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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report: November 12, 1997
MATTEL, INC.
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(Exact name of registrant as specified in its charter)
Delaware 001-05647 95-1567322
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(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File No.) Identification No.)
333 Continental Boulevard, El Segundo, California 90245-5012
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (310) 252-2000
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N/A
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(Former name or former address, if changed since last report)
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Item 7. Financial Statements and Exhibits
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(a) Financial statements of businesses acquired: None
(b) Pro forma financial information: None
(c) Exhibits:
1.0 Distribution Agreement dated as of November 12, 1997 among
the Registrant, Morgan Stanley & Co. Incorporated and Credit
Suisse First Boston Corporation
4.1 Officer's Certificate establishing the terms of the Series C
Medium-Term Notes
4.2 Form of Floating Rate Series C Medium-Term Note
4.3 Form of Fixed Rate Series C Medium-Term Note
5.1 Opinion of Irell & Manella LLP as to the legality of the
Series C Medium-Term Notes
23.1 Consent of Irell & Manella LLP (included in their opinion)
SIGNATURES
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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.
MATTEL, INC.
Registrant
By: /s/ Leland P. Smith
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Leland P. Smith
Secretary and
Date: November 12, 1997 Assistant General Counsel
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EXHIBIT 1.0
MATTEL, INC.
$350,000,000
Series C Medium-Term Notes
Due More Than Nine Months From Date of Issue
DISTRIBUTION AGREEMENT
November 12, 1997
Morgan Stanley & Co. Incorporated
1251 Avenue of the Americas
New York, New York 10020
Credit Suisse First Boston Corporation
55 East 52nd Street
New York, New York 10055
Dear Sirs:
Mattel, Inc., a Delaware corporation (the "Company"), confirms its
agreement with each of you with respect to the issue and sale from time to time
by the Company of up to $350,000,000 (or the equivalent thereof in one or more
foreign currencies or composite currencies) aggregate initial public offering
price of its Series C Medium-Term Notes due more than nine months from date of
issue (the "Notes"). The Notes will be issued under an Indenture, dated as of
February 15, 1996 (the "Indenture"), between the Company and Chase Trust Company
of California (formerly Chemical Trust Company of California), as Trustee (the
"Trustee"), and will have the maturities, interest rates, redemption provisions,
if any, and other terms as set forth in supplements to the Basic Prospectus
referred to below.
The Company hereby appoints Morgan Stanley & Co. Incorporated ("Morgan
Stanley") and Credit Suisse First Boston Corporation ("Credit Suisse First
Boston") (individually, an "Agent" and collectively, the "Agents") as its
exclusive agents, subject to Section 12, for the purpose of soliciting and
receiving offers to purchase Notes from the Company by others and, on the basis
of the representations and warranties herein contained, but subject to the terms
and conditions herein set forth, each Agent agrees to use reasonable efforts to
solicit and receive offers to purchase Notes upon terms acceptable to the
Company at such times and in such amounts as the Company shall from time to time
specify. In addition, any Agent may also purchase Notes as principal pursuant
to the terms of a terms agreement relating to such sale (a "Terms Agreement") in
accordance with the provisions of Section 2(b) hereof.
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The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 333-38625) for the
registration of the Notes under the Securities Act of 1933, as amended (the
"Securities Act") and the offering thereof from time to time in accordance with
Rule 415 of the Rules and regulations of the Commission promulgated pursuant to
the Securities 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), including all documents incorporated
therein by reference, as from time to time amended or supplemented by the filing
of documents pursuant to the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), the Securities Act or otherwise, are referred to herein as the
"Registration Statement." The Company proposes to file with the Commission from
time to time, pursuant to Rule 424 under the Securities Act, supplements to the
prospectus included in the Registration Statement that will describe certain
terms of the Notes. The prospectus in the form in which it appears in the
Registration Statement is hereinafter referred to as the "Basic Prospectus."
The term "Prospectus" means the Basic Prospectus together with the prospectus
supplement or supplements (each a "Prospectus Supplement") specifically relating
to Notes, as filed with, or transmitted for filing to, the Commission pursuant
to Rule 424. As used herein, the terms "Basic Prospectus" and "Prospectus"
shall include in each case the documents, if any, incorporated by reference
therein. If the Company elects to rely on Rule 434 promulgated pursuant to the
Securities Act, all references to the Prospectus shall be deemed to include,
without limitation, the form of prospectus and the term sheet, taken together,
provided to the Agents by the Company in reliance on such Rule 434 (the "Rule
434 Prospectus"). Unless the context otherwise requires, all references in this
Agreement to documents, financial statements and schedules and other information
which is "contained," "included," "stated," "described in," or "referred to" in
the Registration Statement or the Prospectus shall be deemed to mean and include
all such documents, financial statements and schedules and other information
which is or is deemed to be incorporated by reference in the Registration
Statement or the Prospectus, as the case may be; and all references in this
Agreement to "amendments" or "supplements" to the Registration Statement or
Prospectus shall be deemed to mean and include the filing of any document under
the Exchange Act after the date of this Agreement which is or is deemed to be
incorporated by reference in the Registration Statement or the Prospectus, as
the case may be. If the Company files a registration statement to register a
portion of the Notes and relies on Rule 462(b) promulgated pursuant to the
Securities Act for such registration statement to become effective upon filing
with the Commission (the "Rule 462 Registration Statement"), then any reference
to "Registration Statement" herein shall be deemed to be to both the
registration statement referred to above (No. 333-38625) and the Rule 462
Registration Statement, as each such registration statement may be amended
pursuant to the Securities Act.
1. Representations and Warranties. The Company represents and
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warrants to and agrees with each Agent as of the Commencement Date (as defined
below), as of each time the Company accepts an offer to purchase Notes
(including any purchase by an Agent pursuant to a Terms Agreement), as of each
time the Company issues and delivers Notes and as of each time the Registration
Statement or the Basic Prospectus is amended or supplemented, as follows (it
being understood that such representations, warranties and agreements shall be
deemed to relate
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to the Registration Statement, the Basic Prospectus and the Prospectus, each as
amended or supplemented to each such time):
(a) The Registration Statement has become effective; no stop
order suspending the effectiveness of the Registration Statement is in
effect, and no proceedings for such purpose are pending before or
threatened to the Company by the Commission.
(b) (i) Each document, if any, filed or to be filed pursuant to
the Exchange Act and incorporated by reference in the Prospectus complied
or will comply when so filed in all material respects with the Exchange Act
and the applicable rules and regulations of the Commission thereunder, (ii)
each part of the Registration Statement, when such part became effective,
did not contain, and each such part, as amended or supplemented, if
applicable, will not contain any untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to
make the statements therein not misleading, (iii) the Registration
Statement and the Prospectus comply, and, as amended or supplemented, if
applicable, will comply in all material respects with the Securities Act
and the applicable rules and regulations of the Commission thereunder, and
(iv) the Prospectus does not contain and, as amended or supplemented, if
applicable, will not contain any untrue statement of a material fact or
omit to state a material fact necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading,
except that (1) the representations and warranties set forth in this
Section 1(b) do not apply (A) to statements or omissions in the
Registration Statement or the Prospectus based upon information relating to
an Agent furnished to the Company in writing by such Agent expressly for
use therein or (B) to that part of the Registration Statement that
constitutes the Statement of Eligibility and Qualification (Form T-1) under
the Trust Indenture Act of 1939, as amended (the "Trust Indenture Act"), of
the Trustee and (2) the representations and warranties set forth in clauses
(iii) and (iv) above, when made as of the Commencement Date or as of any
time on which the Company accepts an offer to purchase Notes, shall be
deemed not to cover information concerning an offering of particular Notes
to the extent such information will be set forth in a supplement to the
Basic Prospectus.
(c) The financial statements of the Company and its subsidiaries
set forth in the Registration Statement and Prospectus fairly present the
financial condition of the Company and its subsidiaries as of the dates
indicated and the results of operations and changes in financial position
for the periods therein specified in conformity with generally accepted
accounting principles consistently applied throughout the periods involved
(except as otherwise stated therein).
(d) The Company has been duly incorporated, is validly existing
as a corporation in good standing under the laws of the jurisdiction of its
incorporation, has the corporate power and authority to own its property
and to conduct its business as described in the Prospectus and is duly
qualified to transact business and is in good standing in each jurisdiction
in which the conduct of its business or its ownership or
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leasing of property requires such qualification, except to the extent that
the failure to be so qualified or be in good standing would not have a
material adverse effect on the Company and its subsidiaries, taken as a
whole.
(e) Each subsidiary of the Company has been duly incorporated,
is validly existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, has the corporate power and authority to
own its property and to conduct its business as described in the Prospectus
except to the extent that the failure of any such subsidiary, singly or in
the aggregate, to be so duly incorporated or validly existing or to have
such corporate power and authority, would not have a material adverse
effect on the Company and its subsidiaries taken as a whole or on the
business of the Company and its subsidiaries taken as a whole. Each
subsidiary of the Company is duly qualified to transact business and is in
good standing in each jurisdiction in which the conduct of its business or
its ownership or leasing of property requires such qualification, except to
the extent that the failure of any such subsidiary, singly or in the
aggregate, to be so qualified or be in good standing would not have a
material adverse effect on the Company and its subsidiaries taken as a
whole or on the business of the Company and its subsidiaries taken as a
whole.
(f) Each of this Agreement and any applicable Written Terms
Agreement (as hereinafter defined) has been duly authorized, executed and
delivered by the Company.
(g) The Indenture has been duly qualified under the Trust
Indenture Act and has been duly authorized, executed and delivered by the
Company and is a valid and binding agreement of the Company, enforceable in
accordance with its terms except as (i) the enforceability thereof may be
limited by bankruptcy, insolvency or similar laws affecting creditors'
rights generally and (ii) rights of acceleration and the availability of
equitable remedies may be limited by equitable principles of general
applicability.
(h) The Notes have been duly authorized and established as a
series of securities under the Indenture and, when the terms of a
particular Note and its issuance and sale have been duly authorized and
established by all necessary corporate action in conformity with the
Indenture, and such Note has been duly completed, executed, authenticated
and issued in accordance with the provisions of the Indenture and delivered
to and duly paid for by the purchasers thereof as contemplated by this
Agreement, such Note will be entitled to the benefits of the Indenture and
will be a valid and binding obligation of the Company, enforceable in
accordance with its terms except as (i) the enforceability thereof may be
limited by bankruptcy, insolvency or similar laws affecting creditors'
rights generally and (ii) rights of acceleration and the availability of
equitable remedies may be limited by equitable principles of general
applicability.
(i) The execution and delivery by the Company of this Agreement,
the Notes, the Indenture and any applicable Written Terms Agreement, and
the performance by the Company of its obligations under this Agreement, the
Notes, the Indenture and any
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applicable Terms Agreement will not contravene any provision of applicable
law or the certificate of incorporation or by-laws of the Company or any
agreement or other instrument binding upon the Company or any of its
subsidiaries that is material to the Company and its subsidiaries, taken as
a whole, or any judgment, order or decree of any governmental body, agency
or court having jurisdiction over the Company or any subsidiary, and no
consent, approval, authorization or order of, or qualification with, any
governmental body or agency is required for the performance by the Company
of its obligations under this Agreement, the Notes, the Indenture and any
applicable Terms Agreement, except such as may be required by the
securities or Blue Sky laws of the various states in connection with the
offer and sale of the Notes.
(j) There has not occurred any material adverse change, or any
development involving a prospective material adverse change, in the
condition, financial or otherwise, or in the earnings, business or
operations of the Company and its subsidiaries, taken as a whole, from that
set forth in the Prospectus.
(k) There are no legal or governmental proceedings pending or
threatened to the Company to which the Company or any of its subsidiaries
is a party or to which any of the properties of the Company or any of its
subsidiaries is subject that are required to be described in the
Registration Statement or the Prospectus and are not so described or any
statutes, regulations, contracts or other documents that are required to be
described in the Registration Statement or the Prospectus or to be filed or
incorporated by reference as exhibits to the Registration Statement that
are not described or filed or incorporated as required.
(l) The Company and its subsidiaries own or possess the patents,
patent rights, licenses, inventions, copyrights, know-how (including trade
secrets and other unpatented and/or unpatentable proprietary or
confidential information, systems or procedures), trademarks, service marks
and trade names (collectively, the "Intellectual Property") employed by
them in connection with the business operated by them, except to the extent
that the failure to own or possess the Intellectual Property would not have
a material adverse effect on the Company and its subsidiaries taken as a
whole, and neither the Company nor any of its subsidiaries has received any
notice of infringement of or conflict with asserted rights of others with
respect to any of the foregoing which, singly or in the aggregate, if the
subject of an unfavorable decision, ruling or finding, would result in any
material adverse change, or any notice of any other development with
respect to the foregoing involving a prospective material adverse change,
in the condition, financial or otherwise, or in the earnings, business
affairs or business prospects of the Company and its subsidiaries taken as
a whole, except as may be described in writing to, and accepted for
exclusion by, the Agents.
(m) The Company is not an "investment company" or an entity
"controlled" by an "investment company," as such terms are defined in the
Investment Company Act of 1940, as amended.
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(n) The Company and its subsidiaries are (i) in compliance with
any and all applicable foreign, federal, state and local laws and
regulations relating to the protection of human health and safety, the
environment or hazardous or toxic sub stances or wastes, pollutants or
contaminants ("Environmental Laws"), (ii) have received all permits,
licenses or other approvals required of them under applicable Environmental
Laws to conduct their respective businesses, and (iii) are in compliance
with all terms and conditions of any such permit, license or approval,
except where such noncompliance with Environmental Laws, failure to receive
required permits, licenses or other approvals or failure to comply with the
terms and conditions of such permits, licenses or approvals would not,
singly or in the aggregate, have a material adverse effect on the Company
and its subsidiaries, taken as a whole.
(o) In the ordinary course of its business, the Company conducts
a periodic review of the effect of Environmental Laws on the business,
operations and properties of the Company and its subsidiaries, in the
course of which it identifies and evaluates associated costs and
liabilities (including, without limitation, any capital or operating
expenditures required for clean-up, closure of properties or compliance
with Environmental Laws or any permit, license or approval, any related
constraints on operating activities and any potential liabilities to third
parties). On the basis of such review, the Company has reasonably
concluded that such associated costs and liabilities would not, singly or
in the aggregate, have a material adverse effect on the Company and its
subsidiaries, taken as a whole.
(p) Neither the Company nor any of its subsidiaries has,
directly or indirectly, paid or delivered any fee, commission or other sum
of money or item or property, however characterized, to any finder, agent,
government official or other party, in the United States or any other
country, which is in any manner related to the business, assets or
operations of Company or any of its subsidiaries, which is, or may be with
the passage of time or discovery, illegal under any federal, state or local
laws of the United States (including without limitation the U.S. Foreign
Corrupt Practices' Act) or any other country having jurisdiction; and
neither the Company nor any of its subsidiaries has participated, directly
or indirectly, in any boycotts or other similar practices affecting any of
its actual or potential customers.
Notwithstanding the foregoing, the representations and warranties set
forth in Section 1(b)(iii) and (iv), (h) (except as to due authorization of the
Notes) and (i), when made as of the Commencement Date, with respect to any Notes
the payments of principal or interest on which will be determined by reference
to one or more currency exchange rates, commodity prices, equity indices or
other factors, shall be deemed not to address the application of the Commodity
Exchange Act, as amended, or the rules, regulations or interpretations of the
Commodity Futures Trading Commission.
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2. Solicitations as Agent; Purchases as Principal
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(a) Solicitations as Agent. In connection with an Agent's
----------------------
actions as agent hereunder, such Agent agrees to use reasonable efforts to
solicit offers to purchase Notes upon the terms and conditions set forth in
the Prospectus as then amended or supplemented.
The Company reserves the right, in its sole discretion, to
instruct the Agents to suspend at any time, for any period of time or
permanently, the solicitation of offers to purchase Notes. As soon as
practicable, but in any event not later than one business day in New York,
after receipt of notice from the Company, the Agents will suspend
solicitations of offers to purchase Notes from the Company until such time
as the Company has advised the Agents that such solicitation may be
resumed. While such solicitation is suspended, the Company shall not be
required to deliver any certificates, opinions or letters in accordance
with Sections 5(a), 5(b) and 5(c); provided, however, that if the
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Registration Statement or Prospectus is amended or supplemented during the
period of suspension (other than by an amendment or supplement providing
solely for a change in the interest rates, redemption provisions,
amortization schedules or maturities offered on the Notes or for a change
the Agents deem to be immaterial), no Agent shall be required to resume
soliciting offers to purchase Notes until the Company has delivered such
certificates, opinions and letters as such Agent may request.
The Company agrees to pay to each Agent, as consideration for the
sale of each Note resulting from a solicitation made or an offer to
purchase received by such Agent, a commission in the form of a discount
from the purchase price of such Note equal to the percentage set forth
below of the purchase price of such Note:
Term Commission Rate
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From 9 months to less than 1 year 0.125%
From 1 year to less than 18 months 0.150%
From 18 months to less than 2 years 0.200%
From 2 years to less than 3 years 0.250%
From 3 years to less than 4 years 0.350%
From 4 years to less than 5 years 0.450%
From 5 years to less than 6 years 0.500%
From 6 years to less than 9 years 0.550%
From 9 years to less than 15 years 0.600%
From 15 years to less than 20 years 0.700%
From 20 years to less than 30 years 0.750%
30 years and beyond To be negotiated
Each Agent shall communicate to the Company, orally or in
writing, each offer to purchase Notes received by such Agent as agent that
in its judgment should be considered by the Company. The Company shall
have the sole right to accept offers to purchase Notes and may reject any
offer in whole or in part. Each Agent shall have the right to reject any
offer to purchase Notes that it considers to be unacceptable, and any
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such rejection shall not be deemed a breach of its agreements contained
herein. The procedural details relating to the issue and delivery of Notes
sold by the Agents as agents and the payment therefor shall be as set forth
in the Administrative Procedures (as hereinafter defined).
(b) Purchases as Principal. Each sale of Notes to an Agent as
----------------------
principal shall be made in accordance with the terms of this Agreement. In
connection with each such sale, the Company will enter into a Terms
Agreement that will provide for the sale of such Notes to and the purchase
thereof by such Agent. Each Terms Agreement will take the form of either
(i) a written agreement between such Agent and the Company, which may be
substantially in the form of Exhibit A hereto (a "Written Terms
Agreement"), or (ii) an oral agreement between such Agent and the Company
confirmed in writing by such Agent to the Company.
An Agent's commitment to purchase Notes pursuant to a Terms
Agreement shall be deemed to have been made on the basis of the
representations and warranties of the Company herein contained and shall be
subject to the terms and conditions herein set forth. Each Terms Agreement
shall specify the principal amount of Notes to be purchased by such Agent
pursuant thereto, the maturity date of such Notes, the price to be paid to
the Company for such Notes, the interest rate and interest rate formula, if
any, applicable to such Notes and any other terms of such Notes. Each such
Terms Agreement may also specify any requirements for officers'
certificates, opinions of counsel and letters from the independent public
accountants of the Company pursuant to Section 4 hereof. A Terms Agreement
may also specify certain provisions relating to the reoffering of such
Notes by such Agent.
Each Terms Agreement shall specify the time and place of delivery
of and payment for such Notes. Unless otherwise specified in a Terms
Agreement, the procedural details relating to the issue and delivery of
Notes purchased by an Agent as principal and the payment therefor shall be
as set forth in the Administrative Procedures. Each date of delivery of
and payment for Notes to be purchased by an Agent pursuant to a Terms
Agreement is referred to herein as a "Settlement Date."
Unless otherwise specified in a Terms Agreement, if you are
purchasing Notes as principal you may resell such Notes to other dealers.
Any such sales may be at a discount, which shall not exceed the amount set
forth in the Prospectus Supplement relating to such Notes.
(c) Administrative Procedures. The Agents and the Company agree
-------------------------
to perform the respective duties and obligations specifically provided to
be performed in the Medium-Term Notes Administrative Procedures (attached
hereto as Exhibit B) (the "Administrative Procedures"), as amended from
time to time. The Administrative Procedures may be amended only by written
agreement of the Company and the Agents.
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(d) Delivery. The documents required to be delivered by Section
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4 of this Agreement as a condition precedent to each Agent's obligation to
begin soliciting offers to purchase Notes as an agent of the Company shall
be delivered at the Los Angeles office of O'Melveny & Myers LLP, counsel
for the Agents, not later than 1 p.m., Los Angeles time, on the date
hereof, or at such other time and/or place as the Agents and the Company
may agree upon in writing, but in no event later than the day prior to the
earlier of (i) the date on which the Agents begin soliciting offers to
purchase Notes and (ii) the first date on which the Company accepts any
offer by an Agent to purchase Notes pursuant to a Terms Agreement. The
date of delivery of such documents is referred to herein as the
"Commencement Date."
(e) Obligations Several. The Company acknowledges that the
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obligations of the Agents under this Agreement are several and not joint.
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3. Agreements. The Company agrees with each Agent that:
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(a) Prior to the termination of the offering of the Notes
pursuant to this Agreement or any Terms Agreement, the Company will not
file any Prospectus Supplement relating to the Notes or any amendment to
the Registration Statement unless the Company has previously furnished to
the Agents copies thereof for their review and will not file any such
proposed supplement or amendment to which the Agents reasonably object;
provided, however, that (i) the foregoing requirement shall not apply to
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any of the Company's periodic filings with the Commission required to be
filed pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act or
pursuant to Item 5 (including related exhibits filed pursuant to Item 7) of
Form 8-K, copies of which filings the Company will cause to be delivered to
the Agents promptly after being transmitted for filing with the Commission
and (ii) any Prospectus Supplement that merely sets forth the terms or a
description of particular Notes shall only be reviewed and approved by the
Agent or Agents offering such Notes. Subject to the foregoing sentence,
the Company will promptly cause each Prospectus Supplement to be filed with
or transmitted for filing to the Commission in accordance with Rule 424(b)
under the Securities Act. The Company will promptly advise the Agents (i)
of the filing of any amendment or supplement to the Basic Prospectus
(except that notice of the filing of an amendment or supplement to the
Basic Prospectus that merely sets forth the terms or a description of
particular Notes shall only be given to the Agent or Agents offering such
Notes), (ii) of the filing and effectiveness of any amendment to the
Registration Statement, (iii) of any request by the Commission for any
amendment to the Registration Statement or any amendment or supplement to
the Basic Prospectus or for any additional information, (iv) of the
issuance by the Commission of any stop order suspending the effectiveness
of the Registration Statement or the institution or threatening of any
proceeding for that purpose, and (v) of the receipt by the Company of any
notification with respect to the suspension of the qualification of the
Notes for sale in any jurisdiction or the initiation or threatening of any
proceeding for such purpose. The Company will use its best efforts to
prevent the issuance of any such stop order or notice of suspension of
qualification and, if issued, to obtain as soon as possible the withdrawal
thereof. If the Basic Prospectus is amended or supplemented as a result of
the filing under the Exchange Act of any document incorporated by reference
in the Prospectus, no Agent shall be obligated to solicit offers to
purchase Notes so long as it is not reasonably satisfied with such
document.
(b) If, at any time when a prospectus relating to the Notes is
required to be delivered under the Securities Act, any event occurs or
condition exists as a result of which the Prospectus, as then amended or
supplemented, would include an untrue statement of a material fact, or omit
to state any material fact necessary to make the statements therein, in the
light of the circumstances when the Prospectus, as then amended or
supplemented, is delivered to a purchaser, not misleading, or if, in the
opinion of the Agents or in the opinion of the Company, it is necessary at
any time to amend or supplement the Prospectus, as then amended or
supplemented, to comply with
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applicable law, the Company will immediately notify the Agents by telephone
(with confirmation in writing) to suspend solicitation of offers to
purchase Notes and, if so notified by the Company, the Agents shall
forthwith suspend such solicitation and cease using the Prospectus, as then
amended or supplemented. If the Company shall decide to amend or
supplement the Registration Statement or Prospectus, as then amended or
supplemented, it shall so advise the Agents promptly by telephone (with
confirmation in writing) and, at its expense, shall prepare and cause to be
filed promptly with the Commission an amendment or supplement to the
Registration Statement or Prospectus, as then amended or supplemented,
satisfactory in all respects to the Agents, that will correct such
statement or omission or effect such compliance and will supply such
amended or supplemented Prospectus to the Agents in such quantities as they
may reasonably request. If any documents, certificates, opinions and
letters furnished to the Agents pursuant to paragraph (f) below and
Sections 5(a), 5(b) and 5(c) in connection with the preparation and filing
of such amendment or supplement are satisfactory in all respects to the
Agents, upon the filing with the Commission of such amendment or supplement
to the Prospectus or upon the effectiveness of an amendment to the
Registration Statement the Agents will resume the solicitation of offers to
purchase Notes hereunder. Notwithstanding any other provision of this
Section 3(b), until the distribution of any Notes an Agent may own as
principal has been completed if any event described above in this paragraph
(b) occurs, the Company will, at its own expense, forthwith prepare and
cause to be filed promptly with the Commission an amendment or supplement
to the Registration Statement or Prospectus, as then amended or
supplemented, satisfactory in all respects to such Agent, will supply such
amended or supplemented Prospectus to such Agent in such quantities as it
may reasonably request and shall furnish to such Agent pursuant to
paragraph (f) below and Sections 5(a), 5(b) and 5(c) such documents,
certificates, opinions and letters as it may request in connection with the
preparation and filing of such amendment or supplement.
(c) The Company will make generally available to its security
holders and to the Agents as soon as practicable earning statements that
satisfy the provisions of Section 11(a) of the Securities Act and the rules
and regulations of the Commission thereunder covering twelve-month periods
beginning, in each case, not later than the first day of the Company's
fiscal quarter next following the "effective date" (as defined in Rule 158
under the Securities Act) of the Registration Statement with respect to
each sale of Notes. If such fiscal quarter is the last fiscal quarter of
the Company's fiscal year, such earning statement shall be made available
not later than 90 days after the close of the period covered thereby and in
all other cases shall be made available not later than 45 days after the
close of the period covered thereby.
(d) The Company will furnish to each Agent, without charge, a
signed copy of the Registration Statement, including exhibits and all
amendments thereto, and as many copies of the Prospectus, any documents
incorporated by reference therein and any supplements and amendments
thereto as such Agent may reasonably request.
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(e) The Company will endeavor to qualify the Notes for offer and
sale under the securities or Blue Sky laws of such jurisdictions as the
Agents shall reasonably request and to maintain such qualifications for as
long as the Agents shall reasonably request.
(f) The Company shall furnish to the Agents such relevant
documents and certificates of officers of the Company relating to the
business, operations and affairs of the Company, the Registration
Statement, the Basic Prospectus, any amendments or supplements thereto, the
Indenture, the Notes, this Agreement, the Administrative Procedures, any
Terms Agreement and the perfor mance by the Company of its obligations
hereunder or thereunder as the Agents may from time to time reasonably
request.
(g) The Company shall notify the Agents promptly in writing of
any downgrading, or of its receipt of any notice of any intended or
potential downgrading or of any review for possible change that does not
indicate the direction of the possible change, in the rating accorded any
of the Company's securities by any "nationally recognized statistical
rating organization," as such term is defined for purposes of Rule
436(g)(2) under the Securities Act.
(h) The Company will, whether or not any sale of Notes is
consummated, pay all expenses incident to the performance of its
obligations under this Agreement and any Terms Agreement, including: (i)
the preparation and filing of the Registration Statement and the Prospectus
and all amendments and supplements thereto, (ii) the preparation, issuance
and delivery of the Notes, (iii) the fees and disbursements of the
Company's counsel and accountants and of the Trustee and its counsel, (iv)
the qualification of the Notes under securities or Blue Sky laws in
accordance with the provisions of Section 3(e), including filing fees and
the fees and disbursements of counsel for the Agents in connection
therewith and in connection with the preparation of any Blue Sky or Legal
Investment Memoranda, (v) the printing and delivery to the Agents in
quantities as hereinabove stated of copies of the Registration Statement
and all amendments thereto and of the Prospectus and any amendments or
supplements thereto, (vi) the printing and delivery to the Agents of copies
of any Blue Sky or Legal Investment Memoranda, (vii) any fees charged by
rating agencies for the rating of the Notes, (viii) the fees and expenses,
if any, incurred with respect to any filing with the National Association
of Securities Dealers, Inc., (ix) the fees and disbursements of counsel for
the Agents incurred in connection with the offering and sale of the Notes,
including any opinions to be rendered by such counsel hereunder, and (x)
any reasonable out-of-pocket expenses incurred by the Agents; provided that
any advertising expenses (including tombstones) incurred by the Agents
shall have been approved by the Company.
(i) Between the date of any Terms Agreement and the Settlement
Date with respect to such Terms Agreement, the Company will not, without
such Agent's prior consent, offer, sell, contract to sell or otherwise
dispose of any debt securities of the Company substantially similar to such
Notes (other than (i) the Notes that are to be sold
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pursuant to such Terms Agreement, (ii) Notes previously agreed to be sold
by the Company, and (iii) commercial paper and short-term bank loans issued
in the ordinary course of business), except as may otherwise be provided in
such Terms Agreement.
4. Conditions of the Obligations of the Agents. Each Agent's
-------------------------------------------
obligation to solicit offers to purchase Notes as agent of the Company, each
Agent's obligation to purchase Notes pursuant to any Terms Agreement and the
obligation of any other purchaser to purchase Notes will be subject to the
accuracy of the representations and warranties on the part of the Company
herein, to the accuracy of the statements of the Company's officers made in each
certificate furnished pursuant to the provisions hereof and to the performance
and observance by the Company of all covenants and agreements herein contained
on its part to be performed and observed (in the case of an Agent's obligation
to solicit offers to purchase Notes, at the time of such solicitation, and, in
the case of an Agent's or any other purchaser's obligation to purchase Notes, at
the time the Company accepts the offer to purchase such Notes and at the time of
issuance and delivery) and (in each case) to the following additional conditions
precedent when and as specified:
(a) Prior to such solicitation or purchase, as the case may be:
(i) there shall not have occurred any change, or any
development involving a prospective change, in the condition,
financial or otherwise, or in the earnings, business or operations of
the Company and its subsidiaries, taken as a whole, from that set
forth in the Prospectus, as amended or supplemented at the time of
such solicitation or at the time such offer to purchase was made,
that, in the judgment of the relevant Agent, is material and adverse
and that makes it, in the judgment of such Agent, impracticable to
market the Notes on the terms and in the manner contem plated by the
Prospectus, as so amended or supplemented;
(ii) there shall not have occurred any (A) suspension or
material limitation of trading generally on or by, as the case may be,
the New York Stock Exchange, the American Stock Exchange, the National
Association of Securities Dealers, Inc., the Chicago Board Options
Exchange, the Chicago Mercantile Exchange or the Chicago Board of
Trade, (B) suspension of trading of any securities of the Company on
any exchange or in any over-the-counter market, (C) declaration of a
general moratorium on commercial banking activities in New York by
either Federal or New York State authorities, or (D) any outbreak or
escalation of hostilities or any change in financial markets or any
calamity or crisis that, in the judgment of the relevant Agent, is
material and adverse and, in the case of any of the events described
in clauses (ii)(A) through (D), such event, singly or together with
any other such event, makes it, in the judgment of such Agent,
impracticable to market the Notes on the terms and in the manner
contemplated by the Prospectus, as amended or supplemented at the time
of such solicitation or at the time such offer to purchase was made;
and
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<PAGE>
(iii) there shall not have occurred any downgrading, nor
shall any notice have been given of any intended or potential
downgrading or of any review for a possible change that does not
indicate the direction of the possible change, in the rating accorded
any of the Company's securities by any "nationally recognized
statistical rating organization," as such term is defined for purposes
of Rule 436(g)(2) under the Securities Act;
(A) except, in each case described in paragraph (i), (ii) or (iii) above,
as disclosed to the relevant Agent in writing by the Company prior to such
solicitation or, in the case of a purchase of Notes, as disclosed to the
relevant Agent before the offer to purchase such Notes was made, or (B)
unless in each case described in (ii) above, the relevant event shall have
occurred and been known to the relevant Agent before such solicitation or,
in the case of a purchase of Notes, before the offer to purchase such Notes
was made.
(b) On the Commencement Date and, if called for by any Terms
Agreement, on the corresponding Settlement Date, the relevant Agents shall
have received a certificate, dated the Commencement Date or such Settlement
Date, as the case may be, signed by an executive officer of the Company to
the effect set forth in subparagraph (a)(iii) above and to the effect that
the representations and warranties of the Company contained herein are true
and correct as of such date and that the Company has complied with all of
the agreements and satisfied all of the conditions on its part to be
performed or satisfied on or before such date.
The officer signing and delivering such certificate may rely upon
the best of his knowledge as to proceedings threatened.
(c) On the Commencement Date and, if called for by any Terms
Agreement, on the corresponding Settlement Date, the relevant Agents shall
have received:
(i) The opinion, dated as of such date, of Irell & Manella
LLP, counsel for the Company to the effect that:
(A) the Company has been duly incorporated, is validly
existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, has the corporate power and
authority to own its property and to conduct its business as
described in the Prospectus, as then amended or supplemented, and
is duly qualified to transact business and is in good standing in
the State of California;
(B) each of this Agreement and any applicable Written
Terms Agreement has been duly authorized, executed and delivered
by the Company;
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<PAGE>
(C) the Indenture has been duly qualified under the
Trust Indenture Act and has been duly authorized, executed and
delivered by the Company and is a valid and binding agreement of
the Company, enforceable in accordance with its terms except as
(i) the enforceability thereof may be limited by bankruptcy,
insolvency or similar laws affecting creditors' rights generally
and (ii) rights of acceleration and the availability of equitable
remedies may be limited by equitable principles of general
applicability;
(D) the Notes have been duly authorized and, when the
final terms of a particular Note and its issuance and sale have
been established in accordance with the provisions of the
Indenture and when the Notes have been executed and authenticated
in accordance with the provisions of the Indenture and delivered
to and paid for by the purchasers thereof on the date of such
opinion, will be entitled to the benefits of the Indenture and
will be valid and binding obligations of the Company, enforceable
in accordance with their respective terms except as (i) the
enforceability thereof may be limited by bankruptcy, insolvency
or similar laws affecting creditors' rights generally and (ii)
rights of acceleration and the availability of equitable remedies
may be limited by equitable principles of general applicability;
(E) the execution and delivery by the Company of this
Agreement, the Notes, the Indenture and any applicable Written
Terms Agreement, and the performance by the Company of its
obligations under this Agreement, the Notes, the Indenture and
any applicable Terms Agreement will not contravene any provision
of applicable law or the certificate of incorporation or by-laws
of the Company or, to the best of such counsel's knowledge, any
agreement or other instrument binding upon the Company or any of
its subsidiaries that is material to the Company and its
subsidiaries taken as a whole, or, to the best of such counsel's
knowledge, any judgment, order or decree of any gov ernmental
body, agency or court having jurisdiction over the Company or any
subsidiary, and no consent, approval, authorization or order of,
or qualification with, any governmental body or agency is
required for the performance by the Company of its obligations
under this Agreement, the Notes, the Indenture and any applicable
Terms Agreement, except such as may be required by the securities
or Blue Sky laws of the various states in connection with the
offer and sale of the Notes;
(F) to the best of such counsel's knowledge, neither
the Company nor any of its subsidiaries has received any notice
of infringement of or conflict with asserted rights of others
with respect to any Intellectual Property employed by them in
connection with the business operated by the Company or its
subsidiaries which, singly or in
15
<PAGE>
the aggregate, if the subject of an unfavorable decision, ruling
or finding, would result in any material adverse change, or
notice of any other development with respect to the foregoing
involving a prospective material adverse change, in the
condition, financial or otherwise, or in the earnings, business
affairs or business prospects of the Company and its
subsidiaries, taken as a whole, except as may be disclosed in
writing by the Company to, and accepted for exclusion by, the
Agents;
(G) the statements (1) in the Prospectus, as then
amended or supplemented, under the captions "Description of
Notes," "Description of Debt Securities" and "United States
Income Tax Consequences to Holders" and (2) in the Registration
Statement under Item 15, in each case insofar as such statements
constitute summaries of the legal matters, documents or
proceedings referred to therein, fairly present, in all material
respects, the information called for with respect to such legal
matters, documents and proceedings and fairly summarize, in all
material respects, the matters referred to therein;
(H) to the best of such counsel's knowledge, there are
no legal or governmental proceedings pending or threatened to
which the Company or any of its subsidiaries is a party or to
which any of the properties of the Company or any of its
subsidiaries is subject or any developments in such proceedings
that are required to be described or incorporated therein by
reference, in the Registration Statement or the Prospectus, as
then amended or supplemented, and are not so described or
incorporated therein by reference, or of any statutes,
regulations, contracts or other documents that are required to be
described in the Registration Statement or the Prospectus, as
then amended or supplemented, or to be filed or incorporated by
reference as exhibits to such Registration Statement that are not
so described or filed or incorporated as required;
(I) the Company is not an "investment company" or an
entity "controlled" by an "investment company," as such terms are
defined in the Investment Company Act of 1940, as amended;
(J) the Registration Statement has become effective
under the Act; the Prospectus, as then amended or supplemented,
has been filed as required hereunder; and to the best 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 Commission;
(K) such counsel (1) is of the opinion that each
document, if any, filed pursuant to the Exchange Act and
incorporated by reference in the Registration Statement and the
Prospectus, as then
16
<PAGE>
amended or supplemented (except for financial statements and
schedules included therein as to which such counsel need not
express any opinion), complied when so filed as to form in all
material respects with the Exchange Act and the applicable rules
and regulations of the Commission thereunder, and (2) is of the
opinion that the Registration Statement and the Prospectus, as
then amended or supplemented (except for financial statements and
schedules included therein as to which such counsel need not
express any opinion), comply as to form in all material respects
with the Securities Act, the rules and regulations of the
Commission thereunder and the Trust Indenture Act; and
(L) no facts have come to the attention of such
counsel that would lead such counsel to believe that (1) (except
for financial statements and schedules as to which such counsel
need not express any belief and except for that part of the
Registration Statement that constitutes the Form T-1 heretofore
referred to) each part of the Registration Statement, as then
amended, if applicable, when such part became effective contained
any 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, and (2) (except for
financial statements and schedules as to which such counsel need
not express any belief) the Prospectus, as then amended or
supplemented, if applicable, as of the date such opinion is
delivered contains any untrue statement of a material fact or
omits to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which
they were made, not misleading; provided that in the case of an
--------
opinion delivered on the Commencement Date or pursuant to Section
5(c), the belief set forth in clause (2) above shall be deemed
not to cover information concerning an offering of par ticular
Notes to the extent such information will be set forth in a
supplement to the Basic Prospectus.
(ii) The opinion, dated as of such date, of the general
counsel or the assistant general counsel of the Company, to the effect
that:
(A) the Company is duly qualified to transact business
and is in good standing in each jurisdiction in which the conduct
of its business or its ownership or leasing of property requires
such qualification, except to the extent that the failure to be
so qualified or be in good standing would not have a material
adverse effect on the Company and its subsidiaries taken as a
whole;
(B) based upon opinions, oral or written, of foreign
counsel, or of certificates of governmental officials, each of
the subsidiaries of the Company meeting the definition of
"Significant Subsidiary" under Regulation S-X of the Commission
has been duly
17
<PAGE>
incorporated, is validly existing as a corporation in good
standing under the laws of the jurisdiction of its incorporation,
has the corporate power and authority to own its property and to
conduct its business as described in the Prospectus, as then
amended or supplemented, and is duly qualified to transact
business and is in good standing in each jurisdiction in which
the conduct of its business or its ownership or leasing of
property requires such qualification, except to the extent that
the failure to be so qualified or be in good standing would not
have a material adverse effect on such subsidiary;
(C) the execution and delivery by the Company of, and
the performance by the Company of its obligations under, this
Agreement, any applicable Written Terms Agreement, the Notes and
the Indenture will not contravene any agreement or other
instrument binding upon the Company or any of its subsidiaries
that is material, individually or in the aggregate, to the
Company and its subsidiaries, taken as a whole, or any judgment,
order or decree of any governmental body, agency or court having
jurisdiction over the Company or any subsidiary, and no consent,
approval, authorization or order of or qualification with any
governmental body or agency is required for the performance by
the Company of its obligations under this Agreement, any
applicable Terms Agreement, the Notes and the Indenture, except
such as may be required by the securities or Blue Sky laws of the
various states in connection with the offer and sale of the
Notes;
(D) the Company and its subsidiaries own or possess
the Intellectual Property employed by them in connection with the
business operated by them, except to the extent that the failure
to own or possess the Intellectual Property would not have a
material adverse effect on the Company and its subsidiaries taken
as a whole, and neither the Company nor any of its subsidiaries
has received any notice of infringement of or conflict with
asserted rights of others with respect to any of the foregoing
which, singly or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, would result in any
material adverse change, or notice of any other development with
respect to the foregoing involving a prospective material adverse
change, in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Company
and its subsidiaries, taken as a whole, except as may be
disclosed in writing by the Company to, and accepted for
exclusion by, the Agents;
(E) there are no legal or governmental proceedings
pending or threatened to the Company to which the Company or any
of its subsidiaries is a party or to which any of the properties
of the Company or any of its subsidiaries is subject or any
development in such proceedings
18
<PAGE>
that are required to be described in the Registration Statement
or the Prospectus, as then amended or supplemented, and are not
so described, or of any statutes, regulations, contracts or other
documents that are required to be described in the Registration
Statement or the Prospectus, as then amended or supplemented, or
to be filed or incorporated by reference as exhibits to such
Registration Statement that are not so described or filed or
incorporated as required;
(F) such counsel (1) is of the opinion that each
document, if any, filed pursuant to the Exchange Act and
incorporated by reference in the Registration Statement and the
Prospectus, as then amended or supplemented (except for financial
statements and schedules as to which such counsel need not
express any opinion) complied when so filed as to form in all
material respects with the Exchange Act and the applicable rules
and regulations of the Commission thereunder, and (2) is of the
opinion that the Registration Statement and the Prospectus, as
then amended or supplemented (except for financial statements and
schedules included therein as to which such counsel need not
express any opinion), comply as to form in all material respects
with the Securities Act, the rules and regulations of the
Commission thereunder and the Trust Indenture Act; and
(G) no facts have come to the attention of such
counsel that would lead such counsel to believe that (1) (except
for financial statements and schedules as to which such counsel
need not express any belief and except for that part of the
Registration Statement that constitutes the Form T-1 heretofore
referred to) each part of the Registration Statement, as then
amended, if applicable, when such part became effective did not
and, as of the date such opinion is delivered, does not contain
any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make
the statements therein not misleading, and (2) (except for
financial statements and schedules as to which such counsel need
not express any belief) the Prospectus, as then amended or
supplemented, if applicable, as of the date such opinion is
delivered contains any untrue statement of a material fact or
omits to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which
they were made, not misleading; provided that in the case of an
--------
opinion delivered on the Commencement Date or pursuant to Section
5(b), the belief set forth in clause (2) above shall be deemed
not to cover information concerning an offering of particular
Notes to the extent such information will be set forth in a
supplement to the Basic Prospectus.
(iii) The opinion, dated as of such date, of O'Melveny &
Myers LLP, counsel for the Agents, covering the matters in
subparagraphs (B), (C), (D)
19
<PAGE>
and (G) (but only with respect to statements in the Prospectus, as
then amended or supplemented, under the captions "Description of
Notes" and "Description of Debt Securities"), and that nothing has
come to their attention with respect to the matters in subparagraph
(L) in paragraph (c)(i) above.
Notwithstanding the foregoing, the opinions described above, when
contained in an opinion delivered on the Commencement Date or pursuant to
Sections 5(b) or 5(c), shall be deemed not to address the application of
the Commodity Exchange Act, as amended, or the rules, regulations or
interpretations of the Commodity Futures Trading Commission to Notes the
payments of principal or interest on which will be determined by reference
to one or more currency exchange rates, commodity prices, equity indices or
other factors.
With respect to subparagraph (L) of paragraph (c)(i) above, Irell
& Manella LLP may state that their opinion and belief are based upon their
participation in conferences in connection with the preparation of the
Registration Statement and Prospectus and any amendments or supplements
thereto and documents incorporated therein by reference and review and
discussion of the contents thereof, but are without independent check or
verification, except as specified. With respect to subparagraph (L) of
paragraph (c)(iii) above, O'Melveny & Myers LLP may state that their
opinion and belief are based upon their participation in conferences in
connection with the preparation of the Registration Statement and
Prospectus and any amendments or supplements thereto (other than documents
incorporated therein by reference) and review of the contents thereof
(including documents incorporated therein by reference), but are without
independent check or verification, except as specified.
The opinion of Irell & Manella LLP described in paragraph (c)(i)
above shall be rendered to the relevant Agents at the request of the
Company and shall so state therein.
(d) On the Commencement Date and, if called for by any Terms
Agreement, on the corresponding Settlement Date, the Company's independent
public accountants shall have furnished to the relevant Agents a letter or
letters, dated as of the Commencement Date or such Settlement Date, as the
case may be, in form and substance satisfactory to such Agents containing
statements and information of the type ordinarily included in accountant's
"comfort letters" to underwriters with respect to the financial statements
and certain financial information contained in or incorporated by reference
into the Prospectus, as then amended or supplemented.
(e) On the Commencement Date and on each Settlement Date, the
Company shall have furnished to the relevant Agents such appropriate
further information, certificates and documents as they may reasonably
request.
20
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5. Additional Agreements of the Company
------------------------------------
(a) Each time the Registration Statement or Prospectus is
amended or supplemented (other than by an amendment or supplement providing
solely for a change in the interest rates, redemption provisions,
amortization schedules or maturities offered on the Notes or for a change
the Agents deem to be immaterial or for an amendment or supplement by
filing of a Form 8-K which the Company deems to be immaterial), the Company
will deliver or cause to be delivered forthwith to each Agent a certificate
signed by an executive officer of the Company, dated the date of such
amendment or supplement, as the case may be, in form reasonably
satisfactory to the Agents, of the same tenor as the certificate referred
to in Section 4(b) relating to the Registration Statement or the Prospectus
as amended or supplemented to the time of delivery of such certificate.
(b) Each time the Company furnishes a certificate pursuant to
Section 5(a), the Company will furnish or cause to be furnished forthwith
to each Agent a written opinion of the general counsel or assistant general
counsel of the Company. Any such opinion shall be dated the date of such
amendment or supplement, as the case may be, shall be in a form
satisfactory to the Agents and shall be of the same tenor as the opinion
referred to in Section 4(c)(ii), as the case may be, but modified to relate
to the Registration Statement and the Prospectus as amended and
supplemented to the time of delivery of such opinion. In lieu of such
opinion, counsel last furnishing such an opinion to an Agent may furnish to
each Agent a letter to the effect that such Agent may rely on such last
opinion to the same extent as though it were dated the date of such letter
(except that statements in such last opinion will be deemed to relate to
the Registration Statement and the Prospectus as amended or supplemented to
the time of delivery of such letter.)
(c) Each time the Company files a Form 10-K or an amendment to a
Form 10-K and each time a Terms Agreement calls for a written opinion of
independent counsel for the Company, the Company will furnish or cause to
be furnished forthwith to each Agent a written opinion of independent
counsel for the Company. Any such opinion shall be dated the date of such
amendment or supplement, as the case may be, shall be in a form
satisfactory to the Agents and shall be of the same tenor as the opinion
referred to in Section 4(c)(i), as the case may be, but modified to relate
to the Registration Statement and the Prospectus as amended and
supplemented to the time of delivery of such opinion. In lieu of such
opinion, counsel last furnishing such an opinion to an Agent may furnish to
each Agent a letter to the effect that such Agent may rely on such last
opinion to the same extent as though it were dated the date of such letter
(except that statements in such last opinion will be deemed to relate to
the Registration Statement and the Prospectus as amended or supplemented to
the time of delivery of such letter.)
(d) Each time the Registration Statement or the Prospectus is
amended or supplemented to set forth amended or supplemental financial
information or such amended or supplemental information is incorporated by
reference in the Prospectus, the
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<PAGE>
Company shall cause its independent public accountants forthwith to furnish
each Agent with a letter, dated the date of such amendment or supplement,
as the case may be, in form satisfactory to the Agents, of the same tenor
as the letter referred to in Section 4(d), with regard to the amended or
supplemental financial information included or incorporated by reference in
the Registration Statement or the Prospectus as amended or supplemented to
the date of such letter.
6. Indemnification and Contribution
--------------------------------
(a) The Company agrees to indemnify and hold harmless each Agent
and each person, if any, who controls such Agent within the meaning of
either Section 15 of the Securities Act or Section 20 of the Exchange Act
from and against any and all losses, claims, damages and liabilities
(including, without limitation, any legal or other expenses reasonably
incurred by any Agent or any such controlling person in connection with
investigating or defending any such action or claim) caused by any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement or any amendment thereof or the Prospectus (as
amended or supplemented if the Company shall have furnished any amendments
or supplements thereto), or caused by 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, except insofar as such losses,
claims, damages or liabilities are caused by any such untrue statement or
omission or alleged untrue statement or omission based upon information
relating to such Agent furnished to the Company in writing by such Agent
expressly for use therein.
(b) Each Agent agrees, severally and not jointly, to indemnify
and hold harmless the Company, its directors, its officers who sign the
Registration Statement and each person, if any, who controls the Company
within the meaning of either Section 15 of the Securities Act or Section 20
of the Exchange Act to the same extent as the foregoing indemnity from the
Company to such Agent, but only with reference to information relating to
such Agent furnished to the Company in writing by such Agent expressly for
use in the Registration Statement or the Prospectus or any amendments or
supplements thereto.
(c) In case any proceeding (including any governmental
investigation) shall be instituted involving any person in respect of which
indemnity may be sought pursuant to either paragraph (a) or (b) above, such
person (the "indemnified party") shall promptly notify the person against
whom such indemnity may be sought (the "indemnifying party") in writing and
the indemnifying party, upon request of the indemnified party, shall retain
counsel reasonably satisfactory to the indemnified party to represent the
indemnified party and any others the indemnifying party may designate in
such proceeding and shall pay the fees and disbursements of such counsel
related to such proceeding. In any such proceeding, any indemnified party
shall have the right to retain its own counsel, but the fees and expenses
of such counsel shall be at the expense of such indemnified party unless
(i) the indemnifying party and the indemnified party shall have mutually
agreed to the retention of such counsel or (ii) the named parties to any
such
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<PAGE>
proceeding (including any impleaded parties) include both the indemnifying
party and the indemnified party and representation of both parties by the
same counsel would be inappropriate due to actual or potential differing
interests between them. It is understood that the indemnifying party shall
not, in respect of the legal expenses of any indemnified party in
connection with any proceeding or related proceedings in the same
jurisdiction, be liable for the fees and expenses of more than one separate
firm (in addition to any local counsel) for all such indemnified parties
and that all such fees and expenses shall be reimbursed as they are
incurred. Such firm shall be designated in writing by Morgan Stanley or,
if Morgan Stanley is not an indemnified party and is not reasonably likely
to become an indemnified party, by the Agents that are indemnified parties,
in the case of parties indemnified pursuant to paragraph (a) above, and by
the Company, in the case of parties indemnified pursuant to paragraph (b)
above. The indemnifying party shall not be liable for any settlement of
any proceeding effected without its written consent, but if settled with
such consent or if there be a final judgment for the plaintiff, the
indemnifying party agrees to indemnify the indemnified party from and
against any loss or liability by reason of such settlement or judgment.
Notwithstanding the foregoing sentence, if at any time an indemnified party
shall have requested an indemnifying party to reimburse the indemnified
party for fees and expenses of counsel as contemplated by the second and
third sentences of this paragraph, the indemnifying party agrees that it
shall be liable for any settlement of any proceeding effected without its
written consent if (i) such settlement is entered into more than 30 days
after receipt by such indemnifying party of the aforesaid request and (ii)
such indemnifying party shall not have reimbursed the indemnified party in
accordance with such request prior to the date of such settlement. No
indemnifying party shall, without the prior written consent of the
indemnified party (which consent shall not be unreasonably withheld),
effect any settlement of any pending or threatened proceeding in respect of
which any indemnified party is or could have been a party and indemnity
could have been sought hereunder by such indemnified party, unless such
settlement includes an unconditional release of such indemnified party from
all liability on claims that are the subject matter of such proceeding.
(d) To the extent the indemnification provided for in paragraph
(a) or (b) of this Section 6 is unavailable to an indemnified party or
insufficient in respect of any losses, claims, damages or liabilities
referred to therein in connection with any offering of Notes, then each
indemnifying party under such paragraph, in lieu of indemnifying such
indemnified party thereunder, shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, claims,
damages or liabilities (i) in such proportion as is appropriate to reflect
the relative benefits received by the Company on the one hand and each
Agent on the other hand from the offering of such Notes or (ii) if the
allocation provided by clause (i) is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Company
on the one hand and each Agent on the other hand in connection with the
statements or omissions that resulted in such losses, claims, damages or
liabilities, as well as any other relevant equitable considerations. The
relative benefits received by the Company on the one hand and each Agent on
the other hand in connection with the offering of such Notes shall be
deemed to
23
<PAGE>
be in the same respective proportions as the total net proceeds from the
offering of such Notes (before deducting expenses) received by the Company
bear to the total discounts and commissions received by each Agent in
respect thereof. The relative fault of the Company on the one hand and of
each Agent on the other hand shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates
to information supplied by the Company or by such Agent and the parties'
relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. Each Agent's obligation to
contribute pursuant to this Section 6 shall be several (in the proportion
that the principal amount of the Notes the sale of which by or through such
Agent gave rise to such losses, claims, damages or liabilities bears to the
aggre gate principal amount of the Notes the sale of which by or through
any Agent gave rise to such losses, claims, damages or liabilities) and not
joint.
(e) The Company and the Agents agree that it would not be just
or equitable if contribution pursuant to this Section 6 were determined by
pro rata allocation (even if the Agents were treated as one entity for such
--- ----
purpose) or by any other method of allocation that does not take account of
the equitable considerations referred to in paragraph (d) above. The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages and liabilities referred to in paragraph (d) above shall be
deemed to include, subject to the limitations set forth above, any legal or
other expenses reasonably incurred by such indemnified party in connection
with investigating or defending any such action or claim. Notwithstanding
the provisions of this Section 6, no Agent shall be required to contribute
any amount in excess of the amount by which the total price at which the
Notes referred to in paragraph (d) above that were offered and sold to the
public through such Agent exceeds the amount of any damages that such Agent
has otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation. The remedies provided for
in this Section 6 are not exclusive and shall not limit any rights or
remedies which may otherwise be available to any indemnified party at law
or in equity.
7. Position of the Agents. In acting under this Agreement and in
----------------------
connection with the sale of any Notes by the Company (other than Notes sold to
an Agent pursuant to a Terms Agreement), each Agent is acting solely as agent of
the Company and does not assume any obligation towards or relationship of agency
or trust with any purchaser of Notes. An 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, but
such Agent shall not have any liability to the Company in the event any such
purchase is not consummated for any reason. If the Company shall default in its
obligations to deliver Notes to a purchaser whose offer it has accepted, the
Company shall hold the relevant Agent harmless against any loss, claim, damage
or liability arising from or as a result of such default and shall, in
24
<PAGE>
particular, pay to such Agent the commission it would have received had such
sale been consummated.
8. Termination. This Agreement may be terminated at any time by the
-----------
Company or, as to any Agent, by the Company or such Agent upon the giving of
written notice of such termination to the other parties hereto, but without
prejudice to any rights, obligations or liabilities of any party hereto accrued
or incurred prior to such termination. The termination of this Agreement shall
not require termination of any Terms Agreement, and the termination of any such
Terms Agreement shall not require termination of this Agreement. If this
Agreement is terminated, the provisions of the third paragraph of Section 2(a),
Section 2(e), the last sentence of Section 3(b) and Sections 3(c), 3(h), 6, 7,
9, 11 and 14 shall survive; provided that if at the time of termination an offer
--------
to purchase Notes has been accepted by the Company but the time of delivery to
the purchaser or its agent of such Notes has not occurred, the provisions of
Sections 2(b), 2(c), 3(a), 3(e), 3(f), 3(g), 3(i), 4 and 5 shall also survive
until such delivery has been made.
9. Representations and Indemnities to Survive. The respective
------------------------------------------
indemnity and contribution agreements, representations, warranties and other
statements of the Company, its officers and the Agents set forth in or made
pursuant to this Agreement or any Terms Agreement will remain in full force and
effect, regardless of any termination of this Agreement or any such Terms
Agreement, any investigation made by or on behalf of an Agent or the Company or
any of the officers, directors or controlling persons referred to in Section 6
and delivery of and payment for the Notes.
10. Notices. All communications hereunder will be in writing and
-------
effective only on receipt, and, if sent to Morgan Stanley, will be mailed,
delivered or telefaxed and confirmed to Morgan Stanley at 1585 Broadway, 2nd
Floor, New York, New York 10036, Attention: Manager, Continuously Offered
Products (telefax number: 212-761-0780), with a copy to 1585 Broadway, 2nd
Floor, New York, New York 10036, Attention: Peter Cooper, Investment Banking
Information Center, 34th Floor (telefax number: 212-761-0260), or, if sent to
Credit Suisse First Boston, will be mailed, delivered or telefaxed and confirmed
to Credit Suisse First Boston at 11 Madison Avenue, New York, New York 10010,
Attention: Short and Medium Term Finance (telefax number: 212-325-8183), with a
copy to Helena M. Willner at the above address, or, if sent to the Company, will
be mailed, delivered or telefaxed and confirmed to the Company at 333
Continental Boulevard, El Segundo, California 90245-5012, Attention: William
Stavro, Senior Vice President and Treasurer (telefax number: 310-252-3215), with
a copy to Leland Smith, Assistant General Counsel and Secretary.
11. Successors. This Agreement and any Terms Agreement will inure to
----------
the benefit of and be binding upon the parties hereto and their respective
successors and the officers, directors and controlling persons referred to in
Section 6 and the purchasers of Notes (to the extent expressly provided in
Section 4), and no other person will have any right or obligation hereunder.
12. Amendments. This Agreement may be amended or supplemented if,
----------
but only if, such amendment or supplement is in writing and is signed by the
Company and each
25
<PAGE>
Agent; provided that the Company may from time to time, on seven days' prior
--------
written notice to the Agents but without the consent of any Agent, amend this
Agreement to add as a party hereto one or more additional firms registered under
the Exchange Act, whereupon each such firm shall become an Agent hereunder on
the same terms and conditions as the other Agents that are parties hereto. The
Agents shall sign any amendment or supplement giving effect to the addition of
any such firm as an Agent under this Agreement.
13. Counterparts. This Agreement may be signed in any number of
------------
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
14. Applicable Law. This Agreement shall be governed by and
--------------
construed in accordance with the internal laws of the State of New York.
15. Headings. The headings of the sections of this Agreement have
--------
been inserted for convenience of reference only and shall not be deemed a part
of this Agreement.
26
<PAGE>
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof, whereupon
this letter and your acceptance shall represent a binding agreement between the
Company and you.
Very truly yours,
MATTEL, INC.
By /s/ William Stavro
------------------------------
William Stavro
Senior Vice President and Treasurer
The foregoing Agreement is
hereby confirmed and accepted
as of the date first above written.
MORGAN STANLEY & CO. INCORPORATED
By: /s/ Michael Fusco
--------------------------
Michael Fusco
Vice President
CREDIT SUISSE FIRST BOSTON CORPORATION
By: /s/ Helena M. Willner
--------------------------
Helena M. Willner
Vice President
27
<PAGE>
EXHIBIT A
MATTEL, INC.
SERIES C MEDIUM-TERM NOTES
TERMS AGREEMENT
__________ __, 199_
Mattel, Inc.
333 Continental Boulevard
El Segundo, California 90245-5012
Attention:
Re: Distribution Agreement dated as of
November 12, 1997 (the "Distribution Agreement")
------------------------------------------------
We agree to purchase your Series C Medium-Term Notes (the "Notes")
having the following terms:
We agree to purchase, severally and not jointly, the principal amount
of Notes set forth below opposite our names:
Principal Amount
Name of Notes
---- ----------------
Morgan Stanley & Co.
Incorporated
Credit Suisse First Boston Corporation
Total................. $_______________
A-1
<PAGE>
The Notes shall have the following terms:
<TABLE>
<CAPTION>
All Notes: Fixed Rate Notes: Floating Rate Notes:
- --------- ---------------- -------------------
<S> <C> <C>
Principal amount: Interest Rate: Base rate:
Purchase price: Applicability of modified Index maturity:
payment upon acceleration:
Price to public: If yes, state issue price: Spread:
Settlement date and time: Amortization schedule: Spread multiplier:
Place of delivery: Alternate rate event spread:
Specified currency: Initial interest rate:
Maturity date: Initial interest reset date:
Initial accrual period OID: Interest reset dates:
Total amount of OID: Interest reset period:
Original yield to maturity: Maximum interest rate:
Optional repayment date(s): Minimum interest rate:
Optional redemption date(s): Interest payment period:
Initial redemption date: Interest payment dates:
Initial redemption percentage: Calculation agent:
Annual redemption percentage
decrease:
Other terms:
</TABLE>
The provisions of Sections 1, 2(b) and 2(c) and 3 through 6, 9, 10, 11
and 14 of the Distribution Agreement and the related definitions are
incorporated by reference herein and shall be deemed to have the same force and
effect as if set forth in full herein.
If on the Settlement Date any one or more of the Agents shall fail or
refuse to purchase Notes that it has or they have agreed to purchase on such
date, and the aggregate amount of Notes which such defaulting Agent or Agents
agreed but failed or refused to purchase is not more than one-tenth of the
aggregate amount of the Notes to be purchased on such date, the other Agents
shall be obligated severally in the proportions that the amount of Notes set
forth opposite their respective names above bears to the aggregate amount of
Notes set forth opposite the names of all such non-defaulting Agents, or in such
other proportions as _______________________________ may specify, to purchase
the Notes which such defaulting Agent or Agents agreed but failed or refused to
purchase on such date; provided that in no event shall the amount of Notes that
--------
any Agent has agreed to purchase pursuant to this Agreement be
A-2
<PAGE>
increased pursuant to this paragraph by an amount in excess of one-ninth of such
amount of Notes without the written consent of such Agent. If on the Settlement
Date any Agent or Agents shall fail or refuse to purchase Notes and the
aggregate amount of Notes with respect to which such default occurs is more than
one-tenth of the aggregate amount of Notes to be purchased on such date, and
arrangements satisfactory to ___________________________________ and the Company
for the purchase of such Notes are not made within 36 hours after such default,
this Agreement shall terminate without liability on the part of any non-
defaulting Agent or the Company. In any such case either _____________________
or the Company shall have the right to postpone the Settlement Date but in no
event for longer than seven days, in order that the required changes, if any, in
the Registration Statement and in the Prospectus or in any other documents or
arrangements may be effected. Any action taken under this paragraph shall not
relieve any defaulting Agent from liability in respect of any default of such
Agent under this Agreement.
This Agreement is subject to termination on the terms incorporated by
reference herein. If this Agreement is so terminated, the provisions of
Sections 3(h), 6, 9, 11 and 14 of the Distribution Agreement shall survive for
the purposes of this Agreement.
A-3
<PAGE>
The following information, opinions, certificates, letters and
documents referred to in Section 4 of the Distribution Agreement will be
required:
MORGAN STANLEY & CO. INCORPORATED
By: _________________________________________
Name:
Title:
CREDIT SUISSE FIRST BOSTON CORPORATION
By: _________________________________________
Name:
Title:
Accepted:
MATTEL, INC.
By:
Name:
Title:
A-3
<PAGE>
EXHIBIT B
MATTEL, INC.
SERIES C MEDIUM-TERM NOTES
ADMINISTRATIVE PROCEDURES
Explained below are the administrative procedures and specific terms of the
offering of Series C Medium-Term Notes (the "Notes"), on a continuous basis by
Mattel, Inc. (the "Company") pursuant to the Distribution Agreement, dated as of
November 12, 1997 (the "Distribution Agreement") among the Company and Morgan
Stanley & Co. Incorporated ("Morgan Stanley"), and Credit Suisse First Boston
Corporation ("Credit Suisse First Boston") (the "Agents"). The Notes will be
issued under an Indenture dated as of February 15, 1996 (the "Indenture")
between the Company and Chase Trust Company of California (formerly Chemical
Trust Company of California), as trustee (the "Trustee"). In the Distribution
Agreement, the Agents have agreed to use reasonable efforts to solicit purchases
of the Notes, and the administrative procedures explained below will govern the
issuance and settlement of any Notes sold through an Agent, as agent of the
Company. An Agent, as principal, may also purchase Notes for its own account,
and if requested by such Agent, the Company and such Agent will enter into a
terms agreement (a "Terms Agreement"), as contemplated by the Distribution
Agreement. The administrative procedures explained below will govern the
issuance and settlement of any Notes purchased by an Agent, as principal, unless
otherwise specified in the applicable Terms Agreement. Capitalized terms used
herein without definition shall have the meaning ascribed to them in the Notes.
The Trustee will be the Registrar, Calculation Agent, Authenticating Agent
and Paying Agent for the Notes and will perform the duties specified herein.
Each Note will be represented by either a Global Security (as defined below)
delivered to the Trustee, as agent for The Depository Trust Company ("DTC"), and
recorded in the book-entry system maintained by DTC (a "Book-Entry Note") or a
certificate delivered to the holder thereof or a person designated by such
holder (a "Certificated Note"). Except as set forth in the Indenture, an owner
of a Book-Entry Note will not be entitled to receive a Certificated Note.
Book-Entry Notes, which may be payable only in U.S. dollars, will be issued
in accordance with the administrative procedures set forth in Part I hereof as
they may subsequently be amended as the result of changes in DTC's operating
procedures. Certificated Notes will be issued in accordance with the
administrative procedures set forth in Part II hereof. Unless otherwise defined
herein, terms defined in the Indenture, the Notes or any prospectus supplement
relating to the Notes shall be used herein as therein defined.
The Company will advise the Agents in writing of the employees of the
Company with whom the Agents are to communicate regarding offers to purchase
Notes and the related settlement details.
B-1
<PAGE>
PART I: ADMINISTRATIVE PROCEDURES FOR BOOK-ENTRY NOTES
In connection with the qualification of the Book-Entry Notes for
eligibility in the book-entry system maintained by DTC, the Trustee will perform
the custodial, document control and administrative functions described below, in
accordance with its respective obligations under a Letter of Representation from
the Company and the Trustee to DTC, dated as of November 12, 1997, and a Medium-
Term Note Certificate Agreement between Chemical Bank as agent for the Trustee
and DTC, dated as of December 2, 1988 (the "MTN Certificate Agreement"), and its
obligations as a participant in DTC, including DTC's Same-Day Funds Settlement
System ("SDFS").
Issuance: On any date of settlement (as defined under "Settlement"
below) for one or more Book-Entry Notes, the Company will
issue a single global security in fully registered form
without coupons (a "Global Security") representing up to
U.S. $200,000,000 principal amount of all such Notes that
have the same Original Issue Date, Maturity Date and other
terms. Each Global Security will be dated and issued as of
the date of its authentication by the Trustee. Each Global
Security will bear an "Interest Accrual Date," which will be
(i) with respect to an original Global Security (or any
portion thereof), its original issuance date and (ii) with
respect to any Global Security (or any portion thereof)
issued subsequently upon exchange of a Global Security, or
in lieu of a destroyed, lost or stolen Global Security, the
most recent Interest Payment Date to which interest has been
paid or duly provided for on the predecessor Global Security
(or if no such payment or provision has been made, the
original issuance date of the predecessor Global Security),
regardless of the date of authentication of such
subsequently issued Global Security. Book-Entry Notes may be
payable only in U.S. dollars. No Global Security will
represent any Certificated Note.
Denominations: Book-Entry Notes will be issued in principal amounts of U.S.
$1,000 or any amount in excess thereof that is an integral
multiple of U.S. $1,000. Global Securities will be
denominated in principal amounts not in excess of U.S.
$200,000,000. If one or more Book-Entry Notes having an
aggregate principal amount in excess of $200,000,000 would,
but for the preceding sentence, be represented by a single
Global Security, then one Global Security will be issued to
represent each U.S. $200,000,000 principal amount of such
Book-Entry Note or Notes and an additional Global Security
will be issued to represent any remaining principal amount
of such Book-Entry Note or Notes. In such a case, each of
the Global Securities representing such Book-Entry Note or
Notes shall be assigned the same CUSIP number.
B-2
<PAGE>
Preparation of If any offer to purchase a Book-Entry Note is accepted by or
Pricing on behalf of the Company, the Company will prepare a pricing
Supplement: supplement (a "Pricing Supplement") reflecting the terms of
such Note. The Company (i) will arrange to file such
Pricing Supplement with the Commission in accordance with
the applicable paragraph of Rule 424(b) under the Securities
Act of 1933, as amended, and (ii) will, as soon as possible
and in any event not later than 11:00 a.m. on the business
day immediately following the applicable trade date, deliver
the number of copies of such Pricing Supplement to the
relevant Agent as such Agent shall request at the following
address:
If to Morgan Stanley:
Morgan Stanley & Co. Incorporated
1585 Broadway, 2nd Floor
New York, New York 10036
Attn: Medium Term Note Trading Desk,
Carlos Cabrera
Telephone: (212) 761-1316
Telecopy: (212) 761-0780
with a copy to:
Morgan Stanley & Co. Incorporated
1585 Broadway, 2nd Floor
New York, New York 10036
Attn: Manager - Continuously Offered Products
Telephone: (212) 761-2000
Telecopy: (212) 761-0780
If to Credit Suisse First Boston:
Credit Suisse First Boston Corporation
5 World Trade Center, 7th Floor
New York, New York 10048
Attn: Ms. Joan Bryan
Telephone: (212) 322-5105
Telecopy: (212) 803-4096
B-3
<PAGE>
with a copy to:
Credit Suisse First Boston Corporation
Short and Medium Term Finance
11 Madison Avenue
New York, New York 10010
Attn: Helena Willner
Telephone: (212) 325-7198
Telecopy: (212) 325-8183
B-4
<PAGE>
In each instance
that a Pricing
Supplement is
prepared, the
relevant Agent
will affix the
Pricing Supplement
to Prospectuses
prior to their use.
Outdated Pricing
Supplements, and
the Prospectuses to
which they are
attached (other
than those retained
for files), will
be destroyed.
Settlement: The receipt by the Company of immediately available funds in
payment for a Book-Entry Note and the authentication and
issuance of the Global Security representing such Note shall
constitute "settlement" with respect to such Note. All
offers accepted by the Company will be settled on the third
Business Day next succeeding the date of acceptance pursuant
to the timetable for settlement set forth below, unless the
Company and the purchaser agree to settlement on another
day, which shall be no earlier than the next Business Day.
Settlement Settlement Procedures with regard to each Book-Entry Note
Procedures: sold by the Company to or through an Agent (unless otherwise
specified pursuant to a Terms Agreement) shall be as
follows:
A. The relevant Agent will advise the Company by telephone
that such Note is a Book-Entry Note and of the
following settlement information:
1. Principal amount.
2. Maturity Date.
3. In the case of a Fixed Rate Book-Entry Note, the
Interest Rate, whether such Note will pay interest
annually or semi-annually and whether such Note is
an Amortizing Note, and, if so, the amortization
schedule, or, in the case of a
B-5
<PAGE>
Floating Rate Book-Entry Note, the Initial
Interest Rate (if known at such time), Interest
Payment Date(s), Interest Payment Period,
Calculation Agent, Base Rate, Index Maturity,
Interest Reset Period, Initial Interest Reset
Date, Interest Reset Date, Spread or Spread
Multiplier (if any), Minimum Interest Rate (if
any), Maximum Interest Rate (if any), and the
Alternate Rate Event Spread (if any).
4. Redemption or repayment provisions (if any).
5. Settlement date and time (Original Issue Date).
6. Interest Accrual Date.
7. Price.
8. Agent's commission (if any) determined as provided
in the Distribution Agreement.
9. Whether the Note is an Original Issue Discount
Note (an "OID Note"), and if it is an OID Note,
the total amount of OID, the yield to maturity,
the initial accrual period OID and the
applicability of Modified Payment upon
Acceleration (and, if so, the Issue Price).
10. Whether the Note is an Indexed Note, and if it is
an Indexed Note, the Denominated Currency, the
Indexed Currency or Currencies, the Payment
Currency, the Exchange Rate Agent, the Reference
Dealers, the Face Amount, the Fixed Amount of each
Indexed Currency, the Aggregate Fixed Amount of
each Indexed Currency and the Authorized
Denominations (if other than U.S. Dollars).
11. Whether the Note is a Renewable Note, and if it is
a Renewable Note, the Initial Maturity Date and
the Final Maturity Date.
12. Whether the Company has the option to extend the
Original Maturity Date of the Note, and if so, the
Final Maturity Date of such Note.
13. Whether the Company has the option to reset the
Interest Rate, the Spread or the Spread Multiplier
of the Note.
14. Any other applicable terms.
B-6
<PAGE>
B. The Company will advise the Trustee by telephone or
electronic transmission (confirmed in writing at any
time on the same date) of the information set forth in
Settlement Procedure "A" above. The Trustee will then
assign a CUSIP number to the Global Security
representing such Note and will notify the Company and
the relevant Agent of such CUSIP number by telephone as
soon as practicable.
C. The Trustee will enter a pending deposit message
through DTC's Participant Terminal System, providing
the following settlement information to DTC, to all
relevant Agents and the CUSIP Bureau of Standard &
Poor's Corporation:
1. The information set forth in Settlement Procedure
"A".
2. The Initial Interest Payment Date for such Note,
the number of days by which such date succeeds the
related DTC Record Date (which in the case of
Floating Rate Notes which reset daily or weekly,
shall be the date five calendar days immediately
preceding the applicable Interest Payment Date
and, in the case of all other Notes, shall be the
Record Date as defined in the Note) and, if known,
the amount of interest payable on such Initial
Interest Payment Date.
3. The CUSIP number of the Global Security
representing such Note.
4. Whether such Global Security will represent any
other Book-Entry Note (to the extent known at such
time).
5. Whether such Note is an Amortizing Note (by an
appropriate notation in the comments field of
DTC's Participant Terminal System).
6. The number of participant accounts to be
maintained by DTC on behalf of the relevant Agent
and the Trustee.
D. The Trustee will complete and authenticate the Global
Security representing such Note.
E. DTC will credit such Note to the Trustee's participant
account at DTC.
F. The Trustee will enter an SDFS deliver order through
DTC's Participant Terminal System instructing DTC to
(i) debit such Note
B-7
<PAGE>
to the Trustee's participant account and credit such
Note to the relevant Agent's participant account and
(ii) debit such Agent's settlement account and credit
the Trustee's settlement account for an amount equal to
the price of such Note less such Agent's commission (if
any). The entry of such a deliver order shall
constitute a representation and warranty by the Trustee
to DTC that (a) the Global Security representing such
Book-Entry Note has been issued and authenticated and
(b) the Trustee is holding such Global Security
pursuant to the MTN Certificate Agreement.
G. Unless the relevant Agent is the end purchaser of such
Note, such Agent will enter an SDFS deliver order
through DTC's Participant Terminal System instructing
DTC (i) to debit such Note to such Agent's participant
account and credit such Note to the participant
accounts of the Participants with respect to such Note
and (ii) to debit the settlement accounts of such
Participants and credit the settlement account of such
Agent for an amount equal to the price of such Note.
H. Transfers of funds in accordance with SDFS deliver
orders described in Settlement Procedures "F" and "G"
will be settled in accordance with SDFS operating
procedures in effect on the settlement date.
I. The Trustee will credit to the account of the Company
maintained with respect to any transaction conducted in
U.S. Dollars at Bank of America, Concord, California
94520, account number 12354-07478, to the account of
Mattel Toys, ABA #121000358, or such other account as
the Company shall have specified to such Agent and the
Trustee, and with respect to any transaction conducted
in any Specified Currency other than U.S. Dollars, to
such account as the Company shall have specified to
such Agent and the Trustee, in immediately available
funds the amount transferred to the Trustee in
accordance with Settlement Procedure "F".
J. Unless the relevant Agent is the end purchaser of such
Note, such Agent will confirm the purchase of such Note
to the purchaser either by transmitting to the
Participants with respect to such Note a confirmation
order or orders through DTC's institutional delivery
system or by mailing a written confirmation to such
purchaser.
K. Monthly, the Trustee will send to the Company a
statement setting forth the principal amount of Notes
outstanding as of that date under the Indenture and
setting forth a brief description of any sales of which
the Company has advised the Trustee that have not yet
been settled.
B-8
<PAGE>
Settlement For sales by the Company of Book-Entry Notes to or through
Procedures an Agent (unless otherwise specified pursuant to a Terms
Timetable: Agreement) for settlement on the first Business Day after
the sale date, Settlement Procedures "A" through "J" set
forth above shall be completed as soon as possible but not
later than the respective times in New York City set forth
below:
Settlement Time
Procedure ----
----------
A 11:00 A.M. on sale date
B 12:00 Noon on sale date
C 2:00 P.M. on sale date
D 9:00 A.M. on settlement date
E 10:00 A.M. on settlement date
F-G 2:00 P.M. on settlement date
H 4:45 P.M. on settlement date
I-J 5:00 P.M. on settlement date
If a sale is to be settled more than one Business Day after
the sale date, Settlement Procedures "A", "B" and "C" shall
be completed as soon as practicable but no later than 11:00
A.M., 12:00 Noon and 2:00 P.M., respectively, on the first
Business Day after the sale date. If the Initial Interest
Rate for a Floating Rate Book-Entry Note has not been
determined at the time that Settlement Procedure "A" is
completed, Settlement Procedures "B" and "C" shall be
completed as soon as such rate has been determined but no
later than 12:00 Noon and 2:00 P.M., respectively, on the
first Business Day before the settlement date. Settlement
Procedure "H" is subject to extension in accordance with any
extension of Fedwire closing deadlines and in the other
events specified in the SDFS operating procedures in effect
on the settlement date.
If settlement of a Book-Entry Note is rescheduled or
cancelled, the Trustee, after receiving notice from the
Company or the relevant Agent, will deliver to DTC, through
DTC's Participant Terminal System, a cancellation message to
such effect by no later than 2:00 p.m. on the Business Day
immediately preceding the scheduled settlement date.
B-9
<PAGE>
Failure If the Trustee fails to enter an SDFS deliver order with
to Settle: respect to a Book-Entry Note pursuant to Settlement
Procedure "F", the Trustee may deliver to DTC, through DTC's
Participant Terminal System, as soon as practicable a
withdrawal message instructing DTC to debit such Note to the
Trustee's participant account, provided that the Trustee's
participant account contains a principal amount of the
Global Security representing such Note that is at least
equal to the principal amount to be debited. If a withdrawal
message is processed with respect to all the Book-Entry
Notes represented by a Global Security, the Trustee will
mark such Global Security "cancelled," make appropriate
entries in the Trustee's records and send such cancelled
Global Security to the Company. The CUSIP number assigned
to such Global Security shall, in accordance with the
procedures of the CUSIP Service Bureau of Standard & Poor's
Corporation, be cancelled and not immediately reassigned.
If a withdrawal message is processed with respect to one or
more, but not all, of the Book-Entry Notes represented by a
Global Security, the Trustee will exchange such Global
Security for two Global Securities, one of which shall
represent such Book-Entry Note or Notes and shall be
cancelled immediately after issuance and the other of which
shall represent the remaining Book-Entry Notes previously
represented by the surrendered Global Security and shall
bear the CUSIP number of the surrendered Global Security.
If the purchase price for any Book-Entry Note is not timely
paid to the Participants with respect to such Note by the
beneficial purchaser thereof (or a person, including an
indirect participant in DTC, acting on behalf of such
purchaser), such Participants and, in turn, the relevant
Agent may enter SDFS deliver orders through DTC's
Participant Terminal System reversing the orders entered
pursuant to Settlement Procedures "F" and "G", respectively.
Thereafter, the Trustee will deliver the withdrawal message
and take the related actions described in the preceding
paragraph. Notwithstanding the foregoing, upon any failure
to settle with respect to a Book-Entry Note, DTC may take
any actions in accordance with its SDFS operating procedures
then in effect.
In the event of a failure to settle with respect to one or
more, but not all, of the Book-Entry Notes to have been
represented by a Global Security, the Trustee will provide,
in accordance with Settlement Procedures "D" and "F", for
the authentication and issuance of a Global Security
representing the Book-Entry Notes to be represented by such
Global Security and will make appropriate entries in its
records.
B-10
<PAGE>
PART II: ADMINISTRATIVE PROCEDURES FOR CERTIFICATED NOTES
The Trustee will serve as Registrar in connection with the Certificated
Notes.
Issuance: Each Certificated Note will be dated and issued as of the
date of its authentication by the Trustee. Each Certificated
Note will bear an Original Issue Date, which will be (i)
with respect to an original Certificated Note (or any
portion thereof), its original issuance date (which will be
the settlement date) and (ii) with respect to any
Certificated Note (or portion thereof) issued subsequently
upon transfer or exchange of a Certificated Note or in lieu
of a destroyed, lost or stolen Certificated Note, the
original issuance date of the predecessor Certificated Note,
regardless of the date of authentication of such
subsequently issued Certificated Note.
Preparation If any offer to purchase a Certificated Note is accepted by
of Pricing or on behalf of the Company, the Company will prepare a
Supplement: Pricing Supplement reflecting the terms of such Note. The
Company (i) will arrange to file such Pricing Supplement
with the Commission in accordance with the applicable
paragraph of Rule 424(b) under the Act and (ii) will, as
soon as possible and in any event not later than 11:00 a.m.
on the Business Day immediately following the applicable
trade date, deliver the number of copies of such Pricing
Supplement to the relevant Agent as such Agent shall request
at the following address:
If to Morgan Stanley:
Morgan Stanley & Co. Incorporated
1585 Broadway, 2nd Floor
New York, New York 10036
Attn: Medium Term Note Trading Desk,
Carlos Cabrera
Telephone: (212) 761-1316
Telecopy: (212) 761-0780
with a copy to:
Morgan Stanley & Co. Incorporated
1585 Broadway, 2nd Floor
New York, New York 10036
Attn: Manager - Continuously Offered Products
Telephone: (212) 761-2000
Telecopy: (212) 761-0780
B-11
<PAGE>
If to Credit Suisse First Boston:
Credit Suisse First Boston Corporation
Short and Medium Term Finance
11 Madison Avenue
New York, New York 10010
Attn: Helena Willner
Telephone: (212) 325-7198
Telecopy: (212) 325-8183
In each instance that a Pricing Supplement is prepared, the
relevant Agent will affix the Pricing Supplement to
Prospectuses prior to their use. Outdated Pricing
Supplements, and the Prospectuses to which they are attached
(other than those retained for files), will be destroyed.
Settlement: The receipt by the Company of immediately available funds in
exchange for an authenticated Certificated Note delivered to
the relevant Agent and such Agent's delivery of such Note
against receipt of immediately available funds shall
constitute "settlement" with respect to such Note. All
offers accepted by the Company will be settled on the third
Business Day next succeeding the date of acceptance pursuant
to the timetable for settlement set forth below, unless the
Company and the purchaser agree to settlement on another
date, which date shall be no earlier than the next Business
Day.
B-12
<PAGE>
Settlement Settlement Procedures with regard to each Certificated Note
Procedures: sold by the Company to or through an Agent (unless otherwise
specified pursuant to a Terms Agreement) shall be as
follows:
A. The relevant Agent will advise the Company by telephone
that such Note is a Certificated Note and of the
following settlement information:
1. Name in which Note is to be registered
("Registered Owner").
2. Address of the Registered Owner and address for
payment of principal and interest.
3. Taxpayer identification number of the Registered
Owner (if available).
4. Principal amount.
5. Maturity Date.
6. In the case of a Fixed Rate Certificated Note, the
Interest Rate, whether such Note will pay interest
annually or semi-annually and whether such Note is
an Amortizing Note and, if so, the amortization
schedule, or, in the case of a Floating Rate
Certificated Note, the Initial Interest Rate (if
known at such time), Interest Payment Date(s),
Interest Payment Period, Calculation Agent, Base
Rate, Index Maturity, Interest Reset Period,
Initial Interest Reset Date, Interest Reset Dates,
Spread or Spread Multiplier (if any), Minimum
Interest Rate (if any), Maximum Interest Rate (if
any) and the Alternate Rate Event Spread (if any).
7. Redemption or repayment provisions (if any).
8. Settlement date and time (Original Issue Date).
9. Interest Accrual Date.
10. Price.
11. Agent's commission (if any) determined as provided
in the Distribution Agreement.
12. Denominations.
B-13
<PAGE>
13. Specified Currency.
14. Whether the Note is an OID Note, and if it is an
OID Note, the total amount of OID, the yield to
maturity, the initial accrual period OID and the
applicability of Modified Payment upon
Acceleration (and if so, the Issue Price).
15. Whether the Note is an Indexed Note, and if it is
an Indexed Note, the Denominated Currency, the
Indexed Currency or Currencies, the Payment
Currency, the Exchange Rate Agent, the Reference
Dealers, the Face Amount, the Fixed Amount of each
Indexed Currency, the Aggregate Fixed Amount of
each Indexed Currency and the Authorized
Denominations (if other than U.S. Dollars).
16. Whether the Note is a Renewable Note, and if it is
a Renewable Note, the Initial Maturity Date and
the Final Maturity Date.
17. Whether the Company has the option to extend the
Original Maturity Date of the Note, and, if so,
the Final Maturity Date of such Note.
18. Whether the Company has the option to reset the
Interest Rate, the Spread or the Spread Multiplier
of the Note.
19. Any other applicable terms.
B. The Company will advise the Trustee by telephone or
electronic transmissions (confirmed in writing at any
time on the same date) of the information set forth in
Settlement Procedure "A" above.
C. The Company will have delivered to the Trustee a packet
for such Note, which packet will contain the following
documents in forms that have been approved by the
Company, the relevant Agent and the Trustee:
1. Note with customer confirmation.
2. Stub One - for the Trustee.
3. Stub Two - for the relevant Agent.
4. Stub Three - for the Company.
B-14
<PAGE>
D. The Trustee will complete such Note and authenticate
such Note and deliver it (with the confirmation) and
Stubs One and Two to the relevant Agent at the
following applicable addresses: If to Morgan Stanley to
Bank of New York, Dealer Clearance Department, Window
B, 1 Wall Street, 4th Floor, New York, New York 10005,
Attn: For the Account of Morgan Stanley & Co., and if
to Credit Suisse First Boston to Five World Trade
Center, New York, New York 10048, Attn: Paul Riley.
Such Agent will acknowledge receipt of the Note by
stamping or otherwise mailing Stub One and returning it
to the Trustee. Such delivery will be made only
against such acknowledgment of receipt of evidence that
instructions have been given by such Agent for payment
to the account of the Company with respect to any
transaction conducted in U.S. Dollars at Bank of
America, Concord, California 94520, account number
12354-07478, to the account of Mattel Toys, ABA
#121000358, or such other account as the Company shall
have specified to such Agent and the Trustee, and with
respect to any transaction conducted in any Specified
Currency other than U.S Dollars, to such account as the
Company shall have specified to such Agent and the
Trustee, in immediately available funds, of an amount
equal to the price of such Note less such Agent's
commission (if any). In the event that the
instructions given by such Agent for payment to the
account of the Company are revoked, the Company will as
promptly as possible wire transfer to the account of
such Agent an amount of immediately available funds
equal to the amount of such payment made.
E. Unless the relevant Agent is the end purchaser of such
Note, such Agent will deliver such Note (with
confirmation) to the customer against payment in
immediately available funds. Such Agent will obtain the
acknowledgment of receipt of such Note by retaining
Stub Two.
F. The Trustee will send Stub Three to the Company by
first-class mail. Monthly, the Trustee will also send
to the Company a statement setting forth the principal
amount of the Notes outstanding as of that date under
the Indenture and setting forth a brief description of
any sales of which the Company has advised the Trustee
that have not yet been settled.
Settlement For sales by the Company of Certificated Notes to or through
Procedures an Agent (unless otherwise specified pursuant to a Terms
Timetable: Agreement), Settlement Procedures "A" through "F" set forth
above shall be completed on or before the respective times
in New York City set forth below:
B-15
<PAGE>
<TABLE>
<CAPTION>
Settlement Time
Procedure ----
----------
<S> <C> <C>
A 2:00 P.M on the day before settlement date
B 3:00 P.M. on the day before settlement date
C-D 2:15 P.M. on settlement date
E 3:00 P.M. on settlement date
F 5:00 P.M. on settlement date
</TABLE>
Failure to Settle: If a purchaser fails to accept delivery of and make payment
for any Certificated Note, the relevant Agent will notify
the Company and the Trustee by telephone and return such
Note to the Trustee. Upon receipt of such notice, the
Company will immediately wire transfer to the account of
such Agent an amount equal to the price of such Note less
such Agent's commission in respect of such Note (if any).
Such wire transfer will be made on the settlement date, if
possible, and in any event not later than the business Day
following the settlement date. If the failure shall have
occurred for any reason other than a default by such Agent
in the performance of its obligations hereunder and under
the Distribution Agreement, then the Company will reimburse
such Agent or the Trustee, as appropriate, on an equitable
basis for its loss of the use of the funds during the period
when they were credited to the account of the Company.
Immediately upon receipt of the Certificated Note in respect
of which such failure occurred, the Trustee will mark such
Note "cancelled," make appropriate entries in the Trustee's
records and send such Note to the Company.
B-16
<PAGE>
Exhibit 4.1
-----------
MATTEL, INC.
OFFICER'S CERTIFICATE PURSUANT TO
SECTIONS 2.2, 10.4 AND 10.5 OF THE INDENTURE
--------------------------------------------
Each of Harry J. Pearce, Chief Financial Officer, and William Stavro,
Senior Vice President and Treasurer, of Mattel, Inc., a Delaware corporation
(the "Company"), having read the Indenture dated as of February 15, 1996 (the
"Indenture"), between the Company and Chase Trust Company of California
(formerly Chemical Trust Company of California), as Trustee, including Section
2.2 thereof, do hereby determine and certify pursuant to the authority vested in
them by the Board of Directors of the Company (pursuant to resolutions duly
adopted by the Board of Directors of the Company on August 21, 1997) as follows:
(i) They hereby authorize and establish a Series of Securities
to be issued under the Indenture entitled the Series C Medium-Term Note
(the "Notes"), the terms and provisions of, and the form of notes
representing, such Series to be determined and approved by the Chief
Financial Officer and the Treasurer of the Company, which determination and
approval are to be evidenced by an Officers' Certificate as contemplated by
Section 2.2 of the Indenture;
(ii) It is hereby determined that the terms and provisions of
the Notes shall be as set forth in Annex A hereto and the forms of Notes
shall be as set forth in Annex B and Annex C hereto;
(iii) I have read the Indenture, including Section 2.2 thereof;
(iv) In my opinion, I have made such examination or
investigation as is necessary to enable me to express an informed opinion
as to whether the conditions precedent provided for in the Indenture
relating to the establishment of a Series of Securities (as defined in the
Indenture) have been complied with; and
(v) In my opinion, all conditions precedent provided for in the
Indenture relating to the establishment of the Series of Notes have been
complied with.
<PAGE>
IN WITNESS WHEREOF, we have hereunto signed our names and affixed the
seal of the Company this 12th day of November, 1997.
[SEAL]
By: /s/ Harry J. Pearce
__________________________
Harry J. Pearce
Chief Financial Officer
By: /s/ William Stavro
__________________________
William Stavro
Senior Vice President and Treasurer
2
<PAGE>
ANNEX A
-------
Except as otherwise provided in the forms of Fixed Rate Note and
Floating Rate Note included herewith, the terms of the Notes shall be as follows
(terms defined in the Indenture or in the forms of Fixed Rate Note and Floating
Rate Note included herewith and not otherwise defined herein are used herein as
so defined):
(1) A Series of Securities to be issued under the Indenture has
been designated as the "Series C Medium-Term Notes" (such series is
hereinafter referred to as the "Notes" and each individual obligation under
such series, a "Note");
(2) The Notes shall constitute part of a single Series of
Securities under the Indenture, which Series is not limited in aggregate
principal amount, but is limited in aggregate initial public offering price
to $350,000,000;
(3) The date(s) on which principal of each Note is payable shall
be such date more than nine months from the date of issuance as is selected
by the purchaser of such Note and agreed to by the Chairman of the Board,
any President, any Vice President, the Treasurer, the Secretary, any
Assistant Treasurer or any Assistant Secretary of the Company (the
"Authorized Officers") at the time of issuance thereof, which date(s) shall
be included in the form of such Note upon issuance thereof;
(4) The rate or rates and, if applicable, the method used to
determine the rate, at which each Note shall bear interest (which may not
in any case exceed the maximum rate permitted under applicable law) shall
be determined by the Authorized Officers at the time of issuance thereof,
which rate or rates or method for establishing the rate shall be included
in the form of such Note upon issuance thereof. Interest will accrue from
the most recent date on which interest has been paid or duly provided for
or if no interest has been paid or duly provided for, from the Interest
Accrual Date, until the principal thereof has been paid or duly made
available for payment (except as provided below). Interest will be payable
on each Interest Payment Date, which shall be on May 15 and November 15 of
each year with respect to Fixed Rate Notes and on a date or dates as
specified in Floating Rate Notes, and at a maturity as specified in the
Note. 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 such
Note is registered at the close of business on the Record Date for such
Interest Payment date, which Record Date shall be the date 15 calendar days
prior to each Interest Payment Date (whether or not a Business Day);
provided, however, that interest payable on any Maturity Date (or any
-------- -------
redemption or repayment date) will be payable to the person to whom
principal shall be payable. The first payment of interest on any Note
issued between a Record Date and an Interest
1
<PAGE>
Payment Date will be made on the Interest Payment Date following the next
succeeding Record Date to the person in whose name such Note is registered
on such next succeeding Record Date;
(5) Payment of the principal of each Note, any premium and the
interest due on any Maturity Date (or any redemption or repayment date)
will be made in immediately available funds upon surrender of such Note at
the principal corporate trust office of the Trustee or at the office or
agency of the Trustee maintained for that purpose in The City of New York,
New York, or at such other paying agency as the Company may determine.
Payment of the principal of and premium, if any, and interest on each Note
will be made in the Specified Currency at the office or offices indicated
in such Note; provided, however, that U.S. dollar payments of interest,
-------- -------
other than interest due at maturity or on any date of redemption or
repayment, will be made by U.S. dollar check mailed to the address of the
person entitled thereto as such address shall appear in the Note register.
A holder of U.S. $10,000,000 or more in aggregate principal amount of Notes
having the same Interest Payment Date will be entitled to receive payments
of interest, other than interest due at maturity or on any date of
redemption or repayment, by wire transfer of immediately available funds if
appropriate wire transfer instructions have been received by the Paying
Agent in writing not less than 15 calendar days prior to the applicable
Interest Payment Date. If a Note is denominated in a Specified Currency
other than U.S. dollars, payments of interest thereon will be made by wire
transfer of immediately available funds to an account maintained by the
holder thereof with a bank located outside the United States if appropriate
wire transfer instructions have been received by the Paying Agent in
writing not less than 15 calendar days prior to the applicable Interest
Payment Date. If such wire transfer instructions are not so received, such
interest payments will be made by check payable in such Specified Currency
mailed to the address of the person entitled thereto as such address shall
appear in the Note register;
(6) Any Note may be redeemed or repurchased at the times and in
the manner set forth in such Note at the time of issuance thereof, as
determined and certified to the Trustee by the Authorized Officers;
(7) The Company shall be obligated to redeem or purchase each
Note pursuant to such sinking fund or analogous provisions (if any) or at
the option of the Holder thereof (if provided by the terms of the Note),
within such period or periods, at such price or prices and upon such other
terms and conditions as are set forth in such Note at the time of issuance
thereof, as determined and certified to the Trustee by the Authorized
Officers;
(8) The Notes shall be issued in registered form in denominations
of $1,000 and integral multiples thereof and each Note will be represented
by either a global
2
<PAGE>
security registered in the name of a securities depository or a certificate
issued in definitive form, as determined and set forth at the time of
issuance thereof;
(9) The principal of the Notes shall be payable upon declaration
of acceleration of maturity pursuant to Section 6.2 of the Indenture,
except that in the case of a Discount Security, the portion of the
principal that shall be payable upon declaration of acceleration shall be
such portion as is set forth in such Discount Note at the time of issuance
thereof, as determined and certified to the Trustee by the Authorized
Officers;
(10) Unless specified otherwise in any Note, the currency of
denomination of the Notes shall be the coin or currency of the United
States of America that at the time of payment is legal tender for public
and private debts;
(11) Unless specified otherwise in any Note, principal of and
interest on the Notes shall be payable in the coin or currency of the
United States of America that at the time of payment is legal tender for
public and private debts;
(12) The manner in which the exchange rate used to calculate
payment of principal of or interest on the Notes that are to be made in a
Foreign Currency shall be as set forth in such Note at the time of issuance
thereof, as determined and certified to the Trustee by the Authorized
Officers;
(13) The manner in which the amount of any payment of principal
of or interest on any Note that is to be determined by reference to a
commodity, commodity index, stock exchange index or financial index shall
be as set forth in such Note at the time of issuance thereof, as determined
and certified to the Trustee by the Authorized Officers;
(14) Any other terms of the Notes, which shall not be
inconsistent with the Indenture, shall be as set forth in such Note at the
time of issuance thereof, as determined and certified to the Trustee by the
Authorized Officers;
(15) Fixed Rate Notes shall be in the form included herewith as
Annex B, and Floating Rate Notes shall be in the form included herewith as
Annex C hereto; and
(16) Any depositories, interest rate calculation agents, exchange
rate calculation agents or other agents with respect to the Notes, other
than those appointed in the Indenture, will be such as are in the future
appointed from time to time in accordance with the terms of the Indenture.
3
<PAGE>
EXHIBIT 4.2
(FORM OF FACE OF SECURITY)
MATTEL, INC.
SERIES C MEDIUM-TERM NOTE
Floating Rate Note
REGISTERED REGISTERED
No. FLR- [PRINCIPAL AMOUNT]
CUSIP:
If the registered owner of this Security (as indicated below) is The
Depository Trust Company (the "Depository") or a nominee of the Depository, this
Security is a Global Security and the following two legends apply:
This Security is a Global Security within the meaning of the Indenture
hereinafter referred to and is registered in the name of the Depository or a
nominee of the Depository. This Security is exchangeable for Securities
registered in the name of a person other than the Depository or its nominee only
in the limited circumstances described in the Indenture, and may not be
transferred except as a whole by the Depository to a nominee of the Depository,
by a nominee of the Depository to the Depository or another nominee of the
Depository or by the Depository or any such nominee to a successor of the
Depository or a nominee of such successor.
Unless this certificate is presented by an authorized representative
of The Depository Trust Company (55 Water Street, New York, New York) to the
Issuer (as defined below) or its agent for registration of transfer, exchange or
payment, and any certificate issued is registered in the name of Cede & Co. or
such other name as requested by an authorized representative of The Depository
Trust Company and any payment is made to Cede & Co., ANY TRANSFER, PLEDGE OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL since
the registered owner hereof, Cede & Co., has an interest herein.
IF APPLICABLE, THE "TOTAL AMOUNT OF OID," "ORIGINAL YIELD TO MATURITY" AND
"INITIAL ACCRUAL PERIOD OID" (COMPUTED UNDER THE APPROXIMATE METHOD) SET FORTH
BELOW HAVE BEEN COMPLETED SOLELY FOR THE PURPOSES OF APPLYING THE FEDERAL INCOME
TAX ORIGINAL ISSUE DISCOUNT ("OID") RULES.
<PAGE>
BASE RATE: ORIGINAL ISSUE DATE: ORIGINAL MATURITY
DATE:
INDEX MATURITY: INTEREST ACCRUAL FINAL MATURITY
DATE: DATE:
SPREAD (PLUS OR INITIAL INTEREST INTEREST PAYMENT
MINUS): RATE: DATE(S):
ALTERNATE RATE INITIAL INTEREST INTEREST PAYMENT
EVENT SPREAD: RESET DATE: PERIOD:
SPREAD MULTIPLIER: MAXIMUM INTEREST INTEREST RESET
RATE: PERIOD:
APPLICABILITY OF MINIMUM INTEREST INTEREST RESET
MODIFIED PAYMENT RATE: DATES:
UPON ACCELERATION:
If yes, state INITIAL REDEMPTION CALCULATION AGENT:
ISSUE PRICE: DATE:
INITIAL REDEMPTION SPECIFIED CURRENCY:
PERCENTAGE:
ANNUAL REDEMPTION INDEX CURRENCY:
PERCENTAGE
REDUCTION:
OPTIONAL REPAYMENT TOTAL AMOUNT OF OID:
DATE(S):
ORIGINAL YIELD TO
MATURITY:
OTHER TERMS: INITIAL ACCRUAL
PERIOD OID:
Mattel, Inc., a Delaware corporation (together with its successors and
assigns, the "Issuer"), for value received, hereby promises to pay to
or registered assignees, the principal sum of ________________________________,
on the Original Maturity Date specified above (except to the extent redeemed or
repaid prior to the Original Maturity Date) or, if the maturity hereof is
extended in accordance with the procedures set forth below to an Extended
Maturity Date, as defined below, on such Extended Maturity Date (except to the
extent previously redeemed or repaid) and to pay interest thereon, from the
Interest Accrual Date specified above at a rate per annum equal to the Initial
Interest Rate specified above
2
<PAGE>
until the Initial Interest Reset Date specified above, and thereafter at a rate
per annum determined in accordance with the provisions specified on the reverse
hereof (including the provisions relating to extension of maturity) until the
principal hereof is paid or duly made available for payment. The Issuer will pay
interest in arrears monthly, quarterly, semiannually or annually as specified
above as the Interest Payment Period on each Interest Payment Date (as specified
above), commencing with the first Interest Payment Date next succeeding the
Interest Accrual Date specified above, and at maturity (or on any redemption or
repayment date); provided, however, that if the Interest Accrual Date occurs
between a Record Date, as defined below, and the next succeeding Interest
Payment Date, interest payments will commence on the second Interest Payment
Date succeeding the Interest Accrual Date to the registered holder of this Note
on the Record Date with respect to such second Interest Payment Date; and
provided, further, that if an Interest Payment Date or the Maturity Date or
redemption or repayment date would fall on a day that is not a Business Day, as
defined on the reverse hereof, such Interest Payment Date, Maturity Date or
redemption or repayment date shall be the following day that is a Business Day,
except that if the Base Rate specified above is LIBOR and such next Business Day
falls in the next calendar month, the Interest Payment Date, Maturity Date or
redemption or repayment date shall be the immediately preceding day that is a
Business Day.
Except as provided above, unless otherwise specified on the face
hereof, interest on Notes will be payable: (i) in the case of Notes with a
daily, weekly or monthly Interest Reset Date, on the third Wednesday of each
month or on the third Wednesday of March, June, September and December, as
specified on the face hereof; (ii) in the case of Notes with a quarterly
Interest Reset Date, on the third Wednesday of March, June, September and
December specified on the face hereof; (iii) in the case of Notes with a
semiannual Interest Reset Date, on the third Wednesday of the two months
specified on the face hereof; and (iv) in the case of Notes with an annual
Interest Reset Date, on the third Wednesday of the month specified on the face
hereof.
Interest on this Note will accrue from the most recent date on which
interest has been paid or duly provided for, or, if no interest has been paid or
duly provided for, from the Interest Accrual Date, until the principal hereof
has been paid or duly made available for payment (except as provided below).
The interest so payable, and punctually paid or duly provided for, on any
Interest Payment Date will, subject to certain exceptions described herein, be
paid to the person in whose name this Note (or one or more predecessor Notes) is
registered at the close of business on the date 15 calendar days prior to such
Interest Payment Date (whether or not a Business Day) (each such date a "Record
Date"); provided, however, that interest payable at maturity (or on any
-------- -------
redemption or repayment date) will be payable to the person to whom the
principal hereof shall be payable.
Payment of the principal of this Note, any premium and the interest
due at maturity (or on any redemption or repayment date) will be made in
immediately available funds upon surrender of this Note at the principal
corporate trust office of the Trustee or at the office or agency of the Trustee
maintained for that purpose in The City of New York, New York, or at such other
paying agency as the Issuer may determine. Payment of the principal of and
premium, if any, and interest on this Note will be made in the Specified
Currency indicated above; provided, however, that U.S. dollar payments of
-------- -------
interest, other than interest due at maturity or any date of redemption or
repayment, will be made by U.S. dollar check mailed to the address of the person
entitled thereto as
3
<PAGE>
such address shall appear in the Note register. A holder of U.S. $10,000,000 or
more in aggregate principal amount of Notes having the same Interest Payment
Date will be entitled to receive payments of interest, other than interest due
at maturity or any date of redemption or repayment, by wire transfer of
immediately available funds if appropriate wire transfer instructions have been
received by the Paying Agent in writing not less than 15 calendar days prior to
the applicable Interest Payment Date. If this Note is denominated in a Specified
Currency other than U.S. dollars, payments of interest hereon will be made by
wire transfer of immediately available funds to an account maintained by the
holder hereof with a bank located outside the United States if appropriate wire
transfer instructions have been received by the Paying Agent in writing not less
than 15 calendar days prior to the applicable Interest Payment Date. If such
wire transfer instructions are not so received, such interest payments (other
than interest payable at maturity or on any redemption or repayment date) will
be made by check payable in such Specified Currency mailed to the address of the
person entitled thereto as such address shall appear in the Note register.
Reference is hereby made to the further provisions of this Note set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
4
<PAGE>
Unless the certificate of authentication hereon has been executed by
the Trustee referred to on the reverse hereof by manual signature, this Note
shall not be entitled to any benefit under the Indenture, as defined on the
reverse hereof, or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Issuer has caused this Note to be duly
executed under its corporate seal.
DATED: MATTEL, INC.
By______________________________
Name:
Title:
TRUSTEE'S CERTIFICATE
OF AUTHENTICATION
This is one of the Notes
referred to in the within-
mentioned Indenture.
CHASE TRUST COMPANY OF CALIFORNIA,
as Trustee
By_____________________________
Authorized Officer
5
<PAGE>
(FORM OF REVERSE OF SECURITY)
This Note is one of a duly authorized issue of Series C Medium-Term
Notes having maturities of more than nine months from the date of issue (the
"Notes") of the Issuer. The Notes are issuable under an indenture dated as of
February 15, 1996, duly executed and delivered by the Issuer to Chase Trust
Company of California (formerly Chemical Trust Company of California), Trustee
(herein called the "Trustee"), to which indenture and all indentures
supplemental thereto (herein called the "Indenture") reference is hereby made
for a statement of the respective rights, limitations of rights and immunities
of the Issuer, the Trustee and holders of the Notes and terms upon which the
Notes are, and are to be, authenticated and delivered. The Issuer has appointed
Chase Trust Company of California as the paying agent (the "Paying Agent," which
term includes any additional or successor Paying Agent appointed by the Issuer)
with respect to the Notes. The terms of individual Notes may vary with respect
to interest rates, interest rate formulas, issue dates, maturity dates, or
otherwise, all as provided in the Indenture. To the extent not inconsistent
herewith, the terms of the Indenture are hereby incorporated by reference
herein.
This Note will not be subject to any sinking fund and, unless
otherwise provided on the face hereof in accordance with the provisions of the
following two paragraphs, will not be redeemable or subject to repayment at the
option of the holder prior to maturity.
If so indicated on the face of this Note, this Note may be redeemed in
whole or in part at the option of the Issuer on or after the Initial Redemption
Date specified on the face hereof on the terms set forth on the face hereof and
at a redemption price (expressed as a percentage of the principal amount hereof)
equal to the Initial Redemption Percentage, together with interest accrued and
unpaid hereon to the date of redemption. If this Note is subject to "Annual
Redemption Percentage Reduction," the Initial Redemption Percentage indicated on
the face hereof will be reduced on each anniversary of the Initial Redemption
Date by the Annual Redemption Percentage Reduction specified on the face hereof
until the redemption price of this Note is 100% of the principal amount hereof,
together with interest accrued and unpaid hereon to the date of redemption.
Notice of redemption shall be mailed by first class mail, postage prepaid, to
the registered holders of the Notes designated for redemption at their addresses
as the same shall appear on the Note register not less than 30 nor more than 60
days prior to the date fixed for redemption, subject to all the conditions and
provisions of the Indenture. In the event of redemption of this Note in part
only, a new Note or Notes for the amount of the unredeemed portion hereof shall
be issued in the name of the holder hereof upon the cancellation hereof, but, in
any event, the principal amount of the Note remaining outstanding after
redemption must be an Authorized Denomination.
If so indicated on the face of this Note, this Note will be subject to
repayment at the option of the holder on the Optional Repayment Date or Dates
specified on the face hereof on the terms set forth herein. On any Optional
Repayment Date, this Note will be repayable in whole or in part in increments of
$1,000 or, if this Note is denominated in a Specified Currency other than U.S.
dollars, in increments of 1,000 units of such Specified Currency (provided that
any remaining principal amount hereof shall not be less than the minimum
Authorized Denomination hereof) at the
6
<PAGE>
option of the holder hereof at a price equal to 100% of the principal amount to
be repaid, together with interest accrued and unpaid hereon to the date of
repayment. For this Note to be repaid at the option of the holder hereof, the
Paying Agent must receive at its principal corporate trust office in San
Francisco, California, or at its office in The City of New York, New York, at
least 30 but not more than 60 days prior to the date of repayment, (i) this Note
with the form entitled "Option to Elect Repayment" below 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 a trust company in the United States setting forth
the name of the holder of this Note, the principal amount hereof, the principal
amount hereof to be repaid, the certificate number of this Note or a description
of this Note's tenor and terms, a statement that the option to elect repayment
is being exercised thereby and a guarantee that this Note, together with the
form entitled "Option to Elect Repayment" duly completed, will be received by
the Paying Agent not later than the third 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
this Note and such form duly completed are received by the Paying Agent by such
third Business Day. Effective exercise of such repayment option by the holder
hereof shall be irrevocable. In the event of repayment of this Note in part
only, a new Note or Notes for the amount of the unpaid portion hereof shall be
issued in the name of the holder hereof upon the cancellation hereof, but, in
any event, the principal amount of the Note remaining outstanding after
repayment must be an Authorized Denomination.
If so indicated on the face of this Note, the Issuer has the option to
extend the Original Maturity Date hereof for one or more periods of one or more
whole years (each an "Extension Period") up to but not beyond the Final Maturity
Date specified on the face hereof and in connection therewith to establish a new
interest rate (calculated with reference to a Base Rate and the Spread and/or
Spread Multiplier, if any) and new redemption provisions for the Extension
Period.
The Issuer may exercise such option by notifying the Paying Agent of
such exercise at least 45 but not more than 60 days prior to the Original
Maturity Date or, if the maturity hereof has already been extended, prior to the
maturity date then in effect (an "Extended Maturity Date"), such notice to be
accompanied by the form of the Extension Notice referred to below. No later
than 38 days prior to the Original Maturity Date or an Extended Maturity Date,
as the case may be (each, a "Maturity Date"), the Paying Agent will mail to the
holder hereof a notice (the "Extension Notice") relating to such Extension
Period, by first class mail, postage prepaid, setting forth (a) the election of
the Issuer to extend the maturity of this Note; (b) the new Extended Maturity
Date; (c) the interest rate applicable to the Extension Period (calculated with
reference to a Base Rate and the Spread and/or Spread Multiplier, if any); and
(d) 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 Paying Agent of an Extension Notice to the holder of
this Note, the maturity hereof shall be extended automatically, and, except as
modified by the Extension Notice and as described in the next paragraph, this
Note will have the same terms it had prior to the mailing of such Extension
Notice.
Notwithstanding the foregoing, not later than 10:00 A.M., New York
City time, on the twentieth calendar day prior to the Maturity Date in effect
immediately preceding the mailing of
7
<PAGE>
the applicable Extension Notice (or if such day is not a Business Day, not later
than 10:00 A.M., New York City time, on the immediately succeeding Business
Day), the Issuer may, at its option, revoke the interest rate provided for in
such Extension Notice and establish a higher Spread and/or Spread Multiplier, if
any, for the Extension Period by causing the Paying Agent to send notice of such
higher Spread and/or Spread Multiplier, if any, within seven days of receipt of
such notice to the holder of this Note by first class mail, postage prepaid, or
by such other means as shall be agreed between the Issuer and the Paying Agent.
Such notice shall be irrevocable. All Notes with respect to which the Maturity
Date is extended in accordance with an Extension Notice will bear such higher
Spread and/or Spread Multiplier, if any, for the Extension Period, whether or
not tendered for repayment.
If the Issuer elects to extend the maturity hereof, the holder of this
Note will have the option to require the Issuer to repay this Note on the
Maturity Date in effect immediately preceding the mailing of the applicable
Extension Notice at a price equal to the principal amount hereof plus any
accrued and unpaid interest to such date. In order for this Note to be so
repaid on such Maturity Date, the holder hereof must follow the procedures set
forth above for optional repayment, except that the period for delivery of this
Note or notification to the Paying Agent shall be at least 25 but not more that
35 days prior to the Maturity Date in effect immediately preceding the mailing
of the applicable Extension Notice and except that if the holder hereof has
tendered this Note for repayment pursuant to this paragraph he may, by written
notice to the Paying Agent, revoke any such tender for repayment until 3:00
P.M., New York City time, on the twentieth calendar day prior to the Maturity
Date then in effect (or, if such day is not a Business Day, until 3:00 P.M., New
York City time, on the immediately succeeding Business Day).
This Note will bear interest at the rate determined in accordance with
the applicable provisions below by reference to the Base Rate shown on the face
hereof based on the Index Maturity, if any, shown on the face hereof (i) plus or
minus the Spread, if any, and/or (ii) multiplied by the Spread Multiplier, if
any, specified on the face hereof. Commencing with the Initial Interest Reset
Date specified on the face hereof, the rate at which interest on this Note is
payable shall be reset as of each Interest Reset Date (as used herein, the term
"Interest Reset Date" shall include the Initial Interest Reset Date). The
Interest Reset Dates will be the Interest Reset Dates specified on the face
hereof; provided, however, that (i) the interest rate in effect for the period
-------- -------
from the Interest Accrual Date to the Initial Interest Reset Date will be the
Initial Interest Rate and (ii) the interest rate in effect hereon for the ten
calendar days immediately prior to maturity hereof (or, with respect to any
principal amount to be redeemed or repaid, any redemption or repayment date)
shall be that in effect on the tenth calendar day preceding maturity hereof or
such date of redemption or repayment, as the case may be. If any Interest Reset
Date would otherwise be a day that is not a Business Day, such Interest Reset
Date shall be postponed to the next succeeding day that is a Business Day,
except that if the Base Rate specified on the face hereof is LIBOR and such
Business Day is in the next succeeding calendar month, such Interest Reset Date
shall be the immediately preceding Business Day. As used herein, "Business Day"
means (1) any day, other than a Saturday or Sunday, and that is neither a legal
holiday nor a day on which banking institutions are authorized or required by
law or regulation to close in The City of New York, New York, or San Francisco,
California, and (2)(i) with respect to LIBOR Notes (as defined below), is also a
London Banking Day, (ii) with respect to Notes denominated in a Specified
Currency other than U.S. dollars, Australian dollars, or ECUs, in
8
<PAGE>
the principal financial center of the country of the Specified Currency, (iii)
with respect to Notes denominated in Australian dollars, in Sydney, and (iv)
with respect to Notes denominated in ECUs, in Luxembourg and that is not a non-
ECU clearing day, as determined by the ECU Banking Association in Paris.
The Interest Reset Date will be, in the case of Notes which reset
daily, each Business Day; in the case of Notes (other than Notes whose Base Rate
is the Treasury Rate) which reset weekly, the Wednesday of each week; in the
case of Notes whose Base Rate is the Treasury Rate which reset weekly, the
Tuesday of each week, except as provided below; in the case of Notes which reset
monthly, the third Wednesday of each month; in the case of Notes which reset
quarterly, the third Wednesday of March, June, September and December; in the
case of Notes which reset semiannually, the third Wednesday of two months of
each year, as specified on the face hereof; and in the case of Notes which reset
annually, the third Wednesday of one month of each year, as specified on the
face hereof.
In the case where the Interest Payment Date or the Maturity Date (or
any redemption or repayment date) does not fall on a Business Day, payment of
interest, premium, if any, or principal otherwise payable on such date need not
be made on such date, but will be made on the next succeeding Business Day with
the same force and effect as if made on the Interest Payment Date or on the
Maturity Date (or any redemption or repayment date), and no interest on such
payment shall accrue for the period from and after the Interest Payment Date or
the Maturity Date (or any redemption or repayment date) to such next succeeding
Business Day.
The Interest Determination Date pertaining to an Interest Reset Date
for Notes bearing interest calculated by reference to the CD Rate, Commercial
Paper Rate, Federal Funds Rate, CMT Rate and Prime Rate will be the second
Business Day next preceding such Interest Reset Date. The Interest
Determination Date pertaining to an Interest Reset Date for Notes bearing
interest calculated by reference to LIBOR shall be the second London Banking Day
preceding such Interest Reset Date. As used herein, "London Banking Day" means
any day on which dealings in deposits in the Index Currency are transacted in
the London interbank market. The Interest Determination Date pertaining to an
Interest Reset Date for Notes bearing interest calculated by reference to the
Treasury Rate shall be the day of the week in which such Interest Reset Date
falls on which Treasury bills normally would be auctioned; provided, however,
-------- -------
that if, as a result of a legal holiday, an auction is held on the Friday of the
week preceding such Interest Reset Date, the related Interest Determination Date
shall be such preceding Friday; and provided, further, that if an auction shall
-------- -------
fall on any Interest Reset Date, then the Interest Reset Date shall instead be
the first Business Day following the date of such auction.
The "Calculation Date" pertaining to any Interest Determination Date
will be the earlier of (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 preceding the applicable Interest Payment
Date or Maturity Date or date of redemption or payment, as the case may be.
Determination of CD Rate. If the Base Rate specified on the face
------------------------
hereof is the CD Rate, the CD Rate with respect to this Note shall be determined
on each Interest Determination Date
9
<PAGE>
and shall be the rate on such date for negotiable certificates of deposit having
the Index Maturity specified on the face hereof as published by the Board of
Governors of the Federal Reserve System in "Statistical Release H.15(519),
Selected Interest Rates," or any successor publication of the Board of Governors
of the Federal Reserve System ("H.15(519)"), under the heading "CDs (Secondary
Market)," or, if not so published by 9:00 A.M., New York City time, on the
Calculation Date pertaining to such Interest Determination Date, the CD Rate
will be the rate on such Interest Determination Date for negotiable certificates
of deposit of the Index Maturity specified on the face hereof as published by
the Federal Reserve Bank of New York City in its daily statistical release
"Composite 3:30 P.M. Quotations for U.S. Government Securities" ("Composite
Quotations") under the heading "Certificates of Deposit." If neither of such
rates is published by 3:00 P.M., New York City time, on such Calculation Date,
then the CD Rate on such Interest Determination Date will be calculated by the
Calculation Agent referred to on the face hereof and will be the arithmetic mean
of the secondary market offered rates as of 10:00 A.M., New York City time, on
such Interest Determination Date for certificates of deposit in the denomination
of U.S. $5,000,000 with a remaining maturity closest to the Index Maturity
specified on the face hereof of three leading nonbank dealers in negotiable U.S.
dollar certificates of deposit in The City of New York selected by the
Calculation Agent for negotiable certificates of deposit of major United States
money center banks; provided, however, that if the dealers selected as aforesaid
-------- -------
by the Calculation Agent are not quoting as mentioned in this sentence, the rate
of interest in effect for the applicable period will be the same as the CD Rate
for the immediately preceding Interest Reset Period (or, if there was no such
Interest Reset Period, the rate of interest payable hereon shall be the Initial
Interest Rate).
Determination of Commercial Paper Rate. If the Base Rate specified on
--------------------------------------
the face hereof is the Commercial Paper Rate, the Commercial Paper Rate with
respect to this Note shall be determined on each Interest Determination Date and
shall be the Money Market Yield (as defined herein) of the rate on such date for
commercial paper having the Index Maturity specified on the face hereof, as such
rate shall be published in H.15(519) under the heading "Commercial Paper -
Nonfinancial," or if not so published prior to 9:00 A.M., New York City time, on
the Calculation Date pertaining to such Interest Determination Date, the
Commercial Paper Rate shall be the Money Market Yield of the rate on such
Interest Determination Date for commercial paper of the Index Maturity specified
on the face hereof as published in Composite Quotations under the heading
"Commercial Paper." If neither of such rates is published by 3:00 P.M., New
York City time, on such Calculation Date, then the Commercial Paper Rate shall
be the Money Market Yield of the arithmetic mean of the offered rates as of
11:00 A.M., New York City time, on such Interest Determination Date of three
leading dealers in commercial paper in The City of New York selected by the
Calculation Agent for commercial paper of the Index Maturity specified on the
face hereof, placed for an industrial issuer whose bond rating is "AA," or the
equivalent, from a nationally recognized rating agency; provided, however,
--------- -------
that if the dealers selected as aforesaid by the Calculation Agent are not
quoting as mentioned in this sentence, the rate of interest in effect for the
applicable period will be the same as the Commercial Paper Rate for the
immediately preceding Interest Reset Period, (or, if there was no such Interest
Reset Period, the rate of interest payable hereon shall be the Initial Interest
Rate).
"Money Market Yield" shall be the yield calculated in accordance with
the following formula:
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<PAGE>
Money Market Yield = D x 360
------------- x 100
360 - (D x M)
where "D" refers to the applicable per annum rate for commercial paper quoted on
a bank discount basis and expressed as a decimal and "M" refers to the actual
number of days in the Index Maturity specified on the face hereof.
Determination of Federal Funds Rate. If the Base Rate specified on
-----------------------------------
the face hereof is the Federal Funds Rate, the Federal Funds Rate with respect
to this Note shall be determined on each Interest Determination Date and shall
be the rate on such date for Federal Funds as published in H.15(519) under the
heading "Federal Funds (Effective)," or, if not so published by 9:00 A.M., New
York City time, on the Calculation Date pertaining to such Interest
Determination Date, the Federal Funds Rate will be the rate on such Interest
Determination Date as published in Composite Quotations under the heading
"Federal Funds/Effective Rate." If neither of such rates is published by 3:00
P.M., New York City time, on such Calculation Date, the Federal Funds Rate for
such Interest Determination Date will be calculated by the Calculation Agent and
will be the arithmetic mean of the rates for the last transaction in overnight
Federal funds as of 9:00 A.M., New York City time, on such Interest
Determination Date arranged by three leading brokers in Federal funds
transactions in The City of New York selected by the Calculation Agent;
provided, however, that if the brokers selected as aforesaid by the Calculation
- -------- -------
Agent are not quoting as mentioned in this sentence, the rate of interest in
effect for the applicable period will be the same as the Federal Funds Rate for
the immediately preceding Interest Reset Period (or, if there was no such
Interest Reset Period, the rate of interest payable hereon shall be the Initial
Interest Rate).
Determination of LIBOR. If the Base Rate specified on the face hereof
----------------------
is LIBOR, LIBOR with respect to this Note shall be determined on each Interest
Determination Date as follows:
(i) As of the Interest Determination Date, LIBOR shall be either (a)
if "LIBOR Reuters" is specified on the face hereof, the arithmetic
mean of the offered rates (unless the specified Designated LIBOR Page
(as defined below) by its terms provides only for a single rate, in
which case such single rate shall be used) for deposits in the Index
Currency having the Index Maturity designated on the face hereof,
commencing on such Interest Determination Date, that appear on the
Designated LIBOR Page as of 11:00 A.M., London time, on that 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, or (b) if "LIBOR Telerate" is specified on the face hereof, the
rate for deposits in the Index Currency having the Index Maturity
designated on the face hereof, commencing on such Interest
Determination Date, that appears on the Designated LIBOR Page as of
11:00 A.M., London time, on that Interest Determination Date. If fewer
than two offered rates appear, or no rate appears, as applicable,
LIBOR in respect of the related Interest Determination Date shall be
determined as if the parties had specified the rate described in
clause (ii) below.
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<PAGE>
(ii) With respect to an Interest Determination Date on which fewer
than two offered rates appear (unless, as aforesaid, only a single
rate is required), or no rate appears, as the case may be, on the
applicable Designated LIBOR Page as specified in clause (i) above, the
Calculation Agent will request the principal London offices of each of
four major reference banks in the London interbank market, as selected
by the Calculation Agent, to provide the Calculation Agent with its
offered quotation for deposits in the Index Currency for the period of
the Index Maturity designated on the face hereof, commencing on the
second London Banking Day immediately following such Interest
Determination Date, to prime banks in the London interbank market at
approximately 11:00 A.M., London time, on such Interest Determination
Date and in a principal amount of not less than $1,000,000 (or the
equivalent in the Index Currency, if the Index Currency is not the
U.S. dollar) that is representative for a single transaction in such
Index Currency in such market at such time. If at least two such
quotations are provided, LIBOR determined on such Interest
Determination Date will be the arithmetic mean of such quotations. If
fewer than two quotations are provided, LIBOR determined on such
Interest Determination Date will be the arithmetic mean of the rates
quoted at approximately 11:00 A.M. (or such other time specified on
the face hereof), in the applicable principal financial center for the
country of the Index Currency on such Interest Determination Date, by
three major banks in such principal financial center selected by the
Calculation Agent for loans in the Index Currency to leading European
banks, having the Index Maturity designated on the face hereof and in
a principal amount of not less than $1,000,000 commencing on the
second London Banking Day immediately following such Interest
Determination Date (or the equivalent in the Index Currency, if the
Index Currency is not the U.S. dollar) that is representative for a
single transaction in such Index Currency 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 for such
Interest Reset Period will be the same as LIBOR for the immediately
preceding Interest Reset Period (or, if there was no such Interest
Reset Period, the rate of interest payable hereon shall be the Initial
Interest Rate).
"Index Currency" means the currency (including composite currencies)
specified on the face hereof as the currency for which LIBOR shall be
calculated. If no such currency is specified on the face hereof, the Index
Currency shall be U.S. dollars.
"Designated LIBOR Page" means either (a) if "LIBOR Reuters" is
designated on the face hereof, the display on the Reuters Monitor Money Rates
Service for the purpose of displaying the London interbank rates of major banks
for the applicable Index Currency, or (b) if "LIBOR Telerate" is designated on
the face hereof, the display on the Dow Jones Telerate Service for the purpose
of displaying the London interbank rates of major banks for the applicable Index
Currency. If neither LIBOR Reuters nor LIBOR Telerate is specified on the face
hereof, LIBOR for the applicable Index Currency will be determined as if LIBOR
Telerate (and, if the U.S. dollar is the Index Currency, Page 3750) had been
specified.
12
<PAGE>
Determination of Prime Rate. If the Base Rate specified on the face
---------------------------
hereof is the Prime Rate, the Prime Rate with respect to this Note shall be
determined on each Interest Determination Date and shall be the rate set forth
in H.15(519) for such date opposite the caption "Bank Prime Loan." If such rate
is not yet published by 9:00 A.M., New York City time, on the Calculation Date
pertaining to such Interest Determination Date, the Prime Rate for such Interest
Determination Date will be the arithmetic mean of the rates of interest publicly
announced by each bank named on the Reuters Screen U.S. Prime 1 Page (as defined
below) as such bank's prime rate or base lending rate as in effect for such
Interest Determination Date as quoted on the Reuters Screen U.S. Prime 1 Page on
such Interest Determination Date, or, if fewer than four such rates appear on
the Reuters Screen U.S. Prime 1 Page for such Interest Determination Date, the
rate shall be the arithmetic mean of the prime rates quoted on the basis of the
actual number of days in the year divided by 360 as of the close of business on
such Interest Determination Date by at least two of the three major money center
banks in The City of New York selected by the Calculation Agent from which
quotations are requested. If fewer than two quotations are provided, the Prime
Rate shall be calculated by the Calculation Agent and shall be determined as the
arithmetic mean on the basis of the prime rates in The City of New York by the
appropriate number of substitute banks or trust companies organized and doing
business under the laws of the United States, or any State thereof, in each case
having total equity capital of at least U.S. $500 million and being subject to
supervision or examination by federal or state authority, selected by the
Calculation Agent to quote such rate or rates; provided, however, that if the
-------- -------
banks or trust companies selected as aforesaid by the Calculation Agent are not
quoting as mentioned in this sentence, the Prime Rate in effect for such
Interest Reset Date will be the same as the Prime Rate for the immediately
preceding Interest Reset Period (or, if there was no such Interest Reset Period,
the rate of interest payable hereon shall be the Initial Interest Rate).
"Reuters Screen U.S. Prime 1 Page" 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. If the Base Rate specified on the
------------------------------
face hereof is the Treasury Rate, the Treasury Rate with respect to this Note
shall be determined on each Interest Determination Date and shall be the rate
for the auction held on such date of direct obligations of the United States
("Treasury Bills") having the Index Maturity specified on the face hereof, as
published in H.15(519) under the heading "Treasury Bills -- auction average
(investment)," or if not so published by 9:00 A.M., New York City time, on the
Calculation Date pertaining to such Interest Determination Date, the auction
average rate on such Interest Determination Date (expressed as a bond
equivalent, on the basis of a year of 365 or 366 days, as applicable, and
applied on a daily basis) as otherwise announced by the United States Department
of the Treasury. In the event that the results of the auction of Treasury Bills
having the Index Maturity specified on the face hereof are not published or
reported as provided above by 3:00 P.M., New York City time, on such Calculation
Date or if no such auction is held on such Interest Determination Date, then the
Treasury Rate shall be calculated by the Calculation Agent and shall be a yield
to maturity (expressed as a bond equivalent, on the basis of a year of 365 or
366 days, as applicable, and applied on a daily basis) calculated using the
arithmetic mean of the secondary market bid rates, as of approximately 3:30
P.M., New York City time, on such Interest Determination Date, of three leading
primary United States government securities dealers selected by the Calculation
Agent for the issue of Treasury Bills
13
<PAGE>
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 bid rates as mentioned in this sentence, the
Treasury Rate for such Interest Reset Date will be the same as the Treasury Rate
for the immediately preceding Interest Reset Period (or, if there was no such
Interest Reset Period, the rate of interest payable hereon shall be the Initial
Interest Rate).
Determination of CMT Rate. If the Base Rate specified on the face
-------------------------
hereof is the CMT Rate, the CMT Rate with respect to this Note shall be
determined on each Interest Determination Date and shall be the rate on such
date displayed for the Index Maturity specified on the face hereof on the
Designated CMT Telerate Page (as defined below) 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 (as defined
below) for (i) if the Designated CMT Telerate Page is 7055, the rate on such
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 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
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 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 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 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 closing
offer side prices as of approximately 3:30 p.m., New York City time on the
Interest Determination Date reported, according to their written records, by
three leading primary United States government securities dealers (each, a
"Reference Dealer") in The City of New York (which may include the Agents or
their affiliates) selected by the Calculation Agent (from five such Reference
Dealers selected by the Calculation Agent, after consultation with the Company,
and 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 noncallable fixed rate obligations
of the United States ("Treasury notes") with an original maturity of
approximately the Designated CMT Maturity Index and 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 notes quotations, the CMT
Rate for such 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 offer side prices as of approximately 3:30 p.m., New York City
time, on the Interest Determination Date of three Reference Dealers in The City
of New York (from five such Reference Dealers selected by the Calculation Agent
and 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 Treasury notes with an original maturity of the number of
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<PAGE>
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
Reference 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 the lowest of such quotes will be eliminated; provided however, that
if fewer than three Reference Dealers selected by the Calculation Agent are
quoting as described herein, the CMT Rate for such Interest Reset Date will be
the same as the CMT Rate for the immediately preceding Interest Reset Period
(or, if there was no such Interest Reset Period, the rate of interest payable on
the CMT Rate Notes for which the CMT Rate is being determined shall be the
Initial Interest Rate). If two Treasury notes with an original maturity as
described in the second preceding sentence have remaining terms to maturity
equally close to the Designated CMT Maturity Index, the quotes for the Treasury
note with the shorter remaining term to maturity will be used.
"Designated CMT Telerate Page" means the display on the Dow Jones Telerate
Service on the page designated in an applicable Pricing Supplement (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)), for the purpose of
displaying Treasury Constant Maturities as reported in H.15(519). If no such
page is specified in the applicable Pricing Supplement, the Designated CMT
Telerate Page shall be 7052, for the most recent week.
"Designated CMT Maturity Index" shall be the original period to maturity of
the U.S. Treasury securities (either 1, 2, 3, 5, 7, 10, 20 or 30 years)
specified in an applicable Pricing Supplement with respect to which the CMT Rate
will be calculated. If no such maturity is specified in the applicable Pricing
Supplement, the Designated CMT Maturity Index shall be two years.
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 California law, as the same may be
modified by United States Federal law of general application.
At the request of the holder hereof, the Calculation Agent will
provide to the holder hereof the interest rate hereon then in effect and, if
determined, the interest rate that will become effective as of the next Interest
Reset Date.
Interest payments on this Note will include interest accrued to but
excluding the Interest Payment Dates or at maturity (or on any earlier
redemption or repayment date), as the case may be; provided, however, that if
-------- -------
the Interest Reset Period with respect to this Note is daily or weekly, interest
payable on any Interest Payment Date, other than interest payable on any date on
which principal hereof is payable, will include interest accrued from and
including the Original Issue Date or from but excluding the last Record Date to
which interest has been paid, as the case may be, to and including the Record
Date immediately preceding the applicable Interest Payment Date. Accrued
interest hereon shall be an amount calculated by multiplying the face amount
hereof by an accrued interest factor. Such accrued interest factor shall be
computed by adding the interest factor
15
<PAGE>
calculated for each day in the period for which interest is being paid. The
interest factor for each such date shall be computed by dividing the interest
rate applicable to such day by 360 if the Base Rate is the CD Rate, Commercial
Paper Rate, Federal Funds Rate, Prime Rate or LIBOR, as specified on the face
hereof, or by the actual number of days in the year if the Base Rate is the
Treasury Rate or the CMT Rate, as specified on the face hereof. All percentages
used in or resulting from any calculation of the rate of interest on this Note
will be rounded, if necessary, to the nearest one hundred-thousandth of a
percentage point, with five one-millionths of a percentage point rounded upward,
and all dollar amounts used in or resulting from such calculation on this Note
will be rounded to the nearest cent (with one-half cent rounded upward). The
interest rate in effect on any Interest Reset Date will be the applicable rate
as reset on such date. The interest rate applicable to any other day is the
interest rate from the immediately preceding Interest Reset Date (or, if none,
the Initial Interest Rate).
This Note and all the obligations of the Issuer hereunder are direct,
unsecured obligations of the Issuer and rank without preference or priority
among themselves and pari passu with all other existing and future unsecured and
---- -----
unsubordinated indebtedness of the Issuer, subject to certain statutory
exceptions in the event of liquidation upon insolvency.
This Note, and any Note or Notes issued upon transfer or exchange
hereof, is issuable only in fully registered form, without coupons, and, if
denominated in U.S. dollars, is issuable only in denominations of U.S. $1,000
and any integral multiple of U.S. $1,000 in excess thereof. If this Note is
denominated in a Specified Currency other than U.S. dollars, then, unless a
higher minimum denomination is required by applicable law, it is issuable only
in denominations of the equivalent of U.S. $1,000 (rounded to an integral
multiple of 1,000 units of such Specified Currency), or any amount in excess
thereof which is an integral multiple of 1,000 units of such Specified Currency,
as determined by reference to the noon dollar buying rate in New York City for
cable transfers of such Specified Currency as published by the Federal Reserve
Bank of New York (the "Market Exchange Rate") on the Business Day immediately
preceding the date of issuance; provided, however, that in the case of ECUs, the
-------- -------
Market Exchange Rate shall be the rate of exchange determined by the Commission
of the European Union (or any successor thereto) as published in the Official
Journal of the European Union, or any successor publication, on the Business Day
immediately preceding the date of issuance.
The Trustee has been appointed registrar for the Notes, and the
Trustee will maintain at its office in San Francisco, California, a register for
the registration and transfer of Notes. This Note may be transferred at the
aforesaid office of the Trustee or at the office of the Trustee in the City of
New York, New York, by surrendering this Note for cancellation, accompanied by a
written instrument of transfer in form satisfactory to the Trustee and duly
executed by the registered holder hereof in person or by the holder's attorney
duly authorized in writing, and thereupon the Trustee shall issue in the name of
the transferee or transferees, in exchange herefor, a new Note or Notes having
identical terms and provisions and having a like aggregate principal amount in
authorized denominations, subject to the terms and conditions set forth herein;
provided, however, that the Trustee will not be required (i) to register the
- -------- -------
transfer of or exchange any Note that has been called for redemption in whole or
in part, except the unredeemed portion of Notes being redeemed in part, (ii) to
register the transfer of or exchange any Note if the holder thereof has
exercised his right, if
16
<PAGE>
any, to require the Issuer to repurchase such Note in whole or in part, except
the portion of such Note not required to be repurchased, or (iii) to register
the transfer of or exchange Notes to the extent and during the period so
provided in the Indenture with respect to the redemption of Notes. Notes are
exchangeable at said office for other Notes of other authorized denominations of
equal aggregate principal amount having identical terms and provisions. All such
exchanges and transfers of Notes will be free of charge, but the Issuer may
require payment of a sum sufficient to cover any tax or other governmental
charge in connection therewith. All Notes surrendered for exchange shall be
accompanied by a written instrument of transfer in form satisfactory to the
Trustee and executed by the registered holder in person or by the holder's
attorney duly authorized in writing. The date of registration of any Note
delivered upon any exchange or transfer of Notes shall be determined by the
Issuer and shall be such that no gain or loss of interest results from such
exchange or transfer.
In case any Note shall at any time become mutilated, defaced or be
destroyed, lost or stolen and such Note or evidence of the loss, theft or
destruction thereof (together with the indemnity hereinafter referred to and
such other documents or proof as may be required in the premises) shall be
delivered to the Trustee, a new Note of like tenor will be issued by the Issuer
in exchange for the Note so mutilated or defaced, or in lieu of the Note so
destroyed or lost or stolen, but, in the case of any destroyed or lost or stolen
Note, only upon receipt of evidence satisfactory to the Trustee and the Issuer
that such Note was destroyed or lost or stolen and, if required, upon receipt
also of indemnity satisfactory to each of them. All expenses and reasonable
charges associated with procuring such indemnity and with the preparation,
authentication and delivery of a new Note shall be borne by the holder of the
Note mutilated, defaced, destroyed, lost or stolen.
The Indenture provides that if an Event of Default, as defined in the
Indenture, shall occur and be continuing with respect to any series of debt
securities issued under the Indenture, including the series of Series C Medium-
Term Notes of which this Note forms a part, the Trustee or the holders of not
less than 25% in aggregate principal amount of the debt securities then
outstanding of the series may, by a notice in writing to the Issuer (and to the
Trustee if given by such holders), declare the principal of, and the premium, if
any, on such series to be due and payable, together with interest accrued
thereon. Any Event of Default with respect to a particular series of debt
securities may be waived by the holders of a majority in aggregate principal
amount of the outstanding debt securities of the series affected, except in each
case a failure to pay the principal of, or premium, if any, or interest on, such
debt securities.
If the face hereof indicates that this Note is subject to "Modified
Payment upon Acceleration," then (i) if the principal hereof is declared to be
due and payable as described in the preceding paragraph, the amount of principal
due and payable with respect to this Note shall be limited to the aggregate
principal amount hereof multiplied by the sum of the Issue Price specified on
the face hereof (expressed as a percentage of the aggregate principal amount)
plus the original issue discount amortized from the Interest Accrual Date to the
date of declaration, which amortization shall be calculated using the "interest
method" (computed in accordance with generally accepted accounting principles in
effect on the date of declaration), (ii) for the purpose of any vote of
securityholders taken pursuant to the Indenture prior to the acceleration of
payment of this Note, the principal amount hereof shall equal the amount that
would be due and payable hereon, calculated as set forth in clause (i) above, if
this Note were declared to be due and payable on the date of any
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<PAGE>
such vote and (iii) for the purpose of any vote of securityholders taken
pursuant to the Indenture following the acceleration of payment of this Note,
the principal amount hereof shall equal the amount of principal due and payable
with respect to this Note, calculated as set forth in clause (i) above.
The Indenture contains provisions permitting the Issuer and the
Trustee, with the consent of the holders of not less than 66 2/3% in aggregate
principal amount of the debt securities at the time outstanding of all series
affected (or not less than 66 2/3% in aggregate principal amount of any series
affected in case one or more but not all of the series are affected) evidenced
as provided in the Indenture, to execute supplemental indentures adding any
provisions to or changing in any manner or eliminating any of the provisions of
the Indenture or of any supplemental indenture or modifying in any manner the
rights of the holders of the securities of each such series; provided, however,
-------- -------
that no such supplemental indenture shall, among other matters, (i) change the
fixed maturity of any debt security, or reduce the rate of or extend the time of
payment of any interest thereon, or reduce the principal amount thereof or any
premium thereon, or make the principal thereof or any interest or premium
thereon payable in any currency other than that hereinbefore provided, without
the consent of the holder of each debt security so affected, or (ii) reduce the
aforesaid percentage of debt securities, the holders of which are required to
consent to any such supplemental indenture, without the consent of the holder of
each debt security affected.
Except as set forth below, if the principal of, premium, if any, or
interest on, this Note is payable in a Specified Currency other than U.S.
dollars and such Specified Currency is not available to the Issuer for making
payments hereon due to the imposition of exchange controls or other
circumstances beyond the control of the Issuer or is no longer used by the
government of the country issuing such currency or for the settlement of
transactions by public institutions within the international banking community,
then the Issuer will be entitled to satisfy its obligations to the holder of
this Note by making such payments in U.S. dollars on the basis of the Market
Exchange Rate on the date of such payment or, if the Market Exchange Rate is not
available on such date, as of the most recent practicable date. Any payment made
under such circumstances in U.S. dollars where the required payment is in a
Specified Currency other than U.S. dollars will not constitute an Event of
Default.
If payment in respect of this Note is required to be made in ECUs and
ECUs are unavailable due to the imposition of exchange controls or other
circumstances beyond the Issuer's control or are no longer used in the European
Monetary System, then all payments in respect of this Note shall be made in U.S.
dollars until ECUs are again available or so used. The amount of each payment
in U.S. dollars shall be computed on the basis of the equivalent of the ECU in
U.S. dollars, determined as described below, as of the second Business Day prior
to the date on which such payment is due.
The equivalent of the ECU in U.S. dollars as of any date shall be
determined by the Issuer or Chase Trust Company of California as Exchange Rate
Agent on the following basis. The component currencies of the ECU for this
purpose (the "Components") shall be the currency amounts that were components of
the ECU as of the last date on which the ECU was used in the European Monetary
System. The equivalent of the ECU in U.S. dollars shall be calculated by
aggregating the
18
<PAGE>
U.S. dollar equivalents of the Components. The U.S. dollar equivalent of each of
the Components shall be determined by the Issuer or such agent on the basis of
the most recently available Market Exchange Rates for such Components.
If the official unit of any Component is altered by way of combination
or subdivision, the number of units of that currency as a Component shall be
combined or subdivided in the same proportion. If two or more Components are
consolidated into a single currency, the amounts of those currencies as
Components shall be replaced by an amount in such single currency equal to the
sum of the appropriate amounts of the consolidated component currencies
expressed in such single currency. If any Component is divided into two or more
currencies, the amount of the original component currency shall be replaced by
the appropriate amounts of such two or more currencies, the sum of which shall
be equal to the amount of the original component currency.
All determinations referred to above made by the Issuer or its agent
shall be at its sole discretion and shall, in the absence of manifest error, be
conclusive to the extent permitted by law for all purposes and binding on the
holder of this Note.
So long as this Note shall be outstanding, the Issuer will cause to be
maintained an office or agency for the payment of the principal of and premium,
if any, and interest on this Note as herein provided in The City of New York,
and an office or agency in said City for the registration, transfer and exchange
as aforesaid of the Notes and where notices and demands to or upon the Issuer in
respect of the Notes may be served. The Issuer may designate other agencies for
the payment of said principal, premium and interest at such place or places
(subject to applicable laws and regulations) as the Issuer may decide. So long
as there shall be such an agency, the Issuer shall keep the Trustee advised of
the names and locations of such agencies, if any are so designated.
With respect to moneys paid by the Issuer and held by the Trustee or
any Paying Agent for payment of the principal of or interest or premium, if any,
on any Notes that remain unclaimed at the end of two years after such principal,
interest or premium shall have become due and payable (whether at maturity or
upon call for redemption or otherwise), (i) the Trustee or such Paying Agent
shall notify the holders of such Notes that such moneys shall be repaid to the
Issuer and any person claiming such moneys shall thereafter look only to the
Issuer for payment thereof and (ii) such moneys shall be so repaid to the
Issuer. Upon such repayment all liability of the Trustee or such Paying Agent
with respect to such moneys shall thereupon cease, without, however, limiting in
any way any obligation that the Issuer may have to pay the principal of or
interest or premium if any, on this Note as the same shall become due.
No provision of this Note or of the Indenture shall alter or impair
the obligation of the Issuer, which is absolute and unconditional, to pay the
principal of, premium, if any, and interest on this Note at the time, place, and
rate, and in the coin or currency, herein prescribed unless otherwise agreed
between the Issuer and the registered holder of this Note; provided, however, if
-------- -------
the principal of, premium, if any, or interest on, this Note is payable in a
Specified Currency other than U.S. dollars and such Specified Currency is not
available to the Issuer for making payments hereon due to circumstances beyond
the control of the Issuer, as described above, then the Issuer will be
19
<PAGE>
entitled to satisfy its obligations to the holder of this Note by making such
payments in U.S. dollars as set forth above.
Prior to due presentment of this Note for registration of transfer,
the Issuer, the Trustee and any agent of the Issuer or the Trustee may treat the
holder in whose name this Note is registered as the owner hereof for all
purposes, whether or not this Note be overdue, and none of the Issuer, the
Trustee or any such agent shall be affected by notice to the contrary.
Upon any consolidation by the Issuer with or merger by the Issuer into
any other corporation or any conveyance, transfer or lease of the properties and
assets of the Issuer substantially as an entirety in accordance with the
Indenture, the successor corporation formed by such consolidation or into which
the Issuer is merged or to which such conveyance, transfer or lease is made
shall succeed to, and be substituted for, and may exercise every right and power
of, the Issuer under the Indenture with the same effect as if such successor
corporation had been named as the Issuer therein, and thereafter, except in the
case of a lease, the predecessor corporation shall be relieved of all
obligations and covenants under the Indenture and the Notes.
No recourse shall be had for the payment of the principal of, premium,
if any, or the interest on this Note, for any claim based hereon, or otherwise
in respect hereof, or based on or in respect of the Indenture or any
supplemental indenture thereto, against any incorporator, shareholder, officer
or director, as such, past, present or future, of the Issuer or of any successor
corporation, either directly or through the Issuer or any successor corporation,
whether by virtue of any constitution, statute or rule of law or by the
enforcement of any assessment or penalty or otherwise, all such liability being,
by the acceptance hereof and as part of the consideration for the issue hereof,
expressly waived and released.
THIS NOTE SHALL FOR ALL PURPOSES BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF CALIFORNIA.
All terms used in this Note which are defined in the Indenture and not
otherwise defined herein shall have the meanings assigned to them in the
Indenture.
20
<PAGE>
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of survivorship and not as
tenants in common
UNIF GIFT MIN ACT -____________________ Custodian ______________
(Cust) (Minor)
Under Uniform Gifts to Minors Act ______________________________________
State
Additional abbreviations may also be used though not in the above list.
_____________________
21
<PAGE>
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s)
unto
(PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE)
_______________________________________
_____________________________________________________________________________
_____________________________________________________________________________
(PLEASE PRINT OR TYPE NAME AND ADDRESS INCLUDING ZIP CODE, OF ASSIGNEE)
the within Note and all rights thereunder, hereby irrevocably constituting and
appointing such person attorney to transfer such note on the books of the
Issuer, with full power of substitution in the premises.
Dated: _____________________ ________________________________________________
NOTICE: The signature to this assignment must
correspond to the name as written upon the face of
this Note in every particular, without alteration
or any change whatsoever; signature(s) must be
guaranteed by an eligible guarantor institution
(banks, stock brokers, savings and loan
associations and credit unions with membership in
an approved signature guarantee medallion program)
pursuant to Securities and Exchange Commission
Rule 17Ad-15.
22
<PAGE>
OPTION TO ELECT REPAYMENT
The undersigned hereby irrevocably requests and instructs the Issuer
to repay the within Note (or portion thereof specified below) pursuant to its
terms at a price equal to the principal amount thereof, together with interest
to the Optional Repayment Date, to the undersigned at
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
(Please print or typewrite name,
address and telephone number of the undersigned,
and name of contact person, if any)
If less than the entire principal amount of the within Note is to be
repaid, specify the portion thereof which the holder elects to have repaid:
______________________________; and specify the denomination or denominations
(which shall not be less than the minimum authorized denomination) of the Notes
to be issued to the holder for the portions of the within Note not being repaid
(in the absence of any such specification, one such Note will be issued for the
portion not being repaid):_____________________________________________
Dated: _________________________ ____________________________________________
NOTICE: The signature to the foregoing Election must correspond to the
name as written upon the face of this Note in every particular, without
alteration or any change whatsoever; signature(s) must be guaranteed by an
eligible guarantor institution (banks, stock brokers, savings and loan
associations and credit unions with membership in an approved signature
guarantee medallion program) pursuant to Securities and Exchange Commission Rule
17Ad-15.
23
<PAGE>
EXHIBIT 4.3
(FORM OF FACE OF SECURITY)
MATTEL, INC.
SERIES C MEDIUM-TERM NOTE
Fixed Rate Note
REGISTERED REGISTERED
No. FXR- [PRINCIPAL AMOUNT]
CUSIP:
If the registered owner of this Security (as indicated below) is The
Depository Trust Company (the "Depository") or a nominee of the Depository, this
Security is a Global Security and the following two legends apply:
This Security is a Global Security within the meaning of the Indenture
hereinafter referred to and is registered in the name of the Depository or a
nominee of the Depository. This Security is exchangeable for Securities
registered in the name of a person other than the Depository or its nominee only
in the limited circumstances described in the Indenture, and may not be
transferred except as a whole by the Depository to a nominee of the Depository,
by a nominee of the Depository to the Depository or another nominee of the
Depository or by the Depository or any such nominee to a successor of the
Depository or a nominee of such successor.
Unless this certificate is presented by an authorized representative
of The Depository Trust Company (55 Water Street, New York, New York) to the
Issuer (as defined below) or its agent for registration of transfer, exchange or
payment, and any certificate issued is registered in the name of Cede & Co. or
such other name as requested by an authorized representative of The Depository
Trust Company and any payment is made to Cede & Co., ANY TRANSFER, PLEDGE OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL since
the registered owner hereof, Cede & Co., has an interest herein.
IF APPLICABLE, THE "TOTAL AMOUNT OF OID," "ORIGINAL YIELD TO MATURITY" AND
"INITIAL ACCRUAL PERIOD OID" (COMPUTED UNDER THE APPROXIMATE METHOD) SET FORTH
BELOW HAVE BEEN COMPLETED SOLELY FOR THE PURPOSES OF APPLYING THE FEDERAL INCOME
TAX ORIGINAL ISSUE DISCOUNT ("OID") RULES.
ORIGINAL INITIAL INTEREST RATE: ORIGINAL
ISSUE DATE: REDEMPTION MATURITY DATE:
PERCENTAGE:
<PAGE>
INTEREST ANNUAL APPLICABILITY FINAL MATURITY
ACCRUAL DATE: REDEMPTION OF MODIFIED DATE:
PERCENTAGE PAYMENT UPON
REDUCTION: ACCELERATION:
TOTAL AMOUNT If yes, state OPTIONAL
OF OID: ISSUE PRICE: REPAYMENT
DATES:
ORIGINAL YIELD SPECIFIED APPLICABILITY
TO MATURITY: CURRENCY: OF ANNUAL
INTEREST
INITIAL ACCRUAL PAYMENTS:
REDEMPTION
DATE:
INITIAL RECORD DATES
REDEMPTION (IF OTHER THAN
DATE: MAY 1 AND
NOVEMBER 1):
OTHER TERMS:
Mattel, Inc., a Delaware corporation (together with its successors and
assigns, the "Issuer"), for value received, hereby promises to pay to
or registered assignees, the principal sum of ________________________________,
on the Original Maturity Date specified above (except to the extent redeemed or
repaid prior to the Original Maturity Date) or, if the maturity hereof is
extended in accordance with the procedures set forth below to an Extended
Maturity Date, as defined below, on such Extended Maturity Date (except to the
extent previously redeemed or repaid) and to pay interest thereon at the
Interest Rate per annum specified above or, if the interest rate herein is reset
or re-established in connection with an extension of maturity in accordance with
the procedures specified on the reverse hereof, at the interest rate per annum
determined pursuant to such procedures, from the Interest Accrual Date specified
above until the principal hereof is paid or duly made available for payment
(except as provided below), semiannually (unless otherwise specified on the face
hereof) in arrears on the fifteenth day of May and November in each year (unless
otherwise specified on the face hereof) (each such date an "Interest Payment
Date") commencing on the Interest Payment Date next succeeding the Interest
Accrual Date specified above, and at maturity (or on any redemption or repayment
date); provided, however, that if the Interest Accrual Date occurs between a
Record Date, as defined below, and the next succeeding Interest Payment Date,
interest payments will commence on the second Interest Payment Date succeeding
the Interest Accrual Date to the registered holder of this Note on the Record
Date with respect to such second Interest Payment Date; and provided, further,
that if this Note is subject to "Annual Interest Payments," interest payments
shall be made
2
<PAGE>
annually in arrears and the term "Interest Payment Date" shall be deemed to mean
the fifteenth day of November in each year.
Interest on this Note will accrue from the most recent Interest
Payment Date to which interest has been paid or duly provided for, or, if no
interest has been paid or duly provided for, from the Interest Accrual Date,
until the principal hereof has been paid or duly made available for payment
(except as provided below). The interest so payable, and punctually paid or
duly provided for, on any Interest Payment Date will, subject to certain
exceptions described herein, be paid to the person in whose name this Note (or
one or more predecessor Notes) is registered at the close of business on the
date 15 calendar days prior to such Interest Payment Date, whether or not a
Business Day, unless otherwise provided on the face hereof (each such date a
"Record Date"); provided, however, that interest payable at maturity (or on any
-------- -------
redemption or repayment date) will be payable to the person to whom the
principal hereof shall be payable. As used herein, "Business Day" means (1) any
day, other than a Saturday or Sunday, that is neither a legal holiday nor a day
on which banking institutions are authorized or required by law or regulation to
close in The City of New York, New York, or San Francisco, California, and
(2)(i) with respect to Notes denominated in a Specified Currency other than U.S.
dollars, Australian dollars, or ECUs, in the principal financial center of the
country of the Specified Currency, (ii) with respect to Notes denominated in
Australian dollars, in Sydney, and (iii) with respect to Notes denominated in
ECUs, in Luxembourg and that is not a non-ECU clearing day, as determined by the
ECU Banking Association in Paris.
Payment of the principal of this Note, any premium and the interest
due at maturity (or on any redemption or repayment date) will be made in
immediately available funds upon surrender of this Note at the principal
corporate trust office of the Trustee or at the office or agency of the Trustee
maintained for that purpose in The City of New York, New York, or at such other
paying agency as the Issuer may determine. Payment of the principal of and
premium, if any, and interest on this Note will be made in the Specified
Currency indicated above; provided, however, that U.S. dollar payments of
-------- -------
interest, other than interest due at maturity or on any date of redemption or
repayment, will be made by U.S. dollar check mailed to the address of the person
entitled thereto as such address shall appear in the Note register. A holder of
U.S. $10,000,000 or more in aggregate principal amount of Notes having the same
Interest Payment Date will be entitled to receive payments of interest, other
than interest due at maturity or on any date of redemption or repayment, by wire
transfer of immediately available funds if appropriate wire transfer
instructions have been received by the Paying Agent in writing not less than 15
calendar days prior to the applicable Interest Payment Date. If this Note is
denominated in a Specified Currency other than U.S. dollars, payments of
interest hereon will be made by wire transfer of immediately available funds to
an account maintained by the holder hereof with a bank located outside the
United States if appropriate wire transfer instructions have been received by
the Paying Agent in writing not less than 15 calendar days prior to the
applicable Interest Payment Date. If such wire transfer instructions are not so
received, such interest payments will be made by check payable in such Specified
Currency mailed to the address of the person entitled thereto as such address
shall appear in the Note register.
Reference is hereby made to the further provisions of this Note set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
3
<PAGE>
Unless the certificate of authentication hereon has been executed by
the Trustee referred to on the reverse hereof by manual signature, this Note
shall not be entitled to any benefit under the Indenture, as defined on the
reverse hereof, or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Issuer has caused this Note to be duly
executed under its corporate seal.
DATED: MATTEL, INC.
By_____________________________
Name:
Title:
TRUSTEE'S CERTIFICATE
OF AUTHENTICATION
This is one of the Notes referred to
in the within-mentioned Indenture.
CHASE TRUST COMPANY OF CALIFORNIA,
as Trustee
By_______________________________
Authorized Officer
4
<PAGE>
(FORM OF REVERSE OF SECURITY)
This Note is one of a duly authorized issue of Series C Medium-Term
Notes having maturities of more than nine months from the date of issue (the
"Notes") of the Issuer. The Notes are issuable under an indenture dated as of
February 15, 1996, duly executed and delivered by the Issuer to Chase Trust
Company of California (formerly Chemical Trust Company of California), Trustee
(herein called the "Trustee"), to which indenture and all indentures
supplemental thereto (herein called the "Indenture") reference is hereby made
for a statement of the respective rights, limitations of rights and immunities
of the Issuer, the Trustee and holders of the Notes and the terms upon which the
Notes are, and are to be, authenticated and delivered. The Issuer has appointed
Chase Trust Company of California as the paying agent (the "Paying Agent," which
term includes any additional or successor Paying Agent appointed by the Issuer)
with respect to the Notes. The terms of individual Notes may vary with respect
to interest rates, interest rate formulas, issue dates, maturity dates, or
otherwise, all as provided in the Indenture. To the extent not inconsistent
herewith, the terms of the Indenture are hereby incorporated by reference
herein.
This Note will not be subject to any sinking fund and, unless
otherwise provided on the face hereof in accordance with the provisions of the
following two paragraphs, will not be redeemable or subject to repayment at the
option of the holder prior to maturity.
If so indicated on the face of this Note, this Note may be redeemed in
whole or in part at the option of the Issuer on or after the Initial Redemption
Date specified on the face hereof on the terms set forth on the face hereof and
at a redemption price (expressed as a percentage of the principal amount hereof)
equal to the Initial Redemption Percentage, together with interest accrued and
unpaid hereon to the date of redemption. If this Note is subject to "Annual
Redemption Percentage Reduction," the Initial Redemption Percentage indicated on
the face hereof will be reduced on each anniversary of the Initial Redemption
Date by the Annual Redemption Percentage Reduction specified on the face hereof
until the redemption price of this Note is 100% of the principal amount hereof,
together with interest accrued and unpaid hereon to the date of redemption.
Notice of redemption shall be mailed by first class mail, postage prepaid, to
the registered holders of the Notes designated for redemption at their addresses
as the same shall appear on the Note register not less than 30 nor more than 60
days prior to the date fixed for redemption, subject to all the conditions and
provisions of the Indenture. In the event of redemption of this Note in part
only, a new Note or Notes for the amount of the unredeemed portion hereof shall
be issued in the name of the holder hereof upon the cancellation hereof, but, in
any event, the principal amount of the Note remaining outstanding after
redemption must be an Authorized Denomination.
If so indicated on the face of this Note, this Note will be subject to
repayment at the option of the holder on the Optional Repayment Date or Dates
specified on the face hereof on the terms set forth herein. On any Optional
Repayment Date, this Note will be repayable in whole or in part in increments of
$1,000 or, if this Note is denominated in a Specified Currency other than U.S.
dollars, in increments of 1,000 units of such Specified Currency (provided that
any remaining principal amount hereof shall not be less than the minimum
Authorized Denomination hereof) at the option of the holder hereof at a price
equal to 100% of the principal amount to be repaid, together with interest
accrued and unpaid hereon to the date of repayment. For this Note to be repaid
at the
5
<PAGE>
option of the holder hereof, the Paying Agent must receive at its principal
corporate trust office in San Francisco, California, or at its office in The
City of New York, New York, at least 30 days but not more than 60 days prior to
the date of repayment, (i) this Note with the form entitled "Option to Elect
Repayment" below 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 a trust
company in the United States setting forth the name of the holder of this Note,
the principal amount hereof, the principal amount hereof to be repaid, the
certificate number of this Note or a description of this Note's tenor and terms,
a statement that the option to elect repayment is being exercised thereby and a
guarantee that this Note, together with the form entitled "Option to Elect
Repayment" duly completed, will be received by the Paying Agent not later than
the third 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 this Note and such form duly
completed are received by the Paying Agent by such third Business Day. Effective
exercise of such repayment option by the holder hereof shall be irrevocable. In
the event of repayment of this Note in part only, a new Note or Notes for the
amount of the unpaid portion hereof shall be issued in the name of the holder
hereof upon the cancellation hereof, but, in any event, the principal amount of
the Note remaining outstanding after repayment must be an Authorized
Denomination.
If so indicated on the face of this Note, the Issuer has the option to
extend the Original Maturity Date hereof for one or more periods of one or more
whole years (each an "Extension Period") up to but not beyond the Final Maturity
Date specified on the face hereof and in connection therewith to establish a new
interest rate and new redemption provisions for the Extension Period.
The Issuer may exercise such option by notifying the Paying Agent of
such exercise at least 45 but not more than 60 days prior to the Original
Maturity Date or, if the maturity hereof has already been extended, prior to the
maturity date then in effect (an "Extended Maturity Date"), such notice to be
accompanied by the form of the Extension Notice referred to below. No later
than 38 days prior to the Original Maturity Date or an Extended Maturity Date,
as the case may be (each, a "Maturity Date"), the Paying Agent will mail to the
holder hereof a notice (the "Extension Notice") relating to such Extension
Period, by first class mail, postage prepaid, setting forth (a) the election of
the Issuer to extend the maturity of this Note; (b) the new Extended Maturity
Date; (c) the interest rate applicable to the Extension Period; and (d) 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 Paying Agent of an Extension Notice to the holder of this Note,
the maturity hereof shall be extended automatically, and, except as modified by
the Extension Notice and as described in the next paragraph, this Note will have
the same terms it had prior to the mailing of such Extension Notice.
Notwithstanding the foregoing, not later than 10:00 A.M., New York
City time, on the twentieth calendar day prior to the Maturity Date in effect
immediately preceding the mailing of the applicable Extension Notice (or if such
day is not a Business Day, not later than 10:00 A.M., New York City time, on the
immediately succeeding Business Day), the Issuer may, at its option, revoke the
interest rate provided for in such Extension Notice and establish a higher
interest rate for the Extension Period by causing the Paying Agent to send
notice of such higher interest rate within
6
<PAGE>
seven days of receipt of such notice to the holder of this Note by first class
mail, postage prepaid, or by such other means as shall be agreed between the
Issuer and the Paying Agent. Such notice shall be irrevocable. All Notes with
respect to which the Maturity Date is extended in accordance with an Extension
Notice will bear such higher interest rate for the Extension Period, whether or
not tendered for repayment.
If the Issuer elects to extend the maturity hereof, the holder of this
Note will have the option to require the Issuer to repay this Note on the
Maturity Date in effect immediately preceding the mailing of the applicable
Extension Notice at a price equal to the principal amount hereof plus any
accrued and unpaid interest to such date. In order for this Note to be so
repaid on such Maturity Date, the holder hereof must follow the procedures set
forth above for optional repayment, except that the period for delivery of this
Note or notification to the Paying Agent shall be at least 25 but not more than
35 days prior to the Maturity Date in effect immediately preceding the mailing
of the applicable Extension Notice and except that if the holder hereof has
tendered this Note for repayment pursuant to this paragraph he may, by written
notice to the Paying Agent, revoke any such tender for repayment until 3:00
P.M., New York City time, on the twentieth calendar day prior to the Maturity
Date then in effect (or, if such day is not a Business Day, until 3:00 P.M., New
York City time, on the immediately succeeding Business Day).
Interest payments on this Note will include interest accrued to but
excluding the Interest Payment Dates or the Maturity Date (or any earlier
redemption or repayment date), as the case may be. Unless otherwise specified
on the face hereof, interest payments for this Note will be computed and paid on
the basis of a 360-day year of twelve 30-day months.
In the case where the Interest Payment Date or the Maturity Date (or
any redemption or repayment date) does not fall on a Business Day, payment of
interest, premium, if any, or principal otherwise payable on such date need not
be made on such date, but will be made on the next succeeding Business Day with
the same force and effect as if made on the Interest Payment Date or on the
Maturity Date (or any redemption or repayment date), and no interest on such
payment shall accrue for the period from and after the Interest Payment Date or
the Maturity Date (or any redemption or repayment date) to such next succeeding
Business Day.
This Note and all the obligations of the Issuer hereunder are direct,
unsecured obligations of the Issuer and rank without preference or priority
among themselves and pari passu with all other existing and future unsecured and
---- -----
unsubordinated indebtedness of the Issuer, subject to certain statutory
exceptions in the event of liquidation upon insolvency.
This Note, and any Note or Notes issued upon transfer or exchange
hereof, is issuable only in fully registered form, without coupons, and, if
denominated in U.S. dollars, is issuable only in denominations of U.S. $1,000
and any integral multiple of U.S. $1,000 in excess thereof. If this Note is
denominated in a Specified Currency other than U.S. dollars, then, unless a
higher minimum denomination is required by applicable law, it is issuable only
in denominations of the equivalent of U.S. $1,000 (rounded to an integral
multiple of 1,000 units of such Specified Currency), or any amount in excess
thereof which is an integral multiple of 1,000 units of such Specified Currency,
as determined by reference to the noon dollar buying rate in New York City for
cable transfers of
7
<PAGE>
such Specified Currency published by the Federal Reserve Bank of New York (the
"Market Exchange Rate") on the Business Day immediately preceding the date of
issuance; provided, however, that in the case of ECUs, the Market Exchange Rate
-------- -------
shall be the rate of exchange determined by the Commission of the European Union
(or any successor thereto) as published in the Official Journal of the European
Union, or any successor publication, on the Business Day immediately preceding
the date of issuance.
The Trustee has been appointed registrar for the Notes, and the
Trustee will maintain at its office in San Francisco, California, a register for
the registration and transfer of Notes. This Note may be transferred at the
aforesaid office of the Trustee or at the office of the Trustee in The City of
New York, New York, by surrendering this Note for cancellation, accompanied by a
written instrument of transfer in form satisfactory to the Trustee and duly
executed by the registered holder hereof in person or by the holder's attorney
duly authorized in writing, and thereupon the Trustee shall issue in the name of
the transferee or transferees, in exchange herefor, a new Note or Notes having
identical terms and provisions and having a like aggregate principal amount in
authorized denominations, subject to the terms and conditions set forth herein;
provided, however, that the Trustee will not be required (i) to register the
- -------- -------
transfer of or exchange any Note that has been called for redemption in whole or
in part, except the unredeemed portion of Notes being redeemed in part, (ii) to
register the transfer of or exchange any Note if the holder thereof has
exercised his right, if any, to require the Issuer to repurchase such Note in
whole or in part, except the portion of such Note not required to be
repurchased, or (iii) to register the transfer of or exchange Notes to the
extent and during the period so provided in the Indenture with respect to the
redemption of Notes. Notes are exchangeable at said offices for other Notes of
other authorized denominations of equal aggregate principal amount having
identical terms and provisions. All such exchanges and transfers of Notes will
be free of charge, but the Issuer may require payment of a sum sufficient to
cover any tax or other governmental charge in connection therewith. All Notes
surrendered for exchange shall be accompanied by a written instrument of
transfer in form satisfactory to the Trustee and executed by the registered
holder in person or by the holder's attorney duly authorized in writing. The
date of registration of any Note delivered upon any exchange or transfer of
Notes shall be determined by the Issuer and shall be such that no gain or loss
of interest results from such exchange or transfer.
In case any Note shall at any time become mutilated, defaced or be
destroyed, lost or stolen and such Note or evidence of the loss, theft or
destruction thereof (together with the indemnity hereinafter referred to and
such other documents or proof as may be required in the premises) shall be
delivered to the Trustee, a new Note of like tenor will be issued by the Issuer
in exchange for the Note so mutilated or defaced, or in lieu of the Note so
destroyed or lost or stolen, but, in the case of any destroyed or lost or stolen
Note, only upon receipt of evidence satisfactory to the Trustee and the Issuer
that such Note was destroyed, lost or stolen and, if required, upon receipt also
of indemnity satisfactory to each of them. All expenses and reasonable charges
associated with procuring such indemnity and with the preparation,
authentication and delivery of a new Note shall be borne by the holder of the
Note mutilated, defaced, destroyed, lost or stolen.
The Indenture provides that if an Event of Default, as defined in the
Indenture, shall occur and be continuing with respect to any series of debt
securities issued under the Indenture including the series of Series C Medium-
Term Notes of which this Note forms a part, the Trustee
8
<PAGE>
or the holders of not less than 25% in aggregate principal amount of the debt
securities then outstanding of the series may, by a notice in writing to the
Issuer (and to the Trustee if given by such holders), declare the principal of,
and the premium, if any, on such series to be due and payable, together with
interest accrued thereon. Any Event of Default with respect to a particular
series of debt securities may be waived by the holders of a majority in
aggregate principal amount of the outstanding debt securities of the series
affected, except in each case a failure to pay the principal of, or premium, if
any, or interest on, such debt securities.
If the face hereof indicates that this Note is subject to "Modified
Payment upon Acceleration," then (i) if the principal hereof is declared to be
due and payable as described in the preceding paragraph, the amount of principal
due and payable with respect to this Note shall be limited to the aggregate
principal amount hereof multiplied by the sum of the Issue Price specified on
the face hereof (expressed as a percentage of the aggregate principal amount)
plus the original issue discount amortized from the Interest Accrual Date to the
date of declaration, which amortization shall be calculated using the "interest
method" (computed in accordance with generally accepted accounting principles in
effect on the date of declaration), (ii) for the purpose of any vote of
securityholders taken pursuant to the Indenture prior to the acceleration of
payment of this Note, the principal amount hereof shall equal the amount that
would be due and payable hereon, calculated as set forth in clause (i) above, if
this Note were declared to be due and payable on the date of any such vote and
(iii) for the purpose of any vote of securityholders taken pursuant to the
Indenture following the acceleration of payment of this Note, the principal
amount hereof shall equal the amount of principal due and payable with respect
to this Note, calculated as set forth in clause (i) above.
The Indenture contains provisions permitting the Issuer and the
Trustee, with the consent of the holders of not less than 66 2/3% in aggregate
principal amount of the debt securities at the time outstanding of all series to
be affected (or not less than 66 2/3% in aggregate principal amount of any
series affected in case one or more but not all of the series are affected)
evidenced as provided in the Indenture, to execute supplemental indentures
adding any provisions to or changing in any manner or eliminating any of the
provisions of the Indenture or of any supplemental indenture or modifying in any
manner the rights of the holders of the securities of each such series;
provided, however, that no such supplemental indenture shall, among other
- -------- -------
matters, (i) change the fixed maturity of any debt security, or reduce the rate
of or extend the time of payment of any interest thereon, or reduce the
principal amount thereof or any premium thereon, or make the principal thereof
or any interest or premium thereon payable in any currency other than that
hereinbefore provided, without the consent of the holder of each debt security
so affected, or (ii) reduce the aforesaid percentage of debt securities, the
holders of which are required to consent to any such supplemental indenture,
without the consent of the holder of each debt security affected.
Except as set forth below, if the principal of, premium, if any, or
interest on, this Note is payable in a Specified Currency other than U.S.
dollars and such Specified Currency is not available to the Issuer for making
payments hereon due to the imposition of exchange controls or other
circumstances beyond the control of the Issuer or is no longer used by the
government of the country issuing such currency or for the settlement of
transactions by public institutions within the international banking community,
then the Issuer will be entitled to satisfy its obligations to the
9
<PAGE>
holder of this Note by making such payments in U.S. dollars on the basis of the
Market Exchange Rate on the date of such payment or, if the Market Exchange Rate
is not available on such date, as of the most recent practicable date. Any
payment made under such circumstances in U.S. dollars where the required payment
is in a Specified Currency other than U.S. dollars will not constitute an Event
of Default.
If payment in respect of this Note is required to be made in ECUs and
ECUs are unavailable due to the imposition of exchange controls or other
circumstances beyond the Issuer's control or are no longer used in the European
Monetary System, then all payments in respect of this Note shall be made in U.S.
dollars until ECUs are again available or so used. The amount of each payment
in U.S. dollars shall be computed on the basis of the equivalent of the ECU in
U.S. dollars, determined as described below, as of the second Business Day prior
to the date on which such payment is due.
The equivalent of the ECU in U.S. dollars as of any date shall be
determined by the Issuer or Chase Trust Company of California as Exchange Rate
Agent on the following basis. The component currencies of the ECU for this
purpose (the "Components") shall be the currency amounts that were components of
the ECU as of the last date on which the ECU was used in the European Monetary
System. The equivalent of the ECU in U.S. dollars shall be calculated by
aggregating the U.S. dollar equivalents of the Components. The U.S. dollar
equivalent of each of the Components shall be determined by the Issuer or such
agent on the basis of the most recently available Market Exchange Rates for such
Components.
If the official unit of any Component is altered by way of combination
or subdivision, the number of units of that currency as a Component shall be
combined or subdivided in the same proportion. If two or more Components are
consolidated into a single currency, the amounts of those currencies as
Components shall be replaced by an amount in such single currency equal to the
sum of the appropriate amounts of the consolidated component currencies
expressed in such single currency. If any Component is divided into two or more
currencies, the amount of the original component currency shall be replaced by
the appropriate amounts of such two or more currencies, the sum of which shall
be equal to the amount of the original component currency.
All determinations referred to above made by the Issuer or its agent
shall be at its sole discretion and shall, in the absence of manifest error, be
conclusive to the extent permitted by law for all purposes and binding on the
holder of this Note.
So long as this Note shall be outstanding, the Issuer will cause to be
maintained an office or agency for the payment of the principal of and the
premium, if any, and interest on this Note as herein provided in The City of New
York, and an office or agency in said City for the registration, transfer and
exchange as aforesaid of the Notes and where notices and demands to or upon the
Issuer in respect of the Notes may be served. The Issuer may designate other
agencies for the payment of said principal, premium and interest at such place
or places (subject to applicable laws and regulations) as the Issuer may decide.
So long as there shall be such an agency, the Issuer shall keep the Trustee
advised of the names and locations of such agencies, if any are so designated.
10
<PAGE>
With respect to moneys paid by the Issuer and held by the Trustee or
any Paying Agent for payment of the principal of or interest or premium, if any,
on any Notes that remain unclaimed at the end of the two years after such
principal, interest or premium shall have become due and payable (whether at
maturity or upon call for redemption or otherwise), (i) the Trustee or such
Paying Agent shall notify the holders of such Notes that such moneys shall be
repaid to the Issuer and any person claiming such moneys shall thereafter look
only to the Issuer for payment thereof and (ii) such moneys shall be so repaid
to the Issuer. Upon such repayment all liability of the Trustee or such Paying
Agent with respect to such moneys shall thereupon cease, without, however,
limiting in any way any obligation that the Issuer may have to pay the principal
of or interest or premium, if any, on this Note as the same shall become due.
No provision of this Note or of the Indenture shall alter or impair
the obligation of the Issuer, which is absolute and unconditional, to pay the
principal of, premium, if any, and interest on this Note at the time, place, and
rate, and in the coin or currency, herein prescribed unless otherwise agreed
between the Issuer and the registered holder of this Note; provided, however, if
-------- -------
the principal of, premium, if any, or interest on, this Note is payable in a
Specified Currency other than U.S. dollars and such Specified Currency is not
available to the Issuer for making payments hereon due to circumstances beyond
the control of the Issuer, as described above, then the Issuer will be entitled
to satisfy its obligations to the holder of this Note by making such payments in
U.S. dollars as set forth above.
Prior to due presentment of this Note for registration of transfer,
the Issuer, the Trustee and any agent of the Issuer or the Trustee may treat the
holder in whose name this Note is registered as the owner hereof for all
purposes, whether or not this Note be overdue, and none of the Issuer, the
Trustee or any such agent shall be affected by notice to the contrary.
Upon any consolidation by the Issuer with or merger by the Issuer into
any other corporation or any conveyance, transfer or lease of the properties and
assets of the Issuer substantially as an entirety in accordance with the
Indenture, the successor corporation formed by such consolidation or into which
the Issuer is merged or to which such conveyance, transfer or lease is made
shall succeed to, and be substituted for, and may exercise every right and power
of the Issuer under the Indenture with the same effect as if such successor
corporation had been named as the Issuer therein, and thereafter, except in the
case of a lease, the predecessor corporation shall be relieved of all
obligations and covenants under the Indenture and the Notes.
No recourse shall be had for the payment of the principal of, premium,
if any, or the interest on this Note, for any claim based hereon, or otherwise
in respect hereof, or based on or in respect of the Indenture or any
supplemental indenture thereto, against any incorporator, shareholder, officer
or director, as such, past, present or future, of the Issuer or of any successor
corporation, either directly or through the Issuer or any successor corporation,
whether by virtue of any constitution, statute or rule of law or by the
enforcement of any assessment or penalty or otherwise, all such liability being,
by the acceptance hereof and as part of the consideration for the issue hereof,
expressly waived and released.
11
<PAGE>
THIS NOTE SHALL FOR ALL PURPOSES BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF CALIFORNIA.
All terms used in this Note which are defined in the Indenture and not
otherwise defined herein shall have the meanings assigned to them in the
Indenture.
12
<PAGE>
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of survivorship and not as
tenants in common
UNIF GIFT MIN ACT -____________________ Custodian ______________
(Cust) (Minor)
Under Uniform Gifts to Minors Act ______________________________________
State
Additional abbreviations may also be used though not in the above list.
____________________
13
<PAGE>
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s)
unto
(PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE)
_______________________________________
_____________________________________________________________________________
_____________________________________________________________________________
(PLEASE PRINT OR TYPE NAME AND ADDRESS INCLUDING ZIP CODE, OF ASSIGNEE)
the within Note and all rights thereunder, hereby irrevocably constituting and
appointing such person attorney to transfer such note on the books of the
Issuer, with full power of substitution in the premises.
Dated: _____________________ ________________________________________________
NOTICE: The signature to this assignment must
correspond to the name as written upon the face of
this Note in every particular, without alteration
or any change whatsoever; signature(s) must be
guaranteed by an eligible guarantor institution
(banks, stock brokers, savings and loan
associations and credit unions with membership in
an approved signature guarantee medallion program)
pursuant to Securities and Exchange Commission
Rule 17Ad-15.
14
<PAGE>
OPTION TO ELECT REPAYMENT
The undersigned hereby irrevocably requests and instructs the Issuer
to repay the within Note (or portion thereof specified below) pursuant to its
terms at a price equal to the principal amount thereof, together with interest
to the Optional Repayment Date, to the undersigned at
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
(Please print or typewrite name,
address and telephone number of the undersigned,
and name of contact person, if any)
If less than the entire principal amount of the within Note is to be
repaid, specify the portion thereof which the holder elects to have repaid:
______________________________; and specify the denomination or denominations
(which shall not be less than the minimum authorized denomination) of the Notes
to be issued to the holder for the portions of the within Note not being repaid
(in the absence of any such specification, one such Note will be issued for the
portion not being repaid):_____________________________________________
Dated: _________________________ ___________________________________
NOTICE: The signature to the foregoing Election must correspond to the name as
written upon the face of this Note in every particular, without alteration or
any change whatsoever; signature(s) must be guaranteed by an eligible guarantor
institution (banks, stock brokers, savings and loan associations and credit
unions with membership in an approved signature guarantee medallion program)
pursuant to Securities and Exchange Commission Rule 17Ad-15.
15
<PAGE>
EXHIBIT 5.1
[Letterhead of Irell & Manella LLP]
November 12, 1997
Mattel, Inc.
333 Continental Boulevard
El Segundo, California 90245-5022
Re: Series C Medium-Term Notes of Mattel, Inc.
------------------------------------------
Ladies and Gentlemen:
We have acted as counsel for Mattel, Inc., a Delaware corporation (the
"Company"), in connection with the Company's Registration Statement on Form S-3
(No. 333-38625), as amended by pre-effective amendment number 1 ("Amendment
Number One") (the "Registration Statement"), with respect to the registration
under the Securities Act of 1933, as amended (the "Act"), of up to $350,000,000
(exclusive of the unissued securities under the Company's registration statement
on Form S-3, dated February 29, 1996, which securities may be issued under the
Registration Statement in reliance on Rule 429 under the Act) (or the equivalent
thereof in one or more foreign currencies or composite currencies) aggregate
initial offering price of an indeterminate amount of various Securities (as
defined in the Registration Statement). The Registration Statement was
initially filed with the Securities and Exchange Commission (the "Commission")
on October 24, 1997, was amended by Amendment Number One filed November 10, 1997
and was declared effective by the Commission on November 12, 1997, having the
effect of qualifying the indenture dated as of February 15, 1996 (the
"Indenture") between the Company and Chase Trust Company of California (formerly
Chemical Trust Company of California), as trustee (the "Trustee"), under the
Trust Indenture Act of 1939, as amended (the "Trust Indenture Act"). Pursuant
to the Indenture, the Company may issue up to $350,000,000 (or the equivalent
thereof in one or more foreign currencies or composite currencies) in aggregate
principal
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Mattel, Inc.
November 12, 1997
Page 2
amount of its Series C Medium-Term Notes (the "Notes"). The Notes will be
offered on a continuing basis pursuant to Rule 415 under the Act by the
Prospectus dated November 12, 1997 (the "Basic Prospectus"), as supplemented by
the Prospectus Supplement dated November 12, 1997 (the "Supplement" and,
together with the Basic Prospectus, the "Prospectus"). The Prospectus will be
further supplemented by pricing supplements, each of which will be dated
approximately as of the date of sale of particular Notes and will furnish
information as to the specific terms thereof.
For purposes of this opinion, we have reviewed such corporate records,
agreements and other instruments, and certificates of public officials, and have
considered such questions of law, as we deemed necessary or appropriate for the
purposes of this opinion.
On the basis of the foregoing and in reliance thereon, we are of the
opinion that the issuance and sale of Notes have been duly authorized and, when
the final terms of a particular Note and of its issuance and sale have been duly
established in accordance with the provisions of the Indenture and when the
Notes have been executed and authenticated in accordance with the provisions of
the Indenture and delivered to and paid for by the purchasers thereof in the
manner provided in the Distribution Agreement dated November 12, 1997 between
the Company and, as Agents, Morgan Stanley & Co. Incorporated and Credit Suisse
First Boston Corporation, the Notes will be entitled to the benefits of the
Indenture and will be valid and binding obligations of the Company, enforceable
in accordance with their respective terms.
With respect to the opinions rendered above relating to enforceability of
the Notes:
(i) such opinions are subject to the following exceptions, limitations and
qualifications: (a) the effect of bankruptcy, insolvency or similar laws
affecting creditors' rights generally; (b) the effect of general principles of
equity, including, without limitation, concepts of materiality, reasonableness,
good faith and fair dealing and the possible unavailability of specific
performance or injunctive relief, regardless of whether such enforceability is
considered in a proceeding in equity or at law; (c) certain rights, remedies and
waivers contained in the Indenture or the Notes may be limited or rendered
ineffective by applicable California laws or judicial decisions governing such
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Mattel, Inc.
November 12, 1997
Page 3
provisions, but such laws or judicial decisions do not render the Indenture or
the Notes invalid or unenforceable as a whole; and (d) applicable California
laws or judicial decisions may require that a judgment for money damages
rendered in the United States be expressed in United States dollars;
(ii) we express no opinion with respect to (a) the enforceability of the
waiver of rights or defenses contained in Section 4.4 of the Indenture or (b)
whether acceleration of any Notes that may have been sold for less than the full
face amount thereof may affect the collectibility of that portion of the stated
principal amount thereof that might be determined to constitute unearned
interest thereon; and
(iii) in rendering the opinions, we have assumed that the interest rates
on the Notes at the time of their determination will not exceed the maximum rate
permitted under the usury laws of the State of California.
To the extent the obligations of the Company under the Indenture and with
respect to the Notes may be dependent upon such matters, we assume for purposes
of the opinions rendered above that the Trustee has complied with any applicable
requirement to file returns and pay taxes under the Franchise Tax Law of the
State of California; that the Trustee is duly organized, validly existing and in
good standing under the laws of its jurisdiction of organization; that the
Trustee is duly qualified to engage in the activities contemplated by the
Indenture; that the Indenture has been duly authorized, executed and delivered
by the Trustee and constitutes the valid and binding obligation of the Trustee
enforceable against the Trustee in accordance with its terms; that, with respect
to acting as a trustee under the Indenture, the Trustee is generally in
compliance with all applicable laws and regulations; and that the Trustee has
the requisite organizational and legal power and authority to perform its
obligations under the Indenture.
Please be advised that we are licensed to practice law only in the State of
California. We express no opinion as to the law of any jurisdiction other than
the laws of the State of California, the corporate law of the State of Delaware
and the United States federal laws.
This opinion is being rendered as of the date hereof and we assume no
obligations whatsoever to modify or update this
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Mattel, Inc.
November 12, 1997
Page 4
opinion subsequent to the date hereof, or to correct this opinion to the extent
it may be rendered inaccurate as a result of facts, circumstances or laws not in
existence on the date hereof.
This opinion is rendered solely for your benefit in connection with the
transactions described above. This opinion may not be used or relied upon by
any other person and may not be disclosed, quoted, filed with a governmental
agency or otherwise referred to without our prior written consent. However, we
hereby consent to the use of this opinion as an exhibit to the Company's Current
Report on Form 8-K, event date November 12, 1997.
Sincerely,
/s/Irell & Manella LLP
Irell & Manella LLP
BDO:cl
