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 earliest event reported: June 3, 1996
PARKER-HANNIFIN CORPORATION
(Exact name of registrant as specified in its charter)
OHIO 1-4982 34-0451060
(State or other (Commission File Number) (IRS Employer
jurisdiction of Identification No.)
incorporation)
17325 Euclid Avenue, Cleveland, Ohio 44112
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (216) 531-3000
The Exhibit Index appears on sequential page__3__.
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PARKER-HANNIFIN CORPORATION
FORM 8-K
Item 5. Other Events.
The Company is filing herewith the following exhibits to its
Registration Statement on Form S-3 (File No. 333-02761), which was
declared effective on May 2, 1996.
1. Form of Distribution Agreement
2. Opinion of Jones, Day, Reavis
& Pogue relating to certain tax matters
3. Computation of Ratio of Earnings to Fixed
Charges (revised to reflect the Company's
financial results as of March 31, 1996)
4. Consent of Jones, Day, Reavis & Pogue
SIGNATURE
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.
PARKER-HANNIFIN CORPORATION
(Registrant)
By: Michael J. Hiemstra
Michael J. Hiemstra
Vice President - Finance and Administration
and Chief Financial Officer
Date: June 19, 1996
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EXHIBIT INDEX
Sequential
Exhibit No. Description of Exhibit Page
4.2 Form of Distribution Agreement 4
8.1 Opinion of Jones, Day, Reavis 54
& Pogue relating to tax matters
12.2 Computation of Ratio of Earnings 61
to Fixed Charges (revised to
reflect the Company's financial
results as of March 31, 1996)
23.3 Consent of Jones, Day, Reavis & Pogue
(included in Exhibit 8.1)
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Exhibit 4.2 to Report
on Form 8-K
Current Report
by Parker-Hannifin Corporation
Form of Distribution Agreement
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PARKER-HANNIFIN CORPORATION
$300,000,000
Medium-Term Notes
Due 9 Months or more from Date of Issue
U.S. DISTRIBUTION AGREEMENT
June 3, 1996
Morgan Stanley & Co. Incorporated
1585 Broadway
New York, New York 10036
Citicorp Securities, Inc.
399 Park Avenue
New York, New York 10043
Salomon Brothers Inc
7 World Trade Center
New York, New York 10048
Dear Sirs:
PARKER-HANNIFIN CORPORATION, an Ohio 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 $300,000,000 (or the equivalent thereof in
one or more foreign currencies or composite currencies)
aggregate initial public offering price of its medium-term
notes due 9 months or more from date of issue (the "Notes").
The Notes will be issued under an Indenture dated as of May
3, 1996 (the "Indenture") between the Company and National
City Bank, 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.
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The Company hereby appoints Morgan Stanley & Co.
Incorporated ("Morgan Stanley"), Citicorp Securities, Inc.
and Salomon Brothers Inc (individually, an "Agent" and
collectively, the "Agents") as its exclusive agents, subject
to Section 11, 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.
The Company has filed with the Securities and
Exchange Commission (the "Commission") a registration
statement, including a prospectus, for the registration
under the Act of $400,000,000 aggregate principal amount of
debt securities (the "Securities"), including the Notes.
Such registration statement, including the exhibits thereto,
as amended at the Commencement Date (as hereinafter
defined), is hereinafter referred to as the "Registration
Statement." The Company proposes to file with the
Commission from time to time, pursuant to Rule 424 under the
Securities Act of 1933, as amended (the "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. The terms "supplement," "amendment" and
"amend" as used herein shall include all documents deemed to
be incorporated by reference in the Prospectus that are
filed subsequent to the date of the Basic Prospectus by the
Company with the Commission pursuant to the Securities
Exchange Act of 1934, as amended (the "Exchange Act").
1. REPRESENTATIONS AND WARRANTIES. The Company
represents and warrants to and agrees with each Agent as of
the Commencement Date, as of each date on which the Company
accepts an offer to purchase Notes (including any purchase
by an Agent pursuant to a Terms Agreement), as of each date
the Company issues and delivers Notes and as of each date
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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 to the Registration Statement, the Basic
Prospectus and the Prospectus, each as amended or
supplemented to each such date):
(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 by the
Commission.
(b) Each part of the Registration Statement and
the Prospectus conform and, as amended or supplemented, if
applicable, will conform in all material respects with the
requirements of the Act, the Trust Indenture Act of 1939, as
amended (the "Trust Indenture Act") and the rules and
regulations of the Commission thereunder; 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; and 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 (i) the foregoing
shall not apply to statements in or omissions from any such
document in reliance upon, and in conformity with written
information relating to an Agent furnished to the Company by
such Agent expressly for use in the preparation thereof, and
(ii) the representations and warranties set forth above,
when made as of the Commencement Date or as of any date 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 documents from which information is
incorporated by reference in the Prospectus, when they
became effective or were filed with the Commission, as the
case may be, conformed in all material respects to the
requirements of the Act or the Exchange Act, as applicable,
and the rules and regulations of the Commission thereunder,
and any documents so filed and incorporated by reference
subsequent to the effective date of the Registration
Statement will, when they are filed with the Commission,
conform in all material respects to the requirements of the
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Act and the Exchange Act, as applicable, and the rules and
regulations of the Commission thereunder.
(d) The financial statements of the Company and
its subsidiaries set forth in the Registration Statement and
Prospectus, as amended or supplemented, if applicable,
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).
(e) The Company and each of its subsidiaries has
been duly incorporated and is an existing corporation in
good standing under the laws of its jurisdiction of
incorporation, has full power and authority (corporate and
other) to conduct its business as described in the
Registration Statement and Prospectus and is duly qualified
to do business in each jurisdiction in which it owns or
leases real property or in which the conduct of its business
requires such qualification except where the failure to be
so qualified, considering all such cases in the aggregate,
does not involve a material risk to the business,
properties, financial position or results of operations of
the Company and its subsidiaries (taken as a whole); and all
of the outstanding shares of capital stock of each such
subsidiary have been duly authorized and validly issued, are
fully paid and non-assessable and (except as otherwise
stated in the Prospectus) are owned beneficially by the
Company subject to no security interest, other encumbrance
or adverse claim.
(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 and the Notes have been duly
authorized, the Indenture has been duly qualified under the
Trust Indenture Act, executed and delivered and constitutes,
and the Notes, when duly executed, authenticated, issued and
delivered as contemplated hereby and by the Indenture, will
constitute valid and legally binding obligations of the
Company enforceable in accordance with their terms subject,
as to enforcement, to bankruptcy, insolvency, reorganization
and other laws of general applicability relating to or
affecting creditors' rights and to general equity
principles.
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(h) Except as contemplated in the Prospectus, as
amended or supplemented, if applicable, subsequent to the
respective dates as of which information is given in the
Registration Statement and the Prospectus, neither the
Company nor any of its subsidiaries has incurred any
liabilities or obligations, direct or contingent, or entered
into any transactions, not in the ordinary course of
business, that are material to the Company and its
subsidiaries (taken as a whole), and there has not been any
material change, on a consolidated basis, in the capital
stock, short-term debt or long-term debt of the Company and
its subsidiaries, or any material adverse change, or any
development involving a prospective material adverse change,
in the condition (financial or other), business, prospects,
net worth or results of operations of the Company and its
subsidiaries (taken as a whole).
(i) Except as set forth in the Prospectus, as
amended or supplemented, if applicable, there is not pending
or, to the knowledge of the Company, threatened, any action,
suit or proceeding to which the Company or any of its
subsidiaries is a party before or by any court or
governmental agency or body, which might result in any
material adverse change in the condition (financial or
other), business, prospects, net worth or results of
operations of the Company and its subsidiaries, or might
materially and adversely affect the properties or assets
thereof.
(j) There are no contracts or documents of the
Company or any of its subsidiaries that are required to be
filed as exhibits to the Registration Statement by the Act
or by the Rules and Regulations that have not been so filed.
(k) The performance of this Agreement and the
consummation of the transactions herein contemplated will
not result in a breach or violation of any of the terms and
provisions of, or constitute a default under, any statute,
any agreement or instrument to which the Company is a party
or by which it is bound or to which any of the property of
the Company is subject, the Company's Amended Articles of
Incorporation or Regulations, or any order, rule or
regulation of any court or governmental agency or body
having jurisdiction over the Company or any of its
properties; no consent, approval, authorization or order of,
or filing with, any court or governmental agency or body is
required for the consummation of the transactions
contemplated by this Agreement in connection with the
issuance or sale of the Notes by the Company, except such as
may be required under the Act, the Trust Indenture Act or
state securities laws; and the Company has full power and
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authority to authorize, issue and sell the Notes as
contemplated by this Agreement.
(l) The Company has complied with all provisions
of Section 517.075, Florida Statutes relating to doing
business with the Government of Cuba or with any person or
affiliate located in Cuba.
2. SOLICITATIONS AS AGENT; PURCHASES AS
PRINCIPAL.
(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. Upon receipt of at least one
business day's prior notice from the Company, the Agents
will forthwith 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 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:
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Term Commission Rate
From 9 months to less than 12 months .125%
From 12 months to less than 18 months .150%
From 18 months to less than 2 years .200%
From 2 years to less than 3 years .250%
From 3 years to less than 4 years .350%
From 4 years to less than 5 years .450%
From 5 years to less than 6 years .500%
From 6 years to less than 7 years .550%
From 7 years to less than 8 years .600%
From 8 years to less than 9 years .600%
From 9 years to less than 10 years .600%
From 10 years to less than 15 years .625%
From 15 years to less than 20 years .700%
From 20 years to less than 30 years .750%
From 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 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
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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.
(d) Delivery. The documents required to be
delivered by Section 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 office of Sullivan & Cromwell, counsel for
the Agents, not later than 4:00 p.m., New York 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."
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(e) Obligations Several. The Company
acknowledges that the obligations of the Agents under this
Agreement are several and not joint.
3. AGREEMENTS. The Company agrees with each
Agent that:
(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 given each of you a
reasonable opportunity to comment on any such proposed
amendment or supplement; provided, however, that, in the
event that an Agent may own any Notes as principal, until
the distribution of such Notes has been completed, the
Company will not file any such proposed supplement or
amendment to which such Agent reasonably objects; provided,
further, that (i) the foregoing requirements shall not apply
to 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, 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 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 Act. The Company will promptly advise
the Agents (i) of the filing of any amendment or supplement
to the Basic Prospectus (other than filings referred to in
clause (i) above) (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
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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 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 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, which will be provided to the Agents for
review, 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,
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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 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 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.
(e) The Company will use its best efforts 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, provided
that the Company shall not be required in connection
therewith to qualify as a foreign corporation or to execute
a general consent to service of process in any state.
(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 performance by the
Company of its obligations hereunder or thereunder as the
Agents may from time to time reasonably request.
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(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 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) any expenses
incurred by the Company in connection with a "road show"
presentation to potential investors and (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 out-of-pocket expenses incurred by
the Agents; provided that any advertising expenses incurred
by the Agents shall have been approved by the Company.
(i) During the period beginning the date of any
Terms Agreement and continuing to and including the
Settlement Date with respect to such Terms Agreement, the
Company will not, without such Agent's prior written
consent, offer, sell, contract to sell or otherwise dispose
of any debt securities of the Company or warrants to
purchase debt securities of the Company substantially
similar to such Notes (other than (i) the Notes that are to
be sold pursuant to such Terms Agreement, (ii) Notes
previously agreed to be sold by the Company, (iii)
commercial paper issued in the ordinary course of business
and (iv) debt securities issued by the Company pursuant to
transactions exempt from registration under
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Section 4(2) of the Act or Rule 506 promulgated thereunder,
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 at
the time the Company accepts the offer to purchase such
Notes and at the time of issuance and delivery thereof and
to the following additional conditions precedent when and as
specified:
(a) Prior to such solicitation or purchase, as
the case may be:
(i) no stop order suspending the effectiveness of
the Registration Statement shall have been issued and
no proceeding for that purpose shall have been
instituted or, to the knowledge of the Company or any
Agent, threatened by the Commission, and any request of
the Commission for additional information (to be
included in the Registration Statement or the
Prospectus or otherwise) shall have been complied with
to the satisfaction of the Agents;
(ii) no Agent shall have advised the Company that
the Registration Statement or Prospectus, or any
amendment or supplement thereto, contains an untrue
statement of fact which in the opinion of the Agents is
material, or omits to state a fact which in the opinion
of the Agents is material and is required to be stated
therein or is necessary to make the statements therein
(in the case of the Prospectus, in the light of the
circumstances under which they were made) not
misleading;
(iii) except as contemplated in the
Prospectus, as amended or supplemented at the time
of such solicitation or at the time such offer to
purchase was made, subsequent to the respective
dates as of which information is given on the
Registration Statement and the Prospectus, as
amended or supplemented, if applicable, there
shall not have been any change, on a consolidated
13
<PAGE>
basis, in the capital stock, short-term debt or
long-term debt of the Company and its subsidi-
aries, or any adverse change in the condition
(financial or other), business, prospects, net
worth or results of operations of the Company and
its subsidiaries that, in the judgment of the
relevant Agent, makes it impracticable to market
the Notes on the terms and in the manner
contemplated by the Prospectus, as so amended or
supplemented; and
(iv) none of the following shall have occurred:
(a) trading on the New York Stock Exchange or the
American Stock Exchange shall have been wholly
suspended, (b) minimum or maximum prices for trading
shall have been fixed, or maximum ranges for prices for
securities shall have been required, on the New York
Stock Exchange or the American Stock Exchange, by such
Exchange or by order of the Commission or any other
governmental authority having jurisdiction, (c) a
banking moratorium shall have been declared by Federal
or New York authorities, (d) any 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) under the Act
or any 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, or (e) an outbreak or
material escalation of major hostilities in which the
United States is involved, a declaration of war by
Congress, any other substantial national or inter-
national calamity or any other event or occurrence of a
similar character shall have occurred that, in the
judgment of the relevant Agent, makes it impracticable
or inadvisable 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;
(A) except, in each case described in paragraph
(iii) or (iv) 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 (iv) 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.
14
<PAGE>
(b) 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 Jones,
Day, Reavis & Pogue, outside counsel for the Company,
in substantially the form attached as Annex I hereto.
(ii) The opinion of Joseph D. Whiteman, Esq.,
Vice President, General Counsel and Secretary of the
Company, dated as of such date, to the effect that:
(a) each of Parker Services Inc., Travel 17325
Inc., Parker Properties Inc., Parker-Hannifin
International Corp., Parker Intangibles Inc., Parker de
Puerto Rico, Inc., Parker Finance Corp., Parker-
Hannifin Asia Pacific Co., Ltd., and iPower
Distribution Group, Inc. (collectively referred to as
the "Domestic Subsidiaries") is duly incorporated,
validly existing and in good standing under the laws of
its respective jurisdiction of incorporation; each of
the Domestic Subsidiaries has corporate power and
authority to own its properties and to conduct its
business as described in the Prospectus and is
qualified to do business in each state in which it owns
or leases real property, except where the failure to be
so qualified, considering all such cases in the
aggregate, does not involve a material risk to the
business, properties, financial position or results of
the operations of the Company and its Domestic
Subsidiaries (taken as a whole); all of the outstanding
shares of capital stock of each of the Domestic
Subsidiaries have been duly authorized and validly
issued, are fully paid and nonassessable and (except as
otherwise stated in the Prospectus)are owned
beneficially by the Company;
(b) each of Parker Hannifin GmbH, Parker Hannifin
Plc, Parker Hannifin S.p.A., Parker Hannifin (Canada)
Inc., Parker Hannifin RAK, S.A., VOAC Hydraulics AB and
Parker Pneumatic AB (collectively referred to as the
"Significant Foreign Subsidiaries") has been duly
organized and is in good standing under the laws of its
respective jurisdiction of incorporation; each of the
Significant Foreign Subsidiaries has full power and
authority (corporate and other) to conduct its business
as described in the Registration Statement; each of the
Significant Foreign Subsidiaries is not, and is not
required to be, registered or qualified to do business
as a foreign corporation under the laws of any
jurisdiction other than its jurisdiction of
incorporation, and all of the outstanding shares of
15
<PAGE>
capital stock of each of the Significant Foreign
Subsidiaries have been duly authorized and validly
issued, are fully paid and non-assessable and (except
for shareholders' or directors' qualifying shares) are
owned, directly or indirectly, by the Company subject
to no security interest, other encumbrance, or adverse
claim (such counsel being entitled to rely upon
opinions of local counsel, provided that such counsel
shall furnish to you signed copies thereof and state
that he believes that both you and he are justified in
relying upon such opinion).
(iii) The opinion, dated as of such date, of
Sullivan & Cromwell, counsel for the Agents, covering
the matters in Annex I in the paragraphs numbered (2),
(3) and (4), and certain matters covered in the first
and last unnumbered paragraphs of Annex I.
The opinion of Jones, Day, Reavis & Pogue
described in paragraph (b)(i) above shall be rendered
to the Agents at the request of the Company and shall
so state therein.
(c) 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, and signed by the Chairman of the Board, the
President or a Vice President and by the principal financial
or accounting officer to the effect that, to the best of
their knowledge based upon reasonable investigation:
(i) the representations and warranties of the
Company contained in this Agreement 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;
(ii) no stop order suspending the effectiveness
of the Registration Statement has been issued, and no
proceeding for that purpose has been instituted or is
threatened by the Commission; and
(iii) since the effective date of the
Registration Statement, there has occurred no event
required to be set forth in an amendment or supplement
to the Registration Statement or Prospectus that has
not been so set forth, and there has been no document
required to be filed under the Exchange Act and the
rules and regulations thereunder that upon such filing
16
<PAGE>
would be deemed to be incorporated by reference in the
Prospectus that has not been so filed.
The officers signing and delivering such
certificate may rely upon the best of their knowledge as to
proceedings threatened.
(d) On the Commencement Date and, if called for
by any Terms Agreement, on the corresponding Settlement
Date, Coopers & Lybrand, independent public accountants,
shall have furnished to the relevant Agents a letter or
letters, dated the Commencement Date or such Settlement Date
to the effect set forth in Exhibit II hereto.
(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.
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 (i) solely setting forth the terms of any
Securities other than the Notes or (ii) 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), the Company
will deliver or cause to be delivered forthwith to each
Agent a certificate, 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(c), and signed by
officers as required in such Section, 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
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(b)(i), 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
17
<PAGE>
the Registration Statement and the Prospectus as amended or
supplemented to the time of delivery of such letter).
(c) 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 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. INDEMNITY AND CONTRIBUTION. (a) The Company
agrees to indemnify and hold harmless each Agent and each
person, if any, who controls any Agent within the meaning of
either Section 15 of the 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 defending or
investigating 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 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.
18
<PAGE>
(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 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
19
<PAGE>
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, 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) 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 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 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 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 aggregate principal amount of
the Notes the sale of which by or through any Agent gave
20
<PAGE>
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) of this Section 6. The amount paid or payable
by an indemnified party as a result of the losses, claims,
damages and liabilities referred to in paragraph (d) of this
Section 6 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) of this Section 6 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 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.
(f) The indemnity and contribution provisions
contained in this Section 6, 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
(i) any termination of this Agreement or any such Terms
Agreement, (ii) any investigation made by or on behalf of
any Agent or any person controlling any Agent or by or on
behalf of the Company, its officers or directors or any
person controlling the Company and (iii) acceptance of and
payment for any of the Notes.
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
21
<PAGE>
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
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 13 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. 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 1251 Avenue of the Americas,
New York, New York 10020, Attention: Manager, Credit
Department (telefax number: 212-703-4575), with a copy to
1585 Broadway, New York, New York 10036, Attention:
Managing Director, Continuously Offered Products (telefax
number: 212-761-0780), Citicorp Securities, Inc., 399 Park
Avenue, New York, NY 10043, Attention: Manager, Debt
Syndicate (telefax number: 212-291-3109) and Salomon
Brothers Inc, 7 World Trade Center, New York, New York 10048
(telefax number: 212-783-4120) or, if sent to the Company,
will be mailed, delivered or telefaxed and confirmed to the
Company at 17325 Euclid Avenue, Cleveland, Ohio 44112,
Attention: Treasurer (telefax number (216) 481-4057).
10. 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
22
<PAGE>
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.
11. AMENDMENTS. This Agreement may be amended or
supplemented if, but only if, such amendment or supplement
is in writing and is signed by the Company and each Agent;
provided that the Company may from time to time, on 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.
12. COUNTERPARTS. This Agreement may be signed
in two or more counterparts, each of which shall be an
original, with the same effect as if the signatures thereto
and hereto were upon the same instrument.
13. APPLICABLE LAW. This Agreement shall be
governed by and construed in accordance with the internal
laws of the State of New York.
14. 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.
23
<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,
PARKER-HANNIFIN CORPORATION
By /s/ Joseph D. Whiteman
Name: Joseph D. Whiteman
Title: Vice President, General
Counsel and Secretary
The foregoing Agreement
is hereby confirmed
and accepted as of the
date first above written.
MORGAN STANLEY & CO. INCORPORATED
By /s/ James D. Glascott
Name: James D. Glascott
Title: Principal
CITICORP SECURITIES, INC.
By /s/ Donald J. Donahue
-----------------------------
Name: Donald J. Donahue
Title: Vice President
SALOMON BROTHERS INC
By /s/ Pamela Kendall
-----------------------------
Name: Pamela Kendall
Title: Vice President
24
<PAGE>
EXHIBIT A
PARKER-HANNIFIN CORPORATION
MEDIUM-TERM NOTES
TERMS AGREEMENT
_______ __, 199_
PARKER-HANNIFIN CORPORATION
17325 Euclid Avenue
Cleveland, OH 44112
Attention:
Re: Distribution Agreement dated
June 3, 1996
(the "Distribution Agreement")
We agree to purchase your Medium-Term 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
---- ----------------
[Name of relevant Agent(s)]
[Insert syndicate list]*
Total . . . . . . $
===========
______________________
Delete if the transaction will not be syndicated.
- 1 -
<PAGE>
The Notes shall have the following terms:
All Notes: Fixed Rate Notes: Floating Rate Notes:
- --------- ---------------- -------------------
Principal amount: Interest Rate: Base rate:
Purchase price: Applicability Index maturity:
of modified
Price to public: payment upon Spread:
acceleration:
Settlement date Spread multiplier:
and time: If yes, state
issue price: Alternate rate
Place of event spread:
delivery: Amortization
schedule: Initial interest
Specified rate:
currency:
Initial interest
Maturity date: reset date:
Initial accrual Interest reset
period OID: dates:
Total amount Interest reset
of OID: period:
Original yield Maximum interest
to maturity: rate:
Optional repayment Minimum interest
date(s): rate:
Optional redemption Interest payment
date(s): period:
Initial redemption Interest payment
date: dates:
Initial redemption Calculation agent:
percentage:
Annual redemption
percentage
decrease:
Other terms:
- 2 -
<PAGE>
The provisions of Sections 1, 2(b) and 2(c) and 3
through 6, 9, 10, 11 and 13 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 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
______________________
Delete if the transaction will not be syndicated.
- 3 -
<PAGE>
and 13 of the Distribution Agreement shall survive for the
purposes of this Agreement.
The following information, opinions, certificates,
letters and documents referred to in Section 4 of the
Distribution Agreement will be required: ________________
[NAME OF RELEVANT AGENT(S)]
By _______________________
Name
Title:
Accepted:
PARKER-HANNIFIN CORPORATION
By ________________________
Name:
Title:
- 4 -
<PAGE>
ANNEX I
(1) The Company is duly incorporated,
validly existing and in good standing under the
laws of its jurisdiction of incorporation, with
corporate power and authority to own its
properties and to conduct its business as
described in the Prospectus and is qualified to do
business in each state in which it owns or leases
real property, except where the failure to be so
qualified, considering all such cases in the
aggregate, does not involve a material risk to the
business, properties, financial position or
results of operations of the Company and its
subsidiaries (taken as a whole).
(2) The Indenture has been duly
authorized, executed and delivered by the Company
and duly qualified under the Trust Indenture Act
of 1939 and is a valid and binding instrument of
the Company, enforceable against the Company in
accordance with its terms, subject to the effect
of (i) general principles of equity, regardless of
whether such enforceability is considered in a
proceeding in equity or at law, and (ii) any
applicable bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting creditors'
rights generally.
(3) The Notes have been duly authorized
and, if 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, would be valid and binding
obligations of the Company, enforceable against
the Company in accordance with their terms,
subject to the effect of (i) general principles of
equity, regardless of whether such enforceability
is considered in a proceeding in equity or at law,
and (ii) any applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws
affecting creditors' rights generally.
(4) Each of the Distribution Agreement
and, if applicable, any Written Terms Agreement
has been duly authorized, executed and delivered
by the Company.
(5) Neither the execution and delivery of
the Distribution Agreement nor the performance of
the transactions therein contemplated will result
in the violation of any statute or regulation or
any order or decree of any court or governmental
<PAGE>
authority known to us which is binding upon the
Company or its property, or conflict with or
result in a default under any of the terms and
provisions of the Company's Amended Articles of
Incorporation or Code of Regulations or any
indenture, loan agreement or any agreement listed
on Exhibit A attached hereto.
(6) No consent, approval, authorization
or order of any governmental agency or body is
required for the issuance or sale by the Company
of the Notes, except such as have been obtained
under the Act and the Trust Indenture Act and such
as may be required under state securities or Blue
Sky laws in connection with the purchase and
distribution of the Notes by the Agents.
We have participated in the preparation of the
Registration Statement and Prospectus (certain of the
documents incorporated into the Prospectus by reference
having previously been prepared and filed by the Company
without our participation). From time to time we have had
discussions with officers and employees of the Company,
accountants and auditors, the independent accountants who
examined certain of the financial statements of the Company
and its consolidated subsidiaries included in the
Registration Statement and Prospectus, and your
representatives concerning the information contained in the
Registration Statement and Prospectus and the proposed
responses to various items in Form S-3. Based thereupon we
are of the opinion that the Registration Statement and the
Prospectus (except for financial statements, financial
schedules, and other financial data included therein, as to
which we express no opinion) at the time the Registration
Statement became effective under the Act complied as to form
in all material respects with the Act and the Trust
Indenture Act and the respective rules and regulations
thereunder, and that the documents incorporated or deemed to
be incorporated by reference into the Prospectus that were
filed prior to the date of this opinion (except for
financial statements, financial schedules, and other
financial data included therein, as to which we express no
opinion) at the time they were filed complied as to form in
all material respects with the requirements of the Exchange
Act and the rules and regulations thereunder.
- 2 -
<PAGE>
We do not know of any litigation or governmental
proceedings required to be described in the Prospectus that
are not described as required, or of any contracts or other
documents of a character required to be described in the
Registration Statement or Prospectus or to be filed as
exhibits to the Registration Statement which are not
described and filed as required. The descriptions in the
Registration Statement and Prospectus of statutes, legal and
governmental proceedings, contracts and other documents
present fair summaries of such statutes, legal and
governmental proceedings, contracts or other documents. We
further are of the opinion that the statements contained in
the Prospectus under the caption "Description of Senior Debt
Securities" and "United States Taxation," insofar as they
purport to summarize the provisions of documents or the
Unites States Federal tax laws described therein, present
fair summaries of such provisions or such United States
Federal tax laws.
The Registration Statement has become effective
under the Act, and to the best of our knowledge, no stop
order suspending the effectiveness of the Registration
Statement has been issued and no proceeding for that purpose
or challenging the accuracy of any document incorporated by
reference into the Prospectus are pending or, to the best of
our knowledge, threatened by the Commission.
We have not independently verified and are not
passing upon, and do not assume any responsibility for, the
accuracy, completeness or fairness (except as set forth in
the second preceding paragraph above) of the information
contained in the Registration Statement and Prospectus,
including any document incorporated or deemed to be
incorporated therein by reference. Based upon the
participation and discussions described above, however, no
facts have come to our attention that cause us to believe
that the Registration Statement (except for financial
statements, financial schedules, and other financial date
included therein), at the time it became effective contained
any untrue statement of a material fact or omitted to state
a material fact required to be stated therein or necessary
in order to make the statements therein not misleading, or
that the Prospectus (with the foregoing exceptions), on the
date of the Prospectus and the Commencement Date, contained
or contains any untrue statement of a material fact or
omitted or omits to state a material fact required to be
stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they
were made, not misleading.
- 3 -
<PAGE>
ANNEX II
(1) They are independent certified public
accountants with respect to the Company and its
subsidiaries within the meaning of the Act and the
published rules and regulations thereunder.
(2) In their opinion, the consolidated
financial statements and schedules audited by them and
included or incorporated by reference in the
Registration Statement and Prospectus comply as to form
in all material respects with the applicable accounting
requirements of the Act or the Exchange Act, as
applicable, and the published rules and regulations
thereunder.
(3) On the basis of procedures referred to in
such letter, including a reading of the latest
available interim financial statements of the Company
and inquiries of officials of the Company responsible
for financial and accounting matters, nothing caused
them to believe that:
(A) any unaudited financial statements
included or incorporated in the Prospectus do not
comply as to form in all material respects with
the applicable accounting requirements of the
Exchange Act and the published rules and
regulations thereunder or are not stated on a
basis substantially consistent with that of the
audited financial statements included in the
Company's most recent Annual Report on Form 10-K;
or
(B) at a specified date not more than five
days prior to the date of such letter, there was
any change in the capital stock, short-term debt
or long-term debt of the Company and its
subsidiaries or any decrease in consolidated net
current assets or net assets as compared with
amounts shown in the most recent unaudited balance
sheet included or incorporated by reference in the
Prospectus, except in all cases for changes or
decreases which the Prospectus discloses have
occurred or may occur or as may be set forth in
such letter; or
(C) for the period from the date of the most
recent unaudited balance sheet included or
incorporated by reference in the Prospectus to a
subsequent specified date not more than five days
prior to the date of such letter, there was any
decrease, as compared with the corresponding
<PAGE>
period of the previous year and with the period of
corresponding length ended the date of such
unaudited balance sheet, in consolidated net
sales, consolidated net income before taxes, or
net income, except in all cases for changes or
decreases which the Prospectus discloses have
occurred or may occur or as may be set forth in
such letter.
(4) In addition to their examination referred to
in their report included or incorporated by reference
in the Registration Statement and Prospectus and the
procedures referred to in (3) above, they have carried
out certain other specified procedures, not
constituting an audit, with respect to certain of the
dollar amounts, percentages and other financial
information to be agreed upon by the Company and the
Underwriters (in each case to the extent that such
dollar amounts, percentages and other financial
information, are derived directly or by analysis or
computation, from the general accounting records of the
Company and its subsidiaries) that are included or
incorporated by reference in the Prospectus and appear
or are incorporated by reference in the Company's
Annual Report on Form 10-K under the captions "Item
1. - Business", "Item 6. - Selected Financial Data",
and "Item 7. - Management's Discussion and Analysis of
Financial Condition and Results of Operations", and
have found such dollar amounts, percentages and
financial information to be in agreement with the
general accounting records of the Company and its
subsidiaries.
- 2 -
<PAGE>
EXHIBIT B
PARKER-HANNIFIN CORPORATION
MEDIUM-TERM NOTES
ADMINISTRATIVE PROCEDURES
_________________________________
Explained below are the administrative procedures
and specific terms of the offering of Medium-Term Notes (the
"Notes"), on a continuous basis by PARKER-HANNIFIN CORPORATION
(the "Company") pursuant to the Distribution Agreement, dated
as of June 3, 1996 (the "Distribution Agreement") among the
Company and Morgan Stanley & Co. Incorporated, Citicorp
Securities, Inc. and Salomon Brothers Inc (the "Agents"). The
Notes will be issued under an Indenture dated as of May 3,
1996 (the "Indenture") between the Company and National City
Bank, 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.
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.
B-1
<PAGE>
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.
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 June 3, 1996, and a Medium-Term Note Certificate
Agreement between the Trustee and DTC, dated as of March 22,
1989 (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.
B-2
<PAGE>
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.
Preparation If any offer to purchase a Book-
of Pricing Entry Note is accepted by or on
Supplement: behalf of the Company, the Company
will prepare a pricing 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 Act and (ii) will, as
soon as possible and in any event not later
than the date on which such Pricing Supplement
is filed with the Commission, deliver the
number of copies of such Pricing Supplement to
the relevant Agent as such Agent shall request.
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, unless the
Company accepts an offer to purchase Notes
after 4:30 p.m. on such date in which case
settlement will occur on the fourth Business
Day next succeeding such date of acceptance,
B-3
<PAGE>
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
Procedures: to each Book-Entry Note 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 Book-Entry
Note, the Interest Rate, whether such Note
will pay interest annually or semiannually
and whether such Note is an Amortizing
Note, and, if so, the amortization
schedule, or, in the case of a 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 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).
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.
B-4
<PAGE>
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. 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, the
B-5
<PAGE>
relevant Agent and 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
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
B-6
<PAGE>
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 at Society National
Bank, Cleveland, Ohio, 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
B-7
<PAGE>
the Trustee that have not yet been settled.
Settlement For sales by the Company of Book-
Procedures Entry Notes to or through an Agent
Timetable: (unless otherwise specified pursuant to a Terms
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
Procedure Time
--------- ----
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 a 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-8
<PAGE>
Failure If the Trustee fails to enter an
to Settle: SDFS deliver order with 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
B-9
<PAGE>
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 Certi-
of Pricing ficated Note is accepted by or on
Supplement: behalf of the Company, the Company will prepare
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 Act and (ii)
will, as soon as possible and in any event not
later than the date on which such Pricing
Supplement is filed with the Commission,
deliver the number of copies of such Pricing
Supplement to the relevant Agent as such Agent
shall request.
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, unless the Company accepts an offer
to purchase Notes after 4:30 p.m. on
B-11
<PAGE>
such date in which case settlement will occur
on the fourth Business Day next succeeding such
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.
Settlement Settlement Procedures with regard to
Procedures: each Certificated Note 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 such 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 semiannually 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).
B-12
<PAGE>
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.
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.
B-13
<PAGE>
19. Any other applicable terms.
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.
C. The Company will have delivered to the
Trustee a pre-printed four-ply 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.
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, and such Agent
will acknowledge receipt of the Note by
stamping or otherwise marking Stub One and
returning it to the Trustee. Such delivery
will be made only against such
acknowledgment of receipt and evidence that
instructions have been given by such Agent
for payment to the account of the Company
at Society National Bank, Cleveland, Ohio,
or to such other 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
B-14
<PAGE>
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 Certifi-
Procedures cated Notes to or through an Agent
Timetable: (unless otherwise specified pursuant to a
Terms 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:
Settlement
Procedure Time
A 2:00 P.M. on day before settlement date
B 3:00 P.M. on 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
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
B-15
<PAGE>
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
Exhibit 8.1 to Report
on Form 8-K
Current Report
by Parker-Hannifin Corporation
Opinion of Jones, Day, Reavis & Pogue
<PAGE>
June 3, 1996
Parker-Hannifin Corporation
17325 Euclid Avenue
Cleveland, Ohio 44112
Re: Parker-Hannifin Corporation Medium-Term Notes
Ladies and Gentlemen:
We have acted as special tax counsel to Parker-Hannifin
Corporation (the "Company") in connection with its medium-term notes (the
"Notes"), which may be issued in one or more series and may be offered and
sold in the United States from time to time, as set forth in the Company's
Prospectus (the "Prospectus"), dated May 3, 1996, and the Company's
Prospectus Supplement (the "Prospectus Supplement"), dated June 3, 1996.
This letter will be deemed accepted by you in the form hereof upon
the filing of the Prospectus Supplement with the Securities and Exchange
Commission. Your acceptance of this letter in the form hereof constitutes
your acceptance of, and acquiescence in, the assumptions, exclusions,
limitations and rules of construction set forth below.
1. AUTHORITIES EXAMINED
In rendering the opinion set forth below, we have examined and relied
upon provisions of the Internal Revenue Code of 1986, as amended (hereinafter
"I.R.C." or the "Code"); final, temporary and proposed regulations promulgated
under the Code by the U.S. Department of the Treasury; administrative
pronouncements issued by the U.S. Internal Revenue Service; judicial decisions
rendered by U.S. Federal courts of competent jurisdiction; and such other
sources and authorities that we have deemed relevant in reaching the conclusions
expressed herein.
<PAGE>
Parker-Hannifin Corporation
June 3, 1996
Page 2
2. OPINION
Based upon the foregoing, and subject to the assumptions, exclusions
and limitations set forth below, we are of the opinion that the discussion
contained in the section of the Prospectus Supplement entitled "United States
Taxation" accurately reflects the material United States federal income tax
consequences of the ownership and disposition of the Notes purchased by an
initial Holder (as defined in such section) thereof at the "issue price" (as
defined in such section).
3. ASSUMPTIONS
In rendering the opinion set forth above, we have assumed (and we
have made no independent investigation or inquiry whatsoever to confirm, and we
expressly disclaim any intent, undertaking or obligation to make any such
investigation or inquiry to confirm) that:
3.1. Each document that was required to be executed but was not
executed, or that was otherwise not in final form, on the date on
which we examined such document, will be timely executed and/or
delivered in final form, which final form will not differ in any
material respect from the form in which such document was
examined by us on such date.
3.2. The representations made to us by officers of the Company,
whether orally or in writing, with respect to the subject
matter of the opinion set forth above are true, correct and
complete in all material respects as of the date they were made
and at all times thereafter through and including the date
hereof.
3.3. The transactions contemplated by the Prospectus Supplement will
not contravene any obligation to which any party is subject.
3.4. All assumptions made in connection with the delivery of any other
opinion to the addressee hereof or any other person, whether by
ourselves or by any other professional adviser, in connection
with any transaction or subject matter reasonably related to the
subject matter of our opinion set forth above are correct at all
relevant times through and including the later of the date of
such other opinion and the date hereof.
<PAGE>
Parker-Hannifin Corporation
June 3, 1996
Page 3
4. EXCLUSIONS
Anything in the foregoing to the contrary notwithstanding, we
expressly decline to opine upon, and expressly disclaim any intent, undertaking
or obligation to opine upon, and hereby expressly exclude from the scope of the
opinion set forth above, the following matters:
4.1. Any and all matters arising under the laws of any State of the
United States or the District of Columbia or any political
subdivision thereof.
4.2. Any and all matters arising under the laws of any country
other than the United States. For this purpose, the depen-
dencies, protectorates, territories and possessions of the
United States shall be deemed to be countries other than the
United States.
4.3. Any and all matters with respect to any tax other than the
U.S. Federal income tax.
4.4. The effect upon the opinion set forth above of any provision
of law that may affect any particular person differently from
any other person, by reason of such first-mentioned person's
special status, characteristics or situation.
5. LIMITATIONS
5.1. The opinion set forth above is furnished only as to facts and
circumstances existing at the date hereof and actually known
or represented to us on such date. If any such facts and
circumstances should change, or if a determination is made
hereafter that any such facts or circumstances were untrue or
inaccurate on such date, any such change or determination
could adversely affect or render inapplicable the opinion set
forth above. We expressly disclaim any intent, undertaking or
obligation to notify the addressee hereof or any other person
of any such change or determination of which we may
subsequently become aware or any possible effects thereof on
the opinion set forth above.
5.2. The opinion set forth above is furnished in express reliance
on the assumptions set forth in Section 3
<PAGE>
Parker-Hannifin Corporation
June 3, 1996
Page 4
hereof. If a determination is made hereafter that any such
assumption was untrue or inaccurate as of the date hereof, any
such determination could adversely affect or render inapplicable
the opinion set forth above. We expressly disclaim any intent,
undertaking or obligation to notify the addressee hereof or
any other person of any such determination of which we may
subsequently become aware or of any possible effects thereof
on the opinion set forth above.
5.3. Each of the sources and authorities described in Section 1
hereof is subject to repeal, revocation or modification
without notice, possibly with retroactive effect; any such
repeal, revocation or modification could adversely affect or
render inapplicable the opinion set forth above. The opinion
set forth above applies only to the subject matter thereof as
at the date hereof, and we expressly disclaim any intent,
undertaking or obligation to notify the addressee hereof or
any other person of any such repeal, revocation or
modification or any possible effects thereof on the opinion
set forth above.
5.4. The contents of Section 2 hereof, subject to and as modified
by the remaining contents hereof, constitute the entirety of
the opinion and advice furnished by us to the addressee hereof
with respect to the subject matter hereof. This original and
any simultaneously executed counterparts hereof together
constitute one and the same original writing, which writing
supersedes any and all (a) prior drafts or versions hereof and
(b) prior or contemporaneous statements, conclusions,
representations, writings, understandings, opinions, dis-
cussions and other communications in any form between us and
any addressee hereof relating to the subject matter hereof.
In proving the existence or contents of this letter, it shall
not be necessary to produce, refer to or account for (a) any
particular executed original counterpart hereof in preference
to any other such counterpart, or (b) more than one such
counterpart.
5.5. No oral communication made after the date hereof shall be
deemed or effective to modify the contents hereof in any
manner. No written communication made
<PAGE>
Parker-Hannifin Corporation
June 3, 1996
Page 5
after the date hereof shall be deemed or effective to modify the
contents hereof in any manner, except to the extent that any such
modification is explicitly set forth in such subsequent written
communication and contains an express reference to this letter.
5.6. In rendering the opinion contained in Section 2 hereof, we do
not purport to be experts on laws other than the Federal laws
of the United States.
5.7. The opinion set forth above is furnished solely for the
benefit of the addressee hereof and may not, except as
specifically provided below, be used, relied upon, referred to
or quoted by any other person without our prior specific
written consent thereto. There are no express or implied
third-party beneficiaries of or in the opinion set forth
above.
6. RULES OF CONSTRUCTION
In interpreting the provisions of this letter, the following rules of
interpretation and construction shall apply:
6.1. The terms and provisions hereof and the wording used herein
shall in all cases be interpreted and construed in accordance
with their fair meanings and not strictly for or against any
person.
6.2. Capitalized terms used herein without definition have the res-
pective meanings set forth in the Prospectus or Prospectus
Supplement.
6.3. The captions at the headings of each Section of this letter
are provided for convenience of reference only, and are in no
way intended or to be used or applied to describe, interpret,
construe, define or limit the scope, extent, intent, meaning
or operation of any term or provision hereof.
6.4. Unless the context clearly requires otherwise, each reference
to, and each use of, any of the masculine, feminine or neuter
genders herein shall be deemed to constitute a reference to,
and a use of, each such gender without distinction.
<PAGE>
Parker-Hannifin Corporation
June 3, 1996
Page 6
6.5. Unless the context clearly requires otherwise, each reference
to, and each use of, either the singular or plural number
herein shall be deemed to constitute a reference to, and a use
of, each such number without distinction.
****
We hereby consent to the furnishing of the opinion as Exhibit 8.1
to Registration Statement No. 333-07261 on Form S-3 filed by the Company to
effect registration of the Notes under the Securities Act of 1933 and to the
reference to us under the caption "United States Taxation" in the Prospectus
Supplement.
Very truly yours,
Jones, Day, Reavis & Pogue
Jones, Day, Reavis & Pogue
Exhibit 12.2
<TABLE>
<CAPTION>
PARKER-HANNIFIN CORPORATION
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(In thousands)
Nine months
Ended March 31, Fiscal Year Ended June 30,
____________________ _____________________________________________________
1996 1995 1995 1994 1993 1992 1991
<S> <C> <C> <C> <C> <C> <C> <C>
EARNINGS
Income from continuing operations
before income taxes $ 277,618 $ 244,858 $ 348,407 $ 112,449 $ 108,066 $ 105,391 $ 103,468
Add:
Interest on indebtedness, exclusive
of interest capitalized in
accordance with FASB #34 and
interest on ESOP loan guarantee 22,781 21,088 28,884 34,687 43,055 47,394 53,898
Amortization of deferred loan costs 96 96 128 297 237 246 220
Portion of rents representative of
interest factor 5,649 6,593 8,791 7,157 10,299 10,476 12,158
Equity share of losses of companies
for which debt obligations are
not guaranteed 416 377 392 1,359 1,566 416 407
Amortization of previously
capitalized interest 197 173 216 217 206 200 225
_________ _________ _________ _________ _________ _________ _________
Income as adjusted $ 306,757 $ 273,185 $ 386,818 $ 156,166 $ 163,429 $ 164,123 $ 170,376
========= ========= ========= ========= ========= ========= =========
FIXED CHARGES
Interest on indebtedness, exclusive
of interest capitalized in
accordance with FASB #34 and
interest on ESOP loan guarantee $ 22,781 $ 21,088 $ 28,884 $ 34,687 $ 43,055 $ 47,394 $ 53,898
Capitalized interest 438 224 283 298 32 232 921
Amortization of deferred loan costs 96 96 128 297 237 246 220
Portion of rents representative of
interest factor 5,649 6,593 8,791 7,157 10,299 10,476 12,158
_________ _________ _________ _________ _________ _________ _________
Fixed charges $ 28,964 $ 28,001 $ 38,086 $ 42,439 $ 53,623 $ 58,348 $ 67,197
========= ========= ========= ========= ========= ========= =========
RATIO OF EARNINGS TO FIXED CHARGES 10.59x 9.76x 10.16x 3.68x 3.05x 2.81x 2.54x
========= ========= ========= ========= ========= ========= =========
</TABLE>
