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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 (Date of earliest event reported)
March 29, 1996
NATIONAL RURAL UTILITIES COOPERATIVE FINANCE CORPORATION
(Exact name of registrant as specified in its charter)
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<S> <C> <C>
District of Columbia l-7102 52-0891669
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(state or other juris- (Commission (I.R.S. Employer
diction of incorporation) File Number) (Identification No.)
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<TABLE>
<S> <C>
Woodland Park, 2201 Cooperative Way, Herndon, VA 22071-3025
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(Address of principal executive offices) (Zip Code)
</TABLE>
Registrant's telephone number, including area code: (703 )709-6717
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(Former name or former address, if changed since last report)
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Item 7. Financial Statements, Pro Forma Financial
Information and Exhibits.
(c) Exhibits
The following exhibits are filed herewith:
1. Underwriting Agreement dated March 29, 1996 between the
registrant and Lehman Brothers Inc., Goldman, Sachs & Co.
and Merrill Lynch, Pierce, Fenner & Smith Incorporated.
4. Form of Global Certificate for the 6.45% Collateral Trust
Bonds, due 2001.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
NATIONAL RURAL UTILITIES COOPERATIVE
FINANCE CORPORATION
/s/ STEVEN L. LILLY
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Steven L. Lilly
Senior Vice President and
Chief Financial Officer
(Principal Financial Officer)
Dated: April 3, 1995
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EXHIBIT INDEX
Exhibit No. Description
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1. Underwriting Agreement dated March 29, 1995 between the
registrant and Lehman Brothers Inc., Goldman, Sachs & Co.
and Merrill Lynch, Pierce, Fenner & Smith Incorporated.
4. Form of Global Certificate for the 6.45% Collateral Trust
Bonds, due 2001.
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Exhibit 1.
EXECUTION COPY
$100,000,000
NATIONAL RURAL UTILITIES
COOPERATIVE FINANCE CORPORATION
6.45% Collateral Trust Bonds, Due 2001
Underwriting Agreement
March 29, 1996
LEHMAN BROTHERS INC.
GOLDMAN, SACHS & CO.
MERRILL LYNCH, PIERCE, FENNER
& SMITH INCORPORATED
As Representatives of the several Underwriters
In care of Lehman Brothers Inc.
3 World Financial Center
New York, NY 10285
Dear Sirs:
National Rural Utilities Cooperative Finance Corporation, a
District of Columbia cooperative association (the "Company"), proposes to issue
$100,000,000 principal amount of its 6.45% Collateral Trust Bonds, Due 2001
(the "Bonds"), to be issued under and secured by an Indenture dated as of
February 15, 1994, between the Company and First Bank National Association (the
"Trustee"). Such Indenture, as amended by any supplemental indenture, is
hereinafter called the "Indenture." The Bonds are more fully described in the
Registration Statement and in the Prospectus hereinafter mentioned. The Bonds
will be issued in fully registered form only, in denominations of $1,000 and
any integral multiple thereof.
You have advised us (i) that you and any other firms and
corporations named in Schedule I attached hereto (you and such firms and
corporations being hereinafter called the Underwriters, which term shall also
include any underwriter substituted as provided in Section 11 hereof), acting
severally and not jointly, are willing to purchase, on the terms and conditions
hereinafter set forth, the respective principal amounts of the Bonds,
aggregating $100,000,000 principal amount thereof, specified in such Schedule
I, and (ii) that you are
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authorized, on behalf of yourselves and the other Underwriters, to enter into
this Agreement.
1. Certain Representations and Warranties by the Company.
The Company represents and warrants to each Underwriter as follows:
(a) Registration Statement and Prospectus. The Company has
filed with the Securities and Exchange Commission (the "Commission")
Registration Statement No. 33-56065, for the registration under the Securities
Act of 1933 (the "Securities Act") of the Bonds (including a prospectus
relating thereto) and may have filed one or more amendments thereto (including
one or more amended or supplemental prospectuses) and such registration
statement and any such amendments have become effective. A prospectus
supplement relating to the Bonds, including a prospectus (together, the
"Prospectus"), has been prepared and will be filed pursuant to Rule 424 under
the Securities Act. The Company will not file any other amendment of such
registration statement or such prospectus or any supplement to such prospectus
on or after the date of this Agreement and prior to the date and time of
delivery of and payment for the Bonds referred to in Section 3 hereof (the
"Closing Date"), except with your approval. Such registration statement,
including financial statements and exhibits, at the time it became effective,
is hereinafter called the Registration Statement. Any reference in this
Agreement to the Prospectus as amended or supplemented shall include, without
limitation, any prospectus filed with the Commission pursuant to Rule 424 of
the Commission under the Securities Act which amends or supplements the
Prospectus. Any reference herein to the Registration Statement or the
Prospectus shall be deemed to refer to and include the documents incorporated
by reference therein pursuant to Item 12 of Form S-3 which were filed under the
Securities Exchange Act of 1934 (the "Exchange Act") on or before the effective
date of the Registration Statement or the date of such Prospectus, as the case
may be; and any reference herein to the terms "amend", "amendment" or
"supplement" with respect to the Registration Statement or the Prospectus shall
be deemed to refer to and include the filing of any document under the Exchange
Act after the effective date of the Registration Statement, or the date of any
Prospectus, as the case may be, and deemed to be incorporated therein by
reference.
(b) Accuracy of Registration Statement. At all times
subsequent to the date of this Agreement up to and including the Closing Date,
and when any post-effective amendment thereof shall become effective, the
Registration Statement (and the Registration Statement as amended if any
post-effective amendment thereof shall have become effective) will comply in
all material respects with the provisions of the Securities Act and the
Exchange Act and the rules and regulations of the Commission thereunder and
will not contain an untrue statement of a material fact and will not omit to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading; and, at all times subsequent to the date of
this
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Agreement up to and including the Closing Date, the Prospectus (and the
Prospectus as amended or supplemented, if the Company shall have filed with the
Commission any amendment thereof or supplement thereto) will fully comply with
the provisions of the Securities Act and the Exchange Act and the rules and
regulations of the Commission thereunder and will not contain an untrue
statement of a material fact and will not omit to state a material fact
required to be stated therein or necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading;
provided, however, that none of the representations and warranties in this
paragraph (b) shall apply to (i) that part of the Registration Statement which
shall constitute the Statement of Eligibility and Qualification (Form T-1)
under the Trust Indenture Act of 1939 (the "Trust Indenture Act"), of the
Trustee or (ii) statements in, or omissions from, the Registration Statement or
the Prospectus or any amendment thereof or supplement thereto made in reliance
upon and in conformity with information furnished as herein stated or otherwise
furnished in writing to the Company by or on behalf of any Underwriter through
you for use in connection with the preparation of the Registration Statement or
the Prospectus or any such amendment or supplement.
(c) Accountants. The accountants who have certified or shall
certify the financial statements filed and to be filed with the Commission as
parts of the Registration Statement and the Prospectus are independent with
respect to the Company as required by the Securities Act and rules and
regulations of the Commission thereunder.
(d) Due Incorporation. The Company has been duly
incorporated and is now, and on the Closing Date will be, a validly existing
cooperative association in good standing under the laws of the District of
Columbia, duly qualified and in good standing in each jurisdiction in which the
ownership or leasing of properties or the conduct of its business requires it
to be qualified (or the failure to be so qualified will not have a material
adverse effect upon the business or condition of the Company), and the Company
has the corporate power and holds all valid permits and other required
authorizations from governmental authorities necessary to carry on its business
as now conducted and as to be conducted on the Closing Date and as contemplated
by the Prospectus.
(e) Material Changes. Since the respective dates as of
which information is given in the Registration Statement and the Prospectus,
and except as set forth therein, there has not been any material adverse change
in the condition, financial or other, or the results of operations of the
Company, whether or not arising from transactions in the ordinary course of
business.
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(f) Litigation. On the date hereof, except as set forth in
the Prospectus, the Company does not have any litigation pending of a character
which in the opinion of counsel for the Company referred to in Section 10(c)
hereof could result in a judgment or decree having a material adverse effect on
the condition, financial or other, or the results of operations of the Company.
(g) Legality. On the Closing Date, the Bonds will be duly
and validly authorized, and no further authorization, consent or approval of
the members and no further authorization or approval of the Board of Directors
of the Company or any committee thereof will be required for the issuance and
sale of the Bonds as contemplated herein; and neither such issuance or sale of
the Bonds nor the consummation of any other of the transactions herein
contemplated will result in a breach by the Company of any terms of, or
constitute a default under, any other agreement or undertaking of the Company.
(h) No Stop Order. The Commission has not issued and, to
the best knowledge of the Company, is not threatening to issue any order
preventing or suspending the use of the Prospectus (as amended or supplemented,
if the Company shall have filed with the Commission any amendment thereof or
supplement thereto).
(i) Regulation. The Company is not required to be
registered as an investment company under the Investment Company Act of 1940
and is not subject to regulation under the Public Utility Holding Company Act
of 1935.
2. Agreement to Purchase. Subject to the terms and
conditions and upon the representations and warranties herein set forth, the
Company agrees to sell to you and any other Underwriters, severally and not
jointly, and you and such other Underwriters, severally and not jointly, agree
to purchase from the Company, at 99.289% of the principal amount thereof, plus
interest accrued thereon, if any, from April 4, 1996, to the Closing Date, the
respective principal amounts of the Bonds set forth opposite the names of the
respective Underwriters in Schedule I hereto, aggregating $100,000,000
principal amount thereof.
3. Closing. Delivery of and payment for the Bonds shall be
made at the office of Lehman Brothers Inc., Three World Financial Center, New
York, New York 10285, at 9:30 A.M., New York City time, on April 4, 1996, or
such later date (not later than April 11, 1996) as you, as Representatives of
the Underwriters, shall designate, which date and time may be postponed by
agreement between you, as such Representatives, and the Company or as provided
in Section 11 hereof. Delivery of the
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Bonds shall be made to you, for the respective accounts of the several
Underwriters, against payment by the several Underwriters through you of the
purchase price thereof, to or upon the order of the Company by certified or
official bank check or checks payable, or wire transfers, in immediately
available funds. The Bonds shall be delivered in definitive global form
through the facilities of Depository Trust Company.
4. Prospectuses. The Company has caused to be delivered to
you, as Representatives of the Underwriters, copies of the Prospectus and has
consented to the use of such copies for the purposes permitted by the
Securities Act. The Company agrees to deliver to you, as Representatives of
the Underwriters, without charge, from time to time during such period as in
the opinion of Cravath, Swaine & Moore, counsel for the Underwriters, the
Prospectus is required by law to be delivered in connection with sales by an
Underwriter or dealer, as many copies of the Prospectus (and, in the event of
any amendment of or supplement to the Prospectus, of such amended or
supplemented Prospectus) as you, as Representatives of the Underwriters, may
reasonably request. If, at any time during the period in which the Company is
required to deliver copies of the Prospectus, as provided in this Section 4,
any event known to the Company relating to or affecting the Company shall occur
which should be set forth in an amendment of or supplement to the Prospectus in
order to make the statements in the Prospectus not misleading in the light of
the circumstances at the time it is delivered to the purchaser, or it shall be
necessary to amend or supplement the Prospectus to comply with law or with the
rules and regulations of the Commission, the Company, at its expense, will
forthwith prepare and furnish to you for distribution to the Underwriters and
dealers a reasonable number of copies of an amendment or amendments of or a
supplement or supplements to the Prospectus which will so amend or supplement
the Prospectus that, as amended or supplemented, it will not contain an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary in order to make the statements in the Prospectus
not misleading in the light of the circumstances when it is delivered to a
purchaser, and will comply with law and with such rules and regulations. The
Company authorizes the Underwriters and all dealers effecting sales of the
Bonds to use the Prospectus, as from time to time amended or supplemented, in
connection with the sale of the Bonds in accordance with applicable provisions
of the Securities Act and the applicable rules and regulations thereunder for
the period during which the Company is required to deliver copies of the
Prospectus as provided in this Section 4.
5. Commission Proceedings as to Registration Statement.
The Company agrees to advise you promptly, as
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Representatives of the Underwriters, and to confirm such advice in writing,
(a) when any post-effective amendment of the Registration Statement shall have
become effective and when any further amendment of or supplement to the
Prospectus shall be filed with the Commission, (b) of any request by the
Commission for any amendment of the Registration Statement or the Prospectus
or for additional information and (c) of the issuance by the Commission of any
stop order suspending the effectiveness of the Registration Statement or of
the initiation of any proceedings for that purpose. The Company will use
every reasonable effort to prevent the issuance of such a stop order and, if
any such order shall at any time be issued, to obtain the withdrawal thereof
at the earliest possible moment.
6. Blue Sky. The Company will diligently endeavor, when
and as requested by you, to qualify the Bonds, or such portion thereof as you
may request, for offering and sale under the securities or blue sky laws of any
jurisdictions which you shall designate.
7. Earnings Statement. The Company agrees to make
generally available to its security holders, in accordance with Section 11(a)
of the Securities Act and Rule 158 thereunder, an earnings statement of the
Company (which need not be audited) in reasonable detail and covering a period
of at least twelve months beginning after the effective date of the
Registration Statement.
8. Expenses. The Company agrees to pay all fees and
expenses in connection with (a) the preparation, printing and filing of the
Registration Statement (including all exhibits to the Registration Statement),
the Prospectus and any amendments thereof and supplements thereto, and the
furnishing of copies of each thereof to the Underwriters (including costs of
mailing and shipment), (b) the issuance of the Bonds, (c) the rating of the
Bonds by rating agencies, (d) the delivery of the Bonds to you in New York City
for the respective accounts of the several Underwriters and (e) the qualifying
of the Bonds as provided in Section 6 hereof and the determination of the
eligibility of the Bonds for investment under the laws of such jurisdictions as
you may designate (including fees of not more than $10,000 and disbursements of
counsel for the Underwriters in connection therewith).
9. Indemnities.
(a) By the Company. The Company agrees to indemnify and
hold harmless each Underwriter and each person who controls any Underwriter
within the meaning of Section 15 of the Securities Act against any and all
losses, claims, damages or liabilities, joint or several, to which they or any
of them may
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become subject under the Securities Act, the Exchange Act or any other statute
or common law, and to reimburse the Underwriters and such controlling persons,
as incurred, for any legal or other expenses incurred by them in connection
with investigating any claims and defending any actions, insofar as such
losses, claims, damages, liabilities or actions arise out of or are based upon
(i) any untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement or any post-effective amendment
thereof, or the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, or (ii) any untrue statement or alleged untrue statement of a
material fact contained in the Prospectus (as amended or supplemented, if the
Company shall have filed with the Commission any amendment thereof or
supplement thereto), if used within the period during which the Underwriters
are authorized to use the Prospectus as provided in Section 4 hereof, or the
omission or alleged omission to state therein (if so used) a material fact
required to be stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; provided, however, that the indemnity agreement contained in this
Section 9(a) shall not apply to any such losses, claims, damages, liabilities
or actions arising out of, or based upon, any such untrue statement or alleged
untrue statement, or any such omission or alleged omission, if such statement
or omission was made in reliance upon and in conformity with information
furnished as herein stated in Section 12 or otherwise furnished in writing to
the Company by or on behalf of any Underwriter through you for use in
connection with the preparation of the Registration Statement or the Prospectus
or any such amendment thereof or supplement thereto, or was contained in that
part of the Registration Statement constituting the Statement of Eligibility
and Qualification (Form T-1) under the Trust Indenture Act of the Trustee;
provided, further, that, with respect to any untrue statement or alleged untrue
statement made in, or omission or alleged omission from, the Prospectus, the
indemnity agreement contained in this Section 9(a) with respect to the
Prospectus shall not inure to the benefit of any Underwriter (or the benefit of
any person controlling such Underwriter) from whom the person asserting any
such losses, claims, damages or liabilities purchased the Bonds which are the
subject thereof, if such person did not receive a copy of the Prospectus (or
the Prospectus as amended or supplemented if the Company shall have made any
amendments thereof or supplements thereto which shall have been furnished to
you, as Representatives of the Underwriters, or to such Underwriter prior to
the time of the below-written confirmation), excluding the documents
incorporated therein by reference, at or prior to the written confirmation of
the sale of such Bonds to such person in any case where delivery of the
Prospectus is
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required under the Securities Act and the rules and regulations of the
Commission thereunder and any untrue statement or alleged untrue statement or
omission or alleged omission was corrected in the Prospectus (or the Prospectus
as amended or supplemented).
(b) By the Underwriters. Each Underwriter agrees, in the
manner and to the same extent as set forth in Section 9(a) hereof, to indemnify
and hold harmless the Company, each person, if any, who controls the Company
within the meaning of Section 15 of the Securities Act, the directors of the
Company and those officers of the Company who shall have signed the
Registration Statement, with respect to any statement in or omission from the
Registration Statement or any post-effective amendment thereof or the
Prospectus (as amended or supplemented, if so amended or supplemented), if such
statement or omission was made in reliance upon and in conformity with
information furnished as herein stated in Section 12 or otherwise furnished in
writing to the Company through you on behalf of such Underwriter for use in
connection with the preparation of the Registration Statement or the Prospectus
or any such amendment thereof or supplement thereto.
(c) General. Each indemnified party will, within ten days
after the receipt of notice of the commencement of any action against such
indemnified party in respect of which indemnity may be sought from an
indemnifying party on account of an indemnity agreement contained in this
Section 9, notify the indemnifying party in writing of the commencement
thereof. The omission of any indemnified party so to notify an indemnifying
party of any such action shall not relieve the indemnifying party from any
liability which it may have to such indemnified party on account of the
indemnity agreement contained in this Section 9 or otherwise. Except as
provided in the next succeeding sentence, in case any such action shall be
brought against any indemnified party and it shall notify an indemnifying party
of the commencement thereof, such indemnifying party will be entitled to
participate therein and, to the extent that it may wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel satisfactory to such indemnified party, and after notice in writing from
such indemnifying party to such indemnified party of its election so to assume
the defense thereof, such indemnifying party will not be liable to such
indemnified party under this Section 9 for any legal or other expenses
subsequently incurred by such indemnified party in connection with the defense
thereof other than reasonable costs of investigation. Such indemnified party
shall have the right to employ its own counsel in any such action, but the fees
and expenses of such counsel shall be at the expense of such indemnified party
unless (i) the employment of such counsel has been authorized in writing by the
indemnifying party in
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connection with the defense of such action, (ii) such indemnified party shall
have been advised by such counsel that there are material legal defenses
available to it which are different from or additional to those available to
the indemnifying party (in which case the indemnifying party shall not have the
right to assume the defense of such action on behalf of such indemnified party)
or (iii) the indemnifying party shall not have assumed the defense of such
action and employed counsel therefor satisfactory to such indemnified party
within a reasonable time after notice of commencement of such action, in any of
which events such fees and expenses shall be borne by the indemnifying party.
No indemnifying party shall, without the written consent of the indemnified
party, effect the settlement or compromise of, or consent to the entry of any
judgment with respect to, any pending or threatened action or claim in respect
of which indemnification may be sought hereunder (whether or not the
indemnified party is an actual or potential party to such action or claim)
unless such settlement, compromise or judgment (i) includes an unconditional
release of the indemnified party from all liability arising out of such action
or claim and (ii) does not include any statement as to, or an admission of,
fault, culpability or a failure to act, by or on behalf of any indemnified
party. No indemnified party shall effect the settlement or compromise of, or
consent of the entry of any judgment with respect to, any pending or threatened
action or claim in respect of which indemnification may be sought hereunder
without the consent of the indemnifying party (which consent shall not be
unreasonably withheld).
(d) Contribution. If the indemnification provided for in
this Section 9 shall for any reason be unavailable to an indemnified party
under Section 9(a) or 9(b) hereof in respect of any loss, claim, damage or
liability or any action in respect thereof, referred to therein, then each
indemnifying party shall, in lieu of indemnifying such indemnified party,
contribute to the amount paid or payable by such indemnified party as a result
of such loss, claim, damage or liability, or action in respect thereof, (i) in
such proportion as shall be appropriate to reflect the relative benefits
received by the Company on the one hand and the Underwriters on the other from
the offering of the Bonds or (ii) if the allocation provided by clause (i) above
is not permitted by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause (i) above but also
the relative fault of the Company on the one hand and the Underwriters on the
other with respect to the statements or omissions which resulted in such loss,
claim, damage or liability, or action in respect thereof, as well as any other
relevant equitable considerations. The relative benefits received by the
Company on the one hand and the Underwriters on the other with respect to such
offering shall be deemed to be in the same proportion as the total net proceeds
from the offering
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of the Bonds (before deducting expenses) received by the Company bear to the
total underwriting discounts and commissions received by the Underwriters with
respect to such offering, in each case as set forth in the table on the cover
page of the Prospectus. The relative fault of the Company on the one hand and
the Underwriters on the other shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or
omission or alleged omission to state a material fact relates to information
supplied by the Company or the Underwriters, the intent of the parties and their
relative knowledge, access to information and opportunity to correct or prevent
such statement or omission. The Company and the Underwriters agree that it would
not be just and equitable if contributions pursuant to this Section 9(d) were to
be determined by pro rata allocation (even if the Underwriters were treated as
one entity for such purpose) or by any other method of allocation which does not
take into account the equitable considerations referred to herein. The amount
paid or payable by an indemnified party as a result of the loss, claim, damage
or liability, or action in respect thereof, referred to above in this Section
9(d) shall be deemed to include, for purposes of this Section 9(d), any legal or
other expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 9(d), no Underwriter shall be required to contribute
any amount in excess of the amount by which the total price at which the Bonds
underwritten by it and distributed to the public were offered to the public
exceeds the amount of any damages which such Underwriter has otherwise paid or
become liable to pay by reason of any untrue or alleged untrue statement or
omission or alleged omission. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations to contribute as provided in
this Section 9(d) are several in proportion to their respective underwriting
obligations and not joint.
(e) Survival of Indemnities. The respective indemnity and
contribution agreements of the Company and the Underwriters contained in this
Section 9, and the representations and warranties of the Company set forth in
Section 1 hereof, shall remain operative and in full force and effect,
regardless of any termination or cancelation of this Agreement or any
investigation made by or on behalf of any Underwriter or any such controlling
person or the Company or any such controlling person, director or officer, and
shall survive the delivery of the Bonds, and any successor of any Underwriter
or of any such controlling person or of the Company, and any legal
representative of any such controlling person, director or officer, as the case
may be,
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shall be entitled to the benefit of the respective indemnity and contribution
agreements.
10. Conditions to Underwriters' Obligations. The several
obligations of the Underwriters hereunder are subject to the accuracy of and
compliance with the representations and warranties of the Company contained in
Section 1 hereof, as of the date hereof and as of the Closing Date, and to the
following further conditions:
(a) Effectiveness of Registration Statement. No stop order
suspending the effectiveness of the Registration Statement or
qualification of the Indenture shall be in effect on the Closing Date, and
no proceedings for the issuance of such an order shall be pending or, to
the knowledge of the Company or you, threatened by the Commission on the
Closing Date.
(b) Opinion of Counsel for the Underwriters. The form and
validity of the Indenture, the form and validity of the Bonds, the
legality and sufficiency of the authorization of the issuance and sale of
the Bonds hereunder, and all corporate proceedings and other legal matters
incident to the foregoing, and the form of the Registration Statement and
of the Prospectus (other than financial statements and other financial
data), shall have been approved as of the Closing Date by Cravath, Swaine
& Moore, counsel for the Underwriters.
(c) Opinion of Counsel for the Company. The Company shall
have furnished to you, as Representatives of the Underwriters, on the
Closing Date, the opinion, addressed to the Underwriters and dated the
Closing Date, of Milbank, Tweed, Hadley & McCloy, counsel for the Company,
which opinion shall be satisfactory in form and scope to counsel for the
Underwriters, to the following effect:
(i) the Company has been duly incorporated and is
validly existing as a cooperative association in good standing
under the laws of the District of Columbia with corporate
power to conduct its business as described in the Registration
Statement;
(ii) the issuance and sale of the Bonds by the
Company pursuant to this Agreement have been duly and validly
authorized by all necessary corporate action; and no
authorization, consent, order or approval of, or filing or
registration with, or exemption by, any government or public
body or authority (including, without limitation, the Rural
Utilities Service) of the
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United States or of the State of New York or any department or
subdivision thereof or to the best of such counsel's knowledge
any court, other than such as may be required under State
securities or blue sky laws and other than registration of the
Bonds under the Securities Act and qualification of the
Indenture under the Trust Indenture Act, is required for the
validity of the Bonds or for the issuance, sale and delivery
of the Bonds by the Company pursuant to this Agreement or for
the execution and delivery of this Agreement by the Company;
(iii) the Indenture has been duly authorized by the
Company, has been duly qualified under the Trust Indenture
Act, constitutes an instrument valid and binding on the
Company and enforceable in accordance with its terms and the
Indenture Trustee has a valid first perfected security
interest in the Mortgage Notes in its possession in New York
and, subject to the requirements of Section 9-306 of the New
York Uniform Commercial Code, in the proceeds thereof, subject
only to the exceptions permitted by the Indenture, pledged
pursuant to the Indenture (except that no opinion need be
expressed as to the lien on the Mortgages, as defined in the
Indenture, so pledged);
(iv) the Bonds are in the forms provided for in the
Indenture, and, assuming due execution of the Bonds on behalf
of the Company and authentication thereof by the Trustee, the
Bonds constitute valid and binding obligations of the Company
enforceable in accordance with their terms and are entitled to
the benefits of the Indenture;
(v) this Agreement has been duly authorized,
executed and delivered by the Company and the performance of
this Agreement and the consummation of the transactions herein
contemplated will not result in a breach of any terms or
provisions of, or constitute a default under, the Articles of
Incorporation or By-laws of the Company or any indenture, deed
of trust, note, note agreement or other agreement or
instrument known to such counsel, after due inquiry, to which
the Company is a party or by which the Company or any of its
properties is bound or affected;
(vi) the Bonds and the Indenture conform in all
material respects to the descriptions thereof contained in the
Registration Statement;
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<PAGE> 13
13
(vii) the Registration Statement (and any
post-effective amendment thereof) has become and is effective
under the Securities Act and the Bonds have become registered
under the Securities Act, and, to the best of the knowledge of
such counsel, no stop order suspending the effectiveness of
the Registration Statement has been issued and no proceedings
for that purpose have been instituted or are pending or
contemplated, and the Registration Statement (and any
post-effective amendment thereof), the Prospectus and each
amendment thereof or supplement thereof (except for the
financial statements and other financial data included therein
as to which such counsel need express no opinion) when they
became effective or were filed with the Securities and
Exchange Commission complied as to form in all material
respects with the requirements of the Securities Act, the
Exchange Act, the Trust Indenture Act and the rules and
regulations issued thereunder;
(viii) based upon such counsel's participation in the
preparation of the Registration Statement, the Prospectus and
documents incorporated by reference therein, such counsel's
discussions with certain officers and employees of the
Company, such counsel's conferences with representatives of
the Company's independent Certified Public Accountants and
such counsel's representation of the Company, and while such
counsel does not pass on or assume any responsibility for the
accuracy, completeness or fairness thereof, nothing has come
to such counsel's attention that causes it to believe that
either the Registration Statement (or any post-effective
amendment thereof) as of the date it became effective, or the
Prospectus and each supplement thereto as of the Closing Date
(except in each case for the financial or statistical data
included therein, as to which such counsel expresses no view)
contains an untrue statement of a material fact or omits to
state a material fact required to be stated therein or
necessary to make the statements therein not misleading and
such counsel does not know of any litigation or any
governmental proceeding instituted or threatened against the
Company required to be disclosed in the Registration Statement
or Prospectus and which is not disclosed therein;
(ix) the Company is not required to be registered as
an investment company under the Investment Company Act of
1940;
13
<PAGE> 14
14
(x) the Company is not subject to regulation under
the Public Utility Holding Company Act of 1935; and
(xi) the Company is not a public utility as defined
in the Federal Power Act and is not a natural gas company as
defined in the Natural Gas Act.
If the certification referred to in clause (ix) of subsection
10(e) below indicates that the Pledged Property includes collateral other
than Mortgage Notes, the opinion referred to in clause (iii) above shall
also address the security interest of the Indenture Trustee in the Pledged
Property (and in the proceeds thereof), in form reasonably satisfactory to
you.
The foregoing opinion may contain qualifications to the effect
that any sale or transfer by the Trustee under the Indenture of any
Pledged Property (other than a transfer into the name of the Trustee or a
nominee thereof) may be subject to the provisions of the Securities Act
and other applicable securities laws and regulations promulgated
thereunder, and, insofar as such opinion relates to the enforceability of
the Bonds and the Indenture, the enforceability thereof may be limited by
bankruptcy, reorganization, insolvency, moratorium or other laws of
general application relating to or affecting the enforcement of creditors'
rights and by general principals of equity (regardless of whether
considered in a proceeding in equity or at law), including without
limitation (a) the possible unavailability of specific performance,
injunctive relief or any other equitable remedy and (b) concepts of
materiality, reasonableness, good faith and fair dealing. In addition,
the Company's obligations and the rights and remedies of the Trustee and
the Bondholders may be subject to possible limitations on the exercise of
remedial or procedural provisions contained in the Indenture (provided
that such limitations do not, in the opinion of such counsel, make
inadequate the remedies afforded thereby for the practical realization of
the substantive benefits provided for in the Bonds and the Indenture).
In rendering the foregoing opinion, Milbank, Tweed, Hadley &
McCloy may rely as to matters of the law of the District of Columbia upon
the opinion of John Jay List, Esq., General Counsel of the Company,
addressed to the Underwriters and dated the Closing Date, satisfactory in
form and scope to counsel for the Underwriters. If Milbank, Tweed, Hadley
& McCloy shall so rely upon the opinion of John Jay List, Esq., (i) copies
of the opinion so relied upon shall be delivered to you, as
Representatives of the
14
<PAGE> 15
15
Underwriters, and to counsel for the Underwriters and (ii) the opinion
required by this Section 10(c) shall also state that Milbank, Tweed,
Hadley & McCloy has made an independent investigation of the matters in
its opinion covered by the opinion so relied upon and that the
Underwriters are justified in relying upon such opinion.
(d) Accountants' Letter. Arthur Andersen LLP shall have
furnished to you, as Representatives of the Underwriters, at or prior to
the Closing Date, a letter, addressed to the Underwriters and dated the
Closing Date, confirming that they are independent public accountants with
respect to the Company within the meaning of the Securities Act and are in
compliance with the applicable requirements relating to the qualification
of accountants under Rule 2-01 of Regulation S-X of the Commission; and
stating, as of the date of such letter (or, with respect to matters
involving changes or developments since the respective dates as of which
specified financial information is given in the Prospectus, as of a date
not more than five days prior to the date of such letter), the conclusions
and findings of such firm with respect to the financial information and
other matters covered by its letter delivered to you, as Representatives
of the Underwriters, concurrently with the execution of this Agreement and
confirming in all material respects the conclusions and findings set forth
in such prior letter or, if no such letter shall have been delivered to
you, the conclusions and findings of such firm, in form and substance
satisfactory to you, as Representatives of the Underwriters, with respect
to such financial information and other matters as you, as Representatives
of the Underwriters, shall reasonably request.
(e) Officer's Certificate. You shall have received, on the
Closing Date, a certificate of the Company dated the Closing Date, signed
on its behalf by the President, the Governor or a Vice President of the
Company, to the effect that the signer of such certificate has examined
the Registration Statement and the Prospectus and that (i) in his opinion,
as of the effective date of the Registration Statement, the Registration
Statement did not contain an untrue statement of a material fact and did
not omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, and the
Prospectus did not contain an untrue statement of a material fact and did
not 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, (ii) since the effective date of the Registration Statement no
event has occurred which should
15
<PAGE> 16
16
have been set forth in an amendment or supplement to the Prospectus but
which has not been so set forth, (iii) since the respective dates as of
which information is given in the Registration Statement and the
Prospectus, there has not been any material adverse change in the
condition, financial or other, or earnings of the Company, whether or not
arising from transactions in the ordinary course of business, other than
changes which the Registration Statement and the Prospectus indicate might
occur after the effective date of the Registration Statement, (iv) the
Company has no material contingent obligations which are required to be
disclosed in the Registration Statement and the Prospectus and are not
disclosed therein, (v) no stop order suspending the effectiveness of the
Registration Statement is in effect on the Closing Date and no proceedings
for the issuance of such an order have been taken or to the knowledge of
the Company are contemplated by the Commission at or prior to the Closing
Date, (vi) there are no material legal proceedings to which the Company is
a party or of which property of the Company is the subject which are
required to be disclosed and which are not disclosed in the Registration
Statement and the Prospectus, (vii) there are no material contracts to
which the Company is a party which are required to be disclosed and which
are not disclosed in the Registration Statement or the Prospectus, (viii)
the representations and warranties of the Company herein are true and
correct as of the Closing Date and (ix) the Pledged Property consists
solely of Mortgage Notes, or if such is not the case, a description of the
other collateral included in the Pledged Property.
(f) (i) The Company shall not have sustained since the date
of the latest audited financial statements included or incorporated by
reference in the Prospectus any loss or interference with its business
from fire, explosion, flood or other calamity, whether or not covered by
insurance, or from any labor dispute or court or governmental action,
order or decree, otherwise than as set forth or contemplated in the
Prospectus or (ii) since such date there shall not have been any change in
the members' equity or long-term debt of the Company or any of its
subsidiaries or any change, or any development involving a prospective
change, in or affecting the general affairs, management, financial
position, member's equity or results of operations of the Company and its
subsidiaries, otherwise than as set forth or contemplated in the
Prospectus, the effect of which, in any such case described in clause (i)
or (ii), is, in your judgment, so material and adverse as to make it
impracticable or inadvisable to proceed with the public
16
<PAGE> 17
17
offering or the delivery of the Bonds on the terms and in the manner
contemplated in the Prospectus.
(g) On or after the date hereof: (i) no downgrading shall
have occurred in the rating accorded the Company's debt securities by any
"nationally recognized statistical rating organization", as that term is
defined by the Commission for purposes of Rule 436(g)(2) of the Rules and
Regulations and (ii) no such organization shall have publicly announced
that it has under surveillance or review, with possible negative
implications, its rating of any of the Company's debt securities.
(h) On or after the date hereof, there shall not have
occurred any of the following: (i) a suspension or material limitation in
trading in securities generally on the New York Stock Exchange, (ii) a
banking moratorium on commercial banking activities in New York declared
by Federal or state authorities, (iii) the United States shall have become
engaged in hostilities, there shall have been an escalation in hostilities
involving the United States or there shall have been a declaration of a
national emergency or war by the United States or (iv) such a material
adverse change in general economic, political or financial conditions (or
the effect of international conditions on the financial markets in the
United States shall be such) the effect of which, in any such case
described in clause (iii) or (iv), is, in your reasonable judgment, to
make it impracticable or inadvisable to proceed with the public offering
or delivery of the Bonds on the terms and in the manner contemplated in
the Prospectus.
(i) Miscellaneous. The Company shall have taken, on or
prior to the Closing Date, all other action, if any, which it is stated in
the Registration Statement (or any post-effective amendment thereof) or
the Prospectus (as amended or supplemented, if so amended or supplemented)
that the Company will take prior to or concurrently with the issuance and
delivery of the Bonds, and all agreements herein contained to be performed
on the part of the Company on or prior to the Closing Date shall have been
so performed.
(j) Other Documents. The Company shall have furnished to
you and to Cravath, Swaine & Moore, counsel for the Underwriters, such
further certificates and documents as you or they may have reasonably
requested prior to the Closing Date.
17
<PAGE> 18
18
If any of the conditions specified in this Section 10 shall not have been
fulfilled when and as required by this Agreement to be fulfilled, this
Agreement and all obligations of the Underwriters hereunder may be canceled on,
or at any time prior to, the Closing Date by you, as Representatives of the
Underwriters. Notice of such cancelation shall be given to the Company in
writing, or by telegraph, telephone or telex confirmed in writing.
11. Substitution of Underwriters. If any one or more of the
Underwriters shall fail or refuse on the Closing Date to purchase and pay for
the Bonds which it or they have agreed to purchase hereunder, then (a) if the
aggregate principal amount of the Bonds which the defaulting Underwriter or
Underwriters so agreed to purchase shall not exceed $10,000,000, the
nondefaulting Underwriters of shall be obligated to purchase the Bonds from the
Company, in proportion to their respective obligations hereunder and upon the
terms herein set forth, or (b) if the aggregate principal amount of the Bonds
which the defaulting Underwriter or Underwriters so agreed to purchase shall
exceed $10,000,000, either you, as Representatives of the Underwriters, or the
Company shall have the right at any time prior to 9:30 A.M., New York City
time, on the next business day after the Closing Date to procure one or more of
the other Underwriters, or any others, to purchase such Bonds from the Company,
in such amounts as may be agreed upon and upon the terms herein set forth. If
within such specified time neither you, as such representative, nor the Company
shall have procured such other Underwriters or any others to purchase the Bonds
agreed to be purchased by the defaulting Underwriter or Underwriters, this
Agreement shall terminate without liability on the part of any nondefaulting
Underwriter or of the Company. In the event of a default by any Underwriter or
Underwriters, as set forth in this Section 11, the Closing Date may be
postponed for such period, not exceeding seven days, as you, as such
representative, shall determine in order that any required changes in the
Registration Statement and in the Prospectus or in any other documents or
arrangements may be effected. Any action taken or termination of this
Agreement under this Section 11 shall not relieve any defaulting Underwriter
from liability in respect of any default of such Underwriter under this
Agreement.
12. Information Furnished by Underwriters. The statement
set forth in the last paragraph on the cover of, in the last paragraph on page
2 of, and under the heading "Underwriting" in, the prospectus supplement
portion of the Prospectus, and under the heading "Plan of Distribution" in the
Prospectus, constitute the only information furnished in writing by you, on
behalf of the Underwriters, for inclusion therein, and you, as
18
<PAGE> 19
19
Representatives of the Underwriters, confirm that such statements are correct.
13. Termination. This Agreement shall be subject to
termination by you, by notice given to the Company prior to delivery of and
payment for the Bonds, if prior to such time any of the events described in
Sections 10(f), 10(g) or 10(h) occurs.
14. Miscellaneous.
(a) Except as otherwise expressly provided in this
Agreement, (i) whenever notice is required by all the provisions of this
Agreement to be given to the Company, such notice shall be in writing addressed
to the Company at its office, Woodland Park, 2201 Cooperative Way, Herndon,
Virginia 22071, attention of the Governor, and (ii) whenever notice is required
by the provisions of this Agreement to be given to you, as Representatives of
the Underwriters or of any of them, such notice shall be in writing addressed
to you at your office, Three World Financial Center, New York, New York 10285.
(b) The Company agrees to furnish to you and to Cravath,
Swaine & Moore, without charge, a signed copy of the Registration Statement and
each amendment thereof, including all financial statements and all exhibits
thereto (except such financial statements and exhibits as are incorporated
therein by reference and which shall have been previously furnished to you),
and to furnish to each of the other Underwriters, without charge, a copy of the
Registration Statement and each amendment thereof, including all financial
statements (except such financial statements as are incorporated therein by
reference) but without exhibits.
(c) This Agreement is made solely for the benefit of the
several Underwriters and the Company and their respective successors and
assigns, and, to the extent provided in Section 9 hereof, any controlling
person referred to in such Section 9 and the directors of the Company and those
officers of the Company who shall have signed the Registration Statement, and
their respective legal representatives, successors and assigns, and no other
person shall acquire or have any right under or by virtue of this Agreement.
The term "successor" or the term "successors and assigns" as used in this
Agreement shall not include any purchaser, as such purchaser, from any of the
Underwriters of the Bonds.
(d) If this Agreement shall be canceled or terminated by the
Underwriters on any of the grounds referred to or specified in Section 10
hereof or because of any failure or refusal on the part of the Company to
comply with any of the
19
<PAGE> 20
20
terms or to fulfill any of the conditions of this Agreement, the Company will
reimburse the Underwriters severally for all their out-of-pocket expenses
(including the fees and disbursements of their counsel) reasonably incurred by
them in connection with the subject matter of this Agreement.
(e) The term "business day" as used in this Agreement shall
mean any day on which the New York Stock Exchange, Inc., is open for trading.
(f) This Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York.
(g) Section headings have been inserted in this Agreement as
a matter of convenience of reference only and it is agreed that such section
headings are not a part of this Agreement and will not be used in the
interpretation of any provision of this Agreement.
Please confirm that you are acting on behalf of yourself and
the other several Underwriters and that the foregoing correctly sets forth the
agreement between the Company and the several Underwriters.
Very truly yours,
NATIONAL RURAL UTILITIES
COOPERATIVE FINANCE
CORPORATION,
By
------------------
Name:
Title:
Acting on behalf of ourselves and
the other several Underwriters named
in Schedule I attached to the
foregoing letter, we hereby confirm
as of the date thereof that such letter
correctly sets forth the agreement between
the Company and the several Underwriters:
LEHMAN BROTHERS INC.,
By
------------------
Name:
Title:
20
<PAGE> 21
SCHEDULE I
Underwriting Agreement dated March 29, 1996
NATIONAL RURAL UTILITIES
COOPERATIVE FINANCE CORPORATION
<TABLE>
<CAPTION>
Principal Amount
6.45% Collateral
Trust Bonds
Due 2001
Underwriter to be Purchased
- ----------- ---------------
<S> <C>
Lehman Brothers Inc. ...................................... $ 70,000,000
Goldman, Sachs & Co. ...................................... 15,000,000
Merrill Lynch, Pierce,
Fenner & Smith Incorporated. ............................ 15,000,000
------------
Total .................................... $100,000,000
============
</TABLE>
21
<PAGE> 1
EXHIBIT 4.
[FORM OF CERTIFICATE FOR COLLATERAL TRUST BOND, DUE 2001]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION
("DTC"), TO ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE &
CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE
OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS
IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER,
PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.
Certificate No.: 1 CUSIP No.: 637432BL8
PRINCIPAL AMOUNT: $___________
MATURITY DATE: April 1, 2001 CERTIFICATE
INTEREST RATE: 6.45%
ISSUE DATE: April __, 1996 FRACTIONAL SHARE: 100%
6.45% COLLATERAL TRUST BOND, DUE 2001
National Rural Utilities Cooperative Finance Corporation, a
District of Columbia cooperative association (hereinafter called the "Company",
which term includes any successor corporation under the Indenture referred to
on the reverse hereof), for value received, hereby promises to pay to CEDE &
CO., or registered assigns, the principal sum of $100,000,000 dollars on April
1, 2001, and to pay interest thereon as set forth below, until the principal
hereof is paid or made available for payment. Interest for the Bonds is
payable on the 1st day of April and October (each, an "Interest Payment Date"),
in each year, commencing October 1, 1996, for the period
<PAGE> 2
commencing on and including the immediately preceding Interest Payment Date and
ending on and including the day next preceding the Interest Payment Date (an
"Interest Period"), with the exception that the first Interest Period shall
commence on and include April __, 1996 and end on and include September 30,
1996. Interest will be paid to registered holders of Bonds at the close of
business on the fifteenth day of the month (the "Regular Record Date")
preceding the Interest Payment Date.
The Bonds will bear interest at an interest rate per annum of
6.45%. Interest on the Bonds will be calculated on the basis of twelve 30-day
months.
Any such interest not so punctually paid or duly provided for
shall forthwith cease to be payable to the registered holder on such Regular
Record Date, and may be paid to the person in whose name this Bond is
registered at the close of business on a Special Record Date for the payment of
such defaulted interest to be fixed by the Trustee, notice whereof shall be
given to Bondholders not less than 10 days prior to such Special Record Date,
all as more duly provided in such Indenture. Payment of the principal of and
interest on this Bond will be made at the office or agency of the Company
maintained for that purpose in the Borough of Manhattan, City and State of New
York, in such coin or currency of the United States of America as at the time
of payment is legal tender for payment of public and private debts.
Reference is hereby made to the further provisions of this
Bond set forth on the reverse hereof which further
2
<PAGE> 3
provisions shall for all purposes have the same effect as if set forth at this
place.
Unless the certificate of authentication hereon has been
executed by or on behalf of First Bank National Association, the Trustee under
such Indenture, or its successor thereunder, by manual signature, this Bond
shall not be entitled to any benefit under such Indenture, or be valid or
obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to
be duly executed under its corporate seal.
NATIONAL RURAL UTILITIES
COOPERATIVE FINANCE CORPORATION
Dated: April __, 1996
By:
---------------------------------
(Seal) Steven L. Lilly
Chief Financial Officer
Attest:
By:
-----------------------------
John Jay List
Assistant Secretary-Treasurer
Trustee's Certificate of
- ------------------------
Authentication
- --------------
This is one of the Bonds,
of the series designated therein,
described in the within-
mentioned Indenture.
By: FIRST BANK NATIONAL ASSOCIATION,
Trustee
By:
--------------------------------
Authorized Officer
3
<PAGE> 4
[FORM OF REVERSE OF COLLATERAL TRUST BOND, DUE 2001]
This Bond is one of an authorized issue of Bonds of the
Company known as its "Collateral Trust Bonds", issued and to be issued in one
or more series under, and all equally and ratably secured (except as any
sinking or other fund may afford additional special security for the Bonds of
any particular series) by, an Indenture dated as of February 15, 1994 (as
amended, supplemented and modified and in effect from time to time, the
"Indenture"), executed by the Company to First Bank National Association, as
Trustee (herein called the "Trustee", which term includes any successor Trustee
under the Indenture), to which Indenture reference is hereby made for a
description of the nature and extent of the securities and other property
assigned, pledged, transferred and mortgaged thereunder, the rights of the
Holders of said Bonds and of the Trustee and of the Company in respect of such
security, and the terms upon which said Bonds are and are to be authenticated
and delivered.
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Company and the rights of the Holders of the Bonds under the
Indenture at any time by the Company with the consent of the Holders of not less
than a majority in aggregate principal amount of the Bonds at the time
Outstanding, as defined in the Indenture. The Indenture also permits, with
certain exceptions as therein provided, the amendment of the terms of Mortgage
Notes pledged under the Indenture, and Mortgages and Loan Agreements pursuant to
which they were issued, at any time by the Company with the consent of
4
<PAGE> 5
the Holders of not less than a majority in aggregate principal amount of the
Bonds at the time Outstanding. The Indenture also contains provisions
permitting the Holders of specified percentages in aggregate principal amount of
the Bonds at the time Outstanding, on behalf of the Holders of all Bonds, to
waive compliance by the Company with certain provisions of the Indenture and
certain past defaults under the Indenture and their consequences. Any such
consent or waiver by the Holder of this Bond shall be conclusive and binding
upon such Holder and upon all future Holders of this Bond and of any Bond issued
upon the transfer hereof or in exchange herefor or in lieu hereof whether or not
notation of such consent or waiver is made upon this Bond.
As provided in the Indenture, said Bonds are issuable in
series which may vary as in said Indenture provided or permitted. This Bond is
one of a series entitled 6.45% Collateral Trust Bonds, Due 2001.
The Bonds of this series are not subject to redemption prior
to maturity.
If an Event of Default, as defined in the Indenture, shall
occur, the principal of this Bond may become or be declared due and payable, in
the manner and with the effect provided in the Indenture.
This Bond is transferable by the registered owner hereof in
person or by attorney authorized in writing, at the office or agency of the
Company referred to on the face hereof and at such other offices or agencies as
may be maintained for such purpose, upon surrender of this Bond, and upon any
such transfer a new Bond of the same series, for the same aggregate
5
<PAGE> 6
principal amount, will be issued to the transferee in exchange herefor.
The Bonds of this series are issuable only as registered Bonds
without coupons in denominations of $1,000 and any integral multiple thereof.
As provided in, and subject to the provisions of, the Indenture, Bonds of this
series are exchangeable for other Bonds of this series of a different
authorized denomination or denominations, as requested by the Holder
surrendering the same.
No service charge will be made for any such transfer or
exchange, but the Company or the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith.
Prior to due presentment for transfer at any office or agency
of the Company designated for such purpose, the Company, the Trustee and any
agent of the Company or the Trustee may treat the person in whose name this
Bond is registered as the owner hereof for the purpose of receiving payment as
herein provided and for all other purposes whether or not this Bond be overdue,
and neither the Company, the Trustee nor any such agent shall be affected by
notice to the contrary.
No reference herein to the Indenture and no provision of this
Bond or of the Indenture shall alter or impair the obligation of the Company,
which is absolute and unconditional, to pay the principal of and interest on
this Bond at the times, place and rate, and in the coin or currency, herein
prescribed.
6
<PAGE> 7
ASSIGNMENT
For value received the undersigned sells, assigns and
transfers unto (name, address including zip code and taxpayer I.D. or Social
Security number of assignee) _________________________________________________
______________________________________________________________________________
______________________________________________________________________________
the within Certificate and does hereby irrevocably constitute and appoint
______________________________________________________________________________
____________________________ attorney to transfer the said Certificate on the
books kept for registration thereof with full power of substitution on the
premises.
Dated:
------------------------
------------------------------
Signature by or on behalf of
assignor
