SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported) August 21, 1998
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HSBC Americas, Inc.
(Exact name of registrant as specified in charter)
Delaware 1-2940 22-1093160
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State or Other (Commission (IRS Employer
Jurisdiction of File Number) Identification No.)
Incorporation)
One Marine Midland Center,
Buffalo, New York 14203
(Address of Principal Executive Office) (Zip Code)
Registrant's telephone number, including area code (716) 841-2424
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Item 5 OTHER EVENTS
On August 21, 1998, pursuant to authority granted to
certain officers of the Corporation in resolutions adopted at
meetings of the Board of Directors of the Corporation duly called
and held on May 21 and August 20, 1998, respectively, such
officers approved and authorized the issuance and sale from time
to time in one or more series pursuant to the Medium-Term Note
Program (the "Program") and under the indenture (the "Indenture")
dated October 24, 1996, between the Corporation and Bankers Trust
Company, of notes (the "Medium-Term Notes") in the forms attached
hereto as Exhibit 4(a) (for Medium-Term Notes with fixed interest
rates) and Exhibit 4(b) (for Medium-Term Notes with variable
interest rates). The Corporation also, in connection with the
Program, entered into a distribution agreement (the "Distribution
Agreement") dated August 21, 1998, among the Corporation and the
agents named therein. The Distribution Agreement is attached
hereto as Exhibit 1. This report is being filed for the purpose
of amending the Corporation's registration statement on Form S-3
(No. 333-53647) filed with the Securities and Exchange Commission
on May 27, 1998 (the "Registration Statement"), pursuant to which
Medium-Term Notes may be offered and sold from time to time, to
include therein the Exhibits set out in Item 7.
Item 7. Financial Statements, Pro Forma Financial Information
and Exhibits.
Exhibit 1 Distribution Agreement dated August 21, 1998
between the Corporation and the agents named
therein.
Exhibit 4(a) Form of Medium-Term Fixed Rate Note.
Exhibit 4(b) Form of Medium-Term Floating Rate Note.
Exhibit 12 HSBC Americas, Inc. and Subsidiaries Consolidated
Ratio of Earnings to Fixed Charges (Excluding
Interest on Deposits);
HSBC Americas, Inc. and Subsidiaries Consolidated
Ratio of Earnings to Fixed Charges (Including
Interest on Deposits);
HSBC Americas, Inc. and Subsidiaries Consolidated
Ratio of Earnings to Combined Fixed Charges and
Preferred Stock Dividend Requirements (Excluding
Interest on Deposits);
HSBC Americas, Inc. and Subsidiaries Consolidated
Ratio of Earnings to Combined Fixed Charges and
Preferred Stock Dividend Requirements (Including
Interest on Deposits);
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Statement regarding the computation of the Ratio
of Earnings to Fixed Charges and Ratios of
Earnings to combined Fixed Charges and Preferred
Stock Dividend Requirements.
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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.
HSBC Americas, Inc.
By /s/ Gerald A. Ronning
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Name: Gerald A. Ronning
Title: Executive Vice President
& Controller
Dated as of August 21, 1998
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EXHIBIT INDEX
The following exhibits are being filed herewith:
EXHIBIT NO. DESCRIPTION
Exhibit 1 Distribution Agreement dated August 21,
1998 among the Corporation and the agents
named therein.
Exhibit 4(a) Form of Medium-Term Fixed Rate Note.
Exhibit 4(b) Form of Medium-Term Floating Rate Note.
Exhibit 12 HSBC Americas, Inc. and Subsidiaries
Consolidated Ratio of Earnings to Fixed
Charges (Excluding Interest on Deposits);
HSBC Americas, Inc. and Subsidiaries
Consolidated Ratio of Earnings to Fixed
Charges (Including Interest on Deposits);
HSBC Americas, Inc. and Subsidiaries
Consolidated Ratio of Earnings to
Combined Fixed Charges and Preferred
Stock Dividend Requirements (Excluding
Interest on Deposits);
HSBC Americas, Inc. and Subsidiaries
Consolidated Ratio of Earnings to
Combined Fixed Charges and Preferred
Stock Dividend Requirements (Including
Interest on Deposits);
Statement regarding the computation of
the Ratio of Earnings to Fixed Charges
and Ratios of Earnings to combined Fixed
Charges and Preferred Stock Dividend
Requirements.
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EXECUTION COPY
HSBC AMERICAS, INC.
Medium-Term Senior Notes
Due More than Nine Months from Date of Issue
DISTRIBUTION AGREEMENT
August 21, 1998
To the Agents listed on Exhibit A
hereto and to each additional person
that shall become an Agent as
provided in Section 1(f) of this Agreement.
Ladies and Gentlemen:
HSBC Americas, Inc., a Delaware corporation (the
"Company"), has authorized and proposes to issue and sell from
time to time in the manner contemplated by this Agreement up to
$400,000,000 in aggregate initial offering price of its
Medium-Term Senior Notes (the "Notes"). The Notes are to be
issued pursuant to an Indenture dated as of October 24, 1996
between the Company and Bankers Trust Company (the "Trustee"), as
trustee (such Indenture, as amended or supplemented from time to
time, the "Indenture").
The Company has filed with the Securities and Exchange
Commission (the "SEC") a registration statement on Form S-3 (No.
333-53647) for the registration of debt securities (both senior
and subordinated) and shares of preferred stock under the
Securities Act of 1933, as amended (the "1933 Act"), and the
offering thereof from time to time in accordance with Rule 415 of
the rules and regulations of the SEC under the 1933 Act (the
"1933 Act Regulations"). Such registration statement has been
declared effective by the SEC, and the Trustee has been qualified
under the Trust Indenture Act of 1939, as amended (the "1939
Act"). Such registration statement (and any further registration
statements which may be filed by the Company for the purpose of
registering additional Notes and in connection with which this
Agreement is included or incorporated by reference as an exhibit)
and the prospectus relating to the offer and sale of the
Company's debt securities constituting a part thereof, as
supplemented by a prospectus supplement dated on or about the
date hereof relating to the Notes, including all documents
incorporated therein by reference, each as from time to time
amended or supplemented, as the case may be, through the date of
the relevant reference in this Agreement to the Registration
Statement or Prospectus, by the filing of documents pursuant to
the Securities Exchange Act of 1934, as amended (the "1934 Act")
or the 1933 Act, or otherwise, are referred to herein as the
"Registration Statement" and the "Prospectus," respectively,
except that if any revised prospectus shall be provided to the
Agents by the Company for use in connection with the offering of
the Notes which is not required to be filed by the Company
pursuant to Rule
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424(b) or Rule 434 of the 1933 Act Regulations, the term
"Prospectus" shall refer to such revised prospectus from and
after the time it is first provided to the Agent for such use.
The Company confirms its agreement with each of you
(individually, an "Agent" and collectively, the "Agents") with
respect to the issue and sale from time to time by the Company of
the Notes as follows:
Appointment of Agents.
Appointment. Subject to the terms and conditions
stated herein, the Company hereby appoints each of you as Agent
in connection with the offer and sale of the Notes.
Notwithstanding the foregoing or any other provision herein to
the contrary, the Company reserves the right to sell Notes, at
any time, on its own behalf to any unsolicited purchaser, whether
directly to such purchaser or through an agent for such
purchaser. Upon the sale of any Notes directly by the Company to
an unsolicited purchaser, no Agent named herein shall be entitled
to any commission pursuant to this Agreement.
Solicitations as Agent. Subject to the terms and
conditions set forth herein, each Agent agrees, severally and not
jointly, as agent of the Company, to use its reasonable best
efforts when requested by the Company to solicit offers to
purchase the Notes upon the terms and conditions set forth in the
Prospectus and the Administrative Procedures with respect to the
sale of Notes as may be agreed upon from time to time between the
Agents and the Company (the "Procedures"). Initial Administrative
Procedures dated August 21, 1998 shall remain in effect until
changed by the Agents and the Company. The Agents and the Company
agree to perform the respective duties and obligations
specifically provided to be performed by them in the Procedures.
Notwithstanding any provision herein to the contrary, the Company
reserves the right, in its sole discretion, to suspend
solicitation of purchases of the Notes through the Agents, as
agent, commencing at any time for any period of time or
permanently. Upon receipt of instructions from the Company, the
Agents will forthwith suspend solicitation of purchases of the
Notes until such time as the Company has advised the Agents that
such solicitation may be resumed.
Each Agent will communicate to the Company, orally,
each offer to purchase Notes solicited by such Agent on an agency
basis, other than those offers rejected by the Agent. The Agent
shall have the right, in its discretion reasonably exercised, to
reject any proposed purchase of Notes by persons solicited by the
Agent, as a whole or in part, and any such rejection shall not be
deemed a breach of the Agent's agreement contained herein. The
Company may accept or reject any proposed purchase of the Notes,
in whole or in part, and any such rejection shall not be deemed a
breach of the Company's agreement herein.
All Notes sold through an Agent as agent will be sold
at 100% of their principal amount unless otherwise agreed to by
the Company and such Agent. The purchase price, interest
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rate (if applicable), maturity date and other terms of the Notes
(as applicable) specified in Exhibit B hereto shall be agreed
upon by the Company and such Agent and set forth in a pricing
supplement to the Prospectus (a "Pricing Supplement") to be
prepared following each acceptance by the Company of an offer for
the purchase of Notes.
Such Agent shall make reasonable efforts to assist the
Company in obtaining performance by each purchaser whose offer to
purchase Notes has been solicited by such Agent and accepted by
the Company. The Agent shall not have any liability to the
Company in the event any such agency purchase is not consummated
for any reason other than the gross negligence of the Agent. If
the Company shall default on its obligation to deliver Notes to a
purchaser whose offer it has accepted, the Company shall (i) hold
the Agent for such purchase harmless against any loss, claim or
damage arising from or as a result of such default by the Company
and (ii) notwithstanding such default, pay to such Agent any
commission to which it would be entitled in connection with such
sale.
Commissions. For those offers to purchase Notes
accepted by the Company, the Agent shall be paid a commission.
Unless otherwise agreed between the Company and the Agent and
disclosed in a Pricing Supplement, such commission shall be an
amount equal to the applicable percentage of the principal amount
of each Note sold by the Company as a result of a solicitation
made by such Agent as set forth in Exhibit C hereto.
Purchases as Principal. The Agents shall not have any
obligation to purchase Notes from the Company as principal, but
an Agent and the Company may expressly agree from time to time
that such Agent shall purchase Notes as principal. In the event
that an Agent and the Company shall expressly so agree, Notes
shall be purchased by such Agent as principal. Unless otherwise
agreed between the Company and the Agent and disclosed in a
Pricing Supplement, each Note sold to an Agent as principal shall
be purchased by such Agent at a price equal to 100% of the
principal amount thereof less a discount equivalent to the
applicable commissions set forth in Exhibit C hereto and may be
resold by such Agent at prevailing market prices at the time or
times of resale as determined by such Agent. Such purchases as
principal shall otherwise be made in accordance with terms agreed
upon by the Agent and the Company, by written agreement
substantially in the form of Exhibit D hereto (a "Terms
Agreement") relating to such purchase, but may take the form of
an exchange of any standard form of written telecommunication
between the Agent and the Company. The Agent's commitment to
purchase Notes as principal shall be deemed to have been made on
the basis of the representations, warranties and covenants of the
Company herein contained and shall be subject to the terms and
conditions set forth herein, including Section 10(b) hereof.
Sub-Agents. An Agent may engage the services of any
other broker or dealer in connection with the resale of any Notes
purchased as principal but no Agent may appoint sub- agents. In
connection with sales by an Agent of Notes purchased by such
Agent as principal to
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other brokers or dealers, such Agent may allow any portion of the
discount received in connection with such purchases from the
Company to such brokers and dealers.
Appointment of Additional Agents. Notwithstanding any
provision herein to the contrary, the Company reserves the right
to appoint additional agents for the offer and sale of Notes,
which agency may be on an on-going basis or on a one-time basis.
Any such additional agent shall become a party to this Agreement
and shall thereafter be subject to the provisions hereof and
entitled to the benefits hereunder upon the execution of a
counterpart hereof or other form of acknowledgment of its
appointment hereunder, including the form of letter attached
hereto as Exhibit E, and delivery to the Company of addresses for
notice hereunder and under the Procedures. After the time an
Agent is appointed, the Company shall deliver to the Agent, at
such Agent's request, copies of the documents delivered to other
Agents under Sections 4(a), 4(b) and 4(c), and the initial
comfort letter delivered under Section 6(d), and, if such
appointment is on an on-going basis, Sections 6(b), 6(c) and 6(d)
hereof.
Reliance. The Company and the Agents agree that any
Notes the placement of which an Agent arranges shall be placed by
such Agent in reliance on the representations, warranties,
covenants and agreements of the Company contained herein and on
the terms and conditions and in the manner provided herein or
provided in the Procedures.
Sale of Notes. The Company shall not sell or approve
the solicitation of purchases of Notes in excess of the amount
which shall be authorized by the Company from time to time or in
excess of the principal amount of Notes registered pursuant to
the Registration Statement. The Agents will have no
responsibility for maintaining records with respect to the
aggregate principal amount of Notes sold or otherwise monitoring
the availability of Notes for sale under the Registration
Statement.
Representations and Warranties.
The Company represents and warrants to the Agents as
of the date hereof, as of the date of each acceptance by the
Company of an offer for the purchase of Notes (whether through an
Agent as agent or to an Agent as principal), as of the date of
each delivery of Notes (whether through an Agent as agent or to
an Agent as principal) (the date of each such delivery to an
Agent as principal being hereafter referred to as a "Settlement
Date"), and as of any time that the Registration Statement or the
Prospectus is amended or supplemented or there is filed with the
SEC any document incorporated by reference into the Prospectus
(other than any Current Report on Form 8-K relating exclusively
to the issuance of debt securities under the Registration
Statement) (each of the times referenced above being referred to
herein as a "Representation Date") as follows:
The Company meets the requirements for use of
Form S-3 under the 1933 Act and has filed with the SEC the
Registration Statement, which has become effective.
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Such Registration Statement meets the requirements of Rule
415(a)(1) under the 1933 Act and complies in all other
material respects with said Rule.
As of the date hereof, when the Prospectus as
supplemented with respect to the Notes is first filed
pursuant to Rule 424 under the 1933 Act, when any amendment
to the Registration Statement becomes effective (including
the filing of any document incorporated by reference in the
Registration Statement) and as of any other applicable
Representation Date, (a) the Registration Statement, the
Prospectus, and the Indenture comply and will comply in all
material respects with the applicable requirements of the
1933 Act, the 1939 Act and the 1934 Act and the respective
rules and regulations thereunder, (b) the Registration
Statement does not and will not contain any untrue
statement of a material fact or omit to state any material
fact required to be stated therein or necessary in order to
make the statements therein not misleading, and (c) the
Prospectus does not and will not contain any untrue
statement of a material fact or omit to state any material
fact required to be stated therein or necessary in order to
make the statements therein, in light of the circumstances
under which they were made, not misleading; provided,
however, that the Company makes no representations or
warranties as to (x) that part of the Registration
Statement which shall constitute the Statement of
Eligibility and Qualification of the Trustee (Form T-1)
under the 1939 Act of the Trustee or (y) the information
contained in or omitted from the Registration Statement or
the Prospectus in reliance upon and in conformity with
information furnished in writing to the Company by or on
behalf of any Agent specifically for inclusion in the
Registration Statement or the Prospectus.
Additional Certifications. Any certificate signed by
any director or officer of the Company and delivered to an Agent
or to counsel for such Agent in connection with an offering of
Notes or the sale of Notes to an Agent as principal shall be
deemed a representation and warranty by the Company to such Agent
as to the matters covered thereby on the date of such certificate
and at each Representation Date subsequent thereto (and it is
understood that such representation and warranty shall relate
only to the time as of which such certificate is given and
insofar as it relates to the Registration Statement and
Prospectus shall relate to the Registration Statement and
Prospectus as amended and supplemented to the time of such
certificate).
Covenants of the Company.
The Company covenants with the Agents as follows:
Notice of Certain Events. The Company will notify the
Agents immediately (i) of the effectiveness of any amendment to
the Registration Statement, (ii) of the transmittal to the SEC
for filing of any supplement to the Prospectus or any document to
be filed pursuant to the 1934 Act which will be incorporated by
reference in the Prospectus, (iii) of the receipt of any comments
from the SEC with respect to the Registration Statement or the
Prospectus (other than
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with respect to a document filed with the SEC pursuant to the
1934 Act which will be incorporated by reference in the
Registration Statement and the Prospectus), (iv) of any request
by the SEC for any amendment to the Registration Statement or any
amendment or supplement to the Prospectus or for additional
information relating thereto (other than such a request with
respect to a document filed with the SEC pursuant to the 1934 Act
which will be incorporated by reference in the Registration
Statement and the Prospectus), (v) of the issuance by the SEC of
any stop order suspending the effectiveness of the Registration
Statement or the initiation of any proceedings for that purpose,
and (vi) if the rating assigned by Standard & Poor's Ratings
Group, a division of McGraw Hill, Inc., or Moody's Investors
Service, Inc., as the case may be, to any debt securities of the
Company shall have been lowered or if either of such rating
agencies shall have publicly announced that it has under
surveillance or review, with possible negative implications, its
rating of any debt securities of the Company. The Company will
make every reasonable effort to prevent the issuance of any stop
order and, if any stop order is issued, to obtain the lifting
thereof at the earliest possible moment.
Notice of Certain Proposed Filings. The Company will
give the Agents notice of its intention to file or prepare any
additional registration statement with respect to the
registration of additional Notes or any amendment to the
Registration Statement or any amendment or supplement to the
Prospectus (other than an amendment or supplement providing
solely for a change in the interest rates or maturity dates of
Notes or similar changes or an amendment or supplement effected
by the filing of a document with the SEC pursuant to the 1934
Act) and, upon request, will furnish the Agents with copies of
any such registration statement or amendment or supplement
proposed to be filed or prepared a reasonable time in advance of
such proposed filing or preparation, as the case may be, and will
not file any such registration statement or amendment or
supplement in a form as to which the Agents or their counsel
reasonably object.
Copies of the Registration Statement and the
Prospectus and 1934 Act Filings. The Company will deliver to the
Agents as many signed and conformed copies of the Registration
Statement (as originally filed) and of each amendment thereto
(including exhibits filed therewith or incorporated by reference
therein and documents incorporated by reference in the
Prospectus) as the Agents may reasonably request. The Company
will furnish to the Agents as many copies of the Prospectus (as
amended or supplemented) as the Agents shall reasonably request
so long as the Agents are required to deliver a Prospectus in
connection with sales or solicitations of offers to purchase the
Notes under the Act. The Company will furnish to the Agents
copies of any Annual Report on Form 10-K, Quarterly Report on
Form 10-Q or Current Report on Form 8-K filed by the Company with
the Commission pursuant to the 1934 Act as soon as practicable
after the filing thereof.
Preparation of Pricing Supplements. The Company will
prepare, with respect to any Notes to be sold through or to an
Agent pursuant to this Agreement, a Pricing Supplement with
respect to such Notes in a form previously approved by the Agents
and will file such Pricing
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Supplement with the SEC pursuant to Rule 424(b) under the 1933
Act not later than the close of business on the second business
day after the date on which such Pricing Supplement is first
used.
Revisions of Prospectus -- Material Changes. Except as
otherwise provided in subsection (k) of this Section, if at any
time during the term of this Agreement any event shall occur or
condition exist as a result of which it is necessary, in the
reasonable opinion of counsel for the Agents or counsel for the
Company, to further amend or supplement the Prospectus in order
that the Prospectus will not include an untrue statement of a
material fact or omit to state any material fact necessary in
order to make the statements therein not misleading in light of
the circumstances existing at the time the Prospectus is
delivered to a purchaser, or if it shall be necessary, in the
reasonable opinion of either such counsel, to amend or supplement
the Registration Statement or the Prospectus in order to comply
with the requirements of the 1933 Act or the 1933 Act
Regulations, immediate notice shall be given, and confirmed in
writing, to the Agents to cease the solicitation of offers to
purchase the Notes in the Agents' capacity as agent and to cease
sales of any Notes any Agent may then own as principal, and the
Company will promptly prepare and file with the SEC such
amendment or supplement, whether by filing documents pursuant to
the 1934 Act, the 1933 Act or otherwise, as may be necessary to
correct such untrue statement or omission or to make the
Registration Statement and Prospectus comply with such
requirements.
Prospectus Revisions -- Periodic Financial
Information. Except as otherwise provided in subsection (k) of
this Section, on or prior to the date on which there shall be
released to the general public interim financial statement
information related to the Company with respect to each of the
first three quarters of any fiscal year or preliminary financial
statement information with respect to any fiscal year, the
Company shall furnish such information to the Agents, confirmed
in writing, and thereafter shall cause the Prospectus to be
amended or supplemented to include or incorporate by reference
financial information with respect thereto, as well as such other
information and explanations as shall be necessary for an
understanding thereof, as may be required by the 1933 Act or the
1934 Act or otherwise.
Prospectus Revisions -- Audited Financial Information.
Except as otherwise provided in subsection (k) of this Section,
on or prior to the date on which there shall be released to the
general public financial information included in or derived from
the audited financial statements of the Company for the preceding
fiscal year, the Company shall furnish such information to the
Agents and thereafter shall cause the Registration Statement and
the Prospectus to be amended to include or incorporate by
reference such audited financial statements and the report or
reports, and consent or consents to such inclusion or
incorporation by reference, of the independent accountants with
respect thereto, as well as such other information and
explanations as shall be necessary for an understanding of such
financial statements, as may be required by the 1933 Act or the
1934 Act or otherwise.
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Earnings Statements. The Company will make generally
available to its security holders as soon as practicable, but not
later than 90 days after the close of the period covered thereby,
an earnings statement (in form complying with the provisions of
Rule 158 under the 1933 Act) covering each twelve-month period
beginning, in each case, not later than the first day of the
Company's fiscal quarter next following the "effective date" (as
defined in such Rule 158) of the Registration Statement with
respect to each sale of Notes.
Blue Sky Qualification. The Company will endeavor, if
necessary, in cooperation with the Agents, to qualify the Notes
for offering and sale under the applicable securities laws of
such states and other jurisdictions of the United States as the
Agents may designate and will maintain such qualifications in
effect for as long as may be required for the distribution of the
Notes; provided, however, that in no event shall the Company be
obligated to qualify to do business in any jurisdiction in which
it is not now so qualified or to take any action that would
subject it to service of process in suits, other than those
arising out of the offering and sale of the Notes, in any
jurisdiction where it is not now so subject. The Company will
file such statements and reports as may be required by the laws
of each jurisdiction in which the Notes have been qualified as
above provided. The Company will promptly advise the Agents of
the receipt by the Company of any notification with respect to
the suspension of the qualification of the Notes for sale in any
such state or jurisdiction or the initiating or threatening of
any proceeding for such purpose.
1934 Act Filings. During the period when the
Prospectus is required to be delivered under the 1933 Act, the
Company will file promptly all documents required to be filed
with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of
the 1934 Act. During the period when any Notes are outstanding,
the Company shall remain subject to the requirements either of
Section 13(a) or Section 15(d) of the 1934 Act, and will file
with each Form 10-Q and 10-K an Exhibit 12 Statement regarding
Computation of Ratios.
Suspension of Certain Obligations. The Company shall
not be required to comply with the provisions of subsections (e),
(f) or (g) of this Section during any period beginning on the
date on which the Agents shall have suspended solicitation of
purchases of the Notes in their capacity as agent pursuant to a
request from the Company or, if later, the date thereafter when
the Agents shall no longer hold any Notes purchased as principal
from the Company, and ending on the earlier of the date when the
Company shall request, by written notice to the Agents, that
solicitation of purchases of the Notes should be resumed or the
date when the Company shall subsequently agree for the Agents to
purchase Notes as principal.
Conditions of Obligations.
The obligations of an Agent to solicit offers to
purchase the Notes as agent of the Company, the obligations of
any purchasers of the Notes sold through any Agent as agent and
any obligation of an Agent to purchase Notes as principal or
otherwise will be subject to the
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accuracy of the representations and warranties on the part of the
Company herein and to the accuracy of the statements of the
Company's officers made in any certificate furnished pursuant to
the provisions hereof, to the performance and observance by the
Company of all its covenants and agreements herein contained and
to the following additional conditions precedent:
Legal Opinions. On the date hereof, the Agents shall
have received the following legal opinions, dated as of the date
hereof and in form and substance satisfactory to the Agents:
Opinion of Special Counsel to the Company. The
opinion of Cleary, Gottlieb, Steen & Hamilton, special counsel to
the Company, to the effect that:
The Company is validly existing as a corporation
in good standing under the laws of the jurisdiction in
which it is organized.
The Company has corporate power to own its
properties and conduct its business as described in the
Prospectus.
The execution and delivery of the Indenture have
been duly authorized by all necessary corporate action of
the Company, and the Indenture has been duly executed and
delivered by the Company, and qualified under the 1939 Act,
and is a legal, valid, binding and enforceable agreement of
the Company (subject to applicable bankruptcy, insolvency
and similar laws affecting creditors' rights generally and
to general principles of equity).
The execution and delivery of the Notes have been
duly authorized by all necessary corporate action of the
Company, and when the terms of the Notes of any series have
been established and such Notes have been completed,
executed and authenticated, all in accordance with the
provisions of the resolutions of the Board of Directors of
the Company adopted on May 21, 1998 and August 20, 1998
(the "Board Resolutions") and the Indenture and delivered
and paid for pursuant to this Agreement, such Notes will
constitute legal, valid, binding and enforceable
obligations of the Company (subject to applicable
bankruptcy, insolvency and similar laws affecting
creditors' rights generally and to general principles of
equity), entitled to the benefits of the Indenture.
The statements set forth under the headings
"Description of Debt Securities" and "Description of Notes"
in the Prospectus, insofar as such statements purport to
summarize certain provisions of the Notes and the
Indenture, provide a fair summary of such provisions.
The statements made in the Prospectus under the
heading "United States Federal Income Taxation," insofar as
such statements purport to summarize certain
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federal income tax laws of the United States, constitute a
fair summary of the principal U.S. federal income tax
consequences of an investment in the Notes.
The execution and delivery of this Agreement
have been duly authorized by all necessary corporate action
of the Company, and this Agreement has been duly executed
and delivered by the Company, and is a legal, valid,
binding and enforceable agreement of the Company (subject
to applicable bankruptcy, insolvency and similar laws
affecting creditors' rights generally and to general
principles of equity, and except that such counsel need
express no opinion with respect to Section 7 of this
Agreement providing for indemnification and contribution).
Any required filing of the Prospectus (including
all supplements thereto) pursuant to Rule 424(b) has been
made in the manner and within the time period required by
Rule 424(b).
In rendering such opinion, such counsel may rely as to
matters of fact, to the extent deemed proper, on certificates of
responsible officers of the Company and public officials.
In addition to giving its opinion as required by this
subsection (a)(1) above, such special counsel shall deliver a
letter of even date with such opinion in which such special
counsel shall state, without expressing an opinion thereon, that
although they are not passing upon and do not assume any
responsibility for, the accuracy, completeness or fairness
generally of the statements contained in the Registration
Statement or the Prospectus (except as provided in clauses (v)
and (vi) of subsection (a)(1) above) and make no representation
that they have independently verified the accuracy, completeness
or fairness generally of such statements (except as aforesaid),
on the basis set forth in such letter (i) the Registration
Statement (except the financial statements, schedules and other
financial and statistical information included therein and any
documents incorporated by reference therein, as to which such
counsel need to express no opinion) at the time it became
effective, and the Prospectus (except as aforesaid), as of the
date thereof, appeared on their face to be appropriately
responsive in all material respects to the requirements of the
1933 Act and the 1939 Act and the rules and regulations
thereunder, other than Regulation S-T under the 1933 Act and such
counsel do not know of any contracts or other documents of a
character required to be filed as exhibits to the Registration
Statement or required to be described in the Registration
Statement or the Prospectus, that are not filed or described as
required or threatened by the SEC ; (ii) no information has come
to such counsel's attention that causes such counsel to believe
that the Registration Statement (other than the financial
statements, schedules and other financial and statistical data
included therein as to which such counsel need to express no
opinion), at the time it became effective, contained an untrue
statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading; (iii) no information has come to such
counsel's attention that causes such counsel to believe that the
Prospectus (except as aforesaid), as of the date thereof or on
the date hereof, contained or contains an untrue statement or a
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<PAGE>
material fact or omitted or omits to state a material fact
required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which
they were made, not misleading; and (iv) the Registration
Statement is effective under the 1933 Act and, to the best of
such counsel's knowledge, no stop order with respect thereto has
been issued, and no proceeding for that purpose has been
instituted or threatened, by the SEC; and to the best of such
counsel's knowledge, no order directed to any document
incorporated by reference in the Registration Statement or the
Prospectus has been issued by the SEC and remains in effect, and
no proceeding for that purpose has been instituted.
Opinion of Company General Counsel. The opinion
of Philip S. Toohey, Executive Vice President, General Counsel
and Secretary of the Company, to the effect that:
Each of the Company and Marine Midland Bank (the
"Subsidiary") has been duly incorporated and is validly
existing as a corporation in good standing under the laws
of the jurisdiction in which it is chartered or organized,
with full corporate power and authority to own or lease, as
the case may be, and to operate its properties and conduct
its business as described in the Prospectus, and is duly
qualified to do business as a foreign corporation and is in
good standing under the laws of each jurisdiction which
requires such qualification; and the Company is duly
registered as a bank holding company under the Bank Holding
Company Act of 1956, as amended.
All the outstanding shares of capital stock of
the Subsidiary have been duly and validly authorized and
issued and are fully paid and nonassessable, and, except as
otherwise set forth in the Prospectus, all outstanding
shares of capital stock of the Subsidiary are owned,
directly or indirectly, by the Company free and clear of
any perfected security interest and, to the knowledge of
such counsel, after due inquiry, any other security
interest, claim, lien or encumbrance.
The execution and delivery of the Indenture have
been duly authorized by all necessary corporate action of
the Company, and the Indenture has been duly executed and
delivered by the Company, and qualified under the 1939 Act,
and is a legal, valid, binding and enforceable agreement of
the Company (subject to applicable bankruptcy, insolvency
and similar laws affecting creditors' rights generally and
to general principles of equity).
The execution and delivery of the Notes have been
duly authorized by all necessary corporate action of the
Company, and when the terms of the Notes of any series have
been established and such Notes have been completed,
executed and authenticated, all in accordance with the
provisions of the Board Resolutions and the Indenture and
delivered and paid for pursuant to this Agreement, such
Notes will constitute legal, valid, binding and enforceable
obligations of the Company (subject to applicable
bankruptcy,
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<PAGE>
insolvency and similar laws affecting creditors' rights
generally and to general principles of equity), entitled to
the benefits of the Indenture.
The statements set forth under the headings
"Description of Debt Securities" and "Description of Notes"
in the Prospectus, insofar as such statements purport to
summarize certain provisions of the Notes and the
Indenture, provide a fair summary of such provisions.
The execution and delivery of this Agreement have
been duly authorized by all necessary corporate action of
the Company, and this Agreement has been duly executed and
delivered by the Company, and is a legal, valid, binding
and enforceable agreement of the Company (subject to
applicable bankruptcy, insolvency and similar laws
affecting creditors' rights generally and to general
principles of equity, and except that such counsel need
express no opinion with respect to Section 7 of this
Agreement providing for indemnification and contribution).
The Registration Statement is effective under the
1933 Act; any required filing of the Prospectus (including
all supplements thereto) pursuant to Rule 424(b) has been
made in the manner and within the time period required by
Rule 424(b); to the knowledge of such counsel no stop order
suspending the effectiveness of the Registration Statement
has been issued, and no proceeding for that purpose has
been instituted or threatened by the SEC; and the
Registration Statement and the Prospectus (other than the
financial statements and schedules and other financial and
statistical data included therein or incorporated by
reference therein, as to which such counsel need express no
opinion) comply as to form in all material respects with
the applicable requirements of the 1933 Act, the 1934 Act
and the 1939 Act and the respective rules and regulations
thereunder, other than Regulation S-T under the 1933 Act.
To the knowledge of such counsel, except as
disclosed in the Registration Statement or the Prospectus,
there is no pending or threatened action, suit or
proceeding before or by any court or governmental agency,
authority or body or any arbitrator involving the Company
or any of the Subsidiaries, of a character required to be
disclosed in the Registration Statement, which is not
adequately disclosed in the Prospectus, and there is no
franchise, contract or other document of a character
required to be described in the Registration Statement or
the Prospectus, or to be filed as an exhibit, which is not
described or filed as required; and the statements included
or incorporated by reference in the Prospectus describing
any legal proceedings relating to the Company fairly
summarize such matters.
The Company is not and, after giving effect to
the offering and sale of the Notes and the application of
the proceeds thereof as described in the Prospectus, as
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<PAGE>
supplemented or amended, will not be an "investment
company" as defined in the Investment Company Act of 1940,
as amended.
No consent, approval, authorization, filing with
or order of any court or governmental agency or body is
required in connection with the transactions contemplated
herein, except such as have been obtained under the 1933
Act or 1933 Act Regulations and such as may be required
under the blue sky laws of any jurisdiction in connection
with the purchase and/or distribution of the Notes by the
Agents in the manner contemplated in this Agreement and in
the Prospectus, as supplemented or amended, and such other
approvals (specified in such opinion) as have been
obtained.
Neither the issue and sale of the Notes, nor the
consummation of any other of the transactions herein
contemplated nor the fulfillment of the terms hereof will
conflict with, result in a breach or violation of or
imposition of any lien, charge or encumbrance upon any
property or assets of the Company or its subsidiaries
pursuant to, (i) the charter or by-laws of the Company or
its subsidiaries, (ii) the terms of any indenture,
contract, lease, mortgage, deed of trust, note agreement,
loan agreement or other agreement, obligation, condition,
covenant or instrument to which the Company or its
subsidiaries is a party or by which it is bound or to which
its or their property is subject, or (iii) any statute,
law, rule, regulation, judgment, order or decree applicable
to the Company or its subsidiaries of any court, regulatory
body, administrative agency, governmental body, arbitrator
or other authority having jurisdiction over the Company or
its subsidiaries or any of its or their properties.
No holders of securities of the Company have
rights to the registration of such securities under the
Registration Statement
In rendering such opinion, such counsel may rely (A)
as to matters involving the application of laws of any
jurisdiction other than the States of New York and Delaware or
the federal laws of the United States, to the extent deemed
proper and specified in such opinion, upon the opinion of other
counsel of good standing believed to be reliable and who are
satisfactory to counsel for the Agents; and (B) as to matters of
fact, to the extent deemed proper, on certificates of responsible
officers of the Subsidiary and public officials.
Opinion of Counsel to the Agents. The opinion of
Shaw Pittman Potts & Trowbridge, counsel to the Agents, covering
to substantially similar effect the matters referred to in
subsection (a)(1) of this Section, except that such counsel need
not address the matters referred to in clauses (ii) and (vi).
In rendering such opinion, such counsel may rely as to
matters of fact, to the extent deemed proper, on certificates of
responsible officers of the Company and public officials.
13
<PAGE>
Officer's Certificate. On the date hereof, the Agents
shall have received a certificate of the Chairman of the Board,
the President or any Executive Vice President, and the Chief
Financial Officer or the Controller of the Company, dated as of
the date hereof, to the effect that the signers of such
certificate have carefully examined the Registration Statement,
the Prospectus and this Agreement and that to the best of their
knowledge (i) since the respective dates as of which information
is given in the Registration Statement and the Prospectus, there
has not been any material adverse change in the condition,
financial or otherwise, or in the prospects, earnings, business
or properties of the Company and its subsidiaries, taken as a
whole, whether or not arising from transactions in the ordinary
course of business, except as set forth or contemplated in the
Prospectus, as supplemented or amended, (ii) the other
representations and warranties of the Company contained in
Section 2 hereof are true and correct in all material respects
with the same force and effect as though expressly made at and as
of the date of such certificate, (iii) the Company has performed
or complied with all agreements and satisfied all conditions on
its part to be performed or satisfied hereunder at or prior to
the date of such certificate, and (iv) 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 knowledge, threatened by the SEC.
Other Documents. On the date hereof and on each
Settlement Date with respect to any purchase of Notes by an Agent
as principal, counsel to the Agents shall have been furnished
with such documents and opinions as such counsel may reasonably
require for the purpose of enabling such counsel to pass upon the
issuance and sale of Notes as herein contemplated, or in order to
evidence the accuracy and completeness of any of the
representations and warranties, or the fulfillment of any of the
conditions, contained herein; and all proceedings taken by the
Company in connection with the issuance and sale of Notes as
herein contemplated shall be satisfactory in form and substance
to such Agent and to counsel to the Agents.
Rating of Notes. On the date hereof and at all times
hereafter during the term of this Agreement, the Notes shall have
a rating of BBB- or above by Standard & Poor's Ratings Group, a
division of McGraw Hill, Inc., or Baa3 or above by Moody's
Investors Service, Inc., as the case may be.
Listing of Securities. On the date hereof and at all
times hereafter, either (i) the Company shall have a class of
securities that is listed, or authorized for listing, on the New
York Stock Exchange or the American Stock Exchange, or listed on
the National Market System of the Nasdaq Stock Market (or any
successor to such entities), or (ii) the Company shall have
provided evidence satisfactory to the Agents and to counsel to
the Agents of the qualification or exemption from qualification
of the offering and sale of the Notes under the applicable
securities laws of all states of the United States and the
District of Columbia.
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<PAGE>
If any condition specified in this Section 4 shall not
have been fulfilled in all material respects when and as required
to be fulfilled, this Agreement may be terminated by the Agents
by notice to the Company at any time and any such termination
shall be without liability of any party to any other party,
except that the covenant regarding provision of an earnings
statement set forth in Section 3(h) hereof, the provisions
concerning payment of expenses under Section 8 hereof, the
indemnity and contribution agreements set forth in Section 7
hereof, the provisions concerning the representations, warranties
and agreements to survive delivery set forth in Section 9 hereof
and the provisions regarding parties set forth under Section 13
hereof shall remain in effect.
Delivery of and Payment for Notes Sold through the Agents.
Delivery of Notes sold through an Agent as agent shall
be made by the Company to such Agent for the account of any
purchaser only against payment therefor in immediately available
funds. In the event that a purchaser shall fail either to accept
delivery of or to make payment for a Note on the date fixed for
settlement, the Agent shall promptly notify the Company and
deliver the Note to the Company, and, if the Agent has
theretofore paid the Company for such Note, the Company will
promptly return such funds to the Agent. If such failure occurred
for any reason other than default by the Agent in the performance
of its obligations hereunder, the Company will reimburse the
Agent on an equitable basis for its loss of the use of the funds
for the period such funds were credited to the Company's account.
Unless otherwise agreed between the Company and the Agent, all
Notes will be issued in book-entry only form and will be
represented by one or more fully registered global securities.
Additional Covenants of the Company.
The Company covenants and agrees with the Agents that:
Reaffirmation of Representations and Warranties. Each
acceptance by it of an offer for the purchase of Notes, and each
delivery of Notes to an Agent pursuant to a sale of Notes to such
Agent as principal, shall be deemed to be an affirmation that the
representations and warranties of the Company contained in this
Agreement and in any certificate theretofore delivered to such
Agent pursuant hereto are true and correct at the time of such
acceptance or sale, as the case may be, and an undertaking that
such representations and warranties will be true and correct at
the time of delivery to the purchaser or his agent, or to such
Agent, of the Note or Notes relating to such acceptance or sale,
as the case may be, as though made at and as of each such time
(and it is understood that such representations and warranties
shall relate to the Registration Statement and Prospectus as
amended and supplemented to each such time).
Subsequent Delivery of Certificates. (i) Each time
that there is filed with the SEC any Quarterly Report on Form
10-Q or Annual Report on Form 10-K that is incorporated by
reference into the Prospectus, (ii) on the date of each Terms
Agreement for a purchase of Notes
15
<PAGE>
by an Agent as principal pursuant to Section 1(d) hereof, and
(iii) at the written request of the Agents in the case of each
such amendment or supplement, 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 or maturity dates of Notes or similar changes, an
amendment or supplement which relates exclusively to an offering
of securities other than the Notes or, except as hereinbefore
described, an amendment or supplement resulting from the filing
of any document incorporated by reference therein), the Company
shall furnish or cause to be furnished to the Agents forthwith a
certificate of the Chairman of the Board, the President, the
principal financial officer or the principal accounting officer
of the Company dated the date of filing with the SEC of such
supplement or document or the date of effectiveness of such
amendment or date of such purchase as the case may be, in form
satisfactory to the Agents to the effect that the statements
contained in the certificate referred to in Section 4(b) hereof
which was last furnished to the Agents are true and correct at
the time of such filing, supplement, amendment or purchase, as
the case may be, as though made at and as of such time (except
that such statements shall be deemed to relate to the
Registration Statement and the Prospectus as amended and
supplemented to such time) or, in lieu of such certificate, a
certificate of the same tenor as the certificate referred to in
said Section 4(b), modified as necessary to relate to the
Registration Statement and the Prospectus as amended and
supplemented to the time of delivery of such certificate.
Subsequent Delivery of Legal Opinions. (i) Each time
that there is filed with the SEC any Quarterly Report on Form
10-Q or Annual Report on Form 10-K that is incorporated by
reference into the Prospectus, (ii) on the date of each Terms
Agreement for a purchase of Notes by an Agent as principal
pursuant to Section 1(d) hereof, and (iii) at the reasonable
written request of the Agents in the case of each such filing,
amendment or supplement, each time that there is filed with the
SEC any report on Form 8-K, or 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 or maturity dates of the Notes or similar changes
or solely for the inclusion of additional financial information,
an amendment or supplement which relates exclusively to an
offering of securities other than the Notes or, except as
hereinbefore described, an amendment or supplement resulting from
the filing of any document incorporated by reference therein),
the Company shall furnish or cause to be furnished forthwith to
the Agents and to counsel to the Agents the written opinions of
Cleary, Gottlieb, Steen & Hamilton, counsel to the Company,
Philip S. Toohey, Executive Vice President, General Counsel and
Secretary to the Company, or other counsel satisfactory to the
Agents, dated the date of filing with the SEC of such supplement
or the date of effectiveness of such amendment or the date of
such purchase, as the case may be, in form and substance
satisfactory to the Agents, of the same tenor as the opinions
referred to in Section 4(a) hereof, but modified, as necessary,
to relate to the Registration Statement and the Prospectus as
amended and supplemented to the time of delivery of such
opinions; or, in lieu of such opinions, such counsel, or counsel
last furnishing such opinions to the Agents, shall furnish the
Agents with a letter substantially to the effect that
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<PAGE>
the Agents may rely on such last opinion to the same extent as
though it was dated the date of such letter authorizing reliance
(except that statements in such last opinion shall be deemed to
relate to the Registration Statement and the Prospectus as
amended and supplemented to the time of delivery of such letter
authorizing reliance).
Delivery of Comfort Letters. At the times and under
the circumstances set forth below, the Company shall cause KPMG
Peat Marwick LLP ("KPMG") to furnish the Agents a letter, in form
and substance satisfactory to the Agents, to the effect that:
They are independent public accountants with
respect to the Company and its subsidiaries within the
meaning of the 1933 Act and the 1934 Act Regulations.
In their opinion, the consolidated financial
statements of the Company and its subsidiaries audited by
them and included or incorporated by reference in the
Registration Statement and Prospectus and reported on by
them comply as to form in all material respects with the
applicable accounting requirements of the 1933 Act and the
1934 Act and the related published rules and regulations.
On the basis of procedures (but not an audit in
accordance with generally accepted auditing standards)
consisting of:
(a) Reading the minutes of the meetings of
the stockholders, the board of directors, executive
committee and audit committee of the Company and the boards
of directors and executive committees of its subsidiaries
as set forth in the minute books through a specified date
not more than five business days prior to the date of
delivery of such letter;
(b) Performing the procedures specified by
the American Institute of Certified Public Accountants for
a review of interim financial information as described in
SAS NO. 71, Interim Financial Information, on the unaudited
consolidated interim financial statements of the Company
and its consolidated subsidiaries included or incorporated
by reference in the Registration Statement and Prospectus
and reading the unaudited interim financial data, if any,
for the period from the date of the latest balance sheet
included or incorporated by reference in the Registration
Statement and Prospectus to the date of the latest
available interim financial data; and
(c) Making inquiries of certain officials of
the Company who have responsibility for financial and
accounting matters regarding the specific items for which
representations are requested below;
nothing has come to their attention as a result of the foregoing
procedures that caused them to believe that:
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<PAGE>
(1) any material modifications should be
made to the unaudited consolidated interim financial
statements, included or incorporated by reference in the
Registration Statement and Prospectus, for them to be in
conformity with generally accepted accounting principles;
(2) the unaudited consolidated interim
financial statements, included or incorporated by reference
in the Registration Statement and Prospectus, do not comply
as to form in all material respects with the applicable
accounting requirements of the 1934 Act and the published
rules and regulations thereunder;
(3) (i) at the date of the latest available
interim financial data and at the specified date not more
than five business days prior to the date of the delivery
of such letter, there was any change in the capital stock
or the long-term debt (other than scheduled repayments of
long-term debt) or any decrease in shareholders' equity of
the Company and the subsidiaries on a consolidated basis as
compared with the amounts shown in the latest balance sheet
included or incorporated by reference in the Registration
Statement and the Prospectus or (ii) or the period from the
date of the latest available financial data to a specified
date not more than five business days prior to the delivery
of such letter, there was any change in the capital stock
or the long-term debt (other than scheduled repayments of
long-term debt) or any decreases in shareholders' equity of
the Company and the subsidiaries on a consolidated basis,
except in all instances for changes or decreases which the
Registration Statement and Prospectus discloses have
occurred or may occur, or KPMG shall state any specific
changes or decreases.
The letter shall also state that KPMG has carried
out certain other specified procedures, not constituting an
audit, with respect to certain amounts, percentages and
financial information which are included or incorporated by
reference in the Registration Statement and Prospectus and
which are specified by the Agents and agreed to by KPMG,
and has found such amounts, percentages and financial
information to be in agreement with the relevant
accounting, financial and other records of the Company and
its subsidiaries identified in such letter.
The Company shall cause such a letter to be delivered
to the Agents (A) on the date of each Terms Agreement for the
purchase of Notes by an Agent as principal pursuant to Section
1(d) hereof, dated as of such date, (B) within five business days
of the relevant filing date, each time that there is filed with
the SEC by the Company any Annual Report on Form 10- K or
Quarterly Report on Form 10-Q that is incorporated by reference
into the Prospectus, dated the date of filing of such report with
the SEC and (C) if reasonably required by the Agents, within five
days of written request by the Agents, each time that there is
filed any Current Report on Form 8-K that includes financial
information, and each time that the Registration Statement or
Prospectus shall be amended or supplemented to include additional
financial information, dated the date of effectiveness of such
filing, amendment or supplement, as the case may be. Each
18
<PAGE>
such letter shall be of the tenor described above in clauses (i)
through (iv) but modified to relate to the Registration Statement
and Prospectus, as amended and supplemented through the date of
such letter, and with such changes as may be necessary to reflect
changes in the financial statements and other information derived
from the accounting records of the Company, and otherwise in form
satisfactory to the Agents.
Suspension of Certain Obligations. The Company shall
not be required to comply with the provisions of subsections (b),
(c) or (d) of this Section during any period beginning on the
date on which the Agents shall have suspended solicitation of
purchases of the Notes in their capacity as agent pursuant to a
written request from the Company or, if later, the date
thereafter when the Agents shall no longer hold any Notes
purchased as principal from the Company, and ending on the
earlier of the date when the Company shall request, by written
notice to the Agents, that solicitation of purchases of the Notes
should be resumed or the date when the Company shall subsequently
agree for the Agents to purchase Notes as principal.
Indemnification and Contribution.
The Company agrees to indemnify and hold harmless each
Agent, the directors, officers, employees and agents of each
Agent, and each person who controls any Agent within the meaning
of either the 1933 Act or the 1934 Act against any and all
losses, claims, damages or liabilities, joint or several, to
which they or any of them may become subject under the 1933 Act,
the 1934 Act or other Federal or state statutory law or
regulation, at common law 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 a material fact contained in the Registration
Statement as originally filed or in any amendment thereof, or
arise out of or are based upon any omission or alleged omission
to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, or arise
out of or are based upon any untrue statement or alleged untrue
statement of a material fact contained in the Prospectus, or any
amendment or supplement thereof, or arise out of or are based
upon any omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which
they were made, not misleading, and agrees to reimburse each such
indemnified party, as incurred, for any legal or other expenses
reasonably incurred by them in connection with investigating or
defending any such loss, claim, damage, liability or action;
provided, however, that the Company will not be liable in any
such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon any such untrue
statement or alleged untrue statement or omission or alleged
omission made therein in reliance upon and in conformity with
written information furnished to the Company by or on behalf of
any Agent specifically for inclusion therein, or arises out of or
is based upon statements in or omissions from that part of the
Registration Statement which shall constitute the Statement of
Eligibility and Qualification of the Trustee (Form T-1) under the
1939 Act of the Trustee, and (ii) such indemnity with respect to
the Prospectus shall not inure to the benefit of any Agent (or
any person controlling such Agent)
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<PAGE>
from whom the person asserting any such loss, claim, damage or
liability purchased the Notes which are the subject thereof if
such person did not receive a copy of the Prospectus as amended
or supplemented in connection with the sale of such Notes
excluding documents incorporated therein by reference at or prior
to the written confirmation of the sale of such Notes to such
person in any case where such delivery is required by the 1933
Act and the untrue statement or omission of a material fact
contained in the Prospectus was corrected in the Prospectus as
amended or supplemented. This indemnity agreement will be in
addition to any liability which the Company may otherwise have.
Each Agent severally and not jointly agrees to
indemnify and hold harmless the Company, each of its directors,
each of its officers who signs the Registration Statement, and
each person who controls the Company within the meaning of either
the 1933 Act or the 1934 Act, to the same extent as the foregoing
indemnity from the Company to each Agent, but only with reference
to written information relating to such Agent furnished to the
Company by or on behalf of such Agent specifically for inclusion
in the documents referred to in the foregoing indemnity. This
indemnity agreement will be in addition to any liability which
any Agent may otherwise have. The Company acknowledges that the
statements set forth (i) in the last two paragraphs on the cover
page, (ii) in the first paragraph on page S-2 relating to
stabilization and (iii) under the heading "Plan of Distribution"
in the Prospectus, as supplemented or amended, constitute the
only information furnished in writing by or on behalf of the
several Agents for inclusion in the documents referred to in the
foregoing indemnity, and you, as the Agents, confirm that such
statements are correct.
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 this Section 7, notify
the indemnifying party in writing of the commencement thereof;
but the failure so to notify the indemnifying party (i) will not
relieve it from liability under paragraph (a) or (b) above unless
and to the extent it did not otherwise learn of such action and
such failure results in the forfeiture by the indemnifying party
of substantial rights and defenses and (ii) will not, in any
event, relieve the indemnifying party from any obligations to any
indemnified party other than the indemnification obligation
provided in paragraph (a) or (b)above. The indemnifying party
shall be entitled to appoint counsel of the indemnifying party's
choice at the indemnifying party's expense to represent the
indemnified party in any action for which indemnification is
sought (in which case the indemnifying party shall not thereafter
be responsible for the fees and expenses of any separate counsel
retained by the indemnified party or parties except as set forth
below); provided, however, that such counsel shall be
satisfactory to the indemnified party. Notwithstanding the
indemnifying party's election to appoint counsel to represent the
indemnified party in an action, the indemnified party shall have
the right to employ separate counsel (including local counsel),
and the indemnifying party shall bear the reasonable fees, costs
and expenses of such separate counsel if (i) the use of counsel
chosen by the indemnifying party to represent the indemnified
party would present such
<PAGE>
counsel with a conflict of interest, (ii) the actual or potential
defendants in, or targets of, any such action include both the
indemnified party and the indemnifying party and the indemnified
party shall have reasonably concluded that there may be legal
defenses available to it and/or other indemnified parties which
are different from or additional to those available to the
indemnifying party, (iii) the indemnifying party shall not have
employed counsel satisfactory to the indemnified party to
represent the indemnified party within a reasonable time after
notice of the institution of such action or (iv) the indemnifying
party shall authorize the indemnified party to employ separate
counsel at the expense of the indemnifying party. An indemnifying
party will not, without the prior written consent of the
indemnified parties, settle or compromise or consent to the entry
of any judgment with respect to any pending or threatened claim,
action, suit or proceeding in respect of which indemnification or
contribution may be sought hereunder (whether or not the
indemnified parties are actual or potential parties to such claim
or action) unless such settlement, compromise or consent includes
an unconditional release of each indemnified party from all
liability arising out of such claim, action, suit or proceeding.
In the event that the indemnity provided in paragraph
(a) or (b) of this Section 7 is unavailable to or insufficient to
hold harmless an indemnified party for any reason, the Company
and the Agents severally agree to contribute to the aggregate
losses, claims, damages and liabilities (including legal or other
expenses reasonably incurred in connection with investigating or
defending same)(collectively "Losses") to which the Company and
one or more of the Agents may be subject in such proportion as is
appropriate to reflect the relative benefits received by the
Company on the one hand and by the Agents on the other from the
offering of the Notes; provided, however, that in no case shall
any Agent (except as may be provided in any agreement among
underwriters relating to the offering of the Notes) be
responsible for any amount in excess of the underwriting discount
or commission applicable to the Notes purchased by or through
such Agent hereunder. If the allocation provided by the
immediately preceding sentence is unavailable for any reason, the
Company and the Agents severally shall contribute in such
proportion as is appropriate to reflect not only such relative
benefits but also the relative fault of the Company on the one
hand and of the Agents on the other in connection with the
statements or omissions which resulted in such Losses as well as
any other relevant equitable considerations. Benefits received by
the Company shall be deemed to be equal to the total net proceeds
from the offering of Notes (before deducting expenses) received
by it, and benefits received by the Agents shall be deemed to be
equal to the total underwriting discounts and commissions, in
each case to the date of the Loss. Relative fault shall be
determined by reference to, among other things, whether any
untrue or any alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to
information provided by the Company on the one hand or the Agent
on the other, the intent of the parties and their relative
knowledge, access to information and opportunity to correct or
prevent such untrue statement or omission. The Company and the
Agents agree that it would not be just and equitable if
contribution were determined by pro rata allocation or any other
method of allocation which does not take account of the equitable
considerations referred to above. Notwithstanding the
21
<PAGE>
provisions of this paragraph (d), no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the
Act) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation. For purposes of
this Section 7, each person who controls an Agent within the
meaning of either the Act or the Exchange Act and each director,
officer, employee and agent of an Agent shall have the same
rights to contribution as such Agent, and each person who
controls the Company within the meaning of either the Act or the
Exchange Act, each officer of the Company who shall have signed
the Registration Statement and each director of the Company shall
have the same rights to contribution as the Company, subject in
each case to the applicable terms and conditions of this
paragraph (d).
Payment of Expenses.
The Company will pay all expenses incident to the
performance of its obligations under this Agreement, including:
The preparation and filing of the Registration
Statement and all amendments thereto and the Prospectus and
any amendments or supplements thereto;
The preparation, filing and reproduction of this
Agreement;
The preparation, printing, issuance and delivery
of the Notes, including any fees and expenses relating to
the use of book-entry notes;
The qualification of the Notes under state
securities or insurance laws in accordance with the
provisions of Section 4(i) hereof, including filing fees
and the reasonable fees and disbursements of counsel for
the Agents in connection therewith and in connection with
the preparation of any Blue Sky Survey and any Legal
Investment Survey;
The printing and delivery to the Agent in
quantities as hereinabove stated of copies of the
Registration Statement and any amendments thereto, and of
the Prospectus and any amendments or supplements thereto,
and the delivery by the Agent of the Prospectus and any
amendments or supplements thereto in connection with
solicitations or confirmations of sales of the Notes;
The preparation, printing, reproduction and
delivery to the Agents of copies of the Indentures and all
supplements and amendments thereto;
The rating of the Notes;
If applicable, the listing of the Notes on any
securities exchange;
Any filing with the National Association of
Securities Dealers, Inc.; and
22
<PAGE>
Securing any CUSIP or other identification
numbers for the Notes.
The Company shall also pay the fees and disbursements of the
Trustee (including the reasonable fees and disbursements of
counsel to the Trustee), any registrar, transfer agent, paying
agent, calculation agent and any book-entry system depositary (or
nominee thereof) with respect to the Notes and of the Company's
independent public accountants and special counsel.
In addition to the expenses specified in paragraph (a)
the Company will pay or reimburse:
The reasonable fees and disbursements of counsel
to the Agents incurred from time to time in connection with
the transactions contemplated hereby; and
Any advertising and other out-of-pocket expenses
of the Agents incurred in connection with the offering of
the Notes with the prior written approval of the Company.
Representations, Warranties and Agreements to Survive
Delivery.
All representations, warranties and agreements
contained in this Agreement or in certificates of officers of the
Company submitted pursuant hereto shall remain operative and in
full force and effect, regardless of any investigation made by or
on behalf of any Agent or any controlling person of any Agent, or
by or on behalf of the Company, and shall survive each delivery
of and payment for any of the Notes.
Termination.
Termination of this Agreement. This Agreement
(excluding any agreement hereunder by an Agent to purchase Notes
as principal) may be terminated for any reason, with respect to
one or more, or all, of the Agents, at any time by either the
Company or one or more of the Agents upon the giving of 30 days'
written notice of such termination to the other party hereto. Any
termination by the Company of this Agreement with respect to one
or more, but less than all, of the Agents shall be effective with
respect to such designated Agents only, and the Agreement will
remain in force and effect with respect to any other Agents who
remain parties hereto.
Termination of Agreement to Purchase Notes as
Principal. An Agent may terminate any agreement hereunder by such
Agent to purchase Notes as principal, immediately upon notice to
the Company at any time prior to the Settlement Date relating
thereto, (i) if there has been, since the date of such agreement
or since the respective dates as of which information is given in
the Registration Statement, any material adverse change in the
condition, financial or otherwise, or in the prospects, earnings,
business or properties of the Company and its
23
<PAGE>
subsidiaries, taken as a whole, or (ii) if there shall have
occurred, since the date of such agreement, any outbreak or
material escalation of hostilities or other national or
international calamity or crisis the effect of which is such as
to make it, in the judgment of such Agent, impracticable to
market the Notes or enforce contracts for the sale of the Notes,
or (iii) if, since the date of such agreement, trading in
securities generally on the New York Stock Exchange shall have
been suspended or limited, or (iv) if, since the date of such
agreement, a banking moratorium shall have been declared by
either Federal or New York authorities.
If, after the date of an agreement hereunder to
purchase Notes as principal and prior to the Settlement Date with
respect to such agreement, the rating assigned by Standard &
Poor's Ratings Group, a division of McGraw Hill, Inc., or Moody's
Investors Service, Inc., as the case may be, to any debt
securities of the Company shall have been lowered or if either of
such rating agencies shall have publicly announced that it has
under surveillance or review, with possible negative
implications, its rating of any debt securities of the Company,
then the Company and the Agent mutually shall determine whether
the terms of such agreement to purchase Notes shall need to be
renegotiated and, if so, shall so negotiate in good faith the
revised terms of such agreement to purchase Notes. In the event
that the Company and the Agent reasonably fail to agree on any
such revised terms, then either the Company or the Agent may
terminate such agreement to purchase Notes.
General. In the event of a termination under this
Section 10, or following the Settlement Date in connection with a
sale to or through an Agent appointed on a one-time basis,
neither party will have any liability to the other party hereto,
except that (i) the Agents shall be entitled to any commission
earned in accordance with Section 1(c) hereof, (ii) if at the
time of termination (a) any Agent shall own any Notes purchased
by it as principal with the intention of reselling them or (b) an
offer to purchase any of the Notes has been accepted by the
Company but the time of delivery to the purchaser or his agent of
the Note or Notes relating thereto has not occurred, the
covenants set forth in Sections 3 and 6 hereof shall remain in
effect until such Notes are so resold or delivered, as the case
may be, and (iii) the covenant set forth in Section 3(h) hereof,
the provisions of Section 8 hereof, the indemnity and
contribution agreements set forth in Section 7 hereof, and the
provisions of Sections 9, 12 and 13 hereof shall remain in
effect.
Notices.
Unless otherwise provided herein, all notices required
under the terms and provisions hereof shall be in writing, either
delivered by hand, by mail or by telex, telecopier or telegram.
Notices to the Company shall be delivered to it at the address
specified below and notices to any Agent shall be delivered to it
at the address set forth on Exhibit A.
<PAGE>
If to the Company:
HSBC Americas, Inc.
One Marine Midland Center
Buffalo, New York 14203
Attention: Chief Financial Officer
Telecopy: (716) 841-5391
With a copy (which shall not constitute notice) to:
Philip S. Toohey, Esq.
Executive Vice President,
General Counsel and Secretary
HSBC Americas, Inc.
One Marine Midland Center
Buffalo, New York 14203
Telecopy: (716) 841-5391
Cleary, Gottlieb, Steen & Hamilton
One Liberty Plaza
New York, New York 10006
Attention: James F. Munsell, Esq.
Telecopy: (212) 225-3999
or at such other address as such party may designate from time to
time by notice duly given in accordance with the terms of this
Section 11.
Governing Law; Counterparts.
This Agreement and all the rights and obligations of
the parties shall be governed by and construed in accordance with
the laws of the State of New York applicable to agreements made
and to be performed in such State. This Agreement may be executed
in counterparts and the executed counterparts shall together
constitute a single instrument.
Parties.
This Agreement shall inure to the benefit of and be
binding upon the Agents and the Company and their respective
successors. Nothing expressed or mentioned in this Agreement is
intended or shall be construed to give any person, firm or
corporation, other than the parties hereto and their respective
successors and the controlling persons and officers and directors
referred to in Section 7 and their heirs and legal
representatives, any legal or equitable right, remedy or claim
under or in respect of this Agreement or any provision herein
contained. This Agreement and all conditions and provisions
hereof are intended to be for the sole and
25
<PAGE>
exclusive benefit of the parties hereto and respective successors
and said controlling persons and officers and directors and their
heirs and legal representatives, and for the benefit of no other
person, firm or corporation. No purchaser of Notes shall be
deemed to be a successor by reason merely of such purchase.
If the foregoing is in accordance with your
understanding of our agreement, please sign and return to the
Company a counterpart hereof, whereupon this instrument along
with all counterparts will become a binding agreement between the
Agents and the Company in accordance with its terms.
Very truly yours,
HSBC AMERICAS, INC.
By:
Name:
Title:
Accepted:
HSBC SECURITIES, INC.
By:
Name:
Title:
[Signatures By Agents To Follow]
26
<PAGE>
[Signature Page for Agents]
LEHMAN BROTHERS INC.
By:
Name:
Title:
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
By:
Name:
Title:
SALOMON BROTHERS INC
By:
Name:
Title:
27
<PAGE>
EXHIBIT A
AGENTS
HSBC Securities, Inc.
140 Broadway
New York, New York 10005
Telecopy: (212) 825-7517
With a copy (which shall not constitute notice) to:
Shaw Pittman Potts & Trowbridge
2300 N Street, N.W.
Washington, D.C. 20037
Attention: Mary Jane Dodson, Esq.
Telecopy: (202) 663-8007
[Names and Addresses of Additional Agents]
Lehman Brothers Inc.
Three World Financial Center
New York, New York 10285
Merrill Lynch, Pierce, Fenner & Smith Incorporated
World Financial Center
North Tower
New York, New York 10281
Salomon Brothers Inc
7 World Trade Center
New York, New York 10048
28
<PAGE>
EXHIBIT B
The following terms, if applicable, shall be agreed to
by an Agent and the Company in connection with each sale of Notes
on an agency basis:
Principal Amount: $__________
Interest Rate:
If Fixed Rate Note, Interest Rate:
If Floating Rate Note:
Interest Rate Basis:
Base Rate:
Initial Interest Rate:
Index Maturity:
Index Maturity for Initial Interest
Rate (if different):
Index Maturity for Final Interest
Payment Period (if different):
Spread or Spread Multiplier, if any:
Maximum Interest Rate, if any:
Minimum Interest Rate, if any:
Interest Payment Date(s):
Interest Rate Reset Dates:
Interest Rate Reset Period:
Calculation Agent:
If Redeemable:
Initial Redemption Date:
Initial Redemption Percentage:
Annual Redemption Percentage Reduction:
Original Issue Date:
Stated Maturity Date:
Final Maturity Date:
Repayment Date(s)
Purchase Price: _____%
Settlement Date and Time:
Extendible:
29
<PAGE>
Renewable:
Additional Terms:
30
<PAGE>
EXHIBIT C
As compensation for the services of an Agent
hereunder, the Company shall pay it, on a discount basis, a
commission for the sale of each Note by such Agent which, unless
otherwise agreed between the Company and Agent, shall be equal to
the principal amount of such Note multiplied by the appropriate
percentage set forth below:
PERCENT OF
MATURITY RANGES PRINCIPAL AMOUNT
From 9 months to less than 1 year.............. .125%
From 1 year to less than 18 months............. .150
From 18 months to less than 2 years............ .200
From 2 years to less than 3 years.............. .250
From 3 years to less than 4 years.............. .350
From 4 years to less than 5 years.............. .450
From 5 years to less than 6 years.............. .500
From 6 years to less than 7 years.............. .550
From 7 years to less than 10 years............. .600
From 10 years to less than 15 years............ .625
From 15 years to less than 20 years............ .700
From 20 years to less than 30 years............ .750
The commission for Notes with a maturity 30 years or more or sold
to one or more Agents as principal also is subject to negotiation
between the Company and the Agent at the time of sale.
31
<PAGE>
EXHIBIT D
HSBC AMERICAS, INC.
MEDIUM TERM NOTES
TERMS AGREEMENT
___________, ____
HSBC Americas, Inc.
One Marine Midland Center
Buffalo, New York 14203
Attention:
Re: Distribution Agreement dated as of August 21, 1998
(the "Distribution Agreement")
The undersigned agrees to purchase your Medium-Term
Notes, Series __- ___ having the following terms:
Principal (or face) Amount: $___________
Original Issue Date:
Settlement Date and Time:
Stated Maturity Date:
Final Maturity Date:
Purchase Price: __% of Principal Amount, plus accrued
interest, if any, from Settlement Date
Price to Public: __% of Principal Amount, plus accrued
interest, if any, from Settlement Date
32
<PAGE>
Initial Redemption Date:
Initial Redemption Percentage:
Annual Redemption Percentage Reduction:
Repayment Date (Dates):
Repayment Price:
Total Amount of OID:
Original Yield to Maturity
Initial accrual period of OID:
Applicability of modified payment upon acceleration:
If yes, state issue price:
Extendible:
Renewable:
Calculation Agent:
Other terms of Notes:
Provisions relating to underwriter default, if any:
(For Fixed Rate Notes)
Interest Rate:
(For Floating Rate Notes)
Base Rate:
Initial Interest Rate:
33
<PAGE>
Index Maturity:
Index Maturity for Initial Interest Rate (if
different):
Index Maturity for Final Interest Payment Period (if
different):
Interest Reset Period:
Interest Payment Period:
Spread: _________ points (+/-)
Spread Multiplier: ________%
Maximum Interest Rate: ___%
Minimum Interest Rate: ___%
Interest Payment Dates:
Interest Rate Reset Dates:
Interest Rate Reset Period:
Interest Determination Dates:
The provisions of the Distribution Agreement are
incorporated by reference herein and shall be deemed to have the
same force and effect as if set forth in full herein.
This Agreement is subject to termination in our
absolute discretion on the terms incorporated by reference
herein. If this Agreement is so terminated, the provisions set
forth in Section 10(c) of the Distribution Agreement shall
survive for the purpose of this Agreement.
The following opinions, certificates, comfort letters
and documents referred to in Sections 4(c), 6(b), 6(c) and 6(d)
will be required:
[NAME OF AGENT]
By:
Name:
Title:
34
<PAGE>
Accepted:
HSBC Americas, Inc.
By:
Name:
Title:
35
<PAGE>
EXHIBIT E
[Date]
[Name and Address of Agent]
Re: Issuance of $_________________ Medium Term Senior Notes,
Series __-__, by HSBC Americas, Inc.
Dear __________:
The Distribution Agreement dated August 21, 1998 (the
"Agreement"), among HSBC Americas, Inc. (the "Company") and the
Agents named therein, provides for the issue and sale by the
Company of its Medium Term Senior Notes, Series __-__.
Subject to and in accordance with the terms of the Agreement and
accompanying Administrative Procedures, the Company hereby
appoints you as Agent (as such term is defined in the Agreement)
in connection with the purchase of the notes as described in the
accompanying Pricing Supplement No. ___, dated ___________,
_____, (the "Notes") but only for this one reverse inquiry
transaction. Your appointment is made subject to the terms and
conditions applicable to Agents under the Agreement and
terminates upon payment for the Notes or other termination of
this transaction. Accompanying this letter is a copy of the
Agreement, the provisions of which are incorporated herein by
reference. Copies of the officer's certificate, opinions of
counsel, and auditors' letter described in the Agreement are not
enclosed but are available upon your request.
This letter agreement, like the Agreement, is governed by and
construed in accordance with the laws of the State of New York.
If the above is in accordance with your understanding of our
agreement, please sign and return this letter to us on or before
settlement date. This action will confirm your appointment and
your acceptance and agreement to act as Agent in connection with
the issue and sale of the above described Notes under the terms
and conditions of the Agreement.
Very truly yours,
AGREED AND ACCEPTED
HSBC AMERICAS, INC. [Name of Agent]
36
<PAGE>
By:____________________ By:_____________________
Name:__________________ Name:___________________
Title:_________________ Title:__________________
37
[FORM OF MEDIUM-TERM FIXED RATE NOTE]
[FORM OF FACE OF NOTE]
IF APPLICABLE, THE "TOTAL AMOUNT OF OID," "ORIGINAL
YIELD TO MATURITY" AND "INITIAL ACCRUAL PERIOD OID"
(COMPUTED UNDER THE APPROPRIATE METHOD SET FORTH BELOW)
HAS BEEN COMPLETED SOLELY FOR THE PURPOSES OF APPLYING
THE FEDERAL INCOME TAX ORIGINAL ISSUE DISCOUNT ("OID")
RULES.
If the registered owner of this Note is The Depository
Trust Company or a nominee thereof, this Note is a Global
Security and the following legends are applicable: THIS SECURITY
IS A GLOBAL 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 NOT
EXCHANGEABLE FOR NOTES REGISTERED IN THE NAME OF A PERSON OTHER
THAN THE DEPOSITARY OR ITS NOMINEE EXCEPT IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO TRANSFER OF THIS
NOTE (OTHER THAN A TRANSFER OF THIS NOTE AS A WHOLE BY THE
DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE
DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY
OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR
DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY) MAY BE
REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
INDENTURE.*
Unless this certificate is presented by an authorized
representative of The Depository Trust Company, a New York
corporation ("DTC"), (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 DTC (and any payment is made to Cede & Co. or
such other entity as is requested by an authorized representative
of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the
registered owner hereof, Cede & Co., has an interest
herein.*
THIS NOTE IS NOT A SAVINGS ACCOUNT OR A DEPOSIT, IS NOT
AN OBLIGATION OF OR GUARANTEED BY ANY BANKING OR NONBANKING
AFFILIATE OF HSBC AMERICAS, INC. AND IS NOT INSURED BY THE
FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL
AGENCY.
____________________
*Applies only if this Note is a Global Security.
<PAGE>
REGISTERED
NUMBER FXR _________ $__________
HSBC AMERICAS, INC.
MEDIUM-TERM SENIOR NOTE, SERIES [**-***]
(Fixed Rate)
CUSIP _______
ORIGINAL ISSUE DATE:
INTEREST RATE: [ ] This Note is a
STATED MATURITY DATE: Renewable Note.
FINAL MATURITY DATE: See Attached Rider
INITIAL REDEMPTION DATE
INITIAL REDEMPTION PERCENTAGE:
ANNUAL REDEMPTION PERCENTAGE REDUCTION:
REPAYMENT DATE(S): [ ] This Note is an
TOTAL AMOUNT OF OID: Extendible Note.
ORIGINAL YIELD TO MATURITY: See Attached Rider.
APPLICABILITY OF MODIFIED
PAYMENT UPON ACCELERATION:
IF YES, ISSUE PRICE:
INITIAL ACCRUAL PERIOD OID:
ADDITIONAL TERMS:
HSBC Americas, Inc., a corporation duly organized and
existing under the laws of the State of Delaware, (herein called
the "Company" which term includes any successor corporation under
the Indenture referred to on the reverse hereof), for value
received, hereby promises to pay to ___________________________
_________________________________________, or registered assigns,
the principal sum of ___________________ DOLLARS on the Stated
Maturity Date specified above (except to the extent redeemed or
repaid prior to the Stated Maturity Date), and to pay interest on
said principal sum, except as provided below, semiannually in
arrears on September 1 and March 1 of each year (each an
"Interest Payment Date"), at the Interest Rate per annum
specified above, until payment of such principal sum has been
made or duly provided for, commencing on the first Interest
Payment Date next succeeding the Original Issue Date specified
above, unless the Original Issue Date occurs between a Regular
Record Date (as defined below), and the next succeeding Interest
Payment Date, in which case, commencing on the Interest Payment
Date following the next succeeding Regular Record Date, and on
the Stated Maturity Date or Final Maturity Date shown above (or
any Redemption Date as defined on the reverse hereof or any
Repayment Date with respect to which any such option has been
exercised, each such Stated Maturity Date, Final Maturity Date,
Redemption Date and Repayment Date being herein referred to as a
"Maturity Date" with respect to the principal payable on such
date).
____________________
** Insert year of original issue of this series of Notes.
*** Insert letter designation beginning with "A" for the first
series issued in such calendar year of original issue and
continuing alphabetically thereafter.
2
<PAGE>
Except as provided below, interest on this Note will accrue from
the Original Issue Date specified above until the principal
amount is paid or duly provided for and will be computed on the
basis of a 360-day year of twelve 30-day months. Interest
payments will be in the amount of interest accrued from and
including the next preceding Interest Payment Date in respect of
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 specified above, to but excluding such Interest
Payment Date or Maturity Date, as the case may be. If the
Maturity Date or an Interest Payment Date falls on a day which is
not a Business Day as defined below, principal and interest
payable with respect to such Maturity Date or Interest Payment
Date will be paid on the next succeeding Business Day with the
same force and effect as if made on such Maturity Date or
Interest Payment Date, as the case may be, and no additional
interest shall accrue for the period from and after such Maturity
Date or Interest Payment Date to such next succeeding Business
Day. The interest so payable, and punctually paid or duly
provided for, on any Interest Payment Date will be paid to the
person in whose name this Note (or one or more predecessor Notes
evidencing all or a portion of the same debt as this Note) is
registered at the close of business on the Regular Record Date,
which shall be the date fifteen calendar days prior to such
Interest Payment Date except that the Regular Record Date for a
March 15th Interest Payment Date for a Fixed Rate Note will
always be the February 28th (whether or not a Business Day)
immediately preceding such Interest Payment Date; provided,
however, that the first payment of interest on any Note with an
Original Issue Date, as specified above, between a Regular Record
Date and an Interest Payment Date or on an Interest Payment Date
will be made on the Interest Payment Date following the next
succeeding Regular Record Date to the person in whose name this
Note is registered at the close of business on such next
succeeding Regular Record Date; and provided, further, that
interest payable on the Maturity Date will be payable to the
person to whom the principal hereof shall be payable. Any
interest not punctually paid or duly provided for shall be
payable as provided in the Indenture. As used herein, "Business
Day" means any day, other than a Saturday or Sunday or a legal
holiday in New York, New York, that is not a day on which banking
institutions or trust companies in New York, New York are
authorized or obligated by law to be closed.
The principal of and interest on this Note are payable
in immediately available funds in such currency of the United
States as at the time of payment is legal tender for payment of
public and private debts at the office or agency of the Company
designated as provided in the Indenture; provided, however, that
interest may be paid, at the option of the Company, by check
mailed to the person entitled thereto at his address last
appearing on the registry books of the Company relating to the
Notes. Notwithstanding the preceding sentence, payments of
principal of and interest payable on the Maturity Date will be
made by wire transfer of immediately available funds to a
designated account maintained in the United States upon (i)
receipt of written notice by the Trustee from the Holder hereof
not less than one Business Day prior to the due date of such
principal and (ii) presentation of this Note to the Paying Agent
at Marine Midland Bank, as Paying Agent at 140 Broadway, New
York, New York 10005, Facsimile (212) 658-6425.
Reference is hereby made to the further provisions of
this Note set forth on the reverse hereof, which shall have the
same effect as though fully set forth at this place.
3
<PAGE>
Unless the Certificate of Authentication hereon has been
executed by the Trustee or an Authenticating Agent on behalf of
the Trustee by manual signature, this Note shall not be entitled
to any benefit under the Indenture or be valid or obligatory for
any purpose.
IN WITNESS WHEREOF, the Company has caused this
Instrument to be duly executed, by manual or facsimile signature,
under its corporate seal or a facsimile thereof.
HSBC AMERICAS, INC.
By: _______________________________
[SEAL] [Title: ]
ATTEST:
By:______________________
___________ Secretary
CERTIFICATE OF AUTHENTICATION
This is one of the Debt Securities of the series
designated above issued under the Indenture.
Dated:_____________
BANKERS TRUST COMPANY,
as Trustee
By: Marine Midland Bank,
as Authenticating Agent
By: __________________________
Authorized Signatory
4
<PAGE>
[Reverse of Note]
HSBC AMERICAS, INC.
MEDIUM-TERM SENIOR NOTE, SERIES [*-**](Fixed Rate)
This note is one of a duly authorized issue of Debt
Securities of the Company designated as "Medium-Term Senior
Notes" and limited in aggregate original issue price to
$400,000,000 (herein called the "Medium-Term Notes") issued and
to be issued under an Indenture dated as of October 24, 1996
(herein called the "Indenture"), between the Company and Bankers
Trust Company (herein called the "Trustee," which term includes
any successor trustee under the Indenture) to which Indenture and
all indentures supplemental thereto reference is hereby made for
a statement of the respective rights thereunder of the Company,
the Trustee and the Holders of the Debt Securities (including the
Medium-Term Notes) are to be, authenticated and delivered. Marine
Midland Bank, a wholly owned subsidiary of the Company, initially
has been appointed as Authenticating Agent, Security Registrar
and Paying Agent in respect of the Medium-Term Notes. The
Medium-Term Notes are issuable in one or more series under the
Indenture and each series may bear a different date, mature at a
different time, bear interest at a different rate and vary in
such other ways from any other series as permitted by the
Indenture. This note is one of a series of Medium-Term Notes
designated as Medium-Term Notes, Series [*-**], limited in
aggregate principal amount to $______________ (the notes of such
series are hereinafter called the "Notes").
This Note is not subject to any sinking fund.
This Note may be subject to repayment at the option of
the Holder only if the Repayment Date(s) are indicated on the
face hereof. IF NO REPAYMENT DATES ARE SET FORTH ON THE FACE
HEREOF, THIS NOTE MAY NOT BE SO REPAID AT THE OPTION OF THE
HOLDER HEREOF PRIOR TO THE STATED MATURITY DATE. On any Repayment
Date this Note shall be repayable in whole or in part in
increments of $1,000 principal amount at the option of the Holder
hereof at a repayment price equal to 100% (except in the case of
Notes issued with original issue discount, as described below) of
the principal amount to be repaid, together with interest thereon
payable to the Repayment Date (except as provided below). For
this Note to be repaid in whole or in part at the option of the
Holder hereof, this Note must be received, with the form below
entitled "Option to Elect Repayment" duly completed, by the
Paying Agent at Marine Midland Bank, as Paying Agent, 140
Broadway, New York, New York 10005, Facsimile (212) 658-6425, or
such other address notice of which the Company shall from time to
time give the Holders of the Notes, not more than 60 nor less
than 30 days prior to a Repayment Date. Exercise of such
repayment option by the Holder hereof shall be irrevocable.
This Note may be redeemed at the option of the Company
on any date on and after the Initial Redemption Date, if any,
specified on the face hereof (the "Redemption Date"). IF NO
_________________________
* Insert year of original issue of this series of Notes.
** Insert letter designation beginning with "A" for the first
series issued in such calendar year of original issue and
continuing alphabetically thereafter.
5
<PAGE>
INITIAL REDEMPTION DATE IS SET FORTH ON THE FACE HEREOF, THIS
NOTE MAY NOT BE REDEEMED AT THE OPTION OF THE CORPORATION PRIOR
TO THE STATED MATURITY DATE. On and after the Initial Redemption
Date, if any, this Note may be redeemed at any time in whole or
from time to time in part in increments of $1,000 principal
amount at the option of the Company on any Redemption Date at the
applicable Redemption Price (as defined below), on notice given
not more than 60 nor less than 30 days prior to the Redemption
Date. In the event of redemption of this Note in part only, a new
Note for the unredeemed principal amount hereof shall be issued
in the name of the Holder hereof upon the surrender hereof.
If this Note is redeemable at the option of the Company,
the "Redemption Price" shall initially be the sum of (i) the
Initial Redemption Percentage, specified on the face hereof, of
the principal amount of this Note (except in the case of Notes
issued with original issue discount, as described below) to be
redeemed which shall decline at each anniversary of the Initial
Redemption Date by the Annual Redemption Percentage Reduction, if
any, specified on the face hereof, of the principal amount to be
redeemed until the Initial Redemption Percentage as adjusted on
each such anniversary shall have declined to be equal to 100% of
such principal amount (except in the case of Notes issued with
original issue discount, as described below), plus (ii) accrued
and unpaid interest, if any, to the Redemption Date.
If this Note is of a series of Medium-Term Notes that
are Discount Securities (as defined in the Indenture) issued with
original issue discount, the Redemption Price of this Note on any
Redemption Date shall be limited to the face amount hereof (the
principal amount due hereon at the Stated Maturity Date hereof)
multiplied by the sum of the Issue Price specified on the face
hereof (expressed as a percentage of the face amount) plus the
original issue discount amortized from the Original Issue Date to
the Redemption Date (also expressed as a percentage of the face
amount hereof), which amortization shall be calculated using the
"constant interest rate method" (computed in accordance with
generally accepted accounting principles in effect on the
Redemption Date). If this Note is of a series of Medium Term
Notes that are Discount Securities, and by its terms bears
interest only after the Stated Maturity Date hereof, no interest
shall be payable except after such Stated Maturity Date.
[The provisions of Article Fourteen of the Indenture do
not apply to Securities of this Series.][****]
If an Event of Default (defined in the Indenture as (i)
the Company's failure to pay principal of (or premium, if any,
on) the Notes when due, or to pay interest on the Notes within 30
days after the same becomes due and payable, (ii) the Company's
breach of its other covenants contained in this Note or the
Indenture, which breach is not cured within 60 days after written
notice by the Trustee or the Holders of at least 25% in
outstanding principal amount of all Outstanding Notes, (iii)
certain events involving the bankruptcy, insolvency or
liquidation of the Company) shall occur, or (iv) a default shall
have occurred under any note or other evidence of Indebtedness
for Money Borrowed of the Company (including a default with
respect to Medium-
________________________
**** Text in brackets to be included in the Medium-Term Notes of
any series if so specified by Officer's Certificate.
6
<PAGE>
Term Notes or other Debt Securities of another series outstanding
under the Indenture) or Marine Midland Bank in an aggregate
principal amount exceeding $5,000,000, which default results in
acceleration of such indebtedness that persists more than 10 days
after written notice by the trustee or the Holder, of at least
25% in outstanding principal amount of all Outstanding Notes, the
principal of all the Notes may be declared due and payable in the
manner and with the effect provided in the Indenture.
If this Note is of a series of Medium Term Notes that
are Discount Securities and the face hereof indicates that this
Note is subject to "Modified Payment Upon Acceleration", then 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
face amount hereof multiplied by the sum of the Issue Price
specified on the face hereof (expressed as a percentage of the
face amount hereof) plus the original issue discount amortized
from the Original Issue Date to the date of declaration (also
expressed as a percentage of the face amount hereof), which
amortization shall be calculated using the "constant interest
rate method" (computed in accordance with generally accepted
accounting principles in effect on the date of declaration).
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 Notes under the Indenture at any time by the
Company with the consent of the Holders of not less than 66-2/3%
in aggregate principal amount of the Notes then Outstanding and
of each other series of Debt Securities then Outstanding under
the Indenture and affected by such amendment and modification
voting separately. The Indenture also contains provisions
permitting the Holders of a majority in aggregate principal
amount of the Notes then Outstanding, on behalf of the Holders of
all of the Notes, to waive certain past defaults under the
Indenture and their consequences. The Indenture contains
provisions permitting the Holders of at least 66-2/3% in
aggregate principal amount of Notes then Outstanding before the
time for compliance, to waive compliance by the Company with
certain covenants of the Indenture on behalf of the Holders of
all Notes then Outstanding. Any such consent or waiver by the
Holder of this Note shall be conclusive and binding upon such
Holder and upon all future Holders of this Note and of any Note
issued upon the registration of transfer hereof or in exchange
herefor or in lieu hereof whether or not notation of such consent
or waiver is made upon this Note.
No reference herein to the Indenture and 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 and interest on this Note at the times,
place and rate, and in the coin or currency, herein prescribed.
No recourse shall be had for the payment of the
principal of or the interest on this Note, or 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, stockholder, officer or director, as such,
past, present or future, of the Company or any successor
corporation, either directly or through the Company, 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
7
<PAGE>
acceptance hereof and as part of the consideration for issue
hereof, expressly waived and released.
As provided in the Indenture and subject to certain
limitations therein set forth, the transfer of this Note may be
registered on the registry books of the Company relating to the
Notes, upon surrender of this Note for registration of transfer
at the office or agency of the Company designated by it pursuant
to the Indenture, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Company, the
Trustee and the Security Registrar duly executed by, the Holder
hereof or his attorney duly authorized in writing, and thereupon
one or more new Notes, of authorized denominations and for the
same aggregate principal amount as this Note, will be issued to
the designated transferee or transferees.
The Notes are issuable only as registered Notes without
coupons in denominations of $1,000 and any integral multiple
thereof. As provided in the Indenture, and subject to certain
limitations therein set forth, this Note is exchangeable for a
like aggregate principal amount of Notes of different authorized
denominations, as requested by the Holder surrendering the same.
No service charge will be made for any such registration
of transfer or exchange, but the Company may require payment of a
sum sufficient to cover any tax or other governmental charge
payable in connection therewith.
Prior to due presentment for registration of transfer of
this Note, the Company, the Trustee, the Paying Agent and any
agent of the Company, the Trustee or any Paying Agent may treat
the Person in whose name this Note is registered as the absolute
owner hereof for the purpose of receiving payment as herein
provided and for all other purposes, whether or not this Note be
overdue, and neither the Company, the Trustee, the Paying Agent
nor any such agent shall be affected by notice to the contrary.
All terms used in this Note which are defined in the
Indenture shall have the meanings assigned to them in the
Indenture.
If the Notes are to be issued and outstanding pursuant to a
book-entry system, the following paragraph is applicable: The
Notes are being issued by means of a book-entry system with no
physical distribution of certificates to be made except as
provided in the Indenture. The book-entry system maintained by
The Depository Trust Company ("DTC") will evidence ownership of
the Notes, with transfers of ownership effected on the records of
DTC and its participants pursuant to rules and procedures
established by DTC and its participants. The Company will
recognize Cede & Co., as nominee of DTC, while the registered
owner of the Notes, as the owner of the Notes for all purposes,
including payment of principal and interest, notices and voting.
Transfer of principal and interest to participants of DTC will be
the responsibility of DTC, and transfer of principal and interest
to beneficial owners of the Notes by participants of DTC will be
the responsibility of such participants and other nominees of
such beneficial owners. So long as the book-entry system is in
effect, the selection of those specific Notes to be redeemed will
be determined by DTC pursuant to rules and procedures established
by DTC and its participants. The Company will not be responsible
or liable for such transfers or payments or for maintaining,
8
<PAGE>
supervising or reviewing the records maintained by DTC, its
participants or persons acting through such participants.
9
<PAGE>
ABBREVIATIONS
The following abbreviations, when used in the
inscription on the face of the within Note shall be construed as
though they were written out in full according to applicable laws
or regulations:
TEN COM-- as tenants in common
TEN ENT-- as tenants by the entireties
JT TEN-- as joint tenants with right of survivorship
and not as tenants in common
UNIF GIFT MIN ACT--...............Custodian................
(Cust) (Minor)
Under Uniform Gifts to Minors Act
.................................
(State)
Additional abbreviations may also be used though not in
the above list.
10
<PAGE>
____________________________________
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s),
assign(s) and transfer(s) unto
[PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS,
INCLUDING ZIP CODE OF ASSIGNEE]
________________________________________________________________
________________________________________________________________
________________________________________________________________
Please Insert Social Security or Other Identifying Number
of Assignee: ___________________
the within Note and all rights thereunder, hereby irrevocably
constituting and appointing ____________________________________
Attorney to transfer said 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 it appears upon the
face of the within Note in
every particular, without
alteration or enlargement or
any change whatever and must be
guaranteed.
11
<PAGE>
OPTION TO ELECT REPAYMENT
The undersigned hereby irrevocably request(s) and
instruct(s) the Company to repay this Note (or portion hereof
specified below) pursuant to its terms at a price equal to the
principal amount hereof together with interest to the repayment
date, to the undersigned, at
_______________________________________________________________
_______________________________________________________________
(Please print or typewrite name and address of the undersigned)
For this Note to be repaid, the Trustee (or the Paying
Agent on behalf of the Trustee) must receive at Marine Midland
Bank, as Paying Agent, 140 Broadway, New York, New York 10005, or
at such other place or places of which the Company shall from
time to time notify the Holder of this Note, not more than 60 nor
less than 30 days prior to a Repayment Date, if any, shown on the
face of this Note, this Note with this "Option to Elect
Repayment" form duly completed.
If less than the entire principal amount of this Note is
to be repaid, specify the portion hereof (which shall be in
increments of $1,000 principal amount) which the Holder elects to
have repaid and specify the denomination or denominations (which
shall be $1,000 or an integral multiple of $l,000) of the Note(s)
to be issued to the Holder for the portion of this Note not being
repaid (in the absence of any such specification, one such Note
will be issued for the portion not being repaid).
$_______________________ ________________________________
DATE: __________________ NOTICE: The signature on this
Option to Elect Repayment must
correspond with the name as
written upon the face of this
Note in every particular, without
alteration or enlargement or any
change whatever.
12
<PAGE>
RENEWABLE NOTE RIDER
The Company and the purchaser of this Note have agreed
that this Note is a Renewable Note which initially matures on the
Stated Maturity Date shown on the face of this Note. At each
Renewal Date, the maturity of this Note will be automatically
extended to the corresponding New Maturity Date unless the Holder
of this Note delivers a completed Extension Termination Notice to
the Trustee or the Paying Agent on behalf of the Trustee not less
than 15 nor more than 30 days prior to the applicable Renewal
Date. The Extension Termination Notice may specify all or a
portion of the outstanding principal amount of the Note (in
increments of $1,000 principal amount) so long as the principal
amount of the Note remaining Outstanding after repayment is an
integral multiple of $1,000. Upon timely delivery of such
Extension Termination Notice, the term of the principal amount of
this Note subject to such notice will be deemed automatically to
mature on the Stated Maturity Date or the then applicable New
Maturity Date, as the case may be. The remaining principal amount
of this Note, if any, will be deemed to automatically be extended
to the corresponding New Maturity Date but in no circumstances
may such maturity be extended beyond the Final Maturity Date.
Notwithstanding any such extension, the interest rate
applicable to this Note will continue to be calculated as set
forth in this Note.
STATED MATURITY DATE:_________________________________
FINAL MATURITY DATE:__________________________________
Renewal Date(s) New Maturity Date(s)
13
<PAGE>
EXTENDIBLE NOTE RIDER
The Company and the purchaser of this Note have agreed
that this Note is an Extendible Note, which means that the
Company has the option to extend the maturity of this Note by
delivery to the Trustee (or any duly authorized Paying Agent) of
an Extendible Option Notice under the terms of this Note as
supplemented by this Extendible Note Rider.
Stated Maturity Date:
Final Maturity Date:
Extension Notice Due Date: Extended Maturity Date:
The Company may exercise its option with respect to an
Extendible Note by delivery to the Trustee (or any duly appointed
Paying Agent) of an Extendible Option Notice at least 45 but not
more than 60 days prior to the Stated Maturity Date originally in
effect with respect to such Note or, if the Stated Maturity Date
of such Note has already been extended, the Extended Maturity
Date then in effect. After such receipt and not later than 40
days prior to the Stated Maturity Date or an Extended Maturity
Date, as the case may be (each, a "Maturity Date"), the Trustee
(or any duly appointed Paying Agent) will mail first class mail,
postage prepaid, to the Holder of such Extendible Note a notice
(the "Extension Notice") relating to such extension period (the
"Extension Period") setting forth (i) the election of the Company
to extend the maturity of such Extendible Note, (ii) the new
Extended Maturity Date, (iii) in the case of a Fixed Rate Note,
the interest rate applicable to the Extension Period or, in the
case of a Floating Rate Note, the Spread and/or Spread Multiplier
applicable to the Extension Period, and (iv) the provisions, if
any, for redemption during the Extension Period, including the
date or dates on which, the period or periods during which and
the price or prices at which such redemption may occur during the
Extension Period. Upon the mailing by the Trustee (or any duly
appointed Paying Agent) of an Extension Notice to the Holder of
an Extendible Note, the maturity of such Note shall be extended
automatically as set forth in the Extension Notice, and, except
as modified by the Extension Notice and as described in the next
paragraph, such Extendible Note will have the same terms as prior
to the mailing of such Extension Notice.
Notwithstanding the foregoing, not later than 20 days
prior to the Maturity Date for an Extendible Note (or, if such
date is not a Business Day, on the immediately succeeding
Business Day), the Company may, at its option, revoke the
interest rate, in the case of a Fixed Rate Note, or the Spread
and/or Spread Multiplier, in the case of a Floating Rate Note,
provided for in the Extension Notice and establish a higher
interest rate, in the case of a Fixed Rate Note, or a higher
Spread and/or Spread Multiplier, in the case of a Floating Rate
Note, for the Extension period by mailing or causing the Trustee
(or any duly appointed Paying Agent) to mail notice of such
higher interest rate or higher Spread and/or Spread Multiplier,
as the case may be, first class mail, postage prepaid, to the
Holder of such Note. Such notice shall be irrevocable. All
Extendible Notes with respect to which the Maturity Date is
extended will bear such higher
14
<PAGE>
interest rate, in the case of a Fixed Rate Note, or higher Spread
and/or Spread Multiplier, in the case of a Floating Rate Note,
for the Extension Period.
If the Company elects to extend the maturity of an
Extendible Note, the Holder of such Note will have the option to
elect repayment of such Note by the Company on the Maturity Date
then in effect at a price equal to the principal amount thereof
plus any accrued and unpaid interest to such date. In order for
an Extendible Note to be so repaid on the Maturity Date, the
Company must receive, at least 15 days but not more than 30 days
prior to the Maturity Date then in effect with respect to the
Note, (i) the Note with the form "Option to Elect Repayment" on
the reverse of the Note duly completed or (ii) a telegram, telex,
facsimile transmission or a letter from a member of a national
securities exchange, or the National Association of Securities
Dealers, Inc. or a commercial bank or trust company in the United
States setting forth the name of the Holder of the Note, the
principal amount of the Note, the principal amount of the Note to
be repaid, the certificate number or a description of the tenor
and terms of the Note, a statement that the option to elect
repayment is being exercised thereby and a guarantee that the
Note to be repaid, together with the duly completed form entitled
"Option to Elect Repayment" attached to the Note, will be
received by the Trustee (or any duly appointed Paying Agent) not
later than the fifth Business Day after the date of such
telegram, telex, facsimile transmission or letter, provided,
however, that such telegram, telex, facsimile transmission or
letter shall only be effective if such Note and duly completed
form are received by the Trustee (or any duly appointed Paying
Agent) by such fifth Business Day. Such option may be exercised
by the Holder of an Extendible Note for less than the aggregate
principal amount of the Note then Outstanding, provided that the
principal amount of the Note remaining Outstanding after
repayment is an integral multiple of $1,000.
15
[FORM OF MEDIUM-TERM FLOATING RATE NOTE]
[FORM OF FACE OF NOTE]
IF APPLICABLE, THE "TOTAL AMOUNT OF OID," "ORIGINAL
YIELD TO MATURITY" AND "INITIAL ACCRUAL PERIOD OID"
(COMPUTED UNDER THE APPROPRIATE METHOD SET FORTH BELOW)
HAS BEEN COMPLETED SOLELY FOR THE PURPOSES OF APPLYING
THE FEDERAL INCOME TAX ORIGINAL ISSUE DISCOUNT ("OID")
RULES.
If the registered owner of this Note is The Depository
Trust Company or a nominee thereof, this Note is a Global
Security and the following legends are applicable: THIS SECURITY
IS A GLOBAL 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 NOT
EXCHANGEABLE FOR NOTES REGISTERED IN THE NAME OF A PERSON OTHER
THAN THE DEPOSITARY OR ITS NOMINEE EXCEPT IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO TRANSFER OF THIS
NOTE (OTHER THAN A TRANSFER OF THIS NOTE AS A WHOLE BY THE
DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE
DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY
OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR
DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY) MAY BE
REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
INDENTURE.*
Unless this certificate is presented by an authorized
representative of The Depository Trust Company, a New York
corporation ("DTC"), (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 DTC (and any payment is made to Cede & Co. or
such other entity as is requested by an authorized representative
of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the
registered owner hereof, Cede & Co., has an interest
herein.*
THIS NOTE IS NOT A SAVINGS ACCOUNT OR A DEPOSIT, IS NOT
AN OBLIGATION OF OR GUARANTEED BY ANY BANKING OR NONBANKING
AFFILIATE OF HSBC AMERICAS, INC. AND IS NOT INSURED BY THE
FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL
AGENCY.
- ---------------
* Applies only if this Note is a Global Security
<PAGE>
REGISTERED
NUMBER FLR _______ $_________
HSBC AMERICAS, INC.
MEDIUM-TERM SENIOR NOTE, SERIES [**-***]
(Floating Rate)
CUSIP _______
ORIGINAL ISSUE DATE: BASE RATE:
STATED MATURITY DATE: (check one)
FINAL MATURITY DATE: ___CD Rate
INITIAL INTEREST RATE: ___ CMT Rate
INDEX MATURITY: CMT Telerate Page:____
INDEX MATURITY FOR INITIAL CMT Maturity Index:___
INTEREST RATE (IF DIFFERENT): ___Commercial Paper Rate
INDEX MATURITY FOR FINAL ___Federal Funds Rate
INTEREST PAYMENT PERIOD ___LIBOR
(IF DIFFERENT): ___Prime Rate
SPREAD: ___Treasury Rate
SPREAD MULTIPLIER
MAXIMUM INTEREST RATE:
MINIMUM INTEREST RATE: ___Other:________________
INTEREST PAYMENT DATES:
INTEREST RATE RESET DATE(S): [ ] This Note is a
INTEREST RATE RESET PERIOD: Renewable Note.
INITIAL REDEMPTION DATE: See Attached Rider
INITIAL REDEMPTION PERCENTAGE:
ANNUAL REDEMPTION PERCENTAGE REDUCTION:
REPAYMENT DATE(S):
TOTAL AMOUNT OF OID:
ORIGINAL YIELD TO MATURITY:
APPLICABILITY OF MODIFIED
PAYMENT UPON ACCELERATION:
IF YES, ISSUE PRICE:
INITIAL ACCRUAL PERIOD OID:
CALCULATION AGENT: [ ] This Note is an
ADDITIONAL TERMS: Extendible Note.
See Attached Rider.
- --------------
** Insert year of original issue of this series of Notes.
*** Insert letter of designation beginning with "A" for the
first series issued in such calendar year of original
issue and continuing alphabetically thereafter.
<PAGE>
HSBC Americas, Inc., a corporation duly organized and
existing under the laws of the State of Delaware (herein called
the "Company," which term includes any successor corporation
under the Indenture referred to on the reverse hereof), for value
received, hereby promises to pay to
______________________________________________, or registered
assigns, the principal sum of ________________ DOLLARS on the
Stated Maturity Date specified above (except to the extent
redeemed or repaid prior to the Stated Maturity Date), and to pay
interest thereon, except as provided below, at a rate per annum
equal to the Initial Interest Rate specified above until the
Initial Interest Rate Reset Date specified above and thereafter
at a rate determined in accordance with the provisions on the
reverse hereof, depending upon the appropriate Base Rate and
Index Maturity specified above, until the principal hereof is
paid or duly provided for. The Company will pay interest on the
Interest Payment Dates specified above, commencing with the first
Interest Payment Date next succeeding the Original Issue Date
specified above, unless the Original Issue Date occurs between a
Regular Record Date (as defined below), and the next succeeding
Interest Payment Date, in which case commencing on the Interest
Payment Date following the next succeeding Regular Record Date,
and on the Stated Maturity Date or Final Maturity Date shown
above (or any Redemption Date as defined on the reverse hereof or
any Repayment Date with respect to which any such option has been
exercised, each such Stated Maturity Date, Final Maturity Date,
Redemption Date and Repayment Date being herein referred to as a
"Maturity Date" with respect to the principal payable on such
date). Except as provided below, interest on this Note will
accrue from the Original Issue Date specified above until the
principal amount is paid or duly provided for and will be
computed as hereinafter described. Interest payable on this Note
on any Interest Payment Date or the Maturity Date will include
interest accrued from and including the next preceding Interest
Payment Date in respect of 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 specified above, to but
excluding such Interest Payment Date or Maturity Date, as the
case may be. If any Interest Payment Date falls on a day which is
not a Business Day, as defined below, such Interest Payment Date
shall be the following day that is a Business Day, except that if
the Base Rate is LIBOR, if such next Business Day falls in the
next succeeding calendar month, such Interest Payment Date will
be the preceding day that is a Business Day; and if the Maturity
Date falls on a day which is not a Business Day, principal or
interest payable with respect to such Maturity Date will be paid
on the next succeeding Business Day with the same force and
effect as if made on such Maturity Date, and no additional
interest shall accrue for the period from and after such Maturity
Date to such next succeeding Business Day. The interest so
payable, and punctually paid or duly provided for, on any
Interest Payment Date will be paid to the person in whose name
this Note (or one or more predecessor Notes evidencing all or a
portion of the same debt as this Note) is registered at the close
of business on the date 15 calendar days prior to such Interest
Payment Date, whether or not a Business Day (the "Regular Record
Date"); provided, however, that the first payment of interest on
any Note with an Original Issue Date, as specified above, between
a Regular Record Date and an Interest Payment Date or on an
Interest Payment Date will be made on the Interest Payment Date
following the next succeeding Regular Record Date to the person
in whose name this Note is registered at the close of business on
such next succeeding Regular Record Date; and provided, further,
that interest payable on the Maturity Date will be payable to the
person to whom the principal hereof shall be payable. Any such
interest not punctually paid or duly provided for shall be
payable as provided in the Indenture. As used herein, "Business
Day" means any day,
<PAGE>
other than a Saturday or Sunday or a legal holiday in New York,
New York, that is not a day (i) on which banking institutions or
trust companies in New York, New York, are authorized or
obligated by law to be closed and (ii) if the Base Rate is LIBOR,
is a day on which dealings in deposits on Dollars are transacted
in the London interbank market.
The principal of and interest on this Note are payable
in immediately available funds in such currency of the United
States as at the time of payment is legal tender for payment of
public and private debts at the office or agency of the Company
designated as provided in the Indenture; provided, however, that
interest may be paid, at the option of the Company, by check
mailed to the person entitled thereto at his address last
appearing on the registry books of the Company relating to the
Notes. Notwithstanding the preceding sentence, payments of
principal of and interest payable on the Maturity Date will be
made by wire transfer of immediately available funds to a
designated account maintained in the United States upon (i)
receipt of written notice by the Trustee from the Holder hereof
not less than one Business Day prior to the due date of such
principal and (ii) presentation of this Note to the Paying Agent
at Marine Midland Bank, as Paying Agent at 140 Broadway, New
York, New York 10005, Facsimile (212) 658-6425.
Reference is hereby made to the further provisions of
this Note set forth on the reverse hereof, which shall have the
same effect as though fully set forth at this place.
Unless the Certificate of Authentication hereon has been
executed by the Trustee or an Authenticating Agent on behalf of
the Trustee by manual signature, this Note shall not be entitled
to any benefit under the Indenture or be valid or obligatory for
any purpose.
IN WITNESS WHEREOF, the Company has caused this
Instrument to be duly executed, by manual or facsimile signature,
under its corporate seal or a facsimile thereof.
HSBC AMERICAS, INC.
By: ____________________________
[Title: ]
ATTEST:
_________________________
_______________ Secretary
<PAGE>
CERTIFICATE OF AUTHENTICATION
This is one of the Debt Securities of the series
designated above issued under the Indenture.
Dated: ____________________________
BANKERS TRUST COMPANY,
as Trustee
By: Marine Midland Bank,
as Authenticating Agent
By: __________________________
Authorized Signatory
<PAGE>
[Reverse of Note]
HSBC AMERICAS, INC.
MEDIUM-TERM SENIOR NOTE, SERIES [**-***]
(Floating Rate)
This note is one of a duly authorized issue of Debt
Securities of the Company designated as "Medium-Term Senior
Notes" and limited in aggregate original issue price to
$400,000,000 (herein called the "Medium-Term Notes") issued and
to be issued under an Indenture dated as of October 24, 1996,
(herein called the "Indenture"), between the Company and Bankers
Trust Company (herein called the "Trustee," which term includes
any successor trustee under the Indenture) to which Indenture and
all indentures supplemental thereto reference is hereby made for
a statement of the respective rights thereunder of the Company,
the Trustee and the Holders of the Debt Securities (including the
Medium-Term Notes), and the terms upon which the Debt Securities
(including the Medium-Term Notes) are to be, authenticated and
delivered. Marine Midland Bank, a wholly owned subsidiary of the
Company, initially has been appointed as Authenticating Agent,
Security Registrar and Paying Agent in respect of the Medium-Term
Notes. The Medium-Term Notes are issuable in one or more series
under the Indenture and each series may bear a different date,
mature at a different time, bear interest at a different rate and
vary in such other ways from other series as permitted by the
Indenture. This note is one of a series of Medium-Term Notes
designated as Medium-Term Notes, Series [**-***] limited in
aggregate principal amount to $________________ (the notes of
such series are hereinafter called the "Notes").
This Note is not subject to any sinking fund.
This Note may be subject to repayment at the option of
the Holder only if the Repayment Date(s) are indicated on the
face hereof. IF NO REPAYMENT DATES ARE SET FORTH ON THE FACE
HEREOF, THIS NOTE MAY NOT BE SO REPAID AT THE OPTION OF THE
HOLDER HEREOF PRIOR TO THE STATED MATURITY DATE. On any Repayment
Date, this Note shall be repayable in whole or in part in
increments of $1,000 principal amount at the option of the Holder
hereof at a repayment price equal to 100% (except in the case of
Notes issued with original issue discount, as described below) of
the principal amount to be repaid, together with interest thereon
payable to the Repayment Date (except as provided below). For
this Note to be repaid in whole or in part at the option of the
Holder hereof, this Note must be received, with the form below
entitled "Option to Elect Repayment" duly completed, by the
Paying Agent at Marine Midland Bank, as Paying Agent, 140
Broadway, New York, New York 10005, Facsimile (212) 658-6425 or
such other address notice of which the Company shall from time to
time give the Holders of the Notes, not more than 60 nor less
than 30 days prior to a Repayment Date. Exercise of such
repayment option by the Holder hereof shall be irrevocable.
- --------------
** Insert year of original issue of this series of Notes.
*** Insert letter of designation beginning with "A" for the
first series issued in such calendar year of original
issue and continuing alphabetically thereafter.
<PAGE>
This Note may be redeemed at the option of the Company
on any date on and after the Initial Redemption Date, if any,
specified on the face hereof (the "Redemption Date"). IF NO
INITIAL REDEMPTION DATE IS SET FORTH ON THE FACE HEREOF, THIS
NOTE MAY NOT BE REDEEMED AT THE OPTION OF THE CORPORATION PRIOR
TO THE STATED MATURITY DATE. On and after the Initial Redemption
Date, if any, this Note may be redeemed at any time in whole or
from time to time in part in increments of $1,000 principal
amount at the option of the Company on any Redemption Date at the
applicable Redemption Price (as defined below), on notice given
not more than 60 nor less than 30 days prior to the Redemption
Date. In the event of redemption of this Note in part only, a new
Note for the unredeemed principal amount hereof shall be issued
in the name of the Holder hereof upon the surrender hereof.
If this Note is redeemable at the option of the Company,
the "Redemption Price" shall initially be the sum of (i) the
Initial Redemption Percentage, specified on the face hereof, of
the principal amount of this Note (except in the case of Notes
issued with original issue discount, as described below) to be
redeemed which shall decline at each anniversary of the Initial
Redemption Date by the Annual Redemption Percentage Reduction, if
any, specified on the face hereof, of the principal amount to be
redeemed until the Initial Redemption Percentage as adjusted on
each such anniversary shall have declined to be equal to 100% of
such principal amount (except in the case of Notes issued with
original issue discount, as described below), plus (ii) accrued
and unpaid interest, if any, to the Redemption Date.
If this Note is of a series of Medium-Term Notes that
are Discount Securities (as defined in the Indenture) issued with
original issue discount, the Redemption Price of this Note on any
Redemption Date shall be limited to the face amount hereof (the
principal amount due hereon at the Stated Maturity Date hereof)
multiplied by the sum of the Issue Price specified on the face
hereof (expressed as a percentage of the face amount hereof) plus
the original issue discount amortized from the Original Issue
Date to the Redemption Date (also expressed as a percentage of
the face amount hereof), which amortization shall be calculated
using the "constant interest rate method" (computed in accordance
with generally accepted accounting principles in effect on the
Redemption Date). If this Note is of a series of Medium Term
Notes that are Discount Securities, and by its terms bears
interest only after the Stated Maturity Date hereof, no interest
shall be payable except after such Stated Maturity Date
Accrued interest hereon shall be 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 from and including the
Original Issue Date, or from but excluding the last date to which
interest has been paid, as the case may be, to and including the
date for which accrued interest is being calculated. The interest
factor (expressed as a decimal) for each such day shall be
computed by dividing the interest rate in effect on such day by
360 or, in the case of Notes having the Treasury Rate or the CMT
Rate as their Base Rate, by the actual number of days in the
year.
The Base Rate (as defined herein) with respect to this
Note may be (i) the CD Rate, (ii) the Commercial Paper Rate,
(iii) LIBOR, (iv) the Federal Funds Rate, (v) the Prime Rate,
(vi) the
<PAGE>
Treasury Rate, (vii) the CMT Rate, or (viii) such other rate as
will be described on the face hereof and a rider to this Note.
Except as described below, this Note will bear interest
at the rate determined by reference to the appropriate interest
rate basis (the "Base Rate") and Index Maturity 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.
The interest rate in effect on each day shall be (a) if such day
is an Interest Reset Date, the interest rate determined as of the
Interest Determination Date (as defined below) pertaining to such
Interest Reset Date or (b) if such day is not an Interest Reset
Date, the interest rate determined as of the Interest
Determination Date pertaining to the next preceding Interest
Reset Date, provided that (i) the interest rate in effect from
the Original Issue Date to the first Interest Reset Date shall be
the Initial Interest Rate specified on the face hereof, and (ii)
the interest rate in effect for the ten calendar days immediately
prior to the Maturity Date shall be the rate in effect on the
tenth calendar day preceding such Maturity Date. 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 day that
is a Business Day, except that if the Base Rate specified on the
face hereof is LIBOR, if such next Business Day is in the next
succeeding calendar month, such Interest Reset Date shall be the
immediately preceding Business Day. The term "Final Interest
Payment Period" means the period from the final Interest Reset
Date to the Maturity Date.
The Interest Determination Date with respect to any Note
that has as its Base Rate the CD Rate, the Commercial Paper Rate,
the Federal Funds Rate, the Prime Rate or the CMT Rate will be
the second Business Day preceding the Interest Reset Date. The
Interest Determination Date with respect to LIBOR shall be the
second London Banking Day (as defined below) preceding the
Interest Reset Date. The Interest Determination Date with respect
to the Treasury Rate shall be the day of the week in which the
Interest Reset Date falls on which Treasury bills of the Index
Maturity specified on the face hereof 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
the 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 such
auction.
The "Calculation Date" pertaining to any Interest
Determination Date shall be the earlier of (i) the tenth calendar
day after such Interest Determination Date or, if such day is not
a Business Day, the next succeeding Business Day, or (ii) the
Business Day next preceding the applicable Interest Payment Date
or Maturity Date, as the case may be.
All percentages resulting from any calculation on the
Notes will be rounded, if necessary, to the nearest one
hundred-thousandth of a percentage point, with five
one-millionths of a percentage point rounded upward, and all
dollar amounts used in or resulting from such calculation on the
Notes will be rounded to the nearest cent (with one-half cent
being rounded upward).
Determination of CD Rate. CD Rate means, with respect to
an Interest Determination Date (a "CD Rate Interest Determination
<PAGE>
Date"), the rate on such CD Rate Interest Determination Date for
negotiable certificates of deposit having the Index Maturity
specified on the face hereof, as such rate is published by the
Board of Governors of the Federal Reserve System (the "Federal
Reserve Board") in "Statistical Release H.15(519), Selected
Interest Rates," or any successor publication of the Federal
Reserve Board ("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 CD Rate Interest
Determination Date, the CD Rate will be the rate on such CD Rate
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 such rate is not published in
either H.15(519) or the Composite Quotations by 3:00 P.M., New
York City time, on such Calculation Date, then the CD Rate on
such CD Rate Interest Determination Date will be calculated by
the Calculation Agent and will be the arithmetic mean of the
secondary market offered rates as of 10:00 A.M., New York City
time, on such CD Rate Interest Determination Date, 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 with a remaining maturity closest to the Index
Maturity specified on the face hereof in denominations of
$5,000,000; provided, however, that if the dealers selected as
aforesaid by the Calculation Agent are not quoting as set forth
above, the CD Rate for such CD Rate Interest Determination Date
will be the CD Rate in effect on such CD Rate Interest
Determination Date.
Determination of CMT Rate. CMT Rate means with respect
to an Interest Determination Date relating to a CMT Rate Note or
any Floating Rate Note for which the interest rate is determined
by reference to the CMT Rate (a "CMT Rate Interest Determination
Date"), the rate displayed on the designated CMT Telerate Page
under the caption "Treasury Constant Maturities . . . Federal
Reserve Board Release H.15 . . . Mondays approximately 3:45
p.m.," under the column for the Designated CMT Maturity Index for
(i) if the Designated CMT Telerate Page is 7055, the rate on such
CMT Rate Interest Determination Date and (ii) if the Designated
CMT Telerate Page is 7052, the week, or the month, as applicable,
ended immediately preceding the week in which the Related CMT
Rate Interest Determination Date occurs. If such rate is no
longer displayed on the relevant page, or if not displayed by
3:00 p.m., New York City time, on the related Calculation Date,
then the CMT Rate for such CMT Rate Interest Determination Date
will be such Treasury Constant Maturity Rate for the Designated
CMT Maturity Index as published in the relevant H.15(519). If
such rate is no longer published, or if not published by 3:00
p.m. New York City time, on the related Calculation Date, then
the CMT Rate for such CMT Rate Interest Determination Date will
be such Treasury Constant Maturity Rate for the Designated CMT
Maturity Index (or other United States Treasury rate for the
Designated CMT Maturity Index) for the CMT Rate Interest
Determination Date with respect to such Interest Reset Date as
may then be published by either the Board of Governors of the
Federal Reserve System or the United States Department of the
Treasury that the Calculation Agent determines to be comparable
to the rate formerly displayed on the Designated CMT Telerate
Page and published in the relevant H.15(519). If such information
is not provided by 3:00 p.m., New York City time, on the related
Calculation Date, then the CMT Rate for the CMT Rate Interest
Determination Date will be calculated by the Calculation Agent
and will be a yield to maturity,
<PAGE>
based on the arithmetic mean of the secondary market closing
offer side prices as of approximately 3:30 p.m., New York City
time, on the CMT Interest Determination Date reported, according
to their written records, by three leading primary United States
government securities dealers (each a "Referenced Dealer") in The
City of New York selected by the Calculation Agent (from five
such Referenced Dealers selected by the Calculation Agent by
eliminating the highest quotation (or, in the event of equality,
one of the highest) and the lowest quotation (or, in the event of
equality, one of the lowest)), for the most recently issued
direct, non- callable fixed rate obligations of the United States
("Treasury Note") with an original maturity of approximately the
Designated CMT Maturity Index and a remaining term to maturity of
not less than such Designated CMT Maturity Index minus one year.
If the Calculation Agent cannot obtain three such Treasury Note
quotations, the CMT Rate for such CMT Rate Interest Determination
Date will be calculated by the Calculation Agent and will be a
yield to maturity based on the arithmetic mean of the secondary
market side offer prices as of approximately 3:30 p.m. New York
City time, on the CMT Rate Interest Determination Date of three
Referenced Dealers in The City of New York (from five such
Referenced Dealers selected by the Calculation Agent by
eliminating the highest quotation (or, in the even of equality,
one of the highest) and lowest quotation (or, in the event of
equality, one of the lowest)), for Treasury Notes with an
original maturity of the number of years that is the next highest
to the Designated CMT Maturity Index and a remaining term to
maturity closest to the Designated CMT Maturity Index and in an
amount of at least $100,000,000. If three or four (and not five)
of such Referenced Dealers are quoting as described above, then
the CMT Rate will be based on the arithmetic mean of the offer
prices obtained and neither the highest nor lowest of such quotes
will be eliminated; provided however, that if fewer than three
Referenced Dealers selected by the Calculation Agent are quoting
as described herein, the CMT Rate will be the CMT Rate in effect
on such CMT Rate Interest Determination Date. If two Treasury
Notes with an original maturity as described in the third
preceding sentence have remaining terms to maturity equally close
to the Designated CMT Maturity Index, the quotes for the Treasury
Rate Note with the shorter remaining term to maturity will be
used.
"Designated CMT Telerate Page" means the display on the
Dow Jones Telerate Service or successor service on the page
designated on the face of this Note (or any other page as may
replace such page on that service for the purpose of displaying
Treasury Constant Maturities as reported in H.15(519)), or the
purpose of displaying Treasury Constant Maturity as reported in
H.15(519). If no such page is specified, the Designated CMT
Telerate Page shall be 7052, for the most recent week.
"Designated CMT Maturity Index" means the original
period to maturity of the U.S. Treasury Securities (either 1, 2,
3, 5, 7, 10, 20 or 30 years) specified on the fact of this Note
with respect to which the CMT Rate will be calculated. If no such
maturity is specified on the face of this Note, the Designated
CMT Maturity Index shall be two years.
Determination of Commercial Paper Rate. The Commercial
Paper Rate means, with respect to an Interest Determination Date
(a "Commercial Paper Rate Interest Determination Date"), the
Money Market Yield (as defined below) of the rate on such date
for commercial paper having the Index Maturity specified on the
face hereof as published in H.15(519) under the
<PAGE>
heading "Commercial Paper--Nonfinancial." In the event such rate
is not published by 3:00 P.M., New York City time, on the
Calculation Date pertaining to such Commercial Paper Rate
Interest Determination Date, the Commercial Paper Rate shall be
the Money Market Yield on such Commercial Paper Rate Interest
Determination Date of the rate for commercial paper having the
Index Maturity specified on the face hereof as published in
Composite Quotations under the heading "Commercial Paper." If
such rate is not published in either H.15(519) or Composite
Quotations by 3:00 P.M., New York City time, on such Calculation
Date, the Commercial Paper Rate for that Commercial Paper Rate
Interest Determination Date shall be calculated by the
Calculation Agent and shall be the Money Market Yield determined
on the basis of a rate which is the arithmetic mean of the
offered rates as of 11:00 A.M., New York City time, on such
Commercial Paper Rate Interest Determination Date of three
leading dealers of commercial paper in The City of New York
selected by the Calculation Agent for commercial paper having a
maturity equal to the Index Maturity specified on the face hereof
placed for an industrial issuer whose bond rating is "AA", or the
equivalent, by a nationally recognized securities rating agency;
provided, however, that if the dealers selected as aforesaid by
the Calculation Agent are not quoting as set forth above, the
Commercial Paper Rate with respect to such Commercial Paper Rate
Interest Determination Date will be the Commercial Paper Rate
then in effect on such Commercial Paper Rate Interest
Determination Date.
"Money Market Yield" shall be the yield (expressed as a
percentage rounded to the nearest one ten-thousandth of a
percent, with five one hundred-thousandths of a percent rounded
upward) calculated in accordance with the following formula:
D x 360
Money Market Yield = ---------------- x 100
360 - (D x M)
where "D" refers to the per annum commercial paper rate on a bank
discount basis, 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. The Federal Funds
Rate means, with respect to an Interest Determination Date (a
"Federal Funds Rate Interest Determination Date"), the rate on
that date for Federal Funds as published in H.15(519) under the
heading "Federal Funds (Effective)." If H.15(519) is not so
published by 3:00 P.M., New York City time, on the Calculation
Date pertaining to such Federal Funds Rate Interest Determination
Date, the Federal Funds Rate will be the rate on such Federal
Funds Rate Interest Determination Date as published in Composite
Quotations under the heading "Federal Funds/Effective Rate." If
such rate is not yet published in either H.15(519) or Composite
Quotations by 3:00 P.M., New York City time, on the Calculation
Date pertaining to such Federal Funds Rate Interest Determination
Date, the Federal Funds Rate for such Federal Funds Rate 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 Federal Funds Rate Interest Determination Date
quoted by each of three leading brokers of Federal Funds
transactions in The City of New York selected by the Calculation
Agent; provided, however, that
<PAGE>
if fewer than three such brokers are so quoting such rates, the
Federal Funds Rate with respect to such Federal Funds Rate
Interest Determination Date will be the Federal Funds Rate then
in effect on such Federal Funds Rate Interest Determination Date.
Determination of LIBOR. LIBOR means the rate determined
by the Calculation Agent in accordance with the following
provisions:
(i) With respect to an Interest Determination
Date (a "LIBOR Interest Determination Date"),
LIBOR will be "LIBOR Telerate" unless "LIBOR
Reuters" is specified on the face of this Note.
"LIBOR Telerate" is the rate for deposits in
Dollars having a maturity equal to the Index
Maturity specified on the face hereof that
appears on the Designated LIBOR Page (as
defined below) specified on the face hereof as
of 11:00 A.M. London time, on that LIBOR
Interest Determination Date. "LIBOR Reuters" is
that rate which is the arithmetic mean of the
offered rates (unless the specified Designated
LIBOR Page by its terms provides only for a
single rate, in which case such single rate
shall be used) for deposits in Dollars having a
maturity equal to the Index Maturity specified
on the face hereof that appear on the
Designated LIBOR Page specified on the face
hereof as of 11:00 A.M. London time, on that
LIBOR Interest Determination Date, if at least
two such offered rates appear (unless, as
aforesaid, only a single rate is required) on
such Designated LIBOR Page. If LIBOR cannot be
determined under this clause (i), LIBOR in
respect of the related LIBOR Interest
Determination Date will be determined as if the
parties had specified the rate described in
clause (ii) below.
(ii) With respect to a LIBOR Interest
Determination Date on which the applicable
LIBOR rate cannot be determined under clause
(i) above, 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 Dollars for a period
equal to the Index Maturity specified on the
face hereof to prime banks in the London
interbank market commencing on the applicable
Interest Reset Date at approximately 11:00
A.M., London time, on such LIBOR Interest
Determination Date and in a principal amount
that is representative for a single transaction
in Dollars in such market at such time. If at
least two such quotations are provided, LIBOR
determined on such LIBOR Interest Determination
Date will be the arithmetic mean of such
quotations. If fewer than two such quotations
are provided,
<PAGE>
LIBOR for such LIBOR Interest Determination
Date will be the arithmetic mean of the rates
quoted at approximately 11:00 A.M. in The
City of New York, on such LIBOR Interest
Determination Date by three major banks in The
City of New York selected by the Calculation
Agent for loans in Dollars to leading European
banks, having a maturity equal to the Index
Maturity specified on the face hereof
commencing on the applicable Interest Reset
Date and in a principal amount that is
representative for a single transaction in
Dollars in such market at such time; provided,
however, that if the banks so selected by the
Calculation Agent are not quoting as mentioned
in this sentence, LIBOR determined on such
LIBOR Interest Determination Date will be LIBOR
then in effect on such LIBOR Interest
Determination Date.
"Designated LIBOR Page" means either (a) if "LIBOR
Telerate" is specified on the face hereof, the display on the Dow
Jones Telerate Service or successor service for the purpose of
displaying the London interbank offered rates of major banks for
Dollars, or (b) if "LIBOR Reuters" is specified on the face
hereof, the display on the Reuters Monitor Money Rates Service
for the purpose of displaying the London interbank offered rates
of major banks for Dollars. If neither LIBOR Telerate nor LIBOR
Reuters is specified on the face hereof, LIBOR for Dollars will
be determined as if LIBOR Telerate Page 3750, had been specified.
Determination of Prime Rate. Prime Rate means, with
respect to an Interest Determination Date (a "Prime Rate Interest
Determination Date"), the rate set forth on such date in
H.15(519) under the heading "Bank Prime Loan," or if not so
published prior to 9:00 A.M. New York City time, on the
Calculation Date pertaining to such Prime Rate Interest
Determination Date, then the Prime Rate will be determined by the
Calculation Agent and will be the arithmetic mean of the rates of
interest publicly announced by each bank that appears on the
Reuters Screen U.S. Prime 1 (as defined below) as such bank's
prime rate or base lending rates as in effect for that Prime Rate
Interest Determination Date. If fewer than four such rates but
more than one such rate appear on the Reuters Screen U.S. Prime 1
for the Prime Rate Interest Determination Date, the Prime Rate
will be determined by the Calculation Agent and will be the
arithmetic mean of the prime rates, quoted on the basis of the
actual number of days in the year divided by a 360-day year, as
of the close of business on such Prime Rate Interest
Determination Date by four major money center banks in The City
of New York as selected by the Calculation Agent. If fewer than
two such rates appear on the Reuters Screen U.S. Prime 1, the
Prime Rate will be determined by the Calculation Agent as of the
close of business on the Prime Rate Interest Determination Date,
on the basis of the prime rates, as of the close of business on
the Prime Rate Interest Determination Date, furnished 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, having total equity
capital of at least $500 million and being subject to supervision
or examination by Federal or State authority, selected by the
Calculation Agent to provide such rate or rates; provided,
however, that if the banks selected as aforesaid are not quoting
as mentioned in this sentence, the Prime Rate for such
<PAGE>
Prime Rate Interest Determination Date will be the Prime Rate
then in effect on such Prime Rate Interest Determination Date.
"Reuters Screen U.S. Prime 1" means the display
designated as page "U.S. Prime 1" on the Reuters Monitor Money
Rates Service (or such other page as may replace the U.S. Prime 1
page on that service for the purpose of displaying prime rates or
base lending rates of major United States banks).
Determination of Treasury Rate. Treasury Rate means,
with respect to an Interest Determination Date (a "Treasury Rate
Interest Determination Date"), the rate for the auction held on
such Treasury Rate Interest Determination Date of direct
obligations of the United States ("Treasury Bills") having a
maturity equal to the Index Maturity specified on the face
hereof, as published in H.15(519) under the heading "U.S.
Government Securities -- Treasury Bills -- auction average
(investment)." If such rate is not published by 3:00 P.M., New
York City time, on the Calculation Date pertaining to such
Treasury Rate Interest Determination Date, the Treasury Rate will
be the auction average rate (expressed as a bond equivalent on
the basis of a year of 365 or 366 days, as applicable, and
applied on a daily basis) on such Treasury Rate Interest
Determination Date 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 reported as provided by 3:00 P.M., New
York City time, on such Calculation Date, or if no such auction
is held on such Treasury Rate Interest Determination Date, then
the Treasury Rate for such Treasury Rate Interest Determination
Date 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 Treasury Rate 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 with respect to such Treasury Rate Interest Determination
Date will be the Treasury Rate then in effect on such Treasury
Rate Interest Determination Date.
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 higher than the maximum rate permitted by New York law, as the
same may be modified by United States 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 which will
become effective as of the next Interest Reset Date.
<PAGE>
[The provisions of Article Fourteen of the Indenture do
not apply to Securities of this Series.]****
If an Event of Default (defined in the Indenture as (i)
the Company's failure to pay principal of (or premium, if any,
on) the Notes when due, or to pay interest on the Notes within 30
days after the same becomes due and payable, (ii) the Company's
breach of its other covenants contained in this Note or the
Indenture, which breach is not cured within 60 days after written
notice by the Trustee or the Holders of at least 25% in
outstanding principal amount of all Outstanding Notes, (iii)
certain events involving the bankruptcy, insolvency or
liquidation of the Company) shall occur, or (iv) a default shall
have occurred under any note or other evidence of Indebtedness
for Money Borrowed of the Company (including a default with
respect to Medium-Term Notes or other Debt Securities of another
series outstanding under the Indentures) or Marine Midland Bank
in an aggregate principal amount exceeding $5,000,000, which
default results in acceleration of such indebtedness that
persists more than 10 days after written notice by the trustee or
the Holder, of at least 25% in outstanding principal amount of
all Outstanding Notes, the principal of all the Notes may be
declared due and payable in the manner and with the effect
provided in the Indenture.
If this Note is of a series of Medium-Term Notes that
are Discount Securities and the face hereof indicates that this
Note is subject to "Modified Payment Upon Acceleration", then 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
face amount hereof multiplied by the sum of the Issue Price
specified on the face hereof (expressed as a percentage of the
face amount hereof) plus the original issue discount amortized
from the Original Issue Date to the date of declaration (also
expressed as a percentage of the face amount hereof), which
amortization shall be calculated using the "constant interest
rate method" (computed in accordance with generally accepted
accounting principles in effect on the date of declaration).
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 Notes under the Indenture at any time by the
Company with the consent of the Holders of not less than 66-2/3%
in aggregate principal amount of the Notes then Outstanding and
of each other series of Debt Securities then Outstanding under
the Indenture and affected by such amendment and modification
voting separately. The Indenture also contains provisions
permitting the Holders of a majority in aggregate principal
amount of the Notes then Outstanding, on behalf of the Holders of
all of the Notes, to waive certain past defaults under the
Indenture and their consequences. The Indenture contains
provisions permitting the Holders of at least 66-2/3% in
aggregate principal amount of Notes then Outstanding, before the
time for compliance, to waive compliance by the Company with
certain covenants of the Indenture on behalf of the Holders of
all Notes then Outstanding. Any such consent or waiver by the
Holder of this Note shall be conclusive and binding upon such
Holder and upon all future Holders of this
- ------------
**** Text in brackets to be included in the Medium-Term Notes of
any series if so specified by Officer's Certificate.
<PAGE>
Note and of any Note issued upon the registration of transfer
hereof or in exchange herefor or in lieu hereof whether or not
notation of such consent or waiver is made upon this Note.
No reference herein to the Indenture and 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 and interest on this Note at the times,
place and rate, and in the coin or currency, herein prescribed.
No recourse shall be had for the payment of the
principal of or the interest on this Note, or 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, stockholder, officer or director, as such,
past, present or future, of the Company or any successor
corporation, either directly or through the Company, 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 issue hereof, expressly waived and released.
As provided in the Indenture and subject to certain
limitations therein set forth, the transfer of this Note may be
registered on the registry books of the Company relating to the
Notes, upon surrender of this Note for registration of transfer
at the office or agency of the Company designated by it pursuant
to the Indenture, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Company, the
Trustee and the Security Registrar duly executed by, the Holder
hereof or his attorney duly authorized in writing, and thereupon
one or more new Notes, of authorized denominations and for the
same aggregate principal amount as this Note, will be issued to
the designated transferee or transferees.
The Notes are issuable only as registered Notes without
coupons in denominations of $1,000 and any integral multiple
thereof. As provided in the Indenture, and subject to certain
limitations therein set forth, this Note is exchangeable for a
like aggregate principal amount of Notes of different authorized
denominations, as requested by the Holder surrendering the same.
No service charge will be made for any such registration
of transfer or exchange, but the Company may require payment of a
sum sufficient to cover any tax or other governmental charge
payable in connection therewith.
Prior to due presentment for registration of transfer of
this Note, the Company, the Trustee, the Paying Agent and any
agent of the Company, the Trustee or any Paying Agent may treat
the Person in whose name this Note is registered as the absolute
owner hereof for the purpose of receiving payment as herein
provided and for all other purposes, whether or not this Note be
overdue, and neither the Company, the Trustee, the Paying Agent
nor any such agent shall be affected by notice to the contrary.
All terms used in this Note which are defined in the
Indenture shall have the meanings assigned to them in the
Indenture.
<PAGE>
If the Notes are to be issued and outstanding pursuant to a
book-entry system, the following paragraph is applicable: The
Notes are being issued by means of a book-entry system with no
physical distribution of certificates to be made except as
provided in the Indenture. The book-entry system maintained by
The Depository Trust Company ("DTC") will evidence ownership of
the Notes, with transfers of ownership effected on the records of
DTC and its participants pursuant to rules and procedures
established by DTC and its participants. The Company will
recognize Cede & Co., as nominee of DTC, while the registered
owner of the Notes, as the owner of the Notes for all purposes,
including payment of principal and interest, notices and voting.
Transfer of principal and interest to participants of DTC will be
the responsibility of DTC, and transfer of principal and interest
to beneficial owners of the Notes by participants of DTC will be
the responsibility of such participants and other nominees of
such beneficial owners. So long as the book-entry system is in
effect, the selection of those specific Notes to be redeemed will
be determined by DTC pursuant to rules and procedures established
by DTC and its participants. The Company will not be responsible
or liable for such transfers or payments or for maintaining,
supervising or reviewing the records maintained by DTC, its
participants or persons acting through such participants.
<PAGE>
ABBREVIATIONS
The following abbreviations, when used in the
inscription on the face of the within Note, shall be construed as
though they were written out in full according to applicable laws
or regulations:
TEN COM--as tenants in common
TEN ENT--as tenants by the entireties
JT TEN--as joint tenants with right of survivorship
and not as tenants in common
UNIF GIFT MIN ACT--..........Custodian.........
(Cust) (Minor)
Under Uniform Gifts to Minors Act
.................................
(State)
Additional abbreviations may also be used though not in
the above list.
<PAGE>
_______________________
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s),
assign(s) and transfer(s) unto
[PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS
INCLUDING ZIP CODE OF ASSIGNEE]
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
Please Insert Social Security or Other Identifying Number of
Assignee: ____________________
the within Note and all rights thereunder, hereby irrevocably
constituting and appointing __________________________________
Attorney to transfer said 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 it appears upon the
face of the within Note in
every particular, without
alteration or enlargement or
any change whatever and must be
guaranteed.
<PAGE>
OPTION TO ELECT REPAYMENT
The undersigned hereby irrevocably request(s) and
instruct(s) the Company to repay this Note (or portion hereof
specified below) pursuant to its terms at a price equal to the
principal amount hereof together with interest to the repayment
date, to the undersigned, at
_________________________________________________________________
_________________________________________________________________
(print or typewrite name and address of the undersigned)
For this Note to be repaid, the Trustee (or the Paying
Agent on behalf of the Trustee) must receive at Marine Midland
Bank, as Paying Agent, 140 Broadway, New York, New York 10005, or
at such other place or places of which the Company shall from
time to time notify the Holder of this Note, not more than 60 nor
less than 30 days prior to a Repayment Date, if any, shown on the
face of this Note, this Note with this "Option to Elect
Repayment" form duly completed.
If less than the entire principal amount of this Note is
to be repaid, specify the portion hereof (which shall be in
increments of $1,000 principal amount) which the Holder elects to
have repaid and specify the denomination or denominations (which
shall be $1,000 or an integral multiple of $1,000) of the Note(s)
to be issued to the Holder for the portion of this Note not being
repaid (in the absence of any such specification, one such Note
will be issued for the portion not being repaid).
$___________________ _______________________________
Date _______________ NOTICE: The signature on this
Option to Elect Repayment must
correspond with the name as
written upon the face of this
Note in every particular,
without alteration or
enlargement or any change
whatever.
<PAGE>
RENEWABLE NOTE RIDER
The Company and the purchaser of this Note have agreed
that this Note is a Renewable Note which initially matures on the
Stated Maturity Date shown on the face of this Note. At each
Renewal Date, the maturity of this Note will be automatically
extended to the corresponding New Maturity Date unless the Holder
of this Note delivers a completed Extension Termination Notice to
the Trustee or the Paying Agent on behalf of the Trustee not less
than 15 nor more than 30 days prior to the applicable Renewal
Date. The Extension Termination Notice may specify all or a
portion of the outstanding principal amount of the Note (in
increments of $1,000 principal amount) so long as the principal
amount of the Note remaining Outstanding after repayment is an
integral multiple of $1,000. Upon timely delivery of such
Extension Termination Notice, the term of the principal amount of
this Note subject to such notice will be deemed automatically to
mature on the Stated Maturity Date or the then applicable New
Maturity Date, as the case may be. The remaining principal amount
of this Note, if any, will be deemed to automatically be extended
to the corresponding New Maturity Date but in no circumstances
may such maturity be extended beyond the Final Maturity Date.
Notwithstanding any such extension, the interest rate
applicable to this Note will continue to be calculated as set
forth in this Note.
STATED MATURITY DATE:_________________________________
FINAL MATURITY DATE:__________________________________
Renewal Date(s) New Maturity Date(s)
<PAGE>
EXTENDIBLE NOTE RIDER
The Company and the purchaser of this Note have agreed
that this Note is an Extendible Note, which means that the
Company has the option to extend the maturity of this Note by
delivery to the Trustee (or any duly authorized Paying Agent) of
an Extendible Option Notice under the terms of this Note as
supplemented by this Extendible Note Rider.
Stated Maturity Date:
Final Maturity Date:
Extension Notice Extended Maturity
Due Date: Date:
The Company may exercise its option with respect to an
Extendible Note by delivery to the Trustee (or any duly appointed
Paying Agent) of an Extendible Option Notice at least 45 but not
more than 60 days prior to the Stated Maturity Date originally in
effect with respect to such Note or, if the Stated Maturity Date
of such Note has already been extended, the Extended Maturity
Date then in effect. After such receipt and not later than 40
days prior to the Stated Maturity Date or an Extended Maturity
Date, as the case may be (each, a "Maturity Date"), the Trustee
(or any duly appointed Paying Agent) will mail first class mail,
postage prepaid, to the Holder of such Extendible Note a notice
(the "Extension Notice") relating to such extension period (the
"Extension Period") setting forth (i) the election of the Company
to extend the maturity of such Extendible Note, (ii) the new
Extended Maturity Date, (iii) in the case of a Fixed Rate Note,
the interest rate applicable to the Extension Period or, in the
case of a Floating Rate Note, the Spread and/or Spread Multiplier
applicable to the Extension Period, and (iv) the provisions, if
any, for redemption during the Extension Period, including the
date or dates on which, the period or periods during which and
the price or prices at which such redemption may occur during the
Extension Period. Upon the mailing by the Trustee (or any duly
appointed Paying Agent) of an Extension Notice to the Holder of
an Extendible Note, the maturity of such Note shall be extended
automatically as set forth in the Extension Notice, and, except
as modified by the Extension Notice and as described in the next
paragraph, such Extendible Note will have the same terms as prior
to the mailing of such Extension Notice.
Notwithstanding the foregoing, not later than 20 days
prior to the Maturity Date for an Extendible Note (or, if such
date is not a Business Day, on the immediately succeeding
Business Day), the Company may, at its option, revoke the
interest rate, in the case of a Fixed Rate Note, or the Spread
and/or Spread Multiplier, in the case of a Floating Rate Note,
provided for in the Extension Notice and establish a higher
interest rate, in the case of a Fixed Rate Note, or a higher
Spread and/or Spread Multiplier, in the case of a Floating Rate
Note, for the Extension period by mailing or causing the Trustee
(or any duly appointed Paying Agent) to mail notice of such
higher interest rate or higher Spread and/or Spread Multiplier,
as the case may be, first class mail, postage prepaid, to the
Holder of such Note. Such notice shall be irrevocable. All
Extendible Notes with respect to which the Maturity Date is
extended will bear such higher
<PAGE>
interest rate, in the case of a Fixed Rate Note, or higher Spread
and/or Spread Multiplier, in the case of a Floating Rate Note,
for the Extension Period.
If the Company elects to extend the maturity of an
Extendible Note, the Holder of such Note will have the option to
elect repayment of such Note by the Company on the Maturity Date
then in effect at a price equal to the principal amount thereof
plus any accrued and unpaid interest to such date. In order for
an Extendible Note to be so repaid on the Maturity Date, the
Company must receive, at least 15 days but not more than 30 days
prior to the Maturity Date then in effect with respect to the
Note, (i) the Note with the form "Option to Elect Repayment" on
the reverse of the Note duly completed or (ii) a telegram, telex,
facsimile transmission or a letter from a member of a national
securities exchange, or the National Association of Securities
Dealers, Inc. or a commercial bank or trust company in the United
States setting forth the name of the Holder of the Note, the
principal amount of the Note, the principal amount of the Note to
be repaid, the certificate number or a description of the tenor
and terms of the Note, a statement that the option to elect
repayment is being exercised thereby and a guarantee that the
Note to be repaid, together with the duly completed form entitled
"Option to Elect Repayment" attached to the Note, will be
received by the Trustee (or any duly appointed Paying Agent) not
later than the fifth Business Day after the date of such
telegram, telex, facsimile transmission or letter, provided,
however, that such telegram, telex, facsimile transmission or
letter shall only be effective if such Note and duly completed
form are received by the Trustee (or any duly appointed Paying
Agent) by such fifth Business Day. Such option may be exercised
by the Holder of an Extendible Note for less than the aggregate
principal amount of the Note then Outstanding, provided that the
principal amount of the Note remaining Outstanding after
repayment is an integral multiple of $1,000.
HSBC AMERICAS, INC. AND SUBSIDIARIES
CONSOLIDATED RATIO OF EARNINGS TO FIXED CHARGES
(Excluding Interest on Deposits)
(In Millions, Except Ratios)
Six Months
Ended June 30,(a) Years Ended December 31,
-------------- -----------------------------------
1998 1997 1997 1996 1995 1994 1993
----- ----- ------ ------ ----- ----- -----
Income(Loss)Before
Cumulative Effect of
Change in Accounting
Principle $ 249 $ 231 $ 471 $ 380 $ 284 $ (37)$(230)
Applicable Income Tax
Expense 135 105 193 171 52 126 22
Less Undistributed Equity
Earnings (b) 1 1 2 2 0 (c) 4 4
Fixed Charges :
Interest On :
Borrowed Funds 108 86 197 121 81 81 83
Long-Term Debt 50 52 112 48 50 86 116
One Third of Rents, Net of
Income from Subleases(d) 7 7 14 12 12 11 14
----- ----- ------ ------ ----- ----- -----
Total Fixed Charges 165 145 323 181 143 178 213
Earnings Before Taxes
Based on Income and
Fixed Charges $ 548 $ 480 $ 985 $ 730 $ 479 $ 263 $ 1
===== ===== ====== ====== ===== ===== =====
Consolidated Ratio of
Earnings to
Fixed Charges 3.32 3.31 3.05 4.03 3.35 1.48 0.00
===== ===== ====== ====== ===== ===== =====
<PAGE>
HSBC AMERICAS, INC. AND SUBSIDIARIES
CONSOLIDATED RATIO OF EARNINGS TO FIXED CHARGES
(Including Interest on Deposits)
(In Millions, Except Ratios)
Six Months
Ended June 30,(a) Years Ended December 31,
-------------- -----------------------------------
1998 1997 1997 1996 1995 1994 1993
----- ----- ------ ------ ----- ----- -----
Total Fixed Charges
(as above) $ 165 $ 145 $ 323 $ 181 $ 143 $ 178 $ 213
Add : Interest on Deposits 416 312 679 481 465 308 290
----- ----- ------ ------ ----- ----- -----
Total Fixed Charges and
Interest on Deposits $ 581 $ 457 $1,002 $ 662 $ 608 $ 486 $ 503
Earnings Before Taxes
Based on Income and Fixed
Charges (as above) $ 548 $ 480 $ 985 $ 730 $ 479 $ 263 $ 1
Add : Interest on Deposits 416 312 679 481 465 308 290
----- ----- ------ ------ ----- ----- -----
Total $ 964 $ 792 $1,664 $1,211 $ 944 $ 571 $ 291
Consolidated Ratio of
Earnings to
Fixed Charges 1.66 1.73 1.66 1.83 1.55 1.17 0.58
===== ===== ====== ====== ===== ===== =====
(a) Unaudited
(b) Undistributed equity earnings of less than fifty percent owned companies.
(c) Less than $500,000.
(d) The portion deemed representative of the interest
factor.
* The amount by which earnings for the year ended December 31, 1993 were
insufficient to cover fixed charges were $212 million (excluding and
including interest on deposits).
2
<PAGE>
HSBC AMERICAS, INC. AND SUBSIDIARIES
CONSOLIDATED RATIO OF EARNINGS TO COMBINED FIXED CHARGES
AND PREFERRED STOCK DIVIDEND REQUIREMENTS
(Excluding Interest on Deposits)
Six Months
Ended June 30,(a) Years Ended December 31,
-------------- -----------------------------------
1998 1997 1997 1996 1995 1994 1993
----- ----- ------ ------ ----- ----- -----
Income(Loss)Before
Cumulative Effect of
Change in Accounting
Principle $ 249 $ 231 $ 471 $ 380 $ 284 $ (37)$(230)
Applicable Income Tax
Expense 135 105 193 171 52 126 22
Less Undistributed Equity
Earnings (b) 1 1 2 2 0 (c) 4 4
Fixed Charges :
Interest On :
Borrowed Funds 108 86 197 121 81 81 83
Long-Term Debt 50 52 112 48 50 86 116
One Third of Rents, Net of
Income from Subleases(d) 7 7 14 12 12 11 14
----- ----- ------ ------ ----- ----- -----
Total Fixed Charges 165 145 323 181 143 178 213
Earnings Before Taxes
Based on Income and
Fixed Charges $ 548 $ 480 $ 985 $ 730 $ 479 $ 263 $ 1
===== ===== ====== ====== ===== ===== =====
Total Fixed Charges $ 165 $ 145 $ 323 $ 181 $ 143 $ 178 $ 213
Preferred Stock Dividends 0 1 1 6 6 6 6
Ratio of Pretax Income
(Loss) to Income (Loss)
After Applicable Income
Tax Expense 1.54 1.45 1.41 1.45 1.18 (e) (e)
----- ----- ------ ------ ----- ----- -----
Total Preferred Stock
Dividend Factor 0 2 2 9 7 6 6
3
<PAGE>
Fixed Charges, Including
Six Months
Ended June 30,(a) Years Ended December 31,
-------------- -----------------------------------
1998 1997 1997 1996 1995 1994 1993
----- ----- ------ ------ ----- ----- -----
Preferred Stock Dividend
Factor $ 165 $ 147 $ 325 $ 190 $ 150 $ 184 $ 219
===== ===== ====== ====== ===== ===== =====
Consolidated Ratio of
Earnings to Combined Fixed
Charges and Dividends
on Preferred Stock 3.32 3.27 3.03 3.84 3.19 1.43 0.00
===== ===== ====== ====== ===== ===== =====
4
<PAGE>
HSBC AMERICAS, INC. AND SUBSIDIARIES
CONSOLIDATED RATIO OF EARNINGS TO COMBINED FIXED CHARGES
AND PREFERRED STOCK DIVIDEND REQUIREMENTS
(Including Interest on Deposits)
(In Millions, Except Ratios)
Six Months
Ended June 30,(a) Years Ended December 31,
-------------- -----------------------------------
1998 1997 1997 1996 1995 1994 1993
----- ----- ------ ------ ----- ----- -----
Total Fixed Charges Including
Preferred Stock Dividend
Factor (as above) $ 165 $ 147 $ 325 $ 190 $ 150 $ 184 $ 219
Add : Interest on Deposits 416 312 679 481 465 308 290
----- ----- ------ ------ ----- ----- -----
Fixed Charges, Including
Preferred Stock Dividend
Factor and Interest on
Deposits $ 581 $ 459 $1,004 $ 671 $ 615 $ 492 $ 509
Earnings Before Taxes
Based on Income and Fixed
Charges (as above) $ 548 $ 480 $ 985 $ 730 $ 479 $ 263 $ 1
Add : Interest on Deposits 416 312 679 481 465 308 290
----- ----- ------ ------ ----- ----- -----
Total $ 964 $ 792 $1,664 $1,211 $ 944 $ 571 $ 291
Consolidated Ratio of
Earnings to Combined
Fixed Charges and Dividends
on Preferred Stock 1.66 1.73 1.66 1.80 1.53 1.16 0.57
===== ===== ====== ====== ===== ===== =====
(a) Unaudited
(b) Undistributed equity earnings of less than fifty percent owned companies.
(c) Less than $500,000.
(d) The portion deemed representative of the interest
factor.
(e) Ratio is less than one, therefore actual preferred stock
dividend amount used.
* The amount by which earnings for the year ended December 31, 1993 were
insufficient to cover combined fixed charges and dividends on preferred
5
<PAGE>
stock were $218 million (excluding and including interest on deposits).
For purposes of computing both the ratios of earnings to fixed charges
and earnings to combined fixed charges and preferred stock dividend
requirements, earnings represent net income (loss) before the cumulative effect
of changes in accounting principles plus applicable income taxes and fixed
charges. Fixed charges, excluding interest on deposits, include interest
expense (other than on deposits) and the proportion deemed representative of
the interest factor or rent expense, net of income from subleases. Fixed
charges, including interest on deposits, include all interest expense and the
proportion deemed representative of the interest factor of rent expense, net of
income from subleases. Pretax earnings required for preferred stock dividends
were computed using tax rates for the applicable year. No tax adjustments were
made in loss years.
