially in the form of Exhibit A hereto, relating to such sale in
accordance with Section 2(b) hereof. In connection with the Company's
reservation pursuant to clause (B) above, it is understood that the Company may
respond to inquiries and requests for information from any such agents or
dealers.
The Company has prepared and filed a registration statement on Form S-3
(Registration Statement No. 33-64903) in respect of the Securities with the
Securities and Exchange Commission (the "Commission") in accordance with the
provisions of the Securities Act of 1933, as amended, and the rules and
regulations of the Commission thereunder (collectively, the "Securities Act").
The Company has also filed with, or proposes to file with, the Commission
pursuant to Rule 424 under the Securities Act supplements to the prospectus
included in the Registration Statement that will describe certain terms of the
Securities. The registration statement, including the exhibits thereto, as
amended to the Commencement Date (as hereinafter defined) is referred to herein
as the "Registration Statement" and the prospectus in the form in which it
appears in the Registration Statement is hereinafter referred to as the "Basic
Prospectus". The Basic Prospectus as supplemented by the prospectus supplement
or supplements (each a "Prospectus Supplement") specifically relating to the
Securities in the form filed with, or transmitted for filing to, the Commission
pursuant to Rule 424 under the Securities Act is hereinafter referred to as the
"Prospectus". Any reference in this Agreement to the Registration Statement, the
Basic Prospectus, any preliminary form of Prospectus (a "preliminary
prospectus") previously filed with the Commission pursuant to Rule 424 or the
Prospectus shall be deemed to refer to and include the documents incorporated by
reference therein pursuant to Item 12 of Form S-3 under the Securities Act which
were filed by the Company under the Securities Exchange Act of 1934, as amended,
and the rules and regulations of the Commission thereunder (collectively, the
"Exchange Act"), on or before the date of this Agreement or the date of the
Basic Prospectus, any preliminary prospectus or the Prospectus, as the case may
be; and any reference to "amend", "amendment" or "supplement" with respect to
the Registration Statement, the Basic Prospectus, any preliminary prospectus or
the Prospectus, including any supplement to the Prospectus that sets forth only
the terms of a particular issue of the Securities (a "Pricing Supplement"),
shall be deemed to refer to and include any documents filed under the Exchange
Act after the date of this Agreement, or the date of the Basic Prospectus, any
preliminary prospectus or the Prospectus, as the case may be, which are deemed
to be incorporated by reference therein.
2
<PAGE> 3
1. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company represents
and warrants to, and agrees with, each Agent as of the Commencement Date, as of
each date on which the Company accepts an offer to purchase Securities
(including any purchase by an Agent as principal pursuant to a Terms Agreement
or otherwise), as of each date the Company issues and sells Securities and as of
each date the Registration Statement or the Basic Prospectus is amended or
supplemented, as follows (it being understood that such representations and
warranties shall be deemed to relate to the Registration Statement, the Basic
Prospectus and the Prospectus, each as amended or supplemented to each such
date):
(a) The Registration Statement including the Prospectus has been filed
with the Commission and has been declared effective under the Securities
Act; no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceeding for that purpose has been
instituted or, to the Company's best knowledge, threatened by the
Commission.
(b) On the effective date of the Registration Statement, each of the
Registration Statement and the Basic Prospectus (as amended or supplemented
if the Company shall have furnished any amendments or supplements thereto)
conformed in all material respects to the requirements of the Securities
Act and the Trust Indenture Act of 1939, as amended, and the rules and
regulations of the Commission thereunder (collectively, the "Trust
Indenture Act"), and did not include 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, and on the date of
each Terms Agreement and the closing thereunder (the date of such closing
being hereinafter referred to as the "Closing Date"), the Registration
Statement and the Prospectus (as amended or supplemented if the Company
shall have furnished any amendments or supplements thereto) will conform in
all material respects to the requirements of the Securities Act and the
Trust Indenture Act, and neither of such documents will include 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, except that the foregoing does not apply to (i) that part of
the Registration Statement which constitutes the Statement of Eligibility
and Qualification (Form T-1) under the Trust Indenture Act of the Trustee
and (ii) except that the foregoing does not apply to statements in or
omissions from any of such documents based upon written information
furnished to the Company by any Agent specifically for use therein.
(c) The documents incorporated by reference in the Registration
Statement or the Prospectus, when they became effective or when they were
filed with the Commission, as the case may be, under the Exchange Act,
conformed, and any documents so filed and incorporated before the Closing
Date will, when they are filed with the Commission, conform, in all
material respects to the requirements of the Exchange Act, as applicable,
and none of such documents contained an untrue statement of a material fact
or omitted to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading.
3
<PAGE> 4
(d) The financial statements, and the related notes and schedules
thereto, included or incorporated by reference in the Registration
Statement and the Prospectus present fairly the consolidated financial
position of the Company and its consolidated subsidiaries as of the dates
indicated and the results of their operations and the changes in their
consolidated cash flows for the periods specified; such financial
statements have been prepared in conformity with generally accepted
accounting principles applied on a consistent basis except, in the case of
interim unaudited financial statements, for normal recurring year-end
adjustments, and the supporting schedules included or incorporated by
reference in the Registration Statement present fairly the information
required to be stated therein; the pro forma financial information, and the
related notes thereto, included or incorporated by reference in the
Registration Statement and the Prospectus have been prepared in all
material respects in accordance with the applicable requirements of the
Exchange Act; and the selected and summary financial data included in the
Registration Statement present fairly the information shown therein and
have been compiled on a basis substantially consistent with the financial
statements presented therein; the pro forma adjustments reflected in the
pro forma consolidated financial information included in the Prospectus
have been properly applied to the historical amounts in the compilation of
such information and provide a reasonable basis for presenting the
significant effects of the acquisition of D.C. Heath and Company and the
financing of such acquisition; and no other financial statements or
schedules or notes are required to be included in the Registration
Statement.
(e) Subsequent to the respective dates as of which information is
given in the Registration Statement and the Prospectus, there has not been
or occurred (i) any change, nor, to the knowledge of the Company, any
development or event involving a prospective change in the business,
property or assets described or referred to in the Registration Statement,
or the condition (financial or otherwise), earnings, prospects or results
of operations or business of the Company which could have a material
adverse effect on the condition (financial or otherwise), earnings,
prospects or results of operations or business of the Company and its
subsidiaries taken as a whole (a "Material Adverse Effect"), (ii) any
transaction which is material to the Company and its subsidiaries taken as
a whole, except transactions in the ordinary course of business, (iii) any
obligation, direct or contingent, incurred by the Company which is material
to the Company and its subsidiaries taken as a whole, except obligations
incurred in the ordinary course of business, (iv) any change in the capital
stock or outstanding indebtedness of the Company which is material to the
Company and its subsidiaries taken as a whole or (v) any dividend or
distribution of any kind declared, paid or made on the capital stock of the
Company (other than any regularly scheduled quarterly dividend), which in
any such case is not described in the Registration Statement or the
Prospectus as amended or supplemented.
(f) The Company and each of its significant subsidiaries (as defined
in Rule 405 under the Securities Act and hereinafter referred to as, the
"subsidiaries") have been duly incorporated and are validly existing as
corporations in good standing under the laws of their respective
jurisdictions of incorporation with full corporate power and corporate
authority to own, lease and operate their respective properties and
4
<PAGE> 5
conduct their respective businesses as described in the Registration
Statement; and the Company and each of its subsidiaries are duly qualified
to do business as foreign corporations and are in good standing in each
jurisdiction in which their respective ownership or lease of property or
the conduct of their respective businesses requires such qualification,
except where the failure to be so qualified would not have a Material
Adverse Effect.
(g) Each of this Agreement and any other applicable Terms Agreement
has been duly authorized, executed and delivered by the Company and is a
valid and binding agreement of the Company, except as the indemnification
and contribution provisions hereunder and thereunder may be limited by
applicable law and except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance
or other similar laws relating to or affecting creditors' rights generally
or by general equitable principles.
(h) The Indenture has been duly authorized, executed and delivered by
the Company; the Securities to be purchased from the Company hereunder have
been duly authorized for issuance and sale pursuant to this Agreement; the
Indenture has been duly qualified under the Trust Indenture Act; and the
Indenture constitutes and the Securities (when they are duly executed,
authenticated and issued as contemplated hereby and by the Indenture and
delivered against payment therefor in accordance with the terms of this
Agreement) will constitute valid and legally binding obligations of the
Company enforceable in accordance with their respective terms, subject to
bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance
or other similar laws affecting creditors' rights generally or by general
equitable principles.
(i) Except as set forth in the Prospectus, there is no pending or, to
the Company's knowledge, threatened action, suit, claim or proceeding by or
before any court or governmental agency, authority or body or otherwise
against the Company or any of its subsidiaries or any of their respective
officers or any of their respective properties, assets or rights which
would or could reasonably be expected to have a Material Adverse Effect or
prevent consummation of the transactions contemplated herein.
(j) The Securities conform in all material respects to the statements
relating thereto contained in the Registration Statement and the Prospectus
(and such statements correctly state the substance of the instruments
defining the obligations of the Company in all material respects).
(k) Neither the Company nor any of its subsidiaries (i) is in
violation of their respective charter or by-laws, (ii) is in default, and
no event has occurred which, with notice or lapse of time or both, would
constitute a breach or default, in the due performance or observance of any
term, covenant or condition contained in any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument to which they are
parties or by which they are bound or to which any of their respective
properties or assets are subject or (iii) is in violation of any law,
ordinance, governmental rule, regulation or court decree to which they or
their respective prop-
5
<PAGE> 6
erty or assets may be subject or have failed to obtain, comply with or
maintain the effectiveness of any license, permit, certificate, franchise
or other governmental authorization or permit necessary to the ownership of
their respective property or to the conduct of their respective businesses
except, in the case of clauses (ii) and (iii), for those defaults,
violations or failures which, either individually or in the aggregate,
would not or could not reasonably be expected to have a Material Adverse
Effect.
(l) The execution, delivery and performance of this Agreement, any
Terms Agreement and the Indenture by the Company and the consummation of
the transactions herein and therein contemplated, including without
limitation the issuance and sale of the Securities, will not result in a
breach or violation of any of the terms and provisions of, or constitute a
default under: (i) the charter or by-laws of the Company or any subsidiary;
(ii) any material indenture, mortgage, deed of trust, loan agreement, bond,
debenture, note or other evidence of indebtedness or any material lease,
contract or other agreement or instrument to which the Company or any
subsidiary is a party or by which it or any such subsidiary or any of their
respective properties may be bound; or (iii) any law or any order, rule or
regulation of any governmental agency or body or any court having
jurisdiction over the Company or any subsidiary or over the properties of
the Company or any such subsidiary.
(m) No consent, approval, authorization or order of, or filing with,
any governmental agency or body or any court is required for the execution,
delivery and performance of this Agreement, any Terms Agreement and the
Indenture in connection with the issuance or sale of the Securities by the
Company or the consummation by the Company of the transactions contemplated
by this Agreement, except such as may be required under the Securities Act,
the Exchange Act, the Trust Indenture Act or under state or other
securities or Blue Sky laws, rules and regulations.
(n) The Company has full legal right, corporate power and corporate
authority to enter into this Agreement and the Terms Agreement and perform
the transactions contemplated hereby and thereby; this Agreement and the
Terms Agreement have been duly authorized, executed and delivered by the
Company and are valid and biding agreements of the Company, enforceable
against the Company in accordance with their respective terms, except as
the indemnification and contribution provisions hereunder and thereunder
may be limited by applicable law and except as enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium,
fraudulent conveyance or other similar laws relating to or affecting
creditors' rights generally or by general equitable principles.
(o) There are no contracts, agreements or understandings between the
Company and any person granting such person any preemptive right, co-sale
right, right of first refusal or right to require the Company to file a
registration statement under the Securities Act with respect to any
securities of the Company owned or to be owned by such person required to
be described in the Prospectus which are not described in the Prospectus
or, except as described in the Prospectus, to require the Company to
include such securities in the Securities registered pursuant to the Regis-
6
<PAGE> 7
tration Statement or in any securities being registered pursuant to any
other registration statement filed by the Company under the Securities Act.
(p) Ernst & Young LLP ("Ernst & Young") (who have audited the
financial statements, together with the related schedules and notes, of the
Company filed with the Commission as a part of the Registration Statement,
some of which are included in the Prospectus) are, to the best of the
Company's knowledge, independent accountants within the meaning of the
Securities Act.
(q) The Company is not, and after giving effect to the offering and
sale of the Securities and the application of the proceeds as described in
the Prospectus, will not be required to be, registered as an "investment
company" as such term is defined under the Investment Company Act of 1940,
as amended.
(r) The Company and its subsidiaries own or possess adequate rights to
use all material trademarks, service marks, trade names and copyrights
described or referred to in the Prospectus as owned or used by it or which
are necessary for the conduct of its business as described in the
Prospectus; the Company has not received any notice of infringement of or
conflict with asserted rights of others with respect to any patents, patent
rights, inventions, trade secrets, know-how, trademarks, service marks,
trade names or copyrights which, singly or in the aggregate, if the subject
of an unfavorable decision, ruling or finding, would have a Material
Adverse Effect.
(s) The Company will comply with all agreements on its part to be
complied with, and use all reasonable efforts to satisfy all conditions on
its part to be satisfied, pursuant to this Agreement on or prior to the
Closing Date, as the case may be.
(t) As of the date hereof, the Company is in compliance with all
provisions of Section 1 of the Laws of Florida, Chapter 92-198, AN ACT
RELATING TO DISCLOSURE OF DOING BUSINESS WITH CUBA, and if the Company
commences engaging in business with the government of Cuba or with any
person or affiliate located in Cuba after the date the Registration
Statement becomes or has become effective with the Commission or with the
Florida Department of Banking and Finance (the "Department"), whichever
date is later, or if the information reported in the Prospectus, if any,
concerning the Company's business with Cuba or with any person or affiliate
located in Cuba changes in any material way, the Company will provide the
Department notice of such business or change, as appropriate, in a form
acceptable to the Department.
(u) Immediately after any sale of Securities by the Company hereunder
or under any applicable Terms Agreement, the aggregate amount of Securities
which shall have been issued and sold by the Company hereunder or under any
Terms Agreement and of any debt securities of the Company (other than the
Securities) that shall have been issued and sold pursuant to the
Registration Statement will not exceed the amount of debt securities
registered under the Registration Statement.
7
<PAGE> 8
2. SOLICITATIONS AS AGENT; PURCHASES AS PRINCIPAL.
(a) Solicitations as Agent. On the basis of the representations and
warranties herein contained, but subject to the terms and conditions herein
set forth, each of the Agents hereby severally and not jointly agrees, as
agent of the Company, to use its reasonable efforts to solicit offers to
purchase the Securities from the Company upon the terms and conditions set
forth in the Prospectus, as amended or supplemented from time to time. So
long as this Agreement shall remain in effect with respect to any Agent,
the Company shall not, without the consent of such Agent, solicit or accept
offers to purchase, or sell, the Securities or any other debt securities
with a maturity at the time of original issuance of 9 months to 30 years,
except pursuant to this Agreement and any Terms Agreement, or except
pursuant to a private placement not constituting a public offering under
the Securities Act or except in connection with a firm commitment
underwriting pursuant to an underwriting agreement that does not provide
for a continuous offering of medium-term debt securities. However, the
Company reserves the right (i) to sell, and may solicit and accept offers
to purchase, the Securities directly on its own behalf to investors (other
than broker-dealers) and (ii) to accept (but not solicit) offers to
purchase Securities from time to time through one or more additional agents
or dealers, acting as either principal or agent, on substantially the same
terms as those applicable to sales of Securities to or though the Agents
pursuant to this Agreement; provided, that the Company shall provide the
Agents with written notice of each such acceptance within two business days
thereof. In connection with the Company's reservation pursuant to clause
(ii) above, it is understood that the Company may respond to inquiries and
requests for information from any such agents or dealers. No commission
will be paid on Securities sold directly by the Company pursuant to clause
(i) above.
The Company reserves the right, in its sole discretion, to instruct
the Agents to suspend at any time, for any period of time or permanently,
the solicitation of offers to purchase the Securities. Upon receipt of at
least one business day's prior notice from the Company, each Agent will
suspend solicitation of offers to purchase the Securities from the Company
until such time as the Company has advised such Agent or Agents that such
solicitation may be resumed. During the period of time that such
solicitation is suspended, the Company shall not be required to deliver any
opinions, letters or certificates in accordance with Sections 4(f), 4(j),
4(k) and 4(l); provided, that if the Registration Statement or Prospectus
is amended or supplemented during the period of suspension (other than by
an amendment or supplement providing solely for a change in the interest
rates, redemption provisions, amortization schedules or maturities offered
for the Securities or for a change that the Agents deem to be immaterial),
no Agent shall be required to resume soliciting offers to purchase the
Securities until the Company has delivered such opinions, letters and
certificates as such Agent may reasonably request.
The Company agrees to pay each Agent, as consideration for the sale of
each Security resulting from a solicitation made or an offer to purchase
received by such Agent, a commission in the form of a discount from the
purchase price of such
8
<PAGE> 9
Security in an amount equal to the following applicable percentage of the
principal amount of such Security sold:
<TABLE>
<CAPTION>
COMMISSION PERCENTAGE
OF AGGREGATE PRINCIPAL
RANGE OF MATURITIES AMOUNT OF SECURITIES SOLD
<S> <C>
From 9 months to less than 1 year....................................... .125%
From 1 year to less than 18 months...................................... .150%
From 18 months to less than 2 years..................................... .200%
From 2 years to less than 3 years....................................... .250%
From 3 years to less than 4 years....................................... .350%
From 4 years to less than 5 years....................................... .450%
From 5 years to less than 6 years....................................... .500%
From 6 years to less than 7 years....................................... .550%
From 7 years to less than 10 years...................................... .600%
From 10 years to less than 15 years..................................... .625%
From 15 years to less than 20 years.................................... .700%
From 20 years to and including 30 years ................................ .750%
</TABLE>
The Agents are authorized to solicit offers to purchase the Securities
only in the principal amount of $1,000 or any amount in excess thereof
which is an integral multiple of $1,000. Each Agent shall communicate to
the Company, orally or in writing, each offer to purchase Securities
received by such Agent as agent that in its judgment should be considered
by the Company. The Company shall have the sole right to accept offers to
purchase the Securities and may reject any such offer in whole or in part.
Each Agent shall have the right, in its sole discretion, to reject any
offer to purchase Securities, as a whole or in part, that it considers to
be unacceptable and any such rejection shall not be deemed a breach of its
agreements herein contained. The procedural details relating to the issue
and delivery of Securities sold by an Agent as agent and the payment
therefor are set forth in the Administrative Procedures (as hereinafter
defined).
(b) Purchase as Principal. Each sale of Securities to any Agent as
principal shall be made in accordance with the terms of this Agreement and
(unless such Agent shall otherwise agree) a Terms Agreement which will
provide for the sale of such Securities to, and the purchase thereof by,
such Agent. A Terms Agreement will be substantially in the form of Exhibit
A hereto but may take the form of an exchange of any standard form of
written telecommunication between an Agent and the Company and may also
specify certain provisions relating to the reoffering of such Securities by
such Agent. The commitment of any Agent to purchase Securities as
principal, whether pursuant to any Terms Agreement or otherwise, 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 and in the applicable Terms Agreement set forth. Each
agreement by an Agent to purchase Securities as principal (pursuant to a
Terms Agreement or otherwise) shall specify the principal amount of
Securities to be purchased by such Agent pursuant thereto, the price to be
9
<PAGE> 10
paid to the Company for such Securities, the maturity date of such
Securities, the interest rate or interest rate basis, if any, applicable to
such Securities, any other terms of such Securities, the time and date and
place of delivery of and payment for such Securities (the time and date of
any and each such delivery and payment is referred to herein as the "Time
of Delivery"), any provisions relating to rights of, and default by,
underwriters acting together with such Agent in the reoffering of
Securities, and shall also specify any requirements for opinions of
counsel, accountants' letters and officers' certificates pursuant to
Section 4 hereof. Unless otherwise specified in a Terms Agreement, the
procedural details relating to the issue and delivery of Securities
purchased by an Agent as principal and the payment therefore shall be as
set forth in the Administrative Procedures.
(c) Obligations Several. The Company acknowledges that the obligations
of the Agents are several and not joint and, subject to the provisions of
this Section 2, each Agent shall have complete discretion as to the manner
in which it solicits purchasers for the Securities and as to the identity
thereof.
(d) Administrative Procedures. The Agents and the Company agree to
perform their respective duties and obligations specifically provided to be
performed in the Medium-Term Notes Administrative Procedures (the
"Administrative Procedures") attached hereto as Exhibit B, as the same may
be amended from time to time. The Administrative Procedures may be amended
only by written agreement of the Company and the Agents.
3. COMMENCEMENT DATE. The documents required to be delivered pursuant to
Section 6 hereof on the Commencement Date shall be delivered to the Agents at
the offices of Skadden, Arps, Slate, Meagher & Flom, Boston, Massachusetts, at
11:00 a.m., New York City time, on the date of this Agreement, which date and
time of such delivery may be postponed by agreement between the Agents and the
Company but in no event shall be later than the business day prior to the date
on which solicitation of offers to purchase Securities is commenced or the first
date on which the Company accepts an offer by any Agent to purchase Securities
as principal (such time and date of delivery being referred to herein as the
"Commencement Date").
4. COVENANTS OF THE COMPANY. The Company covenants and agrees with each
Agent:
(a) to file the Prospectus with the Commission pursuant to and in
accordance with Rule 424(b)(2) (or, if applicable and if consented to by
the Agents, subparagraph (5)) not later than the second business day
following the execution and delivery of the Terms Agreement. The Company
will advise the Agents promptly (but in no case later than the due date
thereof, including any extensions) of any such filing pursuant to Rule
424(b). The Company will also promptly file all reports and any definitive
proxy or information statements required to be filed by the Company with
the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the
Exchange Act for so long as the delivery of a prospectus is required in
connection with the offering or sale of the Securities;
10
<PAGE> 11
(b) prior to the completion of the distribution of the Securities, to
(i) advise the Agents promptly of any proposal to amend or supplement the
Registration Statement or the Prospectus (other than any amendment or
supplementation resulting solely from the incorporation by reference in the
Prospectus of documents filed subsequent to the date of the Prospectus
under the Exchange Act); (ii) afford the Agents a reasonable opportunity to
comment on any such proposed amendment or supplement; (iii) not effect such
amendment or supplementation (other than any document required to be filed
under the Exchange Act which, upon filing, is deemed to be incorporated by
reference therein) unless the Agents shall have reasonably objected to such
amendment or supplementation; and (iv) advise the Agents promptly of the
filing of any such amendment or supplement or the receipt by the Company of
any notification with respect to any suspension of the qualification of the
Securities for offering or sale in any jurisdiction, of the initiation or
threatening of any proceeding for any such purpose and of the institution
by the Commission of any stop order proceedings in respect of the
Registration Statement or of any part thereof and will use its best efforts
to prevent the issuance of any such stop order and to obtain as soon as
possible its lifting, if issued. If the Basic Prospectus is amended or
supplemented as a result of the filing under the Exchange Act of any
document incorporated by reference in the Prospectus, no Agent shall be
obligated to solicit offers to purchase Securities so long as it is not
reasonably satisfied with such document;
(c) to endeavor to qualify the Securities for offer and sale under the
securities or Blue Sky laws of such jurisdictions as the Agents shall
reasonably request and to continue such qualification in effect so long as
reasonably required in connection with the distribution of the Securities
and to pay all fees and expenses (including fees and disbursements of
counsel to the Agents) reasonably incurred in connection with such
qualification and in connection with the determination of the eligibility
of the Securities for investment under the laws of such jurisdictions as
such Agent may designate; provided, that the Company shall not be required
to file a general consent to service of process in any jurisdiction or to
qualify as a foreign corporation in any jurisdiction in which it is not so
qualified;
(d) to furnish to each Agent copies of the Registration Statement,
including all exhibits thereto, any related preliminary prospectus, any
related preliminary prospectus supplement, all amendments and supplements
to such documents and all documents incorporated by reference therein and,
during the period mentioned in paragraph (e) below, to furnish to each
Agent as many copies of the Prospectus (including all amendments and
supplements thereto) and documents incorporated by reference therein as
soon as available and in such quantities as such Agent may reasonably
request;
(e) if at any time when a prospectus relating to the Securities is
required to be delivered under the Securities Act, any event shall occur as
a result of which the Prospectus, as then amended or supplemented, would
include an untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in the
light of the circumstances when such Prospectus is delivered
11
<PAGE> 12
to a purchaser, not misleading, or, if in the opinion of the Agents or the
Company, it is necessary at any time to amend or supplement the Prospectus
to comply with law, to immediately notify the Agents by telephone (with
confirmation in writing) and request each Agent (i) in its capacity as
agent of the Company, to suspend solicitation of offers to purchase the
Securities from the Company (and, if so notified, such Agent shall cease
such solicitations and cease using the Prospectus as soon as practicable,
but in any event not later than one business day later); and (ii) to cease
sales of any Securities such Agent may then own as principal. If the
Company shall decide to amend or supplement the Registration Statement or
the Prospectus, as then amended or supplemented, it shall so advise each
Agent promptly by telephone (with confirmation in writing) and, at its
expense, shall prepare and cause to be filed promptly with the Commission
an amendment or supplement to the Registration Statement or the Prospectus,
as then amended or supplemented, that will correct such statement or
omission or effect such compliance and will supply such amended or
supplemented Prospectus to the Agents in such quantities as they may
reasonably request. If any such amendment or supplement and any documents,
opinions, letters and certificates furnished to the Agents pursuant to
Sections 4(f), 4(j), 4(k) and 4(l) in connection with the preparation and
filing of such amendment or supplement are satisfactory in all respects to
the Agents, upon the filing with the Commission of such amendment or
supplement to the Prospectus or upon the effectiveness of an amendment to
the Registration Statement, the Agents will resume the solicitation of
offers to purchase the Securities hereunder. Notwithstanding any other
provision of this Section 4(e), until the distribution of any Securities
any Agent may own as principal has been completed or in the event such
Agent, in the opinion of its counsel, is otherwise required to deliver a
prospectus in respect of a transaction in the Securities, if any event
described in this Section 4(e) occurs, the Company will, at its own
expense, promptly prepare and file with the Commission an amendment or
supplement, satisfactory in all respects to such Agent, that will correct
such statement or omission or effect such compliance, will supply such
amended or supplemented Prospectus to such Agent in such quantities as such
Agent may reasonably request and shall furnish to such Agent pursuant to
Sections 4(f), 4(j), 4(k) and 4(l) such documents, certificates, opinions
and letters as it may request in connection with the preparation and filing
of such amendment or supplement;
(f) to furnish to the Agents during the term of this Agreement such
relevant documents and certificates of officers of the Company relating to
the business, operations and affairs of the Company, the Registration
Statement, the Basic Prospectus, the Prospectus, any amendments or
supplements thereto, the Indenture, the Securities, this Agreement, the
Administrative Procedures, any applicable Terms Agreement and the
performance by the Company of its obligations hereunder or thereunder as
the Agents may from time to time reasonably request and shall notify the
Agents promptly in writing of any downgrading, or on its receipt of any
notice of (i) any intended or potential downgrading or (ii) any review or
possible change that does not indicate an improvement in the rating
accorded any of securities of, or guaranteed by, the Company by any
"nationally recognized statistical rating organization," as such term is
defined for purposes of Rule 436(g)(2) under the Securities Act;
12
<PAGE> 13
(g) to make generally available to its security holders and to such
Agent as soon as practicable earnings statements which shall satisfy the
provisions of Section 11(a) of the Securities Act and Rule 158 of the
Commission promulgated thereunder covering periods of at least twelve
months beginning in each case with the first fiscal quarter of the Company
occurring after the "effective date" (as defined in Rule 158) of the
Registration Statement with respect to each sale of Securities;
(h) so long as any Securities are outstanding, the Company will, upon
request, furnish to each Agent, as soon as practicable after the end of
each fiscal year, a copy of its annual report to stockholders for such
year; and the Company will, upon request, furnish to each Agent (i) as soon
as available, a copy of each report or definitive proxy statement of the
Company filed with the Commission under the Exchange Act, any securities
exchange or the National Association of Securities Dealers, Inc. or mailed
to stockholders, and (ii) from time to time, such other information
concerning the Company as such Agent may reasonably request;
(i) that, from the date of any applicable Terms Agreement with such
Agent or other agreement by such Agent to purchase Securities as principal
and continuing to and including the business day following the related Time
of Delivery, not to offer, sell, contract to sell or otherwise dispose of
any debt securities of or guaranteed by the Company which are substantially
similar to the Securities, without the prior written consent of such Agent;
(j) that each time 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, redemption provisions,
amortization schedules or maturities offered on the Securities or for a
change the Agents deem to be immaterial) and each time the Company sells
Securities to such Agent as principal pursuant to a Terms Agreement or
other agreement and such Terms Agreement or other agreement specifies the
delivery of an opinion under this Section 4(j) as a condition to the
purchase of Securities pursuant to such Terms Agreement or other agreement,
the Company shall furnish or cause to be furnished forthwith to such Agent
written opinions of Goodwin, Procter & Hoar and Paul D. Weaver, or other
counsel for the Company reasonably satisfactory to such Agent, dated the
date of such amendment or supplement, or the related Time of Delivery
relating to such sale, as the case may be, in form reasonably satisfactory
to such Agent, of the same tenor as the opinions referred to in Section
6(b) hereof but modified to relate to the Registration Statement and the
Prospectus, as amended and supplemented to the date of such opinions, or,
in lieu of such opinions, counsel last furnishing such opinions may furnish
to the Agents a letter to the effect that such Agent may rely on the
opinions of such counsel which were last furnished to such Agent to the
same extent as though such opinions were dated the date of such letter
(except that the statements in such last opinions shall be deemed to relate
to the Registration Statement and the Prospectus, as amended or
supplemented to date of delivery of such letter);
13
<PAGE> 14
(k) that each time the Registration Statement or the Prospectus shall
be amended or supplemented to include or incorporate amended or
supplemented financial information and each time the Company sells
Securities to such Agent as principal pursuant to a Terms Agreement or
other agreement and such Terms Agreement or other agreement specifies the
delivery of a letter under this Section 4(k) as a condition to the purchase
of Securities pursuant to such Terms Agreement or other agreement, the
Company shall cause Ernst & Young, the Company's independent certified
public accountants, who have certified the financial statements of the
Company and its subsidiaries included or incorporated by reference in the
Registration Statement forthwith to furnish such Agent a letter, dated the
date of such amendment or supplement or the related Time of Delivery
relating to such sale, as the case may be, in form reasonably satisfactory
to such Agent, of the same tenor as the letter referred to in Section 6(d)
hereof but modified to relate to the Registration Statement and the
Prospectus, as amended or supplemented to the date of such letter with such
changes as may be necessary to reflect such amended or supplemented
financial information included or incorporated by reference in the
Registration Statement or the Prospectus as amended or supplemented;
provided, however, that, with respect to any financial information or other
matter, such letter may reconfirm as true and correct at such date, as
though made at and as of such date, rather than repeat, statements with
respect to such financial information or other matters made in the letter
referred to in Section 6(d) hereof which was last furnished to such Agent;
and
(l) that each time 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, redemption provisions,
amortization schedules or maturities offered on the Securities or for a
change the Agents deem to be immaterial), and each time the Company sells
Securities to such Agent as principal and the applicable Terms Agreement or
other agreement specifies the delivery of a certificate under this Section
4(l) as a condition to the purchase of Securities pursuant to such Terms
Agreement or other agreement, the Company shall furnish or cause to be
furnished forthwith to such Agent a certificate signed by an executive
officer of the Company, dated the date of such amendment or supplement or
the related Time of Delivery relating to such sale, as the case may be, in
form reasonably satisfactory to such Agent, of the same tenor as the
certificates referred to in Section 6(e) but modified to relate to the
Registration Statement and the Prospectus as amended and supplemented to
the date of delivery of such certificate or to the effect that the
statements contained in the certificate referred to in Section 6(e) hereof
which was last furnished to such Agent are true and correct at such date as
though made at and as of such date (except that such statements shall be
deemed to relate to the Registration Statement and the Prospectus, as
amended or supplemented to such date).
5. COSTS AND EXPENSES. The Company covenants and agrees with each Agent
that the Company will, whether or not any sale of Securities is consummated, pay
all costs and expenses incident to the performance of its obligations hereunder
and under any applicable Terms Agreement, including without limiting the
generality of the foregoing, all costs and expenses: (i) incident to the
preparation, issuance, execution, authentication and
14
<PAGE> 15
delivery of the Securities, including any expenses of the Trustee, (ii) incident
to the preparation, printing and filing under the Securities Act of the
Registration Statement, the Prospectus and any preliminary prospectus
(including, in each case, all exhibits, amendments and supplements thereto),
(iii) incurred in connection with the registration or qualification and
determination of eligibility for investment of the Securities under the laws of
such jurisdictions as the Agents (or in connection with any Terms Agreement, the
applicable Agent) may designate (including fees of counsel for the Agents (or
such Agent) and their disbursements), (iv) in connection with the listing of the
Securities on any stock exchange, (v) related to any filing with the National
Association of Securities Dealers, Inc., (vi) in connection with the printing
(including word processing and duplication costs) and delivery of this
Agreement, the Indenture, any Blue Sky Memoranda and any Legal Investment Survey
and the furnishing to the Agents and dealers of copies of the Registration
Statement and the Prospectus, including mailing and shipping, as herein
provided, (vii) payable to rating agencies in connection with the rating of the
Securities, (viii) the fees and disbursements of counsel for the Agents incurred
in connection with the offering and sale of the Securities, including any
opinions to be rendered by such counsel hereunder and (ix) any advertising and
out-of-pocket expenses incurred by the Agents.
6. CONDITIONS. The obligation of any Agent, as agent of the Company, at any
time to solicit offers to purchase the Securities ("Solicitation Time"), the
obligation of any Agent to purchase Securities as principal pursuant to any
Terms Agreement or otherwise, and the obligation of any other purchaser to
purchase Securities shall in each case be subject (1) to the condition that all
representations and warranties of the Company herein and all statements of
officers of the Company made in any certificate furnished pursuant to the
provisions hereof are true and correct (i) in the case of an Agent's obligation
to solicit offers to purchase Securities, at and as of such Solicitation Time
and (ii) in the case of any Agent's or any other purchaser's obligation to
purchase Securities, at and as of the time the Company accepts the offer to
purchase such Securities and, as the case may be, at and as of the related Time
of Delivery or time of purchase; (2) to the condition that at or prior to such
Solicitation Time, time of acceptance, Time of Delivery or time of purchase, as
the case may be, the Company shall have complied with all its agreements and all
conditions on its part to be performed or satisfied hereunder; and (3) to the
following additional conditions when and as specified:
(a) Prior to such Solicitation Time or corresponding Time of Delivery
or time of purchase, as the case may be:
(i) the Prospectus, as amended or supplemented (including, if
applicable, the Pricing Supplement), with respect to such Securities
shall have been filed with the Commission pursuant to Rule 424(b)
under the Securities Act within the applicable time period prescribed
for such filing by the rules and regulations under the Securities Act;
no stop order suspending the effectiveness of the Registration
Statement shall be in effect and no proceeding for that purpose shall
have been initiated or threatened by the Commission; and all requests
for additional information on the part of the Commission shall have
been complied with to the reasonable satisfaction of such Agent;
15
<PAGE> 16
(ii) since the date of any Terms Agreement or the acceptance by
the Company of any offer to purchase Notes, as the case may be, there
shall not have occurred any downgrading, nor shall any notice have
been given of (A) any intended or potential downgrading or (B) any
review or possible change that does not indicate an improvement, in
the rating accorded any securities of or guaranteed by the Company by
any "nationally recognized statistical rating organization", as that
term is defined by the Commission for purposes of Rule 436(g)(2) under
the Securities Act;
(iii) since the date of any Terms Agreement or the acceptance by
the Company of any offer to purchase Notes, as the case may be, there
shall not have been any material adverse change or any development
involving a prospective material adverse change, in or affecting the
condition (financial or otherwise), earnings, prospects or results of
operations or business of the Company and its subsidiaries, taken as a
whole, otherwise than as set forth or contemplated in the Prospectus,
as amended or supplemented to such Solicitation Time or at the time
such offer to purchase was made, the effect of which in the reasonable
judgment of the applicable Agent makes it impracticable or inadvisable
to market the Securities on the terms and in the manner contemplated
in the Prospectus, as so amended or supplemented; and
(iv)(A) since the date of any Terms Agreement or the acceptance
by the Company of any offer to purchase Notes, as the case may be,
trading generally shall not have been suspended or materially limited
on or by, as the case may be, any of the New York Stock Exchange, the
American Stock Exchange, the National Association of Securities
Dealers, Inc., the Chicago Board Options Exchange, the Chicago
Mercantile Exchange or the Chicago Board of Trade, (B) trading of any
securities of or guaranteed by the Company shall not have been
suspended on any exchange or in any over-the-counter market, (C) a
general moratorium on commercial banking activities in New York shall
not have been declared by either federal or New York State authorities
or (D) there shall not have occurred any outbreak or escalation of
hostilities or any change in financial markets or any calamity or
emergency that, in the judgment of such Agent or Agents or of such
other purchaser, is material and adverse and which in the judgment of
such Agent or Agents or other purchasers makes it impracticable or
inadvisable to market the Securities on the terms and in the manner
contemplated in the Prospectus, as amended or supplemented at the
Solicitation Time, or at the time such offer to purchase was made.
(b) (i) On the Commencement Date, and in the case of a purchase of
Securities by an Agent as principal pursuant to a Terms Agreement or
otherwise, if called for by the applicable Terms Agreement or other
agreement, at the corresponding Time of Delivery, Goodwin, Procter & Hoar
or other counsel for the Company shall have furnished to the relevant Agent
or Agents their written opinion, dated the Commencement Date or Time of
Delivery, as the case may be, in form and substance satisfactory to such
Agent or Agents, to the effect that:
16
<PAGE> 17
(A) this Agreement and any applicable Terms Agreement have been
duly authorized, executed and delivered by the Company, and are valid
and binding agreements of the Company;
(B) the Securities have been duly authorized and, when executed
and authenticated in accordance with the terms of the Indenture and
delivered to and paid for by any purchaser of Securities sold through
an Agent as agent or an Agent as principal pursuant to any Terms
Agreement or other agreement, will constitute valid and binding
obligations of the Company, enforceable in accordance with their
terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors' rights and to general equity
principles;
(C) the Indenture has been duly authorized, executed and
delivered by the Company and constitutes a valid and binding
instrument of the Company; and the Indenture has been duly qualified
under the Trust Indenture Act;
(D) the execution, delivery and performance of the Indenture, any
applicable Terms Agreement or other agreement pursuant to which an
Agent purchases Securities as principal and the consummation of the
transactions herein and therein contemplated will not result in a
breach or violation of any of the terms and provisions of, or
constitute a default under: (A) the charter or by-laws of the Company
or any subsidiary; (B) any indenture, mortgage, deed of trust, loan
agreement, bond, debenture, note or other evidence of indebtedness or
any material lease, contract or other agreement or instrument to which
the Company or any subsidiary is a party or by which the Company or
any such subsidiary may be bound filed by the Company under the
Securities Act or the Exchange Act; (C) any law or rule or regulation
of any governmental agency or body having jurisdiction over the
Company or any subsidiary or over the properties of the Company or any
such subsidiary; or (D) to the knowledge of such counsel, any order of
any court having jurisdiction over the Company or any subsidiary or
over the properties of the Company or any such subsidiary; and
(E) no consent, approval, authorization, order, registration or
qualification of or with any court or governmental agency or body is
required for the issuance and sale of the Securities or the
consummation of the other transactions contemplated by this Agreement,
any applicable Terms Agreement or other agreement pursuant to which an
Agent purchases Securities as principal, or the Indenture, except such
consents, approvals, authorizations, registrations or qualifications
as have been obtained under the Securities Act and the Trust Indenture
Act and as may be required under state securities or Blue Sky laws in
connection with offers and sales of the Securities from the Company
and with purchases of Securities.
17
<PAGE> 18
In addition, such counsel shall state that (1) such counsel has
no reason to believe that such registration statement, as of its
effective date, the Registration Statement or the Prospectus, as of
the date of the Terms Agreement, or any such amendment or supplement,
as of its date, contained any untrue statement of a material fact or
omitted to state any material fact required to be stated therein or
necessary to make the statements therein not misleading; (2) the
descriptions in the Registration Statement and Prospectus of statutes,
legal and governmental proceedings and contracts and other documents
are accurate and fairly present the information required to be shown;
and (3) such counsel does not know of any legal or governmental
proceedings required to be described in the Prospectus which are not
described as required or of any contracts or documents of a character
required to be described in the Registration Statement or Prospectus
or to be filed as exhibits to the Registration Statement which are not
described and filed as required; it being understood that such counsel
need express no opinion as to the financial statements or other
financial data contained in the Registration Statement or the
Prospectus. In rendering such opinion, such counsel may rely as to the
materiality of agreements and other factual matters on one or more
written certificates of officers of the Company or public officials as
and to the extent they deem such reliance appropriate.
In rendering such opinions, such counsel may rely (1) as to matters involving
the application of the laws other than the laws of the United States and the
Commonwealth of Massachusetts to the extent such counsel deems proper and to the
extent specified in such opinion, if at all, upon an opinion or opinions (in
form and substance reasonably satisfactory to the Agents' counsel) of other
counsel reasonably acceptable to the Agents' counsel, familiar with the
applicable laws; and (2) as to matters of fact, to the extent such counsel deems
proper, on certificates of responsible officers of the Company and certificates
or other written statements of officials of jurisdictions having custody of
documents respecting the corporate existence or good standing of the Company.
The opinion of such counsel for the Company shall state that the opinion of any
such other counsel is in form satisfactory to such counsel and, in such
counsel's opinion, the Agents and they are justified in relying thereon. With
respect to the matters to be covered in subparagraphs (b)(i)(G) and (b)(i)(I)
above, counsel may state their opinion and belief is based upon their
participation in the preparation of the Registration Statement and the
Prospectus and any amendment or supplement thereto (other than the documents
incorporated by reference therein) and review and discussion of the contents
thereof (including the documents incorporated by reference therein) but is
without independent check or verification, except as specified.
(ii) On the Commencement Date, and in the case of a purchase of
Securities by an Agent as principal pursuant to a Terms Agreement or
otherwise, if called for by the applicable Terms Agreement or other
agreement, at the corresponding Time of Delivery, Paul D. Weaver, Senior
Vice President and General Counsel of the Company, shall have furnished to
the relevant Agent or Agents their written opinion, dated the Commencement
Date or Time of Delivery, as the case may be, in form and substance
satisfactory to such Agent or Agents, to the effect that:
18
<PAGE> 19
(A) The Company and each of its subsidiaries have been duly
incorporated, are validly existing and are in good standing under the
laws of their respective jurisdictions of incorporation, with
corporate power and authority to own their properties and conduct
their business as described in the Prospectus; and
(B) The Company and each of its subsidiaries are duly qualified
to do business as foreign corporations in good standing in all other
jurisdictions in which they own or lease substantial properties or in
which the conduct of their business requires such qualification,
except where the failure to so qualify would not have a Material
Adverse Effect.
(c) On the Commencement Date, and in the case of a purchase of
Securities by an Agent as principal pursuant to a Terms Agreement or
otherwise, if called for by the applicable Terms Agreement or other
agreement, at the corresponding Time of Delivery, Skadden, Arps, Slate,
Meagher & Flom, counsel to the Agents, shall have furnished to the relevant
Agent or Agents such opinion or opinions, dated the Commencement Date or
Time of Delivery, as the case may be, with respect to the validity of the
Indenture, the Securities, the Registration Statement, the Prospectus as
amended or supplemented and other related matters as such Agent or Agents
may reasonably request, and in each case such counsel shall have received
such papers and information as they may reasonably request to enable them
to pass upon such matters.
(d) On the Commencement Date, and in the case of a purchase of
Securities by an Agent as principal pursuant to a Terms Agreement or
otherwise, if called for by the applicable Terms Agreement or other
agreement, at the corresponding Time of Delivery, Ernst & Young, the
Company's independent certified public accountants, who have certified the
financial statements of the Company and its subsidiaries included or
incorporated by reference in the Registration Statement and Prospectus, as
then amended or supplemented, shall have furnished to the relevant Agent or
Agents a letter, dated the Commencement Date or Time of Delivery, as the
case may be, in form and substance satisfactory to such Agent or Agents,
containing statements and information of the type ordinarily included in
accountants' "comfort letters" to underwriters with respect to the
financial statements and certain financial information relating to the
Company contained in or incorporated by reference in the Registration
Statement and the Prospectus, as then amended or supplemented.
(e) On the Commencement Date, and in the case of a purchase of
Securities by an Agent as principal pursuant to a Terms Agreement or
otherwise, if called for by the applicable Terms Agreement or other
agreement, at the corresponding Time of Delivery, the relevant Agent or
Agents shall have received a certificate or certificates signed by the
President or any Vice-President and a principal financial or accounting
officer of the Company, dated the Commencement Date or Time of Delivery, as
the case may be, to the effect set forth in Section 6(a)(i) and (ii) above
and to the further effect that (1) the representations and warranties of
the Company contained herein are true and correct on and as of the
Commencement Date or Time of Delivery, as the case may be, as if made on
and as of such date, (2) the Company has complied with
19
<PAGE> 20
all agreements and all conditions on its part to be performed or satisfied
hereunder or under the applicable Terms Agreement or other agreement at or
prior to the Commencement Date or Time of Delivery, as the case may be, and
(3) there has not occurred any material adverse change, or any development
involving a prospective material adverse change, in or affecting the
condition (financial or otherwise), earnings, prospects or results of
operations or business of the Company and its subsidiaries taken as a whole
from that set forth in or contemplated by the Registration Statement or the
Prospectus.
(f) On the Commencement Date and at each Time of Delivery, the Company
shall have furnished to the relevant Agent or Agents such further
certificates, information and documents as such Agent or Agents may
reasonably request.
7. INDEMNIFICATION AND CONTRIBUTION.
(a) The Company will indemnify and hold harmless each Agent against
any losses, claims, damages or liabilities, joint or several, to which such
Agent may become subject, under the Securities Act or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in the Registration Statement, the
Prospectus, or any amendment or supplement thereto, or any related
preliminary prospectus or preliminary prospectus supplement, or arise out
of or are 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 will reimburse each Agent for any
legal or other expenses reasonably incurred by such Agent in connection
with investigating or defending any such loss, claim, damage, liability or
action as such expenses are incurred; provided, however, that the Company
will not be liable in any such case (i) to the extent that any such loss,
claim, damage or liability arises out of or is based upon an untrue
statement or alleged untrue statement in or omission or alleged omission
from any of such documents in reliance upon and in conformity with written
information furnished to the Company by any Agent specifically for use
therein or (ii) if (A) any such loss, claim, damage or liability arises out
of or is based upon an untrue statement or alleged untrue statement or
omission or alleged omission made in any of such documents, (B) such untrue
statement or alleged untrue statement or omission or alleged omission is
corrected in any amendment or supplement to the Registration Statement or
the Prospectus, (C) the Company shall have performed each of its
obligations under Section 3 hereof in respect of such amendment or
supplement and (D) such Agent, having been furnished by or on behalf of the
Company with copies of the Prospectus as so amended or supplemented,
thereafter fails to deliver such amended or supplemented Prospectus prior
to or concurrently with the sale of Securities to the person asserting such
loss, claim, damage or liability who purchased such Securities from such
Agent.
(b) Each Agent, severally and not jointly, agrees to indemnify and
hold harmless the Company against any losses, claims, damages or
liabilities to which the Company may become subject, under the Securities
Act or otherwise, insofar as such
20
<PAGE> 21
losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in the Registration Statement, the
Prospectus, or any amendment or supplement thereto, or any related
preliminary prospectus or preliminary prospectus supplement, or arise out
of or are based upon the omission or the alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein not misleading, in each case to the extent, but only to
the extent, that such 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 by such Agent
specifically for use therein, and will reimburse any legal or other
expenses reasonably incurred by the Company in connection with
investigating or defending any such loss, claim, damage, liability or
action as such expenses are incurred.
(c) Promptly after receipt by an indemnified party under this Section 7 of
notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under
subsection (a) or (b) above, notify the indemnifying party of the
commencement thereof; but the omission so to notify the indemnifying party
will not relieve it from any liability which it may have to any indemnified
party otherwise than under subsection (a) or (b) above except to the extent
the indemnifying party is actually prejudiced by such failure to give
notice. In case any such action is brought against any indemnified party
and it notifies the indemnifying party of the commencement thereof, the
indemnifying party will be entitled to participate therein and, to the
extent that it may wish, jointly with any other indemnifying party
similarly notified, to assume the defense thereof, with counsel
satisfactory to such indemnified party (who shall not, except with the
consent of the indemnified party, which consent shall not be unreasonably
withheld, be counsel to the indemnifying party), and after notice from the
indemnifying party to such indemnified party of its election so to assume
the defense thereof, the indemnifying party will not be liable to such
indemnified party under this Section 7(c) for any legal or other expenses
subsequently incurred by such indemnified party in connection with the
defense thereof other than reasonable costs of investigation unless (i) the
indemnifying party and the indemnified party shall have mutually agreed to
the contrary or (ii) the named parties in any such proceeding (including
any impleaded parties) include both the indemnifying party and the
indemnified party and the indemnified party is advised by counsel that
representation of both parties by the same counsel would be inappropriate
due to actual or potential differing interests between them. No
indemnifying party shall, without the prior written consent of the
indemnified party, effect any settlement of any pending or threatened
proceeding in respect of which any indemnified party is or could have been
a party and indemnity could have been sought hereunder by such indemnified
party, unless such settlement includes an unconditional release of such
indemnified party from all liability on claims that are the subject matter
of such proceeding. The indemnifying party shall not be liable for any
settlement of any proceeding effected without its written consent, which
consent shall not be unreasonably withheld, but if settled with such
consent or if there be a final judgment for the plaintiff, the indemnifying
party agrees to indemnify any
21
<PAGE> 22
indemnified party from and against any loss or liability by reason of such
settlement or judgment.
(d) If the indemnification provided for in this Section 7 is
unavailable or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above, then each indemnifying party shall contribute
to the amount paid or payable by such indemnified party as a result of the
losses, claims, damages or liabilities referred to in subsection (a) or (b)
above (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company on the one hand and the Agents on the
other from the offering of the 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 Agents on the other in connection with the
statements or omissions which resulted in such losses, claims, damages or
liabilities as well as any other relevant equitable considerations. The
relative benefits received by the Company on the one hand and the Agents on
the other shall be deemed to be in the same proportion as the total net
proceeds from the offering of such Securities (before deducting expenses)
received by the Company bear to the total underwriting discounts and
commissions received by the Agents. The relative fault shall be determined
by reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to state a
material fact relates to information supplied by the Company or the Agents
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such untrue statement or omission. The
amount paid by an indemnified party as a result of the losses, claims,
damages or liabilities referred to in the first sentence of this Section
7(d) shall be deemed to include any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating or
defending any action or claim which is the subject of this Section 7(d).
Notwithstanding the provisions of this Section 7(d), no Agent shall be
required to contribute any amount in excess of the amount by which the
total price at which the Securities sold by or through it and distributed
to the public were offered to the public exceeds the amount of any damages
which such Agent has otherwise been required to pay by reason of such
untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. The
Agents' obligations in this Section 7(d) to contribute are several (in
proportion to the principal amount of the Securities the sale of which by
or through such Agent gave rise to such losses, claims, damages or
liabilities bears to the aggregate principal amount of the securities the
sale of which by or through any Agent gave rise to such losses, claims,
damages or liabilities) and not joint.
(e) The obligations of the Company under this Section 7 shall be in
addition to any liability which the Company may otherwise have and shall
extend, upon the same terms and conditions, to each person, if any, who
controls any Agent within the meaning of the Securities Act; and the
obligations of the Agents under this Section 7 shall be in addition to any
liability which the respective Agents may otherwise have and shall extend,
22
<PAGE> 23
upon the same terms and conditions, to each director of the Company, to
each officer of the Company who has signed the Registration Statement and
to each person, if any, who controls the Company within the meaning of the
Securities Act.
(f) The parties to this Agreement hereby acknowledge that they are
sophisticated business persons who were represented by counsel during the
negotiations regarding the provisions hereof, including without limitation
the provisions of this Section 7, and are fully informed regarding said
provisions. They further acknowledge that the provisions of this Section 7
fairly allocate the risks in light of the ability of the parties to
investigate the Company and its business in order to assure that adequate
disclosure is made in the Registration Statement and Prospectus as required
by the Securities Act. The parties are advised that federal or state public
policy, as interpreted by the courts in certain jurisdictions, may be
contrary to certain of the provisions of this Section 7, and the parties
hereto hereby expressly waive and relinquish any right or ability to assert
such public policy as a defense to a claim under this Section 7 and further
agree not to attempt to assert any such defense.
8. TERMINATION.
(a) This Agreement may be terminated at any time (i) by the Company
with respect to any or all of the Agents or (ii) by any Agent with respect
to itself only, in each case upon the giving of written notice of such
termination to each other party hereto. Any Terms Agreement shall be
subject to termination in the absolute discretion of the Agent or Agents
that are parties thereto on the terms set forth or incorporated by
reference therein. The termination of this Agreement shall not require
termination of any agreement by an Agent to purchase Securities as
principal (whether pursuant to a Terms Agreement or otherwise) and the
termination of such an agreement shall not require termination of this
Agreement. In the event this Agreement is terminated with respect to any
Agent, (x) this Agreement shall remain in full force and effect with
respect to any Agent as to which such termination has not occurred, (y)
this Agreement shall remain in full force and effect with respect to the
rights and obligations of any party which have previously accrued or which
relate to Securities which are already issued, agreed to be issued or the
subject of a pending offer at the time of such termination and (z) in any
event, the provisions of the third paragraph of Section 2(a), Section 2(c),
the last sentence of Section 4(e) and Sections 4(g), 4(h), 5, 7, 9, 10, 12
and 15 shall survive; provided that if at the time of termination an offer
to purchase Securities has been accepted by the Company but the time of
delivery to the purchaser or its agent of such Securities has not yet
occurred, the provisions of Sections 2(b), 2(d), 4(a) through 4(f), 4(i)
through 4(l) and 6 shall also survive. If any Terms Agreement is
terminated, the provisions of the last sentence of Section 4(e) and
Sections 2(b), 2(d), 4(a), 4(b), 4(c), 4(f), 4(h) through 4(l), 5, 6, 7, 9,
10, 12 and 15 (which shall have been incorporated by reference in such
Terms Agreement) shall survive.
(b) If this Agreement or any Terms Agreement shall be terminated by an
Agent or Agents because of any failure or refusal on the part of the
Company to comply with the terms or to fulfill any of the conditions of
this Agreement or any
23
<PAGE> 24
Terms Agreement or if for any reason the Company shall be unable to perform
its obligations under this Agreement or any Terms Agreement or any
condition of any Agent's obligations cannot be fulfilled, the Company
agrees to reimburse each Agent or such Agents as have so terminated this
Agreement with respect to themselves, severally, for all out-of-pocket
expenses (including the fees and expenses of their counsel) reasonably
incurred by such Agent or Agents in connection with this Agreement or the
offering of Securities.
9. POSITION OF THE AGENTS. Each Agent, in soliciting offers to purchase
Securities from the Company and in performing the other obligations of such
Agent hereunder (other than in respect of any purchase by an Agent as principal,
pursuant to a Terms Agreement or otherwise), is acting solely as agent for the
Company and not as principal and does not assume any obligation towards or
relationship of agency or trust with any purchaser of Securities. Each Agent
will make reasonable efforts to assist the Company in obtaining performance by
each purchaser whose offer to purchase Securities from the Company was solicited
by such Agent and has been accepted by the Company, but such Agent shall not
have any liability to the Company in the event such purchase is not consummated
for any reason. If the Company shall default on its obligation to deliver
Securities to a purchaser whose offer it has accepted, the Company shall (i)
hold the relevant Agent harmless against any loss, claim, damage or liability
arising from or as a result of such default by the Company and (ii)
notwithstanding such default, pay to the Agent that solicited such offer any
commission to which it would be entitled in connection with such sale.
10. REPRESENTATIONS AND INDEMNITIES TO SURVIVE. The respective indemnities
and contribution agreements, representations, warranties and other statements of
the Company, its officers and the Agents set forth in or made pursuant to this
Agreement or any agreement by an Agent to purchase Securities as principal shall
remain in full force and effect regardless of any termination of this Agreement
or any such agreement, any investigation made by or on behalf of any Agent or
any controlling person of any Agent, or the Company, or any officer or director
or any controlling person of the Company, and shall survive each delivery of and
payment for any of the Securities.
11. NOTICES. Except as otherwise specifically provided herein or in the
Administrative Procedures, all statements, requests, notices and advices
hereunder shall be in writing, and effective only on receipt, and will be
delivered by hand, by mail (postage prepaid), by telegram (charges prepaid) or
by telex.
Communications to the Agents will be sent as follows:
In the case of J.P. Morgan Securities Inc., to:
J.P. Morgan Securities Inc.
60 Wall Street
New York, New York 10260
Attention: Medium-Term Note Trading Desk
Telephone: (212) 648-0591
Telecopy: (212) 648-5907
24
<PAGE> 25
In the case of C.S. First Boston Corporation, to:
CS First Boston Corporation
Park Avenue Plaza
55 East 52nd Street
New York, New York 10055
Attention: Short- and Medium-Term Finance Department
Telephone: (212) 909-3842
Telecopy: (212) 318-1498
In the case of Merrill Lynch & Co., to:
Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Merrill Lynch World Headquarters
World Financial Center
North Tower, 10th Floor
New York, New York 10281-1310
Attention: MTN Product Management
Telephone: (212) 449-7476
Telecopy: (212) 449-2234
In the case of the Company, to:
Houghton Mifflin Company
222 Berkeley Street
Boston, Massachusetts 02116
Attention: Paul D. Weaver, General Counsel
Telephone: (617) 351-5102
Telecopy: (617) 351-5014
12. SUCCESSORS. This Agreement and any Terms Agreement shall be binding
upon, and inure solely to the benefit of, each Agent and the Company, and their
respective successors and the officers, directors and controlling persons
referred to in Section 7 and (to the extent expressly provided in Section 6) the
purchasers of Securities, and no other person shall acquire or have any right or
obligation under or by virtue of this Agreement or any Terms Agreement.
13. AMENDMENTS. This Agreement may be amended or supplemented if, but only
if, such amendment or supplement is in writing and is signed by the Company and
each Agent; provided that the Company may from time to time, on 7 days prior
written notice to the Agents but without the consent of any Agent, amend this
Agreement to add as a party hereto one or more additional firms registered under
the Exchange Act, whereupon each such firm shall become an Agent hereunder on
the same terms and conditions as the other Agents that are parties hereto. The
Agents shall sign any amendment or supplement giving effect to the addition of
any such firm as an Agent under this Agreement.
25
<PAGE> 26
14. BUSINESS DAY. Time shall be of the essence in this Agreement and any
Terms Agreement. As used herein, the term "business day" shall mean any day
which is not a Saturday or Sunday or legal holiday or a day on which banks in
New York City are required or authorized by law or executive order to close.
15. APPLICABLE LAW. This Agreement and any Terms Agreement shall be
governed by, and construed in accordance with, the laws of the State of New
York, without giving effect to the conflict of laws provisions thereof.
16. COUNTERPARTS. This Agreement and any Terms Agreement may be signed in
counterparts, each of which shall be an original, and all of which together
shall constitute one and the same instrument.
17. HEADINGS. The headings of the sections of this Agreement have been
inserted for convenience of reference only and shall not be deemed a part of
this Agreement.
26
<PAGE> 27
If the foregoing is in accordance with your understanding, please sign and
return to us four counterparts hereof, whereupon this letter and the acceptance
by each of you thereof shall constitute a binding agreement between the Company
and each of you in accordance with its terms.
Very truly yours,
HOUGHTON MIFFLIN COMPANY
By:
------------------------------
Name:
Title:
Accepted in New York, New York,
as of the date first above written:
J.P. MORGAN SECURITIES INC.
By:
--------------------------------
Name: Steven Christensen
Title: Vice President
CS FIRST BOSTON CORPORATION
By: --------------------------------
Name:
Title:
MERRILL LYNCH, PIERCE, FENNER &
SMITH INCORPORATED
By:
--------------------------------
Name:
Title:
<PAGE> 28
If the foregoing is in accordance with your understanding, please sign and
return to us four counterparts hereof, whereupon this letter and the acceptance
by each of you thereof shall constitute a binding agreement between the Company
and each of you in accordance with its terms.
Very truly yours,
HOUGHTON MIFFLIN COMPANY
By:
------------------------------
Name:
Title:
Accepted in New York, New York,
as of the date first above written:
J.P. MORGAN SECURITIES INC.
By:
--------------------------------
Name:
Title:
CS FIRST BOSTON CORPORATION
By:
--------------------------------
Name: Martha D. Bailey
Title: Vice President
MERRILL LYNCH, PIERCE, FENNER &
SMITH INCORPORATED
By:
--------------------------------
Name:
Title:
<PAGE> 29
If the foregoing is in accordance with your understanding, please sign and
return to us four counterparts hereof, whereupon this letter and the acceptance
by each of you thereof shall constitute a binding agreement between the Company
and each of you in accordance with its terms.
Very truly yours,
HOUGHTON MIFFLIN COMPANY
By:
------------------------------
Name:
Title:
Accepted in New York, New York,
as of the date first above written:
J.P. MORGAN SECURITIES INC.
By:
--------------------------------
Name:
Title:
CS FIRST BOSTON CORPORATION
By: --------------------------------
Name:
Title:
MERRILL LYNCH, PIERCE, FENNER &
SMITH INCORPORATED
By:
--------------------------------
Name: Scott G. Primrose
Title: Authorized Signatory
<PAGE> 1
EXHIBIT 4.1
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE DEPOSITARY OR A
NOMINEE OF THE DEPOSITARY. THIS SECURITY IS EXCHANGEABLE FOR SECURITIES
REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY
IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE AND MAY NOT BE
TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY
OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE
DEPOSITARY.
THIS SECURITY IS A BOOK-ENTRY SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A
NOMINEE OF A DEPOSITARY. THIS SECURITY IS EXCHANGEABLE FOR SECURITIES REGISTERED
IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN THE
LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO TRANSFER OF THIS
SECURITY (OTHER THAN A TRANSFER OF THIS SECURITY AS A WHOLE BY THE DEPOSITARY TO
A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY
OR ANOTHER NOMINEE OF THE DEPOSITARY) MAY BE REGISTERED EXCEPT IN SUCH LIMITED
CIRCUMSTANCES.
[FORM OF FACE OF FIXED RATE REGISTERED NOTE]
Fixed Rate Note
REGISTERED REGISTERED
No. FXR [PRINCIPAL AMOUNT]
CUSIP: *
Unless this certificate is presented by an authorized representative of
The Depository Trust Company (55 Water Street, New York, New York) to the issuer
or its agent for registration of transfer, exchange or payment, and any
certificate issued is registered in the name of Cede & Co. or such other name as
requested by an authorized representative of The Depository Trust Company and
any payment is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL since the registered owner
hereof, Cede & Co., has an interest herein.*
IF APPLICABLE, THE "AMOUNT OF OID," THE "ORIGINAL ISSUE DATE," THE "YIELD TO
MATURITY," AS WELL AS THE METHOD USED TO DETERMINE THE YIELD TO MATURITY WHERE
THERE IS A SHORT ACCRUAL PERIOD AND THE AMOUNT OF OID ALLOCABLE TO SUCH SHORT
ACCRUAL PERIOD WILL BE SET FORTH BELOW. THE CALCULATION OF THE AMOUNT OF OID
UPON (A) OPTIONAL REDEMPTION OR (B) DECLARATION OF ACCELERATION IS DISCUSSED ON
THE REVERSE HEREOF.
1
<PAGE> 2
<TABLE>
<CAPTION>
HOUGHTON MIFFLIN COMPANY
MEDIUM-TERM NOTE
(Fixed Rate)
<S> <C> <C>
ORIGINAL ISSUE DATE: INITIAL REDEMPTION DATE: APPLICABILITY OF MODIFIED
PAYMENT UPON
ACCELERATION:
STATED MATURITY: INITIAL REDEMPTION If yes, state Issue Price:
PERCENTAGE:
INTEREST PAYMENT DATE(S): INTEREST PAYMENT PERIOD: APPLICABILITY OF ANNUAL
REDEMPTION PERCENTAGE
INCREASE:
SPECIFIED CURRENCY: APPLICABILITY OF ANNUAL If yes, state each redemption date
U.S. Dollars REDEMPTION PERCENTAGE and redemption price:
REDUCTION:
OPTIONAL REPAYMENT If yes, state Annual Percentage INITIAL ACCRUAL PERIOD OID
DATE(S): Reduction: (computed under the Approximate
method):
INTEREST ACCRUAL DATE: YIELD TO MATURITY:
</TABLE>
Houghton Mifflin Company, a Massachusetts corporation (together with its
successors and assigns, the "Company"), for value received, hereby promises to
pay to ____________________ or registered assignees, the principal sum of
______________________ on the Stated Maturity specified above (except to the
extent redeemed or repaid prior to the Stated Maturity) and to pay interest
thereon at the Interest Rate per annum specified above from the Original Issue
Date specified above until the principal hereof is paid or duly made available
for payment (except as provided below), in arrears monthly, quarterly,
semiannually, or annually as specified above as the Interest Payment Period on
each Interest Payment Date (as specified above), commencing with the first
Interest Payment Date next succeeding the Original Issue Date specified above,
and on the Stated Maturity (or any redemption or repayment date); provided,
however, that if the Original Issue Date occurs between a Record Date, as
defined below, and the next succeeding Interest Payment Date, interest payments
will commence on the second Interest Payment Date succeeding the Original Issue
Date to the registered holder of this Note on the Record Date with respect to
such second Interest Payment Date.
Payment of the principal of this Note, any premium and the interest due at
the Stated Maturity (or any redemption or repayment date) will be made in
immediately available funds upon surrender of this Note at the office or agency
of such paying agent as the Company may determine maintained for that purpose in
the Borough of Manhattan, The City of New York (a "Paying Agent"), or at the
office or agency of such other Paying Agent as the Company may determine.
2
<PAGE> 3
Interest on this Note will accrue from the most recent Interest Payment
Date to which interest has been paid or duly provided for or, if no interest has
been paid or duly provided for, from the Original Issue Date, until the
principal hereof has been paid or duly made available for payment (except as
provided below). The interest so payable, and punctually paid or duly provided
for, on any Interest Payment Date, will, subject to certain exceptions described
herein, be paid to the person in whose name this Note (or one or more
predecessor Notes) is registered at the close of business on the date 15 days
prior to an Interest Payment Date (whether or not a Business Day) (each such
date a "Record Date"); provided, however, that interest payable on the Stated
Maturity (or any redemption or repayment date) will be payable to the person to
whom the principal hereof shall be payable.
The Specified Currency indicated on the face hereof shall be U.S. dollars.
Payment of the principal of and premium, if any, and interest on this Note will
be made in such coin or currency of the United States as at the time of payment
is legal tender for payment of public and private debts; provided, however, that
payments of interest, other than interest due at maturity (or any redemption or
repayment date) will be made by United States dollar check mailed to the address
of the person entitled thereto as such address shall appear in the Note
register. A holder of U.S. $5,000,000 or more in aggregate principal amount of
Notes having the same Interest Payment Date will be entitled to receive payments
of interest, other than interest due at maturity or any date of redemption or
repayment, by wire transfer of immediately available funds to an account within
the United States maintained by the holder of this Note if appropriate wire
transfer instructions in writing have been received by the Paying Agent not less
than 10 days prior to the applicable Interest Payment Date.
Reference is hereby made to the further provisions of this Note set forth
on the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by the
Authenticating Agent, as defined on the reverse hereof, by manual signature,
this Note shall not be entitled to any benefit under the Indenture, as defined
on the reverse hereof, or be valid or obligatory for any purpose.
3
<PAGE> 4
IN WITNESS WHEREOF, the Company has caused this Note to be duly
executed under its corporate seal.
DATED: HOUGHTON MIFFLIN COMPANY
By:
------------------------------------
Nader F. Darehshori
Chairman of the Board, President and
Chief Executive officer
By:
------------------------------------
Gail Deegan
Executive Vice President, Chief
Financial Officer and Treasurer
[SEAL]
Attest:
- -----------------------------
Name:
Title:
4
<PAGE> 5
CERTIFICATE OF AUTHENTICATION
This Security is one of the Securities referred to in the
within-mentioned Indenture.
STATE STREET BANK AND TRUST COMPANY,
as Trustee and Authenticating Agent
By:
-----------------------------------
Arthur J. MacDonald
Assistant Vice President
5
<PAGE> 6
[FORM OF REVERSE OF NOTE]
This Note is one of a duly authorized issue of Medium-Term Notes having
maturities from nine months to 30 years from the date of issue (the "Notes") of
the Company. The Notes are issuable under an Indenture, dated as of March 15,
1994, as supplemented by a First Supplemental Indenture dated as of July 27,
1995 (together, the "Indenture"), between the Company and State Street Bank and
Trust Company, as successor trustee (herein called the "Trustee," which term
includes any successor trustee under the Indenture) to The First National Bank
of Boston, to which Indenture and all indentures supplemental thereto reference
is hereby made for a statement of the respective rights, limitations of rights,
duties and immunities of the Company, the Trustee and holders of the Notes and
the terms upon which the Notes are, and are to be, authenticated and delivered.
State Street Bank and Trust Company has been appointed Authenticating Agent (the
"Authenticating Agent," which term includes any successor authenticating agent
or exchange rate agent, as the case may be) with respect to the Notes, and State
Street Bank and Trust Company at its corporate trust office at Two International
Place, Boston, MA 02110 has been appointed registrar and Paying Agent with
respect to the Notes. The terms of individual Notes may vary with respect to
interest rates, interest rate formulas, issue dates, maturity dates, or
otherwise, all as provided in the Indenture. To the extent not inconsistent
herewith, the terms of the Indenture are hereby incorporated by reference
herein.
This Note will not be subject to any sinking fund and, unless otherwise
provided on the face hereof in accordance with the provisions of the following
two paragraphs, will not be redeemable or subject to repayment at the option of
the holder prior to maturity.
Unless otherwise indicated on the face of this Note, this Note may not be
redeemed prior to the Stated Maturity. If the face of this Note indicates that
this Note is subject to (i) "Annual Redemption Percentage Reduction" or (ii)
"Annual Redemption Percentage Increase," then this Note may be redeemed in whole
or in part at the option of the Company on or after the Initial Redemption Date
specified on the face hereof on the terms set forth on the face hereof, together
with interest accrued and unpaid hereon to the date of redemption (except as
provided below). If this Note is subject to "Annual Redemption Percentage
Reduction," the Initial Redemption Percentage indicated on the face hereof will
be reduced on each anniversary of the Initial Redemption Date specified above by
the Annual Percentage Reduction specified on the face hereof until the
redemption price of this Note is 100% of the principal amount hereof. If this
Note is subject to "Annual Redemption Percentage Increase," the amount of
original issue discount allocable to such short accrual period is the Amortized
Amount. Notice of redemption shall be mailed to the registered holders of the
Notes designated for redemption at their addresses as the same shall appear on
the Note register not less than 30 days nor more than 60 days prior to the date
of redemption, subject to all the conditions and provisions of the Indenture. In
the event of redemption of this Note in part only, a new Note or Notes for the
amount of the unredeemed portion hereof shall be issued in the name of the
holder hereof upon the presentation and cancellation hereof.
Unless otherwise indicated on the face of this Note, this Note shall not be
subject to repayment at the option of the holder prior to the Stated Maturity.
If so indicated on the face of
6
<PAGE> 7
this Note, this Note may be subject to repayment at the option of the holder on
the date or dates, if any, specified on the face hereof (the "Optional
Redemption Date" or "Optional Redemption Dates") on the terms set forth herein.
On any Optional Repayment Date, this Note will be repayable in whole or in
part in increments of $1,000 of the specified currency indicated on the face
hereof (provided that any remaining principal amount hereof shall not be less
than the minimum authorized denomination hereof) at the option of the holder
hereof at a price equal to 100% of the principal amount to be repaid, together
with interest hereon payable to the date of repayment. For this Note to be
repaid in whole or in part at the option of the holder hereof, the Company must
receive at the corporate trust office of the Paying Agent in the Borough of
Manhattan, The City of New York, at least 30 days but not more than 60 days
prior to the repayment, (i) this Note with the form entitled "Option to Elect
Repayment" on the reverse hereof duly completed or (ii) a telegram, facsimile
transmission or a letter from a member of a national securities exchange or a
member of the National Association of Securities Dealers, Inc. (the "NASD") or a
commercial bank or trust company in the United States which must set forth the
name of the holder of this Note, the principal amount of this Note, the
principal amount of this Note to be repaid, the certificate number or a
description of the tenor and terms of this Note, a statement that the option to
elect repayment is being exercised thereby and a guarantee that this Note to be
repaid, together with the duly completed form entitled "Option to Elect
Repayment" on the reverse hereof, will be received by the Paying Agent not later
than the fifth Business Day after the date of such telegram, facsimile
transmission or letter; provided, that such telegram, facsimile transmission or
a letter from a member of a national securities exchange or a member of the NASD
or a commercial bank or trust company in the United States shall only be
effective if in such case, this Note and form duly completed are received by the
Company by such fifth Business Day. Exercise of such repayment option by the
holder hereof shall be irrevocable. In the event of repayment of this Note in
part only, a new Note or Notes for the amount of the unpaid portion hereof shall
be issued in the name of the holder hereof upon cancellation hereof.
Interest payments on this Note will include interest accrued to but
excluding the Interest Payment Dates or the Stated Maturity (or earlier
redemption or repayment date), as the case may be. Interest payments for this
Note will be computed and paid on the basis of a 360-day year of twelve 30-day
months.
In the case where the Interest Payment Date or the Stated Maturity (or any
redemption or repayment date) does not fall on a Business Day, payment of
interest, premium, if any, or principal otherwise payable on such date need not
be made on such date, but may be made on the next succeeding Business Day with
the same force and effect as if made on the Interest Payment Date or on the
Stated Maturity (or any redemption or repayment date), and no interest shall
accrue for the period from and after the Interest Payment Date or the Stated
Maturity (or any redemption or repayment date) to such next succeeding Business
Day.
This Note is unsecured and ranks pari passu with all other unsecured and
unsubordinated indebtedness of the Company (excluding subsidiary debt) for
borrowed money.
7
<PAGE> 8
This Note, and any Note or Notes issued upon transfer or exchange hereof,
is issuable only in fully registered form, without coupons, in denominations of
$100,000 or any integral multiple of $1,000.
State Street Bank and Trust Company has been appointed registrar for the
Notes (the "Registrar," which term includes any successor registrar appointed by
the Company), and the Registrar will maintain at its office at Two International
Place, Boston, MA 02110 a register for the registration and transfer of Notes.
This Note may be transferred at the aforesaid office of the Registrar by
surrendering this Note for cancellation, accompanied by a written instrument of
transfer in form approved by the Registrar and duly executed by the registered
holder hereof in person or by the holder's attorney duly authorized in writing,
and thereupon the Registrar shall issue in the name of the transferee or
transferees, in exchange herefor, a new Note or Notes having identical terms and
provisions for an equal aggregate principal amount in authorized denominations,
subject to the terms and conditions set forth herein; provided, however, that
the Registrar will not be required to register the transfer of or exchange any
Note that has been called for redemption in whole or in part, or as to which the
holder thereof has elected to cause such Note to be repaid in whole or in part,
except the unredeemed or unpaid portion of Notes being redeemed or repaid in
part, or to register the transfer of or exchange Notes to the extent and during
the period so provided in the Indenture with respect to the redemption of Notes.
Notes are exchangeable at said office for other Notes of other authorized
denominations of equal aggregate principal amount having identical terms and
provisions. All such exchanges and transfers of Notes will be free of charge,
but the Company may require payment of a sum sufficient to cover any tax or
other governmental charge in connection therewith. All Notes surrendered for
exchange shall be accompanied by a written instrument of transfer in form
approved by the Registrar and executed by the registered holder in person or by
the holder's attorney duly authorized in writing. The date of registration of
any Note delivered upon any exchange or transfer of Notes shall be such that no
gain or loss of interest results from such exchange or transfer.
In case any Note shall at any time become mutilated, defaced or be
destroyed, lost or stolen and such Note or evidence of the loss, theft or
destruction thereof (together with the indemnity hereinafter referred to and
such other documents or proof as may be required in the premises) shall be
delivered to the Registrar, a new Note of like tenor will be issued by the
Company in exchange for the Note so mutilated or defaced, or in lieu of the Note
so destroyed or lost or stolen, but, in the case of any destroyed or lost or
stolen Note, only upon receipt of evidence satisfactory to the Registrar and the
Company that such Note was destroyed or lost or stolen and, if required, upon
receipt also of indemnity satisfactory to each of them. All expenses and
reasonable charges associated with procuring such indemnity and with the
preparation, authentication and delivery of a new Note shall be borne by the
owner of the Note mutilated, defaced, destroyed, lost or stolen.
The Indenture provides that if an Event of Default (as defined in the
Indenture) with respect to any series of debt securities issued under the
Indenture, including the series of Medium-Term Notes of which this Note forms a
part, shall have occurred and be continuing, either the Trustee or the Holders
of not less than 25% in principal amount of the debt securities
8
<PAGE> 9
of such series then outstanding under the Indenture, by notice in writing to the
Company (and to the Trustee if given by securityholders of such series), may
declare the principal (or, if any of the Securities of that series are Original
Issue Discount Securities, such portion of the principal amount of such
Securities as may be specified in the terms thereof) of all debt securities of
such series to be due and payable immediately, but upon certain conditions such
declarations may be annulled and past defaults may be waived (except a
continuing default in payment of principal (or premium, if any) or interest on
such debt securities) by the holders of a majority in principal amount of the
debt securities of such series then outstanding.
If the face hereof indicates that this Note is subject to "Modified Payment
upon Acceleration," then (i) if the principal hereof is declared to be due and
payable as described in the preceding paragraph, the amount of principal due and
payable with respect to this Note shall be limited to the sum of the Issue Price
specified on the face hereof plus the Amortized Amount, (ii) for the purpose of
any vote of securityholders taken pursuant to the Indenture prior to the
acceleration of payment of this Note, the principal amount hereof shall equal
the amount that would be due and payable hereon, calculated as set forth in
clause (i) above, if this Note were declared to be due and payable on the date
of any such vote and (iii) for the purpose of any vote of securityholders taken
pursuant to the Indenture following the acceleration of payment of this Note,
the principal amount hereof shall equal the amount of principal due and payable
with respect to this Note, calculated as set forth in clause (i) above.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities of each series to be
affected under the Indenture at any time by the Company and the Trustee with the
consent of the Holders of a majority in principal amount of the Securities at
the time Outstanding of each series to be affected. The Indenture also contains
provisions permitting the Holders of specified percentages in principal amount
of the Securities of each series at the time Outstanding, on behalf of the
Holders of all Securities of such series, to waive compliance by the Company
with certain provisions of the Indenture and certain past defaults under the
Indenture and their consequences. Any such consent or waiver by the Holder of
this Security shall be conclusive and binding upon such Holder and upon all
future Holders of this Security and of any Security issued upon the registration
of transfer hereof or in exchange hereof or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Security.
So long as this Note shall be outstanding, the Company will cause to be
maintained an office or agency for the payment of the principal of and premium,
if any, and interest on this Note as herein provided in the Borough of
Manhattan, the City of New York, and an office or agency in said City of New
York for the registration, transfer and exchange as aforesaid of the Notes. The
Company may designate other agencies for the payment of said principal, premium,
if any, and interest at such place or places (subject to applicable laws and
regulations) as the Company may decide. So long as there shall be any such
agency, the Company shall keep the Trustee advised of the names and locations of
such agencies, if any are so designated.
With respect to moneys paid by the Company and held by the Trustee or any
Paying Agent for the payment of the principal of or interest or premium, if any,
on any Notes that
9
<PAGE> 10
remain unclaimed at the end of three years after such principal, interest or
premium shall have become due and payable (whether at maturity or upon call for
redemption or otherwise), (i) the Trustee or such Paying Agent shall notify the
holders of such Notes that such moneys shall be repaid to the Company and any
person claiming such monies shall thereafter look only to the Company for
payment thereof and (ii) such moneys shall be so repaid to the Company. Upon
such repayment all liability of the Trustee or such Paying Agent with respect to
such monies shall thereupon cease, without, however, limiting in any way any
obligation that the Company may have to pay the principal of or interest or
premium, if any, on this Note as the same shall become due.
No provision of this Note or of the Indenture shall alter or impair the
obligation of the Company, which is absolute and unconditional, to pay the
principal of, premium, if any, and interest on this Note at the time, place, and
rate, and in the coin or currency, herein and in the Indenture prescribed unless
otherwise agreed between the Company and the registered holder of this Note.
Prior to due presentment of this Note for registration of transfer, the
Company or any agent of the Company, the Registrar or the Trustee may treat the
holder in whose name this Note is registered as the owner hereof for all
purposes, whether or not this Note be overdue, and neither the Company, the
Registrar, the Trustee nor any such agent shall be affected by notice to the
contrary.
No recourse shall be had for the payment of the principal of, or premium,
if any, or the interest on, this Note, for any claim based hereon, or otherwise
in respect hereof, or based on or in respect of the Indenture or any indenture
supplemental thereto, against any incorporator, shareholder, officer or
director, as such, past, present or future, of the Company or of any successor
corporation, either directly or through the Company or any successor
corporation, whether by virtue of any constitution, statute or rule of law or by
the enforcement of any assessment or penalty or otherwise, all such liability
being, by the acceptance hereof and as part of the consideration for the issue
hereof, expressly waived and released.
This Note shall for all purposes be governed by, and construed in
accordance with, the laws of the State of New York.
As used herein:
(a) the term "Amortized Amount" is equal to the original issue
discount amortized from the Original Issue Date to the date of redemption
or declaration, as the case may be, which amortization shall be calculated
using the "constant yield method" (computed in accordance with the rules
under the Internal Revenue Code of 1986, as amended, and the regulations
thereunder, in effect on the date of redemption or declaration, as the case
may be); and
(b) all other terms used in this Note which are defined in the
Indenture and not otherwise defined herein shall have the meanings assigned
to them in the Indenture.
10
<PAGE> 11
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM-as tenants in common
TEN ENT-as tenants by the entireties
JT TEN-as joint tenants with right of survivorship and not as tenants in common
UNIF GIFT MIN ACT- Custodian
------------------ -----------------------------
(Cust) (Minor)
Under Uniform Gifts to Minors Act
-------------------------------
(State)
Additional abbreviations may also be used though not in the above list.
---------------
11
<PAGE> 12
FORM OF ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
[PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE]
---------------------------------------
- --------------------------------------------------------------------------------
[PLEASE PRINT OR TYPE NAME AND ADDRESS INCLUDING ZIP CODE, OF ASSIGNEE.
SIGNATURE MUST BE GUARANTEED BY A BANK, TRUST COMPANY OR BROKER WHO IS A MEMBER
OF A SIGNATURE GUARANTEE MEDALLION PROGRAM.]
- --------------------------------------------------------------------------------
the within Note and all rights thereunder, hereby irrevocably constituting and
appointing
- --------------------------------------------------------------------------------
such person attorney to transfer such Note on the books of the Company, with
full power
- --------------------------------------------------------------------------------
of substitution in the premises.
Dated:
-----------------------
NOTICE: The signature to this assignment must correspond with the name as
written upon the face of the within Note in every particular without alteration
or enlargement or any change whatsoever.
12
<PAGE> 13
FORM OF OPTION TO ELECT REPAYMENT
The undersigned hereby irrevocably request(s) the Issuer to repay the
within Note (or portion thereof specified below) pursuant to its terms at a
price equal to the principal amount thereof, together with interest to the
Optional Repayment Date, to the undersigned, at
- --------------------------------------------------------------------------------
(Please print or typewrite name and address of the undersigned)
If less than the entire principal amount of the within Note is to be
repaid, specify the portion thereof (which shall be increments of $1,000) which
the holder elects to have repaid: ___________________; and [specify the
denomination or denominations (which shall not be less than the minimum
authorized denomination)] of the Notes to be issued to the holder for the
portion of the within Note not being repaid (in the absence of any such
specification, one such Note will be issued for the portion not being repaid):
- ---------------------------
Dated:
-------------------- ---------------------------------------
NOTICE: The signature on this Option to
Elect Repayment must correspond with
the name as written upon the face of
the within instrument in every
particular without alteration or
enlargement.
- ---------------------------
* Applies only if this Note is a Registered Global Security.
13
<PAGE> 1
EXHIBIT 4.2
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE DEPOSITARY OR A
NOMINEE OF THE DEPOSITARY. THIS SECURITY IS EXCHANGEABLE FOR SECURITIES
REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY
IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE AND MAY NOT BE
TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY
OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE
DEPOSITARY.
THIS SECURITY IS A BOOK-ENTRY SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A
NOMINEE OF A DEPOSITARY. THIS SECURITY IS EXCHANGEABLE FOR SECURITIES REGISTERED
IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN THE
LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO TRANSFER OF THIS
SECURITY (OTHER THAN A TRANSFER OF THIS SECURITY AS A WHOLE BY THE DEPOSITARY TO
A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY
OR ANOTHER NOMINEE OF THE DEPOSITARY) MAY BE REGISTERED EXCEPT IN SUCH LIMITED
CIRCUMSTANCES.
[FORM OF FACE OF FLOATING RATE REGISTERED NOTE]
Floating Rate Note
REGISTERED REGISTERED
No. FLR [PRINCIPAL AMOUNT]
CUSIP: *
Unless this certificate is presented by an authorized representative of The
Depository Trust Company (55 Water Street, New York, New York) to the issuer or
its agent for registration of transfer, exchange or payment, and any certificate
issued is registered in the name of Cede & Co. or such other name as requested
by an authorized representative of The Depository Trust Company and any payment
is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL since the registered owner hereof,
Cede & Co., has an interest herein.*
IF APPLICABLE, THE "AMOUNT OF OID", THE "ORIGINAL ISSUE DATE", THE "YIELD TO
MATURITY," AS WELL AS THE METHOD USED TO DETERMINE THE YIELD TO MATURITY WHERE
THERE IS A SHORT ACCRUAL PERIOD AND THE AMOUNT OF OID ALLOCABLE TO SUCH SHORT
ACCRUAL PERIOD WILL BE SET FORTH BELOW. THE CALCULATION OF THE AMOUNT OF OID
UPON (A) OPTIONAL REDEMPTION OR (B) DECLARATION OF ACCELERATION IS DISCUSSED ON
THE REVERSE HEREOF.
1
<PAGE> 2
<TABLE>
<CAPTION>
HOUGHTON MIFFLIN COMPANY
MEDIUM-TERM NOTE
(Floating Rate)
<S> <C> <C> <C>
ORIGINAL ISSUE INITIAL INTEREST SPREAD (PLUS OR INITIAL REDEMPTION
DATE: DATE: MINUS): DATE:
STATED MATURITY: INTEREST ACCRUAL ALTERNATE RATE INITIAL REDEMPTION
DATE: EVENT SPREAD: PERCENTAGE:
SPECIFIED MAXIMUM INTEREST SPREAD MULTIPLIER: APPLICABILITY OF
CURRENCY: U.S. RATE: ANNUAL
DOLLARS REDEMPTION
PERCENTAGE
REDUCTION:
INTEREST PAYMENT MINIMUM INTEREST INTEREST PAYMENT IF YES, STATE
DATE(S): RATE: METHOD: ANNUAL
PERCENTAGE
REDUCTION:
INDEX MATURITY: INTEREST RESET
PERIOD:
APPLICABILITY OF TOTAL AMOUNT OF OPTIONAL
ANNUAL OID: REPAYMENT
REDEMPTION DATE(S):
PERCENTAGE
INCREASE:
IF YES, STATE APPLICABILITY OF YIELD TO MATURITY:
ANNUAL MODIFIED PAYMENT
PERCENTAGE UPON
INCREASE: ACCELERATION:
IF YES, STATE ISSUE INITIAL ACCRUAL
PRICE: PERIOD OID
(COMPUTED UNDER
THE APPROXIMATION
METHOD):
</TABLE>
Houghton Mifflin Company, a Massachusetts corporation (together with its
successors and assigns, the "Company"), for value received, hereby promises to
pay to _______________________, or registered assignees, the principal sum
of_______________ on the Stated Maturity specified above (except to the extent
redeemed or repaid prior to the Stated Maturity) and to pay interest thereon,
from the Original Issue Date specified above at a rate per annum equal to the
Initial Interest Rate specified above until the first Interest Reset Date next
succeeding the Original Issue Date specified above, and thereafter at a rate per
annum determined in accordance with the provisions specified on
2
<PAGE> 3
the reverse hereof until the principal hereof is paid or duly made available for
payment. The Company will pay interest in arrears monthly, quarterly,
semiannually or annually as specified above as the Interest Payment Period on
each Interest Payment Date (as specified above), commencing with the first
Interest Payment Date next succeeding the Original Issue Date specified above,
and on the Stated Maturity (or any redemption or repayment date); provided,
however, that if the Original Issue Date occurs between a Record Date, as
defined below, and the next succeeding Interest Payment Date, interest payments
will commence on the second Interest Payment Date succeeding the Original Issue
Date to the registered holder of this Note on the Record Date with respect to
such second Interest Payment Date; and provided, further, that if an Interest
Payment Date or the Stated Maturity or redemption or repayment date would fall
on a day that is not a Business Day (this and certain other capitalized terms
used herein are defined on the reverse of this Note), such Interest Payment
Date, Stated Maturity or redemption or repayment date shall be the following day
that is a Business Day, except that if the Base Rate Specified above is LIBOR
and such next Business Day falls in the next calendar month, the Interest
Payment Date, Stated Maturity or redemption or repayment date shall be the
immediately preceding day that is a Business Day.
Payment of the principal of this Note, any premium and the interest due at
the Stated Maturity (or any redemption or repayment date) will be made in
immediately available funds upon surrender of this Note at the office or agency
of such paying agent as the Company may determine maintained for that purpose in
The City of New York (a "Paying Agent"), or at the office or agency of such
other Paying Agent as the Company may determine.
Interest on this Note will accrue from the most recent Interest Payment
Date to which interest has been paid or duly provided for or, if no interest has
been paid or duly provided for, from the Original Issue Date, until the
principal hereof has been paid or duly made available for payment (except as
provided below). The interest so payable, and punctually paid or duly provided
for, on any Interest Payment Date, will, subject to certain exceptions described
herein, be paid to the person in whose name this Note (or one or more
predecessor Notes) is registered at the close of business on the date 15 days
prior to an Interest Payment Date (whether or not a Business Day) (the "Record
Date"); provided, however, that interest payable on the Stated Maturity (or any
redemption or repayment date) will be payable to the person to whom the
principal hereof shall be payable.
The specified currency indicated on the face hereof shall be U.S. dollars.
Payment of the principal of and premium, if any, and interest on this Note will
be made in such coin or currency of the United States as at the time of payment
is legal tender for payment of public and private debts; provided, however, that
payments of interest, other than interest due at maturity (or any redemption or
repayment date) will be made by United States dollar check mailed to the address
of the person entitled thereto as such address shall appear in the Note
register. A holder of U.S. $5,000,000 or more in aggregate principal amount of
Notes having the same Interest Payment Date will be entitled to receive payments
of interest, other than interest due at maturity or any date of redemption, by
wire transfer of immediately available funds to an account within the United
States maintained by the holder of this Note if appropriate wire transfer
instructions in writing have been received by the Paying Agent not less than 10
days prior to the applicable Interest Payment Date.
3
<PAGE> 4
Reference is hereby made to the further provisions of this Note set forth
on the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by the
Authenticating Agent, as defined on the reverse hereof, by manual signature,
this Note shall not be entitled to any benefit under the Indenture, as defined
on the reverse hereof, or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this Note to be duly executed
under its corporate seal.
DATED: HOUGHTON MIFFLIN COMPANY
By:
------------------------------------
Nader F. Darehshori
Chairman of the Board, President and
Chief Executive Officer
By:
------------------------------------
Gail Deegan
Executive Vice President, Chief
Financial Officer and Treasurer
[SEAL]
Attest:
- ------------------------------------
Name:
Title:
4
<PAGE> 5
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This Security is one of the Securities referred to in the within-mentioned
Indenture.
STATE STREET BANK AND
TRUST COMPANY, as Trustee and
Authenticating Agent
By:
--------------------------------
Arthur J. MacDonald
Assistant Vice President
5
<PAGE> 6
[FORM OF REVERSE OF NOTE]
This Note is one of a duly authorized issue of Medium-Term Notes having
maturities from nine months to 30 years from the date of issue (the "Notes") of
the Company. The Notes are issuable under an Indenture, dated as of March 15,
1994, as supplemented by a First Supplemental Indenture dated as of July 27,
1995 (together, the "Indenture"), between the Company and State Street Bank and
Trust Company, as successor trustee (herein called the "Trustee," which term
includes any successor trustee under the Indenture) to The First National Bank
of Boston, to which Indenture and all indentures supplemental thereto reference
is hereby made for a statement of the respective rights, limitations of rights,
duties and immunities of the Company, the Trustee and holders of the Notes and
the terms upon which the Notes are, and are to be, authenticated and delivered.
State Street Bank and Trust Company has been appointed Authenticating Agent, and
Calculation Agent (the "Authenticating Agent" and "Calculation Agent,"
respectively, which terms include any successor authenticating agent or
calculation agent, as the case may be) with respect to the Notes, and State
Street Bank and Trust Company at its corporate trust office at Two International
Place, Boston, MA 02110 has been appointed the registrar and a Paying Agent with
respect to the Notes. The terms of individual Notes may vary with respect to
interest rates, interest rate formulas, issue dates, maturity dates, or
otherwise, all as provided in the Indenture. To the extent not inconsistent
herewith, the terms of the Indenture are hereby incorporated by reference
herein.
This Note will not be subject to any sinking fund and, unless otherwise
provided on the face hereof in accordance with the provisions of the following
two paragraphs, will not be redeemable or subject to repayment at the option of
the holder prior to maturity.
Unless otherwise indicated on the face of this Note, this Note may not be
redeemed prior to the Stated Maturity. If the face of this Note indicates that
this Note is subject to (i) "Annual Redemption Percentage Reduction" or (ii)
"Annual Redemption Percentage Increase," then this Note may be redeemed in whole
or in part at the option of the Company on or after the Initial Redemption Date
specified on the face hereof on the terms set forth on the face hereof, together
with interest accrued and unpaid hereon to the date of redemption (except as
provided below). If this Note is subject to "Annual Redemption Percentage
Reduction," the Initial Redemption Percentage indicated on the face hereof will
be reduced on each anniversary of the Initial Redemption Date specified above by
the Annual Percentage Reduction specified on the face hereof until the
redemption price of this Note is 100% of the principal amount hereof. If this
Note is subject to "Annual Redemption Percentage Increase," the amount of
original issue discount allocable to such short accrual period is the Amortized
Amount. Notice of redemption shall be mailed to the registered holders of the
Notes designated for redemption at their addresses as the same shall appear on
the Note register not less than 30 days nor more than 60 days prior to the date
of redemption, subject to all the conditions and provisions of the Indenture. In
the event of redemption of this Note in part only, a new Note or Notes for the
amount of the unredeemed portion hereof shall be issued in the name of the
holder hereof upon the presentation and cancellation hereof.
Unless otherwise indicated on the face of this Note, this Note shall not be
subject to repayment at the option of the holder prior to the Stated Maturity.
If so indicated on the face of this
6
<PAGE> 7
Note, this Note may be subject to repayment at the option of the holder on the
Optional Repayment Date or Dates specified on the face hereof on the terms set
forth herein.
On any Optional Repayment Date, this Note will be repayable in whole or in
part in increments of $1,000 of the specified currency indicated on the face
hereof (provided that any remaining principal amount hereof shall not be less
than the minimum authorized denomination hereof) at the option of the holder
hereof at a price equal to 100% of the principal amount to be repaid, together
with interest hereon payable to the date of repayment. For this Note to be
repaid in whole or in part at the option of the holder hereof, the Company must
receive at the corporate trust office of the Paying Agent in the Borough of
Manhattan, The City of New York, at least 30 days but not more than 60 days
prior to the repayment, (i) this Note with the form entitled "Option to Elect
Repayment" on the reverse hereof duly completed or (ii) a telegram, facsimile
transmission or a letter from a member of a national securities exchange or a
member of the National Association of Securities Dealers, Inc. (the "NASD") or a
commercial bank or trust company in the United States which must set forth the
name of the holder of this Note, the principal amount of this Note, the
principal amount of this Note to be repaid, the certificate number or a
description of the tenor and terms of this Note, a statement that the option to
elect repayment is being exercised thereby and a guarantee that this Note to be
repaid, together with the duly completed form entitled "Option to Elect
Repayment" on the reverse hereof, will be received by the Paying Agent not later
than the fifth Business Day after the date of such telegram, facsimile
transmission or letter; provided, that such telegram, facsimile transmission or
a letter from a member of a national securities exchange or a member of the NASD
or a commercial bank or trust company in the United States shall only be
effective if in such case, this Note and form duly completed are received by the
Company by such fifth Business Day. Exercise of such repayment option by the
holder hereof shall be irrevocable. In the event of repayment of this Note in
part only, a new Note or Notes for the amount of the unpaid portion hereof shall
be issued in the name of the holder hereof upon cancellation hereof.
This Note will bear interest at the rate determined in accordance with the
applicable provisions below by reference to the [rate] shown on the face hereof
based on the [index], if any, shown on the face hereof (i) plus or minus the
[spread], if any, or (ii) multiplied by the [spread multiplier], if any,
specified on the face hereof. Commencing with the Initial Interest Reset Date
next succeeding the Original Issue Date specified on the face hereof, the rate
at which interest on this Note is payable shall be reset as of each Interest
Reset Date. The Interest Reset Dates will be the Interest Reset Dates specified
on the face hereof; provided, however, that the interest rate in effect for the
period from the Original Issue Date to the first Interest Reset Date next
succeeding the Original Issue Date specified on the face hereof will be the
Initial Interest Rate. If any Interest Reset Date would otherwise be a day that
is not a Business Day, such Interest Reset Date shall be postponed to the next
succeeding day that is a Business Day, except that if the Base Rate specified on
the face hereof is LIBOR and such Business Day is in the next succeeding
calendar month, such Interest Reset Date shall be the next preceding Business
Day.
The Interest Determination Date pertaining to an Interest Reset Date for
Notes bearing interest calculated by reference to the CD Rate, Commercial Paper
Rate, Federal Funds Rate and Prime Rate will be the second Business Day next
preceding such Interest Reset Date. The Interest Determination Date pertaining
to an Interest Reset Date for Notes bearing interest calculated by
7
<PAGE> 8
reference to LIBOR shall be the second London Banking Day preceding such
Interest Reset Date. The Interest Determination Date pertaining to an Interest
Reset Date for Notes bearing interest calculated by reference to the Treasury
Rate shall be the day of the week in which such Interest Reset Date falls on
which Treasury bills normally would be auctioned; provided, however, that if as
a result of a legal holiday an auction is held on the Friday of the week
preceding such Interest Reset Date, the related Interest Determination Date
shall be such preceding Friday; and provided, further, that if an auction shall
fall on any Interest Reset Date, then the Interest Reset Date shall instead be
the first Business Day following the date of such auction.
The "Calculation Date" pertaining to any Interest Determination Date will
be the earlier of the tenth day after such Interest Determination Date or the
next succeeding Record Date after such Interest Determination Date or, if either
such day is not a Business Day, the next succeeding Business Day.
DETERMINATION OF CD RATE. If the Base Rate specified on the face hereof is
the CD Rate, the CD Rate with respect to this Note shall be determined on each
Interest Determination Date and shall be the rate on such date for negotiable
certificates of deposit having the Index Maturity specified on the face hereof
as published by the Board of Governors of the Federal Reserve System in
"Statistical Release H.15(519), Selected Interest Rates," or any successor
publication of the Board of Governors of the Federal Reserve System
("H.15(519)"), under the heading "CDS (Secondary Market)," or, if not so
published by 3:00 P.M., New York City time, on the Calculation Date pertaining
to such Interest Determination Date, the CD Rate will be the rate on such
Interest Determination Date for negotiable certificates of deposit of the Index
Maturity specified on the face hereof as published by the Federal Reserve Bank
of New York in its daily statistical release "Composite 3:30 P.M. Quotations for
U.S. Government Securities" ("Composite Quotations") under the heading
"Certificates of Deposit." If neither of such rates is published by 3:00 P.M.,
New York City time, on such Calculation Date, then the CD Rate on such Interest
Determination Date will be calculated by the Calculation Agent referred to on
the face hereof and will be the arithmetic mean of the secondary market offered
rates as of 10:00 A.M., New York City time, on such Interest Determination Date,
for certificates of deposit in the denomination of U.S. $5,000,000 with a
remaining maturity closest to the Index Maturity specified on the face hereof of
three leading nonbank dealers in negotiable U.S. dollar certificates of deposit
in The City of New York selected by the Calculation Agent for negotiable
certificates of deposit of major United States money center banks of the highest
credit standing in the market for negotiable certificates of deposit; provided,
however, that if the dealers selected as aforesaid by the Calculation Agent are
not quoting as mentioned in this sentence, the rate of interest in effect for
the applicable period will be the same as the CD Rate for the immediately
preceding Interest Reset Period (or, if there was no such Interest Reset Period,
the rate of interest payable hereon shall be the Initial Interest Rate).
DETERMINATION OF COMMERCIAL PAPER RATE. If the Base Rate specified on the
face hereof is the Commercial Paper Rate, the Commercial Paper Rate with respect
to this Note shall be determined on each Interest Determination Date and shall
be the Money Market Yield (as defined herein) of the rate on such date for
commercial paper having the Index Maturity specified on the face hereof, as such
rate shall be published in H.15(519) under the heading "Commercial Paper," or if
not so published prior to 3:00 P.M., New York City time, on the Calculation Date
pertaining to such
8
<PAGE> 9
Interest Determination Date, the Commercial Paper Rate shall be the Money Market
Yield of the rate on such Interest Determination Date for commercial paper of
the Index Maturity specified on the face hereof as published in Composite
Quotations under the heading "Commercial Paper (with an Index Maturity of one
month or three months being deemed to be equivalent to an Index Maturity of 30
days or 90 days, respectively)." If neither of such rates is published by 3:00
P.M., New York City time, on such Calculation Date, then the Commercial Paper
Rate shall be the Money Market Yield of the arithmetic mean of the offered rates
as of 11:00 A.M., New York City time, on such Interest Determination Date of
three leading dealers in commercial paper in The City of New York selected by
the Calculation Agent for commercial paper of the Index Maturity specified on
the face hereof, placed for an industrial issuer whose bond rating is "AA," or
the equivalent, from a nationally recognized rating agency; provided, however,
that if the dealers selected as aforesaid by the Calculation Agent are not
quoting as mentioned in this sentence, the rate of interest in effect for the
applicable period will be the same as the Commercial Paper Rate for the
immediately preceding Interest Reset Period (or, if there was no such Interest
Reset Period, the rate of interest payable hereon shall be the Initial Interest
Rate).
"Money Market Yield" shall be the yield expressed as a percentage
calculated in accordance with the following formula:
Money Market Yield = D x 360
----------------- x 100
360 - (D x M)
where "D" refers to the applicable per annum rate for commercial paper
quoted on a bank discount basis and expressed as a decimal and "M" refers to the
actual number of days in the interest period for which interest is being
calculated.
DETERMINATION OF FEDERAL FUNDS RATE. If the Base Rate specified on the
face hereof is the Federal Funds Rate, the Federal Funds Rate with respect to
this Note shall be determined on each Interest Determination Date and shall be
the rate on such date for Federal Funds as published in H.15(519) under the
heading "Federal Funds (Effective)," or, if not so published by 3:00 P.M., New
York City time, on the Calculation Date pertaining to such Interest
Determination Date, the Federal Funds Rate will be the rate on such Interest
Determination Date as published in Composite Quotations under the heading
"Federal Funds/Effective Rate." If neither of such rates is published by 3:00
P.M., New York City time, on such Calculation Date, the Federal Funds Rate for
such Interest Determination Date will be calculated by the Calculation Agent and
will be the arithmetic mean of the rates for the last transaction in overnight
Federal funds as of 9:00 A.M., New York City time, on such Interest
Determination Date arranged by three leading brokers in Federal funds
transactions in The City of New York selected by the Calculation Agent;
provided, however, that if the brokers selected as aforesaid by the Calculation
Agent are not quoting as mentioned in this sentence, the rate of interest in
effect for the applicable period will be the same as the Federal Funds Rate for
the immediately preceding Interest Reset Period (or, if there was no such
Interest Reset Period, the rate of interest payable hereon shall be the Initial
Interest Rate).
9
<PAGE> 10
DETERMINATION OF LIBOR. If the Base Rate specified on the face hereof is
LIBOR, LIBOR with respect to this Note shall be determined on each Interest
Determination Date as follows:
(i) as of the Interest Determination Date, the Calculation Agent shall
determine the arithmetic mean of the offered rates for deposits in U.S.
dollars for the period of the Index Maturity specified on the face hereof
which appear on the Reuters Screen LIBO Page at approximately 11:00 A.M.,
London time, on such Interest Determination Date. "Reuters Screen LIBO
Page," as used herein, means the display designated as Page "LIBO" on the
Reuters Monitor Money Rate Service (or such other page as may replace the
LIBO page on that service for the purpose of displaying London interbank
offered rates of major banks).
(ii) if fewer than two offered rates appear on the Reuters Screen LIBO
Page, the Calculation Agent will request the principal London offices of
each of four major banks in the London interbank market, as selected by the
Calculation Agent, to provide the Calculation Agent with its offered
quotation for deposits in U.S. dollars for the period of the Index
Maturity, specified on the face hereof, to prime banks in the London
interbank market at approximately 11:00 A.M., London time, on such Interest
Determination Date and in a principal amount of not less than U.S.
$1,000,000 that is representative for a single transaction in such market
at such time. If at least two such quotations are provided, LIBOR will be
the arithmetic mean of such quotations. If fewer than two quotations are
provided, LIBOR in respect of such Interest Determination Date will be the
arithmetic mean of the rates quoted by three major banks in The City of New
York selected by the Calculation Agent (after consultation with the
Company) at approximately 11:00 A.M., New York City time, on such Interest
Determination Date for loans in U.S. dollars to leading European banks, for
the period of the Index Maturity and in a principal amount of not less than
U.S. $1,000,000 that is representative of a single transaction in such
market at such time; provided, however, that if fewer than three banks
selected as aforesaid by the Calculation Agent are quoting as mentioned in
this sentence, LIBOR for such Interest Reset Period will be the same as
LIBOR for the immediately preceding Interest Reset Period (or, if there was
no such Interest Reset Period, the rate of interest payable hereon shall be
the Initial Interest Rate).
DETERMINATION OF PRIME RATE. If the Base Rate specified on the face hereof
is the Prime Rate, the Prime Rate with respect to this Note shall be determined
on each Interest Determination Date and shall be the rate set forth in H.15(519)
for such date opposite the caption "Bank Prime Loan." If such rate is not yet
published by 9:00 A.M. New York City time, on the Calculation Date, the Prime
Rate for such Interest Determination Date will be the arithmetic mean of the
rates of interest publicly announced by each bank named on the display
designated as page "USPrime1" on the Reuters Monitor Money Rate Service (or such
other page as may replace the USPrime1 page on such service for the purpose of
displaying the prime rate or base lending rate of major New York City banks)
(the "Reuters Screen USPrime1 Page") as such bank's prime rate or base lending
rate as in effect for such Interest Determination Date as quoted on the Reuters
Screen USPrime1 Page on such Interest Determination Date, or, if fewer than four
such rates appear on the Reuters Screen USPrime1 Page for such Interest
Determination Date, the rate shall be the arithmetic mean of the prime rates
quoted on the basis of the actual number of days in the year divided by 360 as
of the close of business on such Interest Determination Date by at least two of
the three major money center banks in The City
10
<PAGE> 11
of New York selected by the Calculation Agent from which quotations are
requested. If fewer than two quotations are provided, the Prime Rate shall be
calculated by the Calculation Agent and shall be determined as the arithmetic
mean on the basis of the prime rates in The City of New York by the appropriate
number of substitute banks or trust companies organized and doing business under
the laws of the United States, or any State thereof, in each case having total
equity capital of at least U.S. $500 million and being subject to supervision or
examination by Federal or State authority, selected by the Calculation Agent to
quote such rate or rates.
If in any month or two consecutive months the Prime Rate is not published
in H.15(519) and the banks or trust companies selected as aforesaid are not
quoting as mentioned in the preceding paragraph, the "Prime Rate" for such
Interest Reset Period will be the same as the Prime Rate for the immediately
preceding Interest Reset Period (or, if there was no such Interest Reset Period,
the rate of interest payable hereon shall be the Initial Interest Rate). If this
failure continues over three or more consecutive months, the Prime Rate for each
succeeding Interest Determination Date until the maturity or redemption of this
Note or, if earlier, until this failure ceases, shall be LIBOR determined as if
the Base Rate specified on the face hereof were LIBOR, and the Spread, if any,
shall be the number of basis points specified on the face hereof as the
"Alternate Rate Event Spread."
DETERMINATION OF TREASURY RATE. If the Base Rate specified on the face
hereof is the Treasury Rate, the Treasury Rate with respect to this Note shall
be determined on each Interest Determination Date and shall be the rate for the
auction held on such date of direct obligations of the United States ("Treasury
Bills") having the Index Maturity specified on the face hereof, as published in
H.15(519) under the heading "Treasury Bills--auction average (investment)," or
if not so published by 3:00 P.M., New York City time, on the Calculation Date
pertaining to such Interest Determination Date, the auction average rate on such
Interest Determination Date (expressed as a bond equivalent, on the basis of a
year of 365 or 366 days, as applicable, and applied on a daily basis) as
otherwise announced by the United States Department of the Treasury. In the
event that the results of the auction of Treasury Bills having the Index
Maturity specified on the face hereof are not published or reported as provided
above by 3:00 P.M., New York City time, on such Calculation Date or if no such
auction is held on such Determination Date, then the Treasury Rate shall be
calculated by the Calculation Agent and shall be a yield to maturity (expressed
as a bond equivalent, on the basis of a year of 365 or 366 days, as applicable,
and applied on a daily basis) of the arithmetic mean of the secondary market bid
rates, as of approximately 3:30 P.M., New York City time, on such Interest
Determination Date, of three leading primary United States government securities
dealers selected by the Calculation Agent for the issue of Treasury Bills with a
remaining maturity closest to the Index Maturity specified on the face hereof;
provided, however, that if the dealers selected as aforesaid by the Calculation
Agent are not quoting as mentioned in this sentence, the Treasury Rate for such
Interest Reset Date will be the same as the Treasury Rate for the immediately
preceding Interest Reset Period (or, if there was no such Interest Reset Period,
the rate of interest payable hereon shall be the Initial Interest Rate).
Notwithstanding the foregoing, the interest rate hereon shall not be
greater than the Maximum Interest Rate, if any, or less than the Minimum
Interest Rate, if any, specified on the face hereof. The Calculation Agent shall
calculate the interest rate hereon in accordance with the foregoing on or before
each Calculation Date. The interest rate on this Note will in no event be
11
<PAGE> 12
higher than the maximum rate permitted by New York law, as the same may be
modified by United States Federal law of general application.
At the request of the holder hereof, the Calculation Agent will provide to
the holder hereof the interest rate hereon then in effect and, if determined,
the interest rate that will become effective as of the next Interest Reset Date.
Interest payments on this Note will include interest accrued to but
excluding the Interest Payment Dates or the Stated Maturity (or earlier
redemption or repayment date), as the case may be; provided, however, that if
the Interest Reset Period with respect to this Note is daily or weekly, interest
payable on any Interest Payment Date, other than interest payable on any date on
which principal hereof is payable, will include interest accrued through and
including the Record Date next preceding the applicable Interest Payment Date.
Accrued interest hereon shall be an amount calculated by multiplying the face
amount hereof by an accrued interest factor. Such accrued interest factor shall
be computed by adding the interest factor calculated for each day in the period
for which interest is being paid. The interest factor for each such date shall
be computed by dividing the interest rate applicable to such day by 360 if the
Base Rate is CD Rate, Commercial Paper Rate, Federal Funds Rate, Prime Rate or
LIBOR, as specified on the face hereof, or by the actual number of days in the
year if the Base Rate is the Treasury Rate, as specified on the face hereof. All
percentages resulting from any calculation of the rate of interest on this Note
will be rounded, if necessary, to the nearest one hundred-thousandth of a
percentage point (.0000001), with five one-millionths of a percentage point
rounded upward, and all dollar amounts used in or resulting from such
calculation on this Note will be rounded to the nearest cent (with one-half cent
rounded upward). The interest rate in effect on any Interest Reset Date will be
the applicable rate as reset on such date. The interest rate applicable to any
other day is the interest rate from the immediately preceding Interest Reset
Date (or, if none, the Initial Interest Rate).
This Note is unsecured and ranks pari passu with all other unsecured and
unsubordinated indebtedness of the Company (excluding subsidiary debt) for
borrowed money.
This Note, and any Note or Notes issued upon transfer or exchange hereof,
is issuable only in fully registered form, without coupons, in denominations of
US $1,000 or any integral multiple of US $1,000 in excess thereof.
State Street Bank and Trust Company has been appointed registrar for the
Notes (the "Registrar," which term includes any successor registrar appointed by
the Company), and the Registrar will maintain at its office at Two International
Place, Boston, MA 02110 a register for the registration and transfer of Notes.
This Note may be transferred at the aforesaid office of the Registrar by
surrendering this Note for cancellation, accompanied by a written instrument of
transfer in form approved by the Registrar and duly executed by the registered
holder hereof in person or by the holder's attorney duly authorized in writing,
and thereupon the Registrar shall issue in the name of the transferee or
transferees, in exchange herefor, a new Note or Notes having identical terms and
provisions for an equal aggregate principal amount in authorized denominations,
subject to the terms and conditions set forth herein; provided, however, that
the Registrar will not be required to register the transfer of or exchange any
Note that has been called for redemption in whole or in part, or as
12
<PAGE> 13
to which the holder thereof has elected to cause such Note to be repaid in whole
or in part, except the unredeemed or unpaid portion of Notes being redeemed or
repaid in part, or to register the transfer of or exchange Notes to the extent
and during the period so provided in the Indenture with respect to the
redemption of Notes. Notes are exchangeable at said office for other Notes of
other authorized denominations of equal aggregate principal amount having
identical terms and provisions. All such exchanges and transfers of Notes will
be free of charge, but the Company may require payment of a sum sufficient to
cover any tax or other governmental charge in connection therewith. All Notes
surrendered for exchange shall be accompanied by a written instrument of
transfer in form approved by the Registrar and executed by the registered holder
in person or by the holder's attorney duly authorized in writing. The date of
registration of any Note delivered upon any exchange or transfer of Notes shall
be such that no gain or loss of interest results from such exchange or transfer.
In case any Note shall at any time become mutilated, defaced or be
destroyed, lost or stolen and such Note or evidence of the loss, theft or
destruction thereof (together with the indemnity hereinafter referred to and
such other documents or proof as may be required in the premises) shall be
delivered to the Registrar, a new Note of like tenor will be issued by the
Company in exchange for the Note so mutilated or defaced, or in lieu of the Note
so destroyed or lost or stolen, but, in the case of any destroyed or lost or
stolen Note, only upon receipt of evidence satisfactory to the Registrar and the
Company that such Note was destroyed or lost or stolen and, if required, upon
receipt also of indemnity satisfactory to each of them. All expenses and
reasonable charges associated with procuring such indemnity and with the
preparation, authentication and delivery of a new Note shall be borne by the
owner of the Note mutilated, defaced, destroyed, lost or stolen.
The Indenture provides that if an Event of Default (as defined in the
Indenture) with respect to any series of debt securities issued under the
Indenture, including the series of Medium-Term Notes of which this Note forms a
part, shall have occurred and be continuing, either the Trustee or the Holders
of not less than 25% in principal amount of the debt securities of such series
then outstanding under the Indenture, by notice in writing to the Company (and
to the Trustee if given by securityholders of such series) may declare the
principal (or, if any of the Securities of that series are Original Issue
Discount Securities, such portion of the principal amount of such Securities as
may be specified in the terms thereof) of all debt securities of such series to
be due and payable immediately, but upon certain conditions such declarations
may be annulled and past defaults may be waived (except a continuing default in
payment of principal (or premium, if any) or interest on such debt securities)
by the holders of a majority in principal amount of the debt securities of such
series then outstanding.
If the face hereof indicates that this Note is subject to "Modified Payment
upon Acceleration," then (i) if the principal hereof is declared to be due and
payable as described in the preceding paragraph, the amount of principal due and
payable with respect to this Note shall be limited to the sum of the Issue Price
specified on the face hereof plus the Amortized Amount, (ii) for the purpose of
any vote of securityholders taken pursuant to the Indenture prior to the
acceleration of payment of this Note, the principal amount hereof shall equal
the amount that would be due and payable hereon, calculated as set forth in
clause (i) above, if this Note were declared to be due and payable on the date
of any such vote and (iii) for the purpose of any vote of securityholders taken
pursuant to the Indenture following the acceleration of payment of this Note,
the principal amount
13
<PAGE> 14
hereof shall equal the amount of principal due and payable with respect to this
Note, calculated as set forth in clause (i) above.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities of each series to be
affected under the Indenture at any time by the Company and the Trustee with the
consent of the Holders of a majority in principal amount of the Securities at
the time Outstanding of each series to be affected. The Indenture also contains
provisions permitting the Holders of specified percentages in principal amount
of the Securities of each series at the time Outstanding, on behalf of the
Holders of all Securities of such series, to waive compliance by the Company
with certain provisions of the Indenture and certain past defaults under the
Indenture and their consequences. Any such consent or waiver by the Holder of
this Security shall be conclusive and binding upon such Holder and upon all
future Holders of this Security and of any Security issued upon the registration
of transfer hereof or in exchange hereof or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Security.
So long as this Note shall be outstanding, the Company will cause to be
maintained an office or agency for the payment of the principal of and premium,
if any, and interest on this Note as herein provided in the Borough of
Manhattan, The City of New York, and an office or agency in said City of New
York for the registration, transfer and exchange as aforesaid of the Notes. The
Company may designate other agencies for the payment of said principal, premium,
if any, and interest at such place or places (subject to applicable laws and
regulations) as the Company may decide. So long as there shall be any such
agency, the Company shall keep the Trustee advised of the names and locations of
such agencies, if any are so designated.
With respect to moneys paid by the Company and held by the Trustee or any
Paying Agent for the payment of the principal of or interest or premium, if any,
on any Notes that remain unclaimed at the end of three years after such
principal, interest or premium shall have become due and payable (whether at
maturity or upon call for redemption or otherwise), (i) the Trustee or such
Paying Agent shall notify the holders of such Notes that such monies shall be
repaid to the Company and any person claiming such moneys shall thereafter look
only to the Company for payment thereof and (ii) such moneys shall be so repaid
to the Company subject to the terms of the Indenture. Upon such repayment all
liability of the Trustee or such Paying Agent with respect to such monies shall
thereupon cease, without, however, limiting in any way any obligation that the
Company may have to pay the principal of or interest or premium, if any, on this
Note as the same shall become due.
No provision of this Note or of the Indenture shall alter or impair the
obligation of the Company, which is absolute and unconditional, to pay the
principal of, premium, if any, and interest on this Note at the time, place, and
rate, and in the coin or currency, herein and in the Indenture prescribed unless
otherwise agreed between the Company and the registered holder of this Note.
Prior to due presentment of this Note for registration of transfer, the
Company or any agent of the Company, the Registrar or the Trustee may treat the
holder in whose name this Note is registered
14
<PAGE> 15
as the owner hereof for all purposes, whether or not this Note be overdue, and
neither the Company, the Registrar, the Trustee nor any such agent shall be
affected by notice to the contrary.
No recourse shall be had for the payment of the principal of, or premium,
if any, or the interest on, this Note, for any claim based hereon, or otherwise
in respect hereof, or based on or in respect of the Indenture or any indenture
supplemental thereto, against any incorporator, shareholder, officer or
director, as such, past, present or future, of the Company or of any successor
corporation, either directly or through the Company or any successor
corporation, whether by virtue of any constitution, statute or rule of law or by
the enforcement of any assessment or penalty or otherwise, all such liability
being, by the acceptance hereof and as part of the consideration for the issue
hereof, expressly waived and released.
This Note shall for all purposes be governed by, and construed in
accordance with, the laws of the State of New York.
As used herein:
(a) the term "Amortized Amount" is equal to the original issue discount
amortized from the Original Issue Date to the date of redemption or declaration,
as the case may be, which amortization shall be calculated using the "constant
yield method" (computed in accordance with the rules under the Internal Revenue
Code of 1986, as amended, and the regulations thereunder, in effect on the date
of redemption or declaration, as the case may be); and
(b) all other terms used in this Note which are defined in the Indenture
and not otherwise defined herein shall have the meanings assigned to them in the
Indenture.
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM-as tenants in common
TEN ENT-as tenants by the entireties
JT TEN-as joint tenants with right of survivorship and not as tenants
in common
UNIF GIFT MIN ACT- Custodian
----------------- -------------------------
(Cust) (Minor)
Under Uniform Gifts to Minors Act
-----------------------------
(State)
Additional abbreviations may also be used though not in the above list.
15
<PAGE> 16
FORM OF ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
[PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE]
- ---------------------------------------
- --------------------------------------------------------------------------------
[PLEASE PRINT OR TYPE NAME AND ADDRESS INCLUDING ZIP CODE, OF ASSIGNEE.
SIGNATURE MUST BE GUARANTEED BY A BANK, TRUST COMPANY OR BROKER WHO IS A MEMBER
OF A SIGNATURE GUARANTEE MEDALLION PROGRAM.]
- --------------------------------------------------------------------------------
the within Note and all rights thereunder, hereby irrevocably
constituting and appointing
- --------------------------------------------------------------------------------
such person attorney to transfer such Note on the books of the Company, with
full power
- --------------------------------------------------------------------------------
of substitution in the premises.
Dated:
------------------------------
NOTICE: The signature of this assignment must correspond with the name as
written upon the face of the within Note in every particular without alteration
or enlargement or any change whatsoever.
16
<PAGE> 17
FORM OF OPTION TO ELECT REPAYMENT
The undersigned hereby irrevocably request(s) the Issuer to repay the
within Note (or portion thereof specified below) pursuant to its terms at a
price equal to the principal amount thereof, together with interest to the
Optional Repayment Date, to the undersigned, at
- ---------------------------------------------------------------
(Please print or typewrite name and address of the undersigned)
If less than the entire principal amount of the within Note is to be
repaid, specify the portion thereof (which shall be increments of $1,000) which
the holder elects to have repaid: __________________; and [specify the
denomination or denominations (which shall not be less than the minimum
authorized denomination)] of the Notes to be issued to the holder for the
portion of the within Note not being repaid (in the absence of any such
specification, one such Note will be issued for the portion not being repaid):
- -----------------------------
Dated:
------------------------------- ------------------------------------
NOTICE: The signature on this Option
to Elect Repayment must correspond
with the name as written upon the
face of the within instrument in
every particular without alteration
or enlargement.
- -----------------------------
* Applies only if this Note is a Registered Global Security.
17
<PAGE> 1
EXHIBIT 4.3
HOUGHTON MIFFLIN COMPANY
MEDIUM-TERM NOTES
DUE MORE THAN NINE MONTHS
FROM DATE OF ISSUE
CALCULATION AGENT AGREEMENT
THIS AGREEMENT dated as of March 6, 1996, between Houghton Mifflin Company,
a Massachusetts corporation (hereinafter called the "Issuer"), having its
principal office at 222 Berkeley Street, Boston, Massachusetts, 02116 and State
Street Bank and Trust Company (hereinafter sometimes called the "Calculation
Agent," which term shall, unless the context shall otherwise require, include
its successors and assigns), having its principal corporate trust office at Two
International Place, Boston, Massachusetts, 02110.
WHEREAS, the Issuer proposes to issue from time to time Medium-Term Notes
(the "Notes"), to be issued pursuant to the provisions of an Indenture dated as
of March 15, 1994, as supplemented by a First Supplemental Indenture dated as of
July 27, 1995 (as it may be further supplemented or amended from time to time,
the "Indenture"), between the Issuer and State Street Bank and Trust Company
(the "Trustee"), as successor trustee to The First National Bank of Boston.
Capitalized terms used in this Agreement and not otherwise defined herein are
used as defined in the Indenture. Certain of the Notes may bear interest at a
floating rate determined by reference to an interest rate formula or may be in
the form of fixed rate notes that have one Interest Payment Date and have an
interest rate determined by reference to an interest rate formula (collectively,
the "Floating Rate Notes") and the Issuer desires to engage the Calculation
Agent to perform certain services in connection therewith.
NOW IT IS HEREBY AGREED THAT:
1. The Issuer hereby appoints State Street Bank and Trust Company as
Calculation Agent for the Floating Rate Notes, upon the terms and subject to the
conditions herein set forth, and State Street Bank and Trust Company hereby
accepts such appointment. The Calculation Agent shall act as an agent of the
Issuer for the purpose of determining the interest rate or rates of the Floating
Rate Notes.
2. The Issuer agrees to deliver to the Calculation Agent, prior to the
issuance of any Floating Rate Notes, copies of the proposed forms of such Notes,
including copies of all terms and conditions relating to the determination of
the interest rates thereunder. The Issuer shall not issue any Floating Rate Note
prior to the receipt of confirmation from the Calculation Agent of its
acceptance of the proposed form of such Note. The Calculation Agent hereby
acknowledges its acceptance of the proposed forms of the Floating Rate Notes
previously delivered to it.
3. The Issuer shall notify the Calculation Agent of the issuance of any
Floating Rate Notes prior to the issuance thereof and, at the time of such
issuance, shall deliver to the Calculation Agent all information in the
possession of the Issuer for the calculation of the applicable interest rates
thereunder. The Calculation Agent shall calculate the applicable interest rates
for Floating Rate Notes in accordance with the terms of such Floating Rate
Notes, the Indenture and the provisions of this Agreement. In addition, the
Calculation Agent shall
<PAGE> 2
maintain, or cause to be maintained, records permitting it to calculate the
applicable interest rate as of the applicable Interest Determination Date in
case the applicable rates which are to be published, publicly announced or
displayed on the applicable Calculation Date (as defined in the Floating Rate
Notes) are not available on such Calculation Date.
4. Promptly following the determination of each change to the interest rate
or the determination of the interest rate (where there is only one Interest
Payment Date) applicable to any Floating Rate Note, the Calculation Agent will
cause to be forwarded to the Issuer, the Trustee, if different from the
Calculation Agent, and any paying agent for such Note, if different from the
Calculation Agent, information regarding the interest rate then in effect for
such Floating Rate Note.
5. The Issuer will pay such compensation, including reasonable counsel fees
incurred by the Calculation Agent in connection with its duties hereunder, to
the Calculation Agent as is mutually agreed upon receipt of such invoices as the
Issuer shall reasonably require.
6. Notwithstanding any satisfaction or discharge of the Notes or the
Indenture, the Issuer will indemnify the Calculation Agent against any losses,
liabilities, costs, claims, actions or demands which it may incur or sustain or
which may be made against it in connection with its appointment or the exercise
of its powers and duties hereunder as well as the reasonable costs, including
reasonable fees and expenses of counsel in defending any claim, action or
demand, except such as may result from the negligence or wilful misconduct of
the Calculation Agent or any of its employees. The Calculation Agent shall incur
no liability and shall be indemnified and held harmless by the Issuer for, or in
respect of, any actions taken or suffered to be taken in good faith by the
Calculation Agent in reliance upon (i) the written opinion or advice of counsel
or (ii) written instructions from the Issuer.
7. The Calculation Agent accepts its obligations herein set forth upon the
terms and conditions hereof, including the following, to all of which the Issuer
agrees:
(i) in acting under this Agreement and in connection with the Notes,
the Calculation Agent, acting as agent for the Issuer, does not assume any
obligation towards, or any relationship of agency or trust for or with, any
of the holders of the Notes;
(ii) unless herein otherwise specifically provided, any order,
certificate, notice, request or communication from the Issuer made or given
under any provision of this Agreement shall be sufficient if signed or
given by any person whom the Calculation Agent reasonably believes to be a
duly authorized officer or attorney-in-fact of the Issuer;
(iii) the Calculation Agent shall be obligated to perform only such
duties as are expressly set forth herein and any duties necessarily
incidental thereto;
(iv) the Calculation Agent shall be protected and shall incur no
liability for or in respect of any action taken or omitted to be taken or
anything suffered in good
2
<PAGE> 3
faith by it in reliance upon anything contained in a Floating Rate Note,
the Indenture or any information supplied to it by the Issuer pursuant to
this Agreement, including the information to be supplied pursuant to
paragraph 3 above;
(v) the Calculation Agent, whether acting for itself or in any other
capacity, may become the owner or pledgee of Notes with the same rights as
it would have had if it were not acting hereunder as Calculation Agent; and
(vi) the Calculation Agent shall incur no liability hereunder except
for loss sustained by reason of its own negligence or wilful misconduct.
8. (a) The Issuer agrees to notify the Calculation Agent at least 4 days
prior to the first issuance of any Floating Rate Note (other than the Floating
Rate Notes in the form previously delivered to the Calculation Agent) with an
interest rate to be determined by reference to any other formula that would
require the Calculation Agent to select banks, dealers or other financial
institutions (the "Reference Banks") for purposes of quoting rates. Promptly
thereafter, the Calculation Agent will notify the Issuer and the Trustee of the
names and addresses of such Reference Banks. Forthwith upon any change in the
identity of any Reference Bank, the Calculation Agent shall notify the Issuer
and the Trustee of such change. The Calculation Agent shall not be responsible
to the Issuer or any third party for any failure of any Reference Bank to
fulfill its duties or meet its obligations as a Reference Bank or as a result of
the Calculation Agent's having acted (except in the event of negligence or
wilful misconduct) on any quotation or other information given by any Reference
Bank that subsequently may be found to be incorrect.
(b) Except as provided below, the Calculation Agent may at any time resign
as Calculation Agent by giving written notice to the Issuer and the Trustee of
such intention on its part, specifying the date on which its desired resignation
shall become effective, provided that such notice shall be given not less than
60 days prior to said effective date unless the Issuer and the Trustee otherwise
agree in writing; provided, however, if the Calculation Agent has given not less
than 60 days' prior notice of its desired resignation, and during such 60 days a
successor Calculation Agent has not accepted its appointment as successor
Calculation Agent, the Calculation Agent so resigning may petition any court of
competent jurisdiction for the appointment of a successor Calculation Agent. The
Issuer covenants that it shall appoint a successor Calculation Agent as soon as
practicable after receipt of any notice of resignation hereunder.
Except as provided below, the Calculation Agent may be removed by the
filing with it and the Trustee of an instrument in writing signed by the Issuer
specifying such removal and the date it shall become effective (such effective
date being at least 20 days after said filing). Any such resignation or removal
shall take effect upon:
(i) the appointment by the Issuer as provided herein of a successor
Calculation Agent; and
3
<PAGE> 4
(ii) the acceptance of such appointment by such successor Calculation
Agent.
Upon its resignation or removal becoming effective, the retiring
Calculation Agent shall be entitled to the payment of its compensation and the
reimbursement of all expenses (including reasonable counsel fees) incurred by
such retiring Calculation Agent pursuant to paragraph 5 hereof.
(c) If at any time the Calculation Agent shall resign or be removed, or
shall become incapable of acting or shall be adjudged bankrupt or insolvent, or
liquidated or dissolved, or an order is made or an effective resolution is
passed to wind up the Calculation Agent, or if the Calculation Agent shall file
a voluntary petition in bankruptcy or make an assignment for the benefit of its
creditors, or shall consent to the appointment of a receiver, administrator or
other similar official of all or any substantial part of its property, or shall
admit in writing its inability to pay or meet its debts as they mature, or if a
receiver, administrator or other similar official of the Calculation Agent or of
all or any substantial part of its property shall be appointed, or if any order
of any court shall be entered approving any petition filed by or against the
Calculation Agent under the provisions of any applicable bankruptcy or
insolvency law, or if any public officer shall take charge or control of the
Calculation Agent or its property or affairs for the purpose of rehabilitation,
conservation or liquidation, then a successor Calculation Agent shall be
appointed by the Issuer by an instrument in writing filed with the successor
Calculation Agent and the Trustee. Upon the appointment as aforesaid of a
successor Calculation Agent and acceptance by the latter of such appointment,
the former Calculation Agent shall cease to be Calculation Agent hereunder.
(d) Any successor Calculation Agent appointed hereunder shall execute and
deliver to its predecessor, the Issuer and the Trustee an instrument accepting
such appointment hereunder, and thereupon such successor Calculation Agent,
without any further act, deed or conveyance, shall become vested with all the
authority, rights, powers, immunities, duties and obligations of such
predecessor with like effect as if originally named as the Calculation Agent
hereunder, and such predecessor, upon payment of its compensation, charges and
disbursements then unpaid, shall thereupon become obliged to transfer and
deliver, and such successor Calculation Agent shall be entitled to receive,
copies of any relevant records maintained by such predecessor Calculation Agent.
(e) Any corporation or other entity into which the Calculation Agent may be
merged or converted or any corporation or other entity with which the
Calculation Agent may be consolidated or any corporation resulting from any
merger, conversion or consolidation to which the Calculation Agent shall be a
party shall, to the extent permitted by applicable law, be the successor
Calculation Agent under this Agreement without the execution or filing or any
paper or any further act on the part of any of the parties hereto. Notice of any
such merger, conversation or consolidation shall forthwith be given to the
Issuer and the Trustee.
(f) The provision of paragraph 6 hereof shall survive any resignation or
removal of the Calculation Agent hereunder.
4
<PAGE> 5
9. Any notice required to be given hereunder shall be delivered in person,
sent by letter or telex or telecopy or communicated by telephone (subject, in
the case of communication by telephone, to confirmation dispatched within two
business days by letter, telex or telecopy), in the case of the Issuer, to it at
the address set forth in the heading of this Agreement, Attention: Assistant
Treasurer (telephone: (617) 351-5051; telecopier: (617) 351-1104); in the case
of the Calculation Agent, to it at the address set forth in the heading of this
Agreement, Attention: Corporate Trust Division (telephone: (617) 664-5603;
telecopier: (617) 664-5371); and in the case of the Trustee, to it at the same
address as the Calculation Agent; or, in any case, to any other address of which
the party receiving notice shall have notified the party giving such notice in
writing.
10. This Agreement may be amended only by a writing duly executed and
delivered by each of the parties signing below.
11. The provisions of this Agreement shall be governed by, and construed in
accordance with, the internal laws of the State of New York.
12. This Agreement may be executed in counterparts and the executed
counterparts shall together constitute a single instrument.
IN WITNESS WHEREOF, this Agreement has been executed and delivered as of
the date and year first above written.
HOUGHTON MIFFLIN COMPANY
By:
------------------------------
Title:
STATE STREET BANK AND TRUST
COMPANY
By:
-------------------------------
Title:
5
