<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON FEBRUARY 27, 1998
REGISTRATION NO. 333-
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
---------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1993
---------------
CATERPILLAR FINANCIAL SERVICES CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
---------------
<TABLE>
<S> <C>
DELAWARE 37-1105865
(STATE OF OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
</TABLE>
3322 WEST END AVENUE
NASHVILLE, TENNESSEE 37203-0983
(615) 386-5800
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
---------------
PAUL J. GAETO
3322 WEST END AVENUE
NASHVILLE, TENNESSEE 37203-0983
(615) 386-5800
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)
COPIES TO:
<TABLE>
<S> <C>
LESLIE P. JAY ROBERT E. BUCKHOLZ, JR.
ORRICK, HERRINGTON & SUTCLIFFE LLP SULLIVAN & CROMWELL
400 SANSOME STREET 125 BROAD STREET
SAN FRANCISCO, CALIFORNIA 94111 NEW YORK, NEW YORK 10004
</TABLE>
---------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time after the effective date of this Registration Statement as determined
by market conditions.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, check the following
box: [_]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. [X]
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [_]
If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]
CALCULATION OF REGISTRATION FEE
<TABLE>
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- -------------------------------------------------------------------------------------------------------
<CAPTION>
PROPOSED PROPOSED
AMOUNT MAXIMUM MAXIMUM AMOUNT OF
TITLE OF EACH CLASS OF TO BE OFFERING PRICE AGGREGATE REGISTRATION
SECURITIES TO BE REGISTERED REGISTERED PER UNIT** OFFERING PRICE** FEE
- -------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Debt Securities................. $3,000,000,000* 100%** $3,000,000,000*** $885,000
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
</TABLE>
* Or, if any Debt Securities are issued (i) with a principal amount
denominated in a foreign currency, such principal amount as shall result in
an aggregate initial offering price equivalent to $3,000,000,000 at the
time of initial offering, or (ii) at an original issue discount, such as
greater principal amount as shall result in proceeds to the registrant of
$3,000,000,000.
** Estimated solely for the purpose of calculating the registration fee.
*** Exclusive of accrued interest, if any.
---------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS
REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH
SECTION 8(A) OF THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT
SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID
SECTION 8(A), MAY DETERMINE.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<PAGE>
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A +
+REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE +
+SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY +
+OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT +
+BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR +
+THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE +
+SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE +
+UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF +
+ANY STATE. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
SUBJECT TO COMPLETION, DATED FEBRUARY 27, 1998
PROSPECTUS
CATERPILLAR FINANCIAL SERVICES CORPORATION
DEBT SECURITIES
-----------
The Company from time to time may offer its Debt Securities consisting of
debentures, notes and/or other unsecured evidences of indebtedness in one or
more series at an aggregate initial offering price not to exceed
$3,000,000,000. The terms of the Debt Securities, including, where applicable,
the specific designation, aggregate principal amount, denominations, which may
include securities denominated in U.S. dollars, in any other currency or in
composite currencies such as the European Currency Unit, date or dates on which
principal is payable, interest rate or rates (which may be fixed or variable)
and time of payment of interest, if any, terms for redemption at the option of
the Company, terms for any repayment of principal amount at the option of the
holder (which option may be conditional), terms for sinking fund payments, the
initial public offering price, the names of any underwriters or agents, the
principal amounts, if any, to be purchased by underwriters and the compensation
of such underwriters or agents and the other terms in connection with the
offering and sale of the Debt Securities in respect of which this Prospectus is
being delivered, are set forth in the accompanying Prospectus Supplement. The
Debt Securities are solely the obligations of the Company and are not
guaranteed by Caterpillar Inc. This Prospectus may not be used to consummate
the sale of Debt Securities unless accompanied by a Prospectus Supplement.
The Company may sell Debt Securities to or through one or more underwriters
for public offering and sale by them or may sell Debt Securities to investors
directly or through agents. See "Plan of Distribution." Such underwriters or
agents may include one or more of Goldman, Sachs & Co., Lehman Brothers Inc.,
and Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated, or
a group represented by one or more of such firms or by one or more other firms.
-----------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OF ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
-----------
The date of this Prospectus is March , 1998
<PAGE>
AVAILABLE INFORMATION
Caterpillar Financial Services Corporation (the "Company") and Caterpillar
Inc., which owns 100% of the outstanding common stock of the Company, are
subject to the informational requirements of the Securities Exchange Act of
1934, as amended (the "1934 Act"), and in accordance therewith file reports,
proxy material (Caterpillar Inc. only) and other information with the
Securities and Exchange Commission (the "Commission"). Such reports, proxy
material and other information can be inspected and copied at the offices of
the Commission at 450 Fifth Street, N.W., Washington, D.C., as well as 500
West Madison Street, Suite 1400, Chicago, Illinois, and 7 World Trade Center,
New York, New York, and copies can be obtained by mail from the Public
Reference Section of the Commission at 450 Fifth Street, N.W., Washington,
D.C. 20549 at prescribed rates. The Commission maintains a World Wide Web site
that contains reports, proxy and information statements and other information
that are filed through the Commission's Electronic Data Gathering, Analysis
and Retrieval System. This Web site can be accessed at http://www.sec.gov. In
addition, reports and other information concerning the Company can be
inspected at the office of the New York Stock Exchange, and reports, proxy
material and other information concerning Caterpillar Inc. can be inspected at
the offices of the New York, Chicago and Pacific Stock Exchanges.
The Company is not required to deliver an annual report to its security
holders pursuant to Section 14 of the 1934 Act, nor does it currently intend
to deliver to holders of its debt securities any other report that contains
financial information relating to the Company that has been examined and
reported upon, with an opinion expressed by, an independent accountant. Such
information, however, is contained in the Company's Annual Report on Form 10-K
that the Company will provide without charge (without exhibits), upon request,
to any such security holder.
The Prospectus does not contain all information set forth in the
Registration Statement and Exhibits thereto which the Company has filed with
the Commission and to which reference is hereby made.
DOCUMENTS INCORPORATED BY REFERENCE
The Company's Annual Report on Form 10-K for the year ended December 31,
1997, filed with the Commission pursuant to the 1934 Act, is hereby
incorporated in this Prospectus by reference.
All other documents filed by the Company pursuant to Section 13(a), 13(c),
14 or 15(d) of the 1934 Act after the date of this Prospectus and prior to the
termination of the offering of the Debt Securities shall be deemed to be
incorporated by reference in this Prospectus.
The Company hereby undertakes to provide without charge to each person to
whom a copy of this Prospectus has been delivered, upon the written or oral
request of such person, a copy of any or all of the documents referred to
above which have been or may be incorporated in this Prospectus by reference,
other than the exhibits to such documents. Requests for such copies should be
directed to Goldman, Sachs & Co., 85 Broad Street, New York, New York 10004,
Attn: Registration Department; telephone: (212) 902-1000.
2
<PAGE>
THE COMPANY
The Company is a wholly owned finance subsidiary of Caterpillar Inc.
("Caterpillar"). The Company and its subsidiaries are principally engaged in
the business of financing sales and leases of Caterpillar products and non-
competitive related equipment through Caterpillar dealers and are also engaged
in extending loans to Caterpillar customers and dealers.
The Company's business is largely dependent upon the ability of Caterpillar
dealers to generate sales and leasing activity, the willingness of the
customers and the dealers to enter into financing transactions with the
Company, and the availability of funds to the Company to finance such
transactions. See "Relationship with Caterpillar" for information as to
certain operational and financial support provided to the Company by
Caterpillar. Additionally, the Company's business is affected by changes in
the market interest rates, which, in turn, are related to general economic
conditions, demand for credit, inflation, governmental policies and other
factors.
The Company currently offers the following types of retail financing plans:
(1) non-tax (financing) leases; (2) installment sale contracts; (3) tax-
oriented leases; (4) customer loans; (5) dealer loans; and (6) governmental
lease-purchase contracts. The Company also provides wholesale financing of
Caterpillar dealer inventory and rental fleets. At December 31, 1997, the
percentages of total value of the Company's portfolio represented by these
financing plans were as follows: non-tax (financing) leases, 29%; installment
sale contracts, 19%; tax-oriented leases, 18%; customer loans, 18%; wholesale
financing, 7%; dealer loans, 7%; and governmental lease-purchase contracts,
2%.
The Company is a Delaware corporation which was incorporated in 1981 and is
the successor to a company formed in 1954. The Company has wholly owned
finance subsidiaries in Canada, Australia, Germany, Sweden, France, the United
Kingdom, Spain, Ireland, Mexico, Chile, Singapore, the Czech Republic, Poland,
Thailand and the United States. Unless the context otherwise requires, the
term "Company" includes its predecessor and subsidiary companies. The
principal executive office of the Company is located at 3322 West End Avenue,
Nashville, Tennessee 37203-0983 and its telephone number is (615) 386-5800.
CATERPILLAR
Caterpillar, together with its consolidated subsidiary companies, operates
in three principal business segments: (a) Machinery--design, manufacture, and
marketing of earthmoving, construction, mining and agricultural machinery, (b)
Engines--design, manufacture, and marketing of engines, and (c) Financial
Products--providing through the Company financing alternatives for Caterpillar
and non-competitive related equipment sold through Caterpillar dealers,
extending loans to Caterpillar customers and dealers, and providing various
forms of insurance for Caterpillar dealers and customers. Caterpillar reported
profits of $1.67 billion, $1.36 billion and $1.14 billion for 1997, 1996, and
1995, respectively, on sales and revenues of $18.93 billion, $16.52 billion,
and $16.07 billion, respectively. The principal corporate headquarters of
Caterpillar are located at 100 NE Adams Street, Peoria, Illinois 61629. As
used herein, the term "Caterpillar" means Caterpillar Inc. and its
consolidated subsidiary companies, unless the context otherwise requires.
3
<PAGE>
RELATIONSHIP WITH CATERPILLAR
Caterpillar provides the Company with certain operational and financial
support which is integral to the conduct of the Company's business. The
following description summarizes these arrangements.
EMPLOYEE BENEFITS AND INTERCOMPANY SERVICES
The employees of the Company are covered by various benefit plans, including
pension/post-retirement plans, administered by Caterpillar. The Company
reimburses Caterpillar for these charges which amounted to $4.5 million, $3.7
million, and $2.9 million for the years ended December 31, 1997, 1996, and
1995, respectively.
The Company also reimburses Caterpillar for certain other corporate services
which amounted to $2.3 million for the years ended December 31, 1997 and 1996
and $1.8 million for the year ended December 31, 1995.
SPECIAL MERCHANDISING PROGRAMS
The Company participates in certain marketing programs sponsored by
Caterpillar and its subsidiaries by providing financing at rates below
standard rates. Under these programs, Caterpillar compensates the Company at
the outset of the transaction which the Company then recognizes as income over
the term of the financing. During 1997, the Company billed $151.0 million to
Caterpillar and its subsidiaries relative to such programs, compared with
$106.2 million in 1996 and $86.8 million in 1995.
PURCHASE OF RECEIVABLES
The Company has agreements with a subsidiary of Caterpillar to purchase, at
a discount, some or all of the subsidiary's receivables generated by sales of
products to certain Caterpillar dealers in Europe. These purchases in 1997,
1996, and 1995 totaled $444.3 million, $397.3 million, and $330.7 million,
respectively. The cash discount earned in 1997, 1996, and 1995 was $5.6
million, $5.4 million, and $5.3 million, respectively. At December 31, 1997,
1996, and 1995, wholesale notes receivable balances related to these contracts
were $139.0 million, $146.4 million, and $189.7 million, respectively.
In January 1998, a new subsidiary of the Company entered into an agreement
with Caterpillar to purchase a pool of receivables at a discount. The
receivables consist of trade receivables and have an average term of 70 days.
A portion of the collections from these receivables will be used to purchase
additional receivables on a weekly basis. The Company expects the receivables
pool to maintain a balance between $700.0 and $900.0 million. Caterpillar will
continue to service the receivables, and the Company will pay a fee to
Caterpillar for this servicing. This transaction was funded primarily by the
issuance of medium-term notes and $100.0 million equity capital invested by
Caterpillar.
SUPPORT AGREEMENT
Through December 31, 1997, Caterpillar has provided the Company with equity
contributions totaling $395 million. The Company and Caterpillar also have an
agreement (the "Support Agreement") which provides, among other things, that
Caterpillar will (i) remain directly or indirectly, the sole owner of the
Company, (ii) ensure that the Company will maintain a tangible net worth of at
least $20 million, (iii) permit the Company to use (and the Company is
required to use) the name "Caterpillar" in the conduct of its business, and
(iv) ensure that the Company maintains a ratio of earnings and interest
expense (as defined) to interest expense of not less than 1.15 to 1. The
Support Agreement provides that it may be modified, amended or terminated by
either party; provided, however, that no such modification or amendment which
adversely affects the holders of any debt outstanding at the execution thereof
and no such termination shall be binding on or in any manner become effective
with respect to (i) any then outstanding commercial paper, or (ii) any other
debt then outstanding unless
4
<PAGE>
approved in writing by the holders of 66 2/3% of the aggregate principal
amount of such other debt. See "Description of Debt Securities--Certain
Restrictions" for a description of the Indenture covenant relating to the
Support Agreement.
The obligations of Caterpillar under the Support Agreement are to the
Company only and are not directly enforceable by any creditor of the Company,
nor do they constitute a guarantee by Caterpillar of the payment of any debt
or obligation of the Company.
BORROWING ARRANGEMENTS
The Company currently relies primarily on external sources for its debt
financing needs. See "Discussion of Selected Financial Information--Capital
Resources and Liquidity." To supplement external debt financing sources, the
Company has variable amount lending agreements with Caterpillar (including two
of its subsidiaries). As of January 1998, the Company may borrow up to $732.7
million from Caterpillar and its subsidiaries, and Caterpillar and its
subsidiaries may borrow up to $532.7 million from the Company. All of the
variable amount lending agreements are effective for indefinite terms, may be
amended from time to time, and may be terminated by either party upon 30 days
notice. At December 31, 1997, 1996, and 1995, the Company had borrowings from
Caterpillar totaling $243.5 million, $150.0 million, and $475.5 million,
respectively, but had no loans receivable under these agreements.
TAX SHARING AGREEMENTS
The Company has a tax sharing agreement with Caterpillar in which
Caterpillar collects from or pays to the Company its allocated share of any
consolidated U.S. income tax liability or credit applicable to any period for
which the Company is included as a member of the consolidated group. A similar
agreement exists between Caterpillar Financial Australia Limited and
Caterpillar of Australia Ltd. with respect to taxes payable in Australia.
5
<PAGE>
USE OF PROCEEDS
The net proceeds from the sale of the Debt Securities offered hereby will be
used by the Company for the financing of future sales and leasing
transactions, for customer and dealer loans and for other corporate purposes.
The Company expects to incur additional indebtedness in connection with its
financing operations. However, the amount, timing, and precise nature of such
indebtedness have not yet been determined and will depend upon the volume of
the Company's business, the availability of credit, and general market
conditions.
SELECTED FINANCIAL INFORMATION OF THE COMPANY
The following selected financial information of the Company for the years
ended December 31, 1997, 1996, and 1995, with the exception of the ratios of
profit to fixed charges, was derived from the Company's consolidated financial
statements contained in its Annual Report on Form 10-K for the year ended
December 31, 1997 and is qualified in its entirety by such documents. See
"Documents Incorporated by Reference." The selected financial information of
the Company for the years ended December 31, 1994, and 1993, with the
exception of the ratios of profit to fixed charges, was derived from the
consolidated financial statements of the Company for such periods which have
not been incorporated herein by reference.
<TABLE>
<CAPTION>
DOLLAR AMOUNTS IN MILLIONS
--------------------------------------------
YEAR ENDED DECEMBER 31,
--------------------------------------------
1997 1996 1995 1994 1993
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Revenues:
Wholesale finance income........ $ 49.5 $ 47.4 $ 64.2 $ 25.3 $ 5.8
Retail finance income........... 499.3 427.2 361.1 275.2 246.4
Rental income................... 179.9 156.9 133.6 124.2 95.7
Other income.................... 62.8 46.5 52.9 22.3 16.7
-------- -------- -------- -------- --------
Total Revenues................ 791.5 678.0 611.8 447.0 364.6
-------- -------- -------- -------- --------
Expenses:
Interest........................ 366.7 315.4 298.4 212.1 173.1
Depreciation.................... 139.3 121.0 101.2 94.4 69.6
General, operating, and
administrative................. 96.8 82.8 61.9 47.2 41.7
Provision for credit losses..... 39.2 41.3 42.8 23.2 20.8
Other expense................... 1.8 1.7 3.8 19.3 1.0
-------- -------- -------- -------- --------
Total Expenses................ 643.8 562.2 508.1 396.2 306.2
-------- -------- -------- -------- --------
Income before income taxes and
minority interest................ 147.7 115.8 103.7 50.8 58.4
Provision for income taxes........ 53.5 40.2 38.5 19.3 21.3
Minority interest in losses of
subsidiary....................... -- -- -- 0.7 0.7
-------- -------- -------- -------- --------
Net Income........................ $ 94.2 $ 75.6 $ 65.2 $ 32.2 $ 37.8
======== ======== ======== ======== ========
Ratio of profit to fixed charges*. 1.39 1.36 1.34 1.23 1.33
Total assets (end of period)...... $7,426.8 $6,364.2 $5,422.1 $4,511.2 $3,564.7
Long-term debt (end of period).... 2,274.2 1,545.7 1,621.3 1,675.7 1,410.4
Total stockholder's equity (end of
period).......................... 811.1 695.3 603.3 503.1 418.0
</TABLE>
- --------
* For the purpose of calculating this ratio, profit consists of income before
cumulative effect of change in accounting for income taxes plus provision
for income taxes and fixed charges. Profit is reduced by the Company's
equity in profit of certain partnerships in which the Company participates.
Fixed charges consist of interest on borrowed funds (including any
amortization of debt discount, premium and issuance expense) and a portion
of rentals representing interest.
6
<PAGE>
DISCUSSION OF SELECTED FINANCIAL INFORMATION
1997 RESULTS
Total revenues for 1997 were $791.5 million, a 17% increase over 1996
revenues of $678.0 million. The increase in revenues resulted primarily from
increased financing volume (the portfolio value increased to $7,189.3 million
at December 31, 1997 from $6,212.3 million at December 31, 1996), partially
offset by a lower yield.
New retail financing during 1997 totaled $4,375.7 million, a 21% increase
over the $3,619.2 million financed in 1996. This increase was primarily the
result of financing an increased percentage of dealer deliveries of
Caterpillar product assisted by an increase in the use of below-market-rate
financing programs. Wholesale financing activity during 1997 was $2,551.5
million, a 16% increase over the $2,191.5 million financed in 1996. The
increase resulted primarily from the expansion of the rental fleet program in
North America. The maturity for these contracts is generally 36 months,
however, the Company's experience has been that most terminate within six
months.
Revenues from operations in the United States were 74% of total revenues in
1997 and 1996. Net income from operations in the United States was more than
82% and 79% of total net income in 1997 and 1996, respectively. For more
geographic segment information, see Note 12 to the Consolidated Financial
Statements included in the Company's Annual Report on Form 10-K for the year
ended December 31, 1997 incorporated by reference herein.
The annualized interest rate on finance receivables (computed by dividing
annualized finance income by the average monthly finance receivable balances,
net of unearned income) was 8.7% for 1997 compared with 8.9% for 1996. Tax
benefits associated with governmental lease purchase contracts and tax-
oriented leases are not reflected in such annualized interest rates.
Other income of $62.8 million for 1997 included servicing and other
securitization-related income, fees, gains on sales of receivables, and other
miscellaneous income. The increase of $16.3 million for 1997 resulted
primarily from an increase of $6.5 million from sales of used equipment, an
increase of $5.6 million in servicing and other securitization-related income
and increased gains on sales of receivables of $3.6 million.
Interest expense for 1997 was $366.7 million, $51.3 million higher than 1996
due to increased borrowings to support the larger portfolio, partially offset
by lower borrowing rates, as the average cost of borrowed funds was 5.9% in
1997 compared with 6.0% in 1996.
Depreciation expense increased from $121.0 million in 1996 to $139.3 million
in 1997 due to new operating lease business.
General, operating, and administrative expenses increased $14.0 million over
1996 primarily due to staff-related and other expenses required to increase
new business, service the larger managed portfolio, and support international
expansion. The Company's full-time employment increased from 576 at the end of
1996 to 684 at December 31, 1997.
Provision for credit losses decreased from $41.3 million in 1996 to $39.2
million in 1997. Receivables, net of recoveries, of $19.6 million were written
off against the allowance for credit losses during 1997 compared with $20.6
million during 1996. Receivables past due over 30 days were 1.7% of total
receivables at December 1997 compared with 2.1% at December 31, 1996. The
allowance for credit losses was $83.5 million which was 1.3% of finance
receivables, net of unearned income (1.4% excluding wholesale receivables),
compared with $74.4 million and 1.3% (1.4% excluding wholesale receivables),
respectively, at December 31, 1996.
The effective income tax rate for 1997 was 36% compared with 35% for 1996,
primarily attributable to subsidiaries' results subject to tax rates other
than the United States statutory rates.
7
<PAGE>
Net income in 1997 was $94.2 million, compared with $75.6 million in 1996.
The increase resulted primarily from a larger portfolio.
The Company has evaluated the impact of preparing its systems for the year
2000. It has identified areas of potential impact and is implementing
conversion efforts. The Company's target is to have all systems ready for the
year 2000 by December 31, 1998. The financial impact of making the required
systems changes is not expected to be material to the Company's financial
position or results of operations.
CAPITAL RESOURCES AND LIQUIDITY
The Company's operations during the year were primarily funded with a
combination of commercial paper, proceeds from sales (via securitizations) of
receivables, medium-term notes, bank borrowings, retained earnings, and
additional equity capital of $50.0 million invested by Caterpillar.
The Company securitized $346.6 million of its installment sale contracts in
May 1997 and $314.4 million of its installment sale contracts in November
1997. The Company's private-placement, revolving, asset-backed securitization
of wholesale receivables was increased from $500.0 million to $600.0 million
in September 1997. These installment sale contracts and wholesale receivables
were sold to Caterpillar Financial Funding Corporation and Caterpillar
Financial Asset Sales Corporation, respectively. The assets of Caterpillar
Financial Funding Corporation and Caterpillar Financial Asset Sales
Corporation, including such installment sale contracts and wholesale
receivables, are not available to pay creditors of the Company. The proceeds
from these securitizations and the equity capital provided by Caterpillar were
used to reduce debt. The Company recognized a $2.3 million pre-tax gain on the
May transaction, a $0.6 million pre-tax gain on the September transaction and
a $4.8 million pre-tax gain on the November transaction.
The net amount of sold receivables serviced by the Company was $1,409.3
million at December 31, 1997, which consisted of $600.0 million of wholesale
receivables, under a revolving asset-backed securitization agreement, and
$809.3 million of installment sale contracts. The Company receives fees for
servicing these receivables.
Total debt outstanding as of December 31, 1997, was $6,337.1 million, an
increase of $904.7 million over that at December 31, 1996 and was primarily
comprised of $3,322.2 million of medium-term notes, $2,536.0 million of
commercial paper, and $145.0 million of bank borrowings. Interest rate swaps
were contracted to hedge against interest rate fluctuations.
At December 31, 1997, the Company had available, from a number of banks, a
total of $585.2 million of short-term credit lines which expire at various
dates in 1998. These credit lines support the Company's outstanding commercial
paper and are utilized for bank borrowings. At December 31, 1997, there were
$145.0 million of these lines utilized for bank borrowings.
The Company also participates with Caterpillar in two syndicated revolving
credit facilities aggregating $2.5 billion, consisting of a $1,875.0 million
five-year facility and a $625.0 million 364-day revolving facility. The
Company's allocation is $2,250.0 million, consisting of a $1,687.5 million
five-year revolving credit and a $562.5 million 364-day revolving credit. The
Company has the ability to request a change in its allocation to maintain the
required amount of support for the Company's outstanding commercial paper and
commercial paper guarantees. These facilities provide for borrowings at
interest rates which vary according to LIBOR or money market rates. At
December 31, 1997, there were no borrowings under these facilities.
The Company has a $1.0 billion five-year revolving credit facility in the
United Kingdom to support its $1.0 billion Euro-commercial paper program. The
commercial paper is issued by Caterpillar International Finance plc, an Irish
subsidiary of the Company, with the guarantee of the Company. Proceeds from
the issuance of commercial paper have been used to replace bank borrowings of
certain of the Company's subsidiaries. At December 31, 1997, there were no
borrowings under this facility.
8
<PAGE>
The revolving credit facilities require the Company to maintain its
consolidated ratio of profit before taxes plus fixed charges to fixed charges
at no less than 1.15 to 1 for each quarter, and the Company's total debt to
total stockholder's equity, as defined by agreement, may not exceed 8.0 to 1
at year-end (8.5 to 1 moving six month average at other than year-end); and
the Company's tangible net worth must be at least $20.0 million. At December
31, 1997, the Company was in compliance with these requirements.
The Company's funding requirements were met primarily through the sale of
commercial paper and medium-term notes and through bank borrowings. During
1997, the average outstanding commercial paper balance, net of discount, was
$2,426.6 million at an average interest rate of 5.4%. At December 31, 1997,
the face value of commercial paper outstanding was $2,536.0 million. During
1997, $849.0 million of fixed-rate medium-term notes were sold at an average
interest rate of 6.5%, and $967.7 million of floating rate medium-term notes
were sold at rates primarily indexed to LIBOR. Medium-term notes outstanding
at December 31, 1997 were $3,322.2 million. During the year, the average
outstanding bank borrowings were $179.3 million at an average interest rate of
4.8%.
Through the course of normal business, the Company is exposed to market risk
from fluctuations in interest rates and foreign currency exchange rates. To
manage these exposures, the Company uses interest rate and currency derivative
financial instruments. The Company does not use any of these instruments for
trading purposes.
Interest rate swap agreements are used to manage the risk due to
fluctuations in interest rates. These agreements reduce the risk of
deteriorating margins between interest-earning assets and interest-bearing
liabilities and allow the Company to gain competitive and economic advantages
by minimizing funding costs regardless of the direction interest rates move.
At December 31, 1997, notional amounts of interest rate swap agreements
totaled $1,742.9 million.
The Company's degree of interest rate sensitivity has been simulated through
computer modeling by measuring the re-pricing characteristics of interest-
sensitive assets, liabilities and off-balance sheet derivatives. The interest
rate sensitivity modeling technique includes the creation of prospective
twelve month "baseline" and "rate shocked" net interest expense simulations.
At the date that the interest rate sensitivity is modeled, "baseline" net
interest expense is derived considering the current level of interest-
sensitive assets and related income (based on contractual repayment), the
current level of interest-sensitive liabilities and related maturities, equity
and the current level of off-balance sheet derivatives. The "baseline"
simulation also assumes that, over the next successive twelve months, market
interest rates (as of the date of the simulation) are held constant and that
no new loans are extended. Once the "baseline" net interest expense is known,
market interest rates, previously held constant, are raised 100 basis points
instantaneously and parallel across the entire curve, and a "rate shocked"
simulation is run. Interest rate sensitivity is then measured as the
difference between calculated "baseline" and "rate shocked" net interest
expense.
Utilizing the Company's computer modeling, if no new fixed rate loans or
leases were extended and no new actions to alter existing interest rate
sensitivity were taken after December 31, 1997, the impact to interest expense
of an immediate hypothetical 100 basis points parallel rise in the yield curve
on January 1, 1998 would be an estimated $9.6 million increase over the twelve
months ending December 31, 1998. Although management believes that this
measure provides a meaningful estimate of the Company's interest rate
sensitivity, it does not adjust for potential changes in the credit quality,
size and composition of the balance sheet and other business developments that
could affect net interest income or expense. Accordingly, no assurance can be
given that actual results would not differ materially from the potential
outcome simulated by the Company's computer modeling. Further, the Company's
computer modeling does not necessarily represent management's current view of
future market interest rate movements.
Foreign exchange contracts are used to minimize the risk associated with
fluctuations in exchange rates. The Company has forward exchange contracts to
hedge its U.S. dollar denominated obligations in Spain, its U.S. dollar
denominated customer receivables in Australia, its foreign currency
denominated short-term
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<PAGE>
intercompany loans, and its net investment in Thailand against currency
fluctuations. The Company only enters into foreign currency related derivative
instruments to neutralize risk--not as speculative instruments. These
contracts have terms generally ranging up to three months. At December 31,
1997, the Company had forward exchange contracts totaling $1,055.3 million, of
which $3.1 million were with Caterpillar.
The exchange gains/losses associated with exposure for net investments in
foreign subsidiaries other than Thailand are not hedged and are reflected in
"Foreign currency translation adjustment". $9.8 million of the Company's $16.3
million net investment in Thailand is hedged by foreign exchange contracts
described above.
Equity capital at the end of 1997 was $811.1 million, an increase of $115.8
million during the year. This increase included $94.2 million of retained
earnings from operations and $50.0 million of additional equity investment
made by Caterpillar. The increase in debt and the funds provided by operations
and by Caterpillar were used to finance the increase in the portfolio. The
ratio of debt to equity at December 31, 1997 and 1996 was 7.8 to 1, compared
with 7.7 to 1 for 1995. Included in the debt to equity ratio are short-term
borrowings from Caterpillar.
Additional short-term funding is available from Caterpillar. See
"Relationship with Caterpillar--Borrowing Arrangements."
DESCRIPTION OF DEBT SECURITIES
The following description sets forth certain general terms and provisions of
the Debt Securities to which any Prospectus Supplement may relate. The
particular terms of the Debt Securities offered by any Prospectus Supplement
and the extent, if any, to which such general provisions may apply to the Debt
Securities so offered will be described in the Prospectus Supplement relating
to such Debt Securities.
Offered Debt Securities (as defined below) are to be issued under an
Indenture (the "Indenture") dated as of April 15, 1985, as supplemented,
between the Company and First Trust of New York, National Association, as
successor Trustee. The statements under this caption relating to the Debt
Securities and the Indenture are summaries and do not purport to be complete.
Such summaries make use of terms defined in the Indenture and are qualified in
their entirety by express reference to the Indenture and the cited provisions
thereof, a copy of which is filed as an exhibit to the Registration Statement.
GENERAL
The Debt Securities will be unsecured obligations of the Company. The
Indenture does not limit the aggregate principal amount of Debt Securities
which may be issued hereunder and provides that Debt Securities may be issued
thereunder from time to time in one or more series.
Reference is made to the Prospectus Supplement relating to the particular
Debt Securities offered thereby (the "Offered Debt Securities") for the
following terms of the Offered Debt Securities: (1) the title of the Offered
Debt Securities; (2) any limit on the aggregate principal amount of the
Offered Debt Securities; (3) the date or dates on which the principal of the
Offered Debt Securities will be payable; (4) the rate or rates per annum at
which the Offered Debt Securities will bear interest, if any, or the formula
pursuant to which such rate or rates shall be determined, and the date or
dates from which such interest will accrue; (5) the dates on which such
interest, if any, will be payable and the regular record dates for such
interest payment dates; (6) the place or places where principal of (and
premium, if any) and interest on Offered Debt Securities shall be payable; (7)
any mandatory or optional sinking fund or analogous provisions; (8) if
applicable, the price at which, the periods within which, and the terms and
conditions upon which the Offered Debt Securities may, pursuant to any
optional or mandatory redemption provisions, be redeemed at the option of the
Company; (9) if applicable, the terms and conditions upon which the Offered
Debt Securities may be repayable prior to final maturity at the option of the
holder thereof (which option may be conditional); (10) the portion of the
principal amount of the Offered Debt Securities, if other than the principal
amount thereof, payable upon acceleration of maturity thereof; (11) the
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<PAGE>
currency or currencies, including composite currencies, in which principal of
(and premium, if any) and interest may be payable (which may be other than
those in which the Offered Debt Securities are stated to be payable); (12) any
index pursuant to which the amount of payments of principal of (and premium,
if any) or interest may be determined; (13) whether all or any part of the
Offered Debt Securities will be issued in the form of a Global Security or
Securities and, if so, the Depositary for, and other terms relating to, such
Global Security or Securities; and (14) any other terms of the Offered Debt
Securities. (Section 301)
Unless otherwise indicated in the Prospectus Supplement relating thereto,
the Offered Debt Securities are to be issued as registered securities without
coupons in denominations of $1,000 or any integral multiple of $1,000.
(Section 302) No service charge will be made for any transfer or exchange of
such Offered Debt Securities, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. (Section 305)
The applicable Prospectus Supplement will describe any special United States
federal tax consequences and any other special considerations with respect to
the Offered Debt Securities.
CERTAIN RESTRICTIONS
Support Agreement. The Indenture provides that the Company (1) will observe
and perform in all material respects all covenants or agreements of the
Company contained in the Support Agreement; (2) to the extent possible, will
cause Caterpillar to observe and perform in all material respects all
covenants or agreements of Caterpillar contained in the Support Agreement; and
(3) will not waive compliance under, amend in any material respect, or
terminate the Support Agreement; provided, however, that the Support Agreement
may be amended if such amendments would not have a material adverse effect on
the Holders of any outstanding Debt Securities of any series or if the Holders
of at least 66 2/3% in principal amount of the Outstanding Debt Securities of
each series so affected (excluding from the amount so outstanding and from
such Holders, the Holders of such series who are not so affected) shall waive
compliance with the provisions of this Section insofar as it relates to such
amendment. (Section 1004)
Restrictions on Liens and Encumbrances. The Company will not create, assume
or guarantee any Secured Debt (as defined below) without making effective
provision for securing the Debt Securities (and, if the Company shall so
determine, any other indebtedness of or guaranteed by the Company), equally
and ratably with such Secured Debt. The term "Secured Debt" shall mean
indebtedness for money borrowed which is secured by a mortgage, pledge, lien,
security interest or encumbrance on any property of any character of the
Company. This covenant does not apply to debt secured by (i) certain
mortgages, pledges, liens, security interests or encumbrances in connection
with the acquisition, construction or improvement of any fixed asset or other
physical or real property by the Company, (ii) mortgages, pledges, liens,
security interests or encumbrances on property existing at the time of
acquisition thereof, whether or not assumed by the Company, (iii) mortgages,
pledges, liens, security interests or encumbrances on property of a
corporation existing at the time such corporation is merged into or
consolidated with the Company or at the time of a sale, lease or other
disposition of the properties of a corporation or firm as an entirety or
substantially as an entirety to the Company, (iv) mortgages, including
mortgages, pledges, liens, security interests or encumbrances, on property of
the Company in favor of the United States of America, any state thereof, or
any other country, or any agency, instrumentality or political subdivision
thereof, to secure certain payments pursuant to any contract or statute or to
secure indebtedness incurred for the purpose of financing all or any part of
the purchase price or the cost of construction or improvement of the property
subject to such mortgages, (v) any extension, renewal or replacement (or
successive extensions, renewals, or replacements), in whole or in part, of any
mortgage, pledge, lien or encumbrance referred to in the foregoing clauses (i)
to (iv), inclusive or (vi) any mortgage, pledge, lien, security interest, or
encumbrance securing indebtedness owing by the Company to one or more wholly
owned Subsidiaries. Notwithstanding the above, the Company may, without
securing the Debt Securities, create, assume or guarantee Secured Debt which
would otherwise be subject to the foregoing restrictions, provided that, after
giving effect thereto, the aggregate amount of all Secured Debt then
outstanding (not including Secured Debt permitted under the foregoing
exceptions) at such time does not exceed 5% of the Consolidated Net Tangible
Assets. (Sections 101 and 1005)
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<PAGE>
The Indenture provides that no consolidation or merger of the Company and no
conveyance, transfer or lease of the property of the Company, substantially as
an entirety, shall be made with or to another corporation if as a result
thereof any properties or assets of the Company would become subject to a lien
or mortgage not permitted by the terms of the Indenture unless effective
provision shall be made to secure the Debt Securities equally and ratably with
(or prior to) all indebtedness thereby secured. (Section 801)
The term "Consolidated Net Tangible Assets" shall mean as of any particular
time the aggregate amount of assets after deducting therefrom (a) all current
liabilities (excluding any such liability that by its terms is extendable or
renewable at the option of the obligor thereon to a time more than 12 months
after the time as of which the amount thereof is being computed) and (b) all
goodwill, excess of cost over assets acquired, patents, copyrights,
trademarks, tradenames, unamortized debt discount and expense and other like
intangibles, all as shown in the most recent consolidated financial statements
of the Company and its Subsidiaries prepared in accordance with generally
accepted accounting principles. The term "Subsidiary" means any corporation of
which more than 50% of the outstanding stock having ordinary voting power to
elect directors is owned directly or indirectly by the Company or by one or
more other corporations more than 50% of such stock of which is similarly
owned or controlled. (Section 101)
THE TRUSTEE
The Indenture contains certain limitations on the right of the Trustee, as a
creditor of the Company, to obtain payment of claims in certain cases, or to
realize on certain property received in respect of any such claim as security
or otherwise. (Section 613) In addition, the Trustee may be deemed to have a
conflicting interest and may be required to resign as Trustee if at the time
of a default under the Indenture it is a creditor of the Company.
EVENTS OF DEFAULT AND NOTICE THEREOF
The following events are defined in the Indenture as "Events of Default"
with respect to Debt Securities of any series: (a) failure to pay principal of
or premium, if any, on any Debt Security of that series when due; (b) failure
to pay any interest on any Debt Security of that series when due, continued
for 60 days; (c) failure to deposit any sinking fund payment, when due, in
respect of any Debt Security of that series; (d) default in the performance,
or breach, of any term or provision of the covenant described under "Certain
Restrictions--Support Agreement"; (e) failure to perform any other covenant of
the Company in the Indenture (other than a covenant included in the Indenture
solely for the benefit of a series of Debt Securities other than that series),
continued for 60 days after written notice given to the Company by the Trustee
or the holders of at least 25% in principal amount of the Debt Securities
outstanding and affected thereby; (f) Caterpillar or one of its wholly owned
subsidiaries shall at any time fail to own all of the issued and outstanding
shares of the capital stock of the Company; (g) default in payment of
principal in excess of $10,000,000 or acceleration of any indebtedness for
money borrowed in excess of $10,000,000 by the Company (including a default
with respect to Debt Securities of any series other than that series), if such
indebtedness has not been discharged or become no longer due and payable or
such acceleration has not been rescinded or annulled, within 10 days after
written notice given to the Company by the Trustee or the holders of at least
10% in principal amount of the outstanding Debt Securities of such series; (h)
certain events in bankruptcy, insolvency or reorganization of the Company;
(i) certain events in bankruptcy, insolvency or reorganization of Caterpillar
or one of its subsidiaries if such events affect any significant part of the
assets of the Company or any of its subsidiaries; and (j) any other Event of
Default provided with respect to Debt Securities of such series. (Section 501)
If an Event of Default with respect to Debt Securities of any series at the
time outstanding shall occur and be continuing, either the Trustee or the
holders of at least 25% in principal amount of the outstanding Debt Securities
of that series may declare the principal amount (or, if the Debt Securities of
that series are Original Issue Discount Securities (as defined in the
Indenture), such portion of the principal amount as may be specified in the
terms of that series) of all Debt Securities of that series to be due and
payable immediately; provided, however, that under certain circumstances the
holders of a majority in aggregate principal amount of outstanding Debt
Securities of that series may rescind and annul such declaration and its
consequences. (Section 502)
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<PAGE>
Reference is made to the Prospectus Supplement relating to any series of
Offered Debt Securities which are Original Issue Discount Securities for the
particular provisions relating to the principal amount of such Original Issue
Discount Securities due on acceleration upon the occurrence of an Event of
Default and the continuation thereof.
The Indenture provides that the Trustee, within 90 days after the occurrence
of a default with respect to any series of Debt Securities, shall give to the
holders of Debt Securities of that series notice of all uncured defaults known
to it (the term default to mean the events specified above without grace
periods), provided that, except in the case of default in the payment of
principal of (or premium, if any) or interest, if any, on any Debt Security,
the Trustee shall be protected in withholding such notice if it in good faith
determines that the withholding of such notice is in the interest of the
holders of Debt Securities. (Section 602)
The Company will be required to furnish to the Trustee annually a statement
by certain officers of the Company to the effect that to the best of their
knowledge the Company is not in default in the fulfillment of any of its
obligations under the Indenture or, if there has been a default in the
fulfillment of any such obligation, specifying each such default. (Section
1006)
The holders of a majority in principal amount of the outstanding Debt
Securities of any series affected will have the right, subject to certain
limitations, to direct the time, method and place of conducting any proceeding
for any remedy available to the Trustee, exercising any trust or power
conferred on the Trustee with respect to the Debt Securities of such series,
and to waive certain defaults. (Sections 512 and 513)
Under the Indenture, record dates may be set for Acts of the holders with
respect to Events of Default, declaring an acceleration, or rescission and
annulment thereof, the direction of the time, method and place of conducting
any proceeding for any remedy available to the Trustee, exercising any trust
or power conferred on the Trustee, or waiving any default. (Sections 501, 502,
512 and 513)
The Indenture provides that in determining whether the holders of the
requisite principal amount of the Outstanding Debt Securities have given any
request, demand, authorization, direction, notice, consent or waiver
thereunder (i) the principal amount of an Original Issue Discount Security
that shall be deemed to be Outstanding shall be the amount of the principal
thereof that would be due and payable as of the date of such determination
upon acceleration of the maturity thereof, and (ii) the principal amount of a
Debt Security denominated in a foreign currency or a composite currency shall
be the U.S. dollar equivalent, determined on the basis of the rate of exchange
on the business day immediately preceding the date of original issuance of
such Debt Security by the Company in good faith, of the principal amount of
such Debt Security (or, in the case of an Original Issue Discount Security,
the U.S. dollar equivalent, determined based on the rate of exchange
prevailing on the Business Day immediately preceding the date of original
issuance of such Debt Security, of the amount determined as provided in (i)
above). (Section 101)
The Indenture provides that in case an Event of Default shall occur and be
continuing, the Trustee shall exercise such of its rights and powers under the
Indenture, and use the same degree of care and skill in their exercise, as a
prudent man would exercise or use under the circumstances in the conduct of
his own affairs. (Section 601) Subject to such provisions, the Trustee will be
under no obligation to exercise any of its rights or powers under the
Indenture at the request of any of the holders of Debt Securities unless they
shall have offered to the Trustee reasonable security or indemnity against the
costs, expenses and liabilities which might be incurred by it in compliance
with such request. (Section 603)
MODIFICATION OF THE INDENTURE
Modifications and amendments of the Indenture may be made by the Company and
the Trustee, with the consent of the holders of not less than 66 2/3% in
aggregate principal amount of each series of the outstanding Debt Securities
issued under the Indenture which are affected by the modification or
amendment, provided that no such modification or amendment may, without a
consent of each holder of such Debt Securities affected
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<PAGE>
thereby: (1) change the stated maturity date of the principal of (or premium,
if any) or any installment of interest, if any, on any such Debt Security; (2)
reduce the principal amount of (or premium, if any) or the interest, if any,
on any such Debt Security or the principal amount due upon acceleration of an
Original Issue Discount Security; (3) change the place or currency of payment
of principal or (or premium, if any) or interest, if any, on any such Debt
Security; (4) impair the right to institute suit for the enforcement of any
such payment on or with respect to any such Debt Security; (5) reduce the
above-stated percentage of holders of Debt Securities necessary to modify or
amend the Indenture; or (6) modify the foregoing requirements or reduce the
percentage of outstanding Debt Securities necessary to waive compliance with
certain provisions of the Indenture or for waiver of certain defaults. A
record date may be set for any Act of the holders with respect to consenting
to any amendment. (Section 902)
PLAN OF DISTRIBUTION
The Company may sell Debt Securities to or through one or more underwriters
or dealers and also may sell Debt Securities to other investors directly or
through agents. Any such underwriter or agent involved in the offer and sale
of the Debt Securities will be named in the Prospectus Supplement. The
underwriters or agents may include one or more of Goldman, Sachs & Co., Lehman
Brothers Inc., and Merrill Lynch, Pierce, Fenner & Smith Incorporated or a
group of underwriters represented by one or more of such firms or may be one
or more other firms.
Underwriters or agents may offer and sell the Debt Securities at a fixed
price or prices, which may be changed, or from time to time at market prices
prevailing at the time of sale, at prices related to such prevailing market
prices or at negotiated prices. In connection with the sale of the Debt
Securities, underwriters or agents may be deemed to have received compensation
from the Company in the form of underwriting discounts or commissions and may
also receive commissions in the form of discounts, concessions or commissions
from the underwriters or commissions from the purchasers for whom they may act
as agent.
The Debt Securities, when first issued, will have no established trading
market. Any underwriters or agents to or through whom Debt Securities are sold
by the Company for public offering and sale may make a market in such Debt
Securities, but such underwriters or agents will not be obligated to do so and
may discontinue any market making at any time without notice. No assurance can
be given as to the liquidity of the trading market for any Debt Securities.
Any underwriters or agents participating in the distribution of the Debt
Securities may be deemed to be underwriters, and any discounts and commissions
received by them and any profit realized by them on resale of the Debt
Securities may be deemed to be underwriting discounts and commissions, under
the Securities Act of 1933, as amended. Underwriters or agents may be
entitled, under agreements entered into with the Company, to indemnification
against or contribution toward certain civil liabilities, including
liabilities under the Securities Act of 1933, as amended.
Certain of the underwriters or agents and their associates may be customers
of, engage in transactions with and perform services for, the Company in the
ordinary course of business.
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VALIDITY OF DEBT SECURITIES
The validity of Debt Securities will be passed upon by Orrick, Herrington &
Sutcliffe LLP, 400 Sansome Street, San Francisco, California 94111, counsel
for the Company, and, unless otherwise indicated in a Prospectus Supplement
relating to Offered Debt Securities, by Sullivan & Cromwell, 125 Broad Street,
New York, New York 10004, counsel for the underwriters or agents.
EXPERTS
The financial statements incorporated in this Prospectus by reference to the
Company's Annual Report on Form 10-K for the year ended December 31, 1997,
have been so incorporated in reliance on the report of Price Waterhouse LLP,
independent accountants, given on the authority of said firm as experts in
auditing and accounting.
15
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following is an itemized statement of expenses of the Company in
connection with the issue of the Debt Securities.
<TABLE>
<S> <C>
Registration fee................................................. $ 885,000
Rating Agency fees............................................... 200,000
Fees and expenses of Trustee..................................... 30,000
Printing expenses................................................ 20,000
Accountants' fees and expenses................................... 10,000
Counsel fees and expenses........................................ 65,000
Miscellaneous.................................................... 15,000
----------
Total.......................................................... $1,225,000
==========
</TABLE>
All except the first of the foregoing amounts are estimates.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the Delaware Corporation Law authorizes indemnification of
officers and Directors of the Company under certain circumstances.
Insurance carried by Caterpillar provides (within limits and subject to
certain exclusions) for reimbursement of amounts which (a) Caterpillar or the
Company may be required or permitted to pay as indemnities to the Company's
Directors or officers for claims made against them, and (b) individual
Directors, officers and certain employees of the Company may become legally
obligated to pay as the result of acts committed by them while acting in their
corporate or fiduciary capacities.
The Distribution Agreement provides for the indemnification of officers and
Directors of the Company under certain circumstances.
ITEM 16. EXHIBITS.
<TABLE>
<CAPTION>
EXHIBIT
NUMBER EXHIBIT
------- -------
<C> <S>
1 Form of Distribution Agreement.
4.1 Indenture, dated as of April 15, 1985, between the Company and Morgan
Guaranty Trust Company of New York, as Trustee (incorporated by
reference from Exhibit 4.1 to the Company's Registration Statement on
Form S-3, Registration No. 33-2246).
4.2 First Supplemental Indenture, dated as of May 22, 1986, amending the
Indenture dated as of April 15, 1985, between the Company and Morgan
Guaranty Trust Company of New York, as Trustee (incorporated by
reference from Exhibit 4.1 to the Company's Quarterly Report on Form
10-Q for the quarter ended June 20, 1986, Commission File No. 0-
13295).
4.3 Second Supplemental Indenture, dated as of March 15, 1987, amending
the Indenture dated as of April 15, 1985, between the Company and
Morgan Guaranty Trust Company of New York, as Trustee (incorporated by
reference from Exhibit 4.3 to the Company's Current Report on Form 8-K
dated April 24, 1987, Commission File No. 0-13295).
</TABLE>
II-1
<PAGE>
<TABLE>
<C> <S>
4.4 Third Supplemental Indenture, dated as of October 2, 1989, amending the
Indenture dated as of April 15, 1985, between the Company and Morgan
Guaranty Trust Company of New York, as Trustee (incorporated by reference
from Exhibit 4.3 to the Company's Current Report on Form 8-K, dated
October 16, 1989, Commission File No. 0-13295).
4.5 Fourth Supplemental Indenture, dated as of October 1, 1990, amending the
Indenture dated as of April 15, 1985, between the Company and Morgan
Guaranty Trust Company of New York, as Trustee (incorporated by reference
from Exhibit 4.3 to the Company's Current Report on Form 8-K, dated
October 29, 1990, Commission File No. 0-13295).
4.6 Support Agreement, dated as of December 21, 1984, between the Company and
Caterpillar (incorporated by reference from Exhibit 4.2 to the Company's
Form 10, as amended, Commission File No. 0-13295).
4.7 First Amendment to the Support Agreement dated June 14, 1995 between the
Company and Caterpillar (incorporated by reference from Exhibit 4 to the
Company's Current Report on Form 8-K dated June 14, 1995, Commission File
No. 0-13295).
4.8 Form of Medium-Term Note (Fixed Rate).
4.9 Form of Medium-Term Note (Floating Rate).
5 Opinion of Orrick, Herrington & Sutcliffe LLP, as to the validity of the
Debt Securities.
12 Statement Setting Forth Computation of Ratio of Profit to Fixed Charges.
23.1 Consent of Independent Accountants.
23.2 The consent of Orrick, Herrington & Sutcliffe LLP is contained in their
opinion filed as Exhibit 5 to this Registration Statement.
24 Powers of Attorney of Directors and Officers of the Company.
25 Form T-1 Statement of Eligibility and Qualification of First Trust of New
York, National Association.
</TABLE>
- --------
* The Indenture has previously been qualified in connection with Registration
Statement No. 2-96479 (22-13716) and is deemed to be qualified with respect
to the Debt Securities registered hereunder.
ITEM 17. UNDERTAKINGS.
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement;
(i) To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after the
effective date of the registration statement (or the most recent post-
effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the
registration statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering range
may be reflected in the form of prospectus filed with the Securities and
Exchange Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than 20 percent change in the
maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement, or any
material change to such information in the registration statement;
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<PAGE>
provided, however, that paragraphs (i) and (ii) shall not apply if the
information required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed with or
furnished to the Securities and Exchange Commission by the registrant
pursuant to section 13 or section 15(d) of the Securities Exchange Act
of 1934 that are incorporated by reference in the registration
statement.
(2) That, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any of
the securities being registered which remain unsold at the termination of the
offering.
(4) That, for purposes of determining any liability under the Securities Act
of 1933, each filing of the registrant's annual report pursuant to section
13(a) or section 15(d) of the Securities Exchange Act of 1934 that is
incorporated by reference in the registration statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(5) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the registrant pursuant to the provisions described under Item 15 above, or
otherwise, the registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by the registrant of expenses incurred or paid by a director, officer
or controlling person of the registrant in the successful defense of any
action, suit or proceeding) is asserted against the registrant by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Company
certifies that it has reasonable grounds to believe that it meets all the
requirements for filing on Form S-3 and has duly caused this registration
statement or amendment to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Nashville, State of Tennessee, on
the 27th day of February, 1998.
CATERPILLAR FINANCIAL SERVICES CORPORATION
(Registrant)
By: /s/ Paul J. Gaeto
-----------------------------------------
(Paul J. Gaeto, Secretary)
Pursuant to the requirements of the Securities Act of 1933, this
registration statement or amendment has been duly signed below by the
following persons in the capacities indicated on the 27th day of February,
1998.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
* James S. Beard President, Director and Principal Executive
___________________________________________ Officer
James S. Beard
* James R. English Executive Vice President and Director
___________________________________________
James R. English
* James W. Owens Director
___________________________________________
James W. Owens
* Kenneth C. Springer Controller and Principal Accounting Officer
___________________________________________
Kenneth C. Springer
* Edward J. Scott Treasurer and Principal Financial Officer
___________________________________________
Edward J. Scott
</TABLE>
*By /s/ Paul J. Gaeto
----------------------------------
Paul J. Gaeto, Attorney-in-Fact
II-4
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER EXHIBIT
------- -------
<C> <S>
1 Form of Distribution Agreement.
4.1 Indenture, dated as of April 15, 1985, between the Company and Morgan
Guaranty Trust Company of New York, as Trustee (incorporated by
reference from Exhibit 4.1 to the Company's Registration Statement on
Form S-3, Registration No. 33-2246).*
4.2 First Supplemental Indenture, dated as of May 22, 1986, amending the
Indenture dated as of April 15, 1985, between the Company and Morgan
Guaranty Trust Company of New York, as Trustee (incorporated by
reference from Exhibit 4.1 to the Company's Quarterly Report on Form
10-Q for the quarter ended June 20, 1986, Commission File No. 0-
13295).
4.3 Second Supplemental Indenture, dated as of March 15, 1987, amending
the Indenture dated as of April 15, 1985, between the Company and
Morgan Guaranty Trust Company of New York, as Trustee (incorporated by
reference from Exhibit 4.3 to the Company's Current Report on Form 8-K
dated April 24, 1987, Commission File No. 0-13295).
4.4 Third Supplemental Indenture, dated as of October 2, 1989, amending
the Indenture dated as of April 15, 1985, between the Company and
Morgan Guaranty Trust Company of New York, as Trustee (incorporated by
reference from Exhibit 4.3 to the Company's Current Report on Form 8-
K, dated October 16, 1989, Commission File No. 0-13295).
4.5 Fourth Supplemental Indenture, dated as of October 1, 1990, amending
the Indenture dated as of April 15, 1985, between the Company and
Morgan Guaranty Trust Company of New York, as Trustee (incorporated by
reference from Exhibit 4.3 to the Company's Current Report on Form 8-
K, dated October 29, 1990, Commission File No. 0-13295).
4.6 Support Agreement, dated as of December 21, 1984, between the Company
and Caterpillar (incorporated by reference from Exhibit 4.2 to the
Company's Form 10, as amended, Commission File No. 0-13295).
4.7 First Amendment to the Support Agreement dated June 14, 1995 between
the Company and Caterpillar (incorporated by reference from Exhibit 4
to the Company's Current Report on Form 8-K, dated June 14, 1996,
Commission File No. 0-13295).
4.8 Form of Medium-Term Note (Fixed Rate).
4.9 Form of Medium-Term Note (Floating Rate).
5 Opinion of Orrick, Herrington & Sutcliffe LLP, as to the validity of
the Debt Securities.
12 Statement Setting Forth Computation of Ratio of Profit to Fixed
Charges.
23.1 Consent of Independent Accountants.
23.2 The consent of Orrick, Herrington & Sutcliffe LLP is contained in
their opinion filed as Exhibit 5 to this Registration Statement.
24 Powers of Attorney of Directors and Officers of the Company.
25 Form T-1 Statement of Eligibility and Qualification of First Trust of
New York, National Association.
</TABLE>
- --------
* The indenture has previously been qualified in connection with Registration
Statement No. 2-96479 (22-13716) and is deemed to be qualified with respect
to the Debt Securities registered hereunder.
<PAGE>
Exhibit 1
Caterpillar Financial Services Corporation
$3,000,000,000
Debt Securities
Distribution Agreement
----------------------
March ___, 1998
[Goldman, Sachs & Co.
85 Broad Street
New York, New York 10004]
[Lehman Brothers Inc.
3 World Financial Center
New York, New York 10285]
[Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Merrill Lynch Headquarters
North Tower
World Financial Center
New York, New York 10281-1323]
Dear Sirs:
Caterpillar Financial Services Corporation, a Delaware corporation
(the "Company"), proposes to issue and sell its debt securities (the
"Securities") in an aggregate principal amount of up to $3,000,000,000 or its
equivalent in foreign currencies or currency units and agrees with [Goldman,
Sachs & Co.], [Lehman Brothers Inc.] and [Merrill Lynch & Co., Merrill Lynch,
Pierce, Fenner & Smith Incorporated] (each individually an "Agent", and
collectively the "Agents") as set forth herein. Subject to the terms and
conditions stated herein, the Company hereby (i) appoints each of the Agents as
an agent of the Company for the purpose of soliciting offers to purchase the
Securities from the Company and (ii) agrees that, except as otherwise
contemplated herein, whenever it determines to sell Securities directly to any
of the Agents as principal for resale to others, it will enter into a separate
agreement, which may be a written agreement, substantially in the form of Annex
I hereto or an oral agreement confirmed in writing by such Agent (each a "Terms
Agreement") relating to such sale in accordance with Section 2(b) hereof.
The terms and rights of the Securities shall be as specified in or
established pursuant to the indenture, dated as of April 15, 1985, as
supplemented to the date hereof (the "Indenture"), between the Company and First
Trust of New York, National Association, as
<PAGE>
successor Trustee (the "Trustee"). The Securities shall have the maturity
ranges, annual interest rates, redemption provisions and other terms set forth
in the Prospectus referred to below as it may be supplemented from time to time.
The Securities will be issued, and the terms thereof established, from time to
time by the Company in accordance with the Indenture and the Administrative
Procedure attached hereto as Annex II or as otherwise agreed upon and, if
applicable, will be specified in a related Terms Agreement.
1. The Company represents and warrants to, and agrees with, you that:
(a) A registration statement on Form S-3 (Registration No. 333-_____) in
respect of the Securities has been filed with the Securities and Exchange
Commission (the "Commission") in the form heretofore delivered or to be
delivered to you, excluding exhibits to such registration statement, but
including all documents incorporated by reference in the prospectus included
therein (except for any statements in such documents which are deemed under Rule
412 under the Securities Act of 1933, as amended (the "Act"), not to be
incorporated by reference in such Prospectus), and such registration statement
in such form has been declared effective by the Commission and no stop order
suspending the effectiveness of such registration statement has been issued and
no proceeding for that purpose has been initiated or threatened by the
Commission (any preliminary prospectus included in such registration statement
being hereinafter called a "Preliminary Prospectus"; the various parts of such
registration statement, including all exhibits thereto but excluding Form T-1,
each as amended at the time such part became effective, being hereinafter
collectively called the "Registration Statement"; the prospectus (including, if
applicable, any prospectus supplement) relating to the Securities, in the form
in which it has most recently been filed, or transmitted for filing, with the
Commission on or prior to the date of this Agreement, being hereinafter called
the "Prospectus"; any reference herein to any Preliminary Prospectus or the
Prospectus shall be deemed to refer to and include the documents incorporated by
reference therein pursuant to the applicable form under the Act as of the date
of such Preliminary Prospectus or Prospectus, as the case may be; any reference
to any amendment or supplement to any Preliminary Prospectus or the Prospectus
shall be deemed to refer to and include any documents filed after the date of
such Preliminary Prospectus or Prospectus, as the case may be, under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and
incorporated therein by reference; and any reference to the Prospectus as
amended or supplemented shall be deemed to refer to the Prospectus as each time
amended or supplemented (including any applicable supplement to the Prospectus
that sets forth the terms of a particular issue of the Securities (a "Pricing
Supplement")) to relate to Securities sold pursuant to this Agreement, in the
form in which it is filed with, or transmitted for filing to, the Commission
pursuant to Rule 424 under the Act, including any documents incorporated therein
by reference as of the date of such filing or mailing);
(b) The documents 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 none of such documents contained, in the case of a registration
statement which became effective under the Act, an untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading, and, in the case of
other documents which were filed under the Act or the Exchange Act with the
Commission, an untrue statement of a material fact
2
<PAGE>
or omitted to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, in each case after excluding any statement in any such document
which does not constitute part of the Registration Statement or the Prospectus
pursuant to Rule 412 under the Act; and any further documents so filed and
incorporated by reference in the Prospectus, when such documents become
effective or are filed with the Commission, as the case may be, will conform 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 will
not contain, in the case of a registration statement which becomes effective
under the Act, an 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, in the case of other documents which are filed under
the Act or the Exchange Act, an 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 are made, not misleading; provided, however,
that this representation and warranty shall not apply to any statements or
omissions made in reliance upon and in conformity with information furnished in
writing to the Company by you expressly for use in the Prospectus as amended or
supplemented to relate to a particular issuance of Securities;
(c) The Registration Statement and the Prospectus conform, and any
amendments or supplements thereto will conform, in all material respects to the
requirements of the Act and the Trust Indenture Act of 1939, as amended (the
"Trust Indenture Act"), and the rules and regulations of the Commission
thereunder, and do not and will not, as of the applicable effective date as to
the Registration Statement and any amendment thereto and as of the applicable
filing date as to the Prospectus and any supplement thereto, contain an 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;
provided, however, that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity with information
furnished in writing to the Company by you expressly for use in the Prospectus
as amended or supplemented to relate to a particular issuance of Securities;
(d) Neither the Company nor any of its subsidiaries has sustained since the
date of the latest audited financial statements included or incorporated by
reference in the Prospectus any material loss or interference with its
consolidated business from fire, explosion, flood or other calamity, whether or
not covered by insurance, or from any labor dispute or court or governmental
action, order or decree, otherwise than as set forth or contemplated in the
Prospectus; and, since the respective dates as of which information is given in
the Registration Statement and the Prospectus, there has not been any material
change in the capital stock or any material increase in the consolidated long-
term debt of the Company or any of its subsidiaries (other than debt incurred in
the ordinary course pursuant to the Company's medium-term note program) or any
material adverse change, or any development involving a prospective material
adverse change, in or affecting the general affairs, management, consolidated
financial position, shareholders' equity or results of operations of the Company
and its subsidiaries, otherwise than as set forth or contemplated in the
Prospectus;
(e) The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Delaware, with
corporate power and authority to own its properties and conduct its business as
described in the Prospectus and has
3
<PAGE>
been duly qualified as a foreign corporation for the transaction of business and
is in good standing under the laws of each other jurisdiction in which it owns
or leases substantial property;
(f) The Company has an authorized capitalization as set forth in the
Prospectus, and all of the issued shares of capital stock of the Company have
been duly and validly authorized and issued and are fully paid and non-
assessable and all of such shares are owned directly or indirectly by
Caterpillar Inc., a Delaware corporation ("Caterpillar"), free and clear of all
liens, encumbrances, security interests or claims;
(g) The Securities have been duly authorized, and, when issued and
delivered pursuant to this Agreement and any Terms Agreement, such Securities
will have been duly executed, authenticated, issued and delivered and will
constitute valid and legally binding obligations of the Company entitled to the
benefits provided by the Indenture; the Indenture has been duly authorized and
qualified under the Trust Indenture Act and constitutes a valid and legally
binding instrument, enforceable in accordance with its 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; and the Indenture conforms and the Securities will conform to the
descriptions thereof in the Prospectus as amended or supplemented to relate to
the Securities;
(h) The issue and sale of the Securities and the compliance by the Company
with all of the provisions of the Securities, the Indenture, this Agreement and
any Terms Agreement, and the consummation of the transactions herein and therein
contemplated will not conflict with or result in a breach of any of the terms or
provisions of, or constitute a default under, any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument to which the Company or
Caterpillar is a party or by which the Company or Caterpillar is bound or to
which any of the property or assets of the Company or Caterpillar is subject,
including the Support Agreement, dated as of December 21, 1984, between the
Company and Caterpillar, as amended, nor will such action result in any
violation of the provisions of the Certificate of Incorporation, as amended, or
By-Laws of the Company or any statute or any order, rule or regulation of any
court or governmental agency or body having jurisdiction over the Company or
Caterpillar or any of their properties; and no consent, approval, authorization,
order, registration or qualification of or with any court or governmental agency
or body is required for the solicitation of offers to purchase Securities and
the issue and sale of the Securities or the consummation by the Company of the
other transactions contemplated by this Agreement, any Terms Agreement or the
Indenture, except such as have been, or will have been prior to the Closing Date
(as defined in Section 3 hereof), obtained under the Act or the Trust Indenture
Act and such consents, approvals, authorizations, registrations or
qualifications as may be required under state securities or Blue Sky laws in
connection with the solicitation by you of offers to purchase the Securities
from the Company and with purchases of the Securities by you as principals, as
the case may be, both in the manner contemplated hereby; and
(i) Except as set forth in the Prospectus, there is no action, suit or
proceeding to which the Company or any of its subsidiaries is a party pending
before or brought by any court, arbitrator or governmental body, nor is any such
action, suit or proceeding to the knowledge of the Company threatened, in
respect of which, in the judgment of the Company, there is any reasonable
likelihood that it will result in a material adverse change in the condition
(financial or
4
<PAGE>
other) or business, or materially affect the properties or assets, of the
Company and its subsidiaries as a whole.
2. (a) On the basis of the representations and warranties, and subject
to the terms and conditions, herein set forth, each of the Agents hereby
severally agrees, as an agent of the Company, to use its reasonable best efforts
to solicit offers to purchase the Securities from the Company upon the terms and
conditions set forth in the Prospectus as amended or supplemented.
The Company reserves the right, in its sole discretion, to instruct
any or all of the Agents to suspend at any time, for any period of time or
permanently, the solicitation of offers to purchase the Securities. Upon
receipt of instructions from the Company, the Agent or Agents receiving such
instructions will forthwith suspend solicitation of offers to purchase
Securities from the Company until such time as the Company has advised such
Agent or Agents that such solicitation may be resumed.
The Company agrees to pay the presenting Agent (or jointly to two or
more Agents if such presentation is jointly made) a commission, at the time of
settlement of each sale of a Security by the Company as a result of a
solicitation made by such Agent, in an amount equal to the following percentage
of the principal amount of such Security sold:
Fee as a Percentage
Range of Maturities of Principal Amount
------------------- -------------------
From 9 months to less than 1 year
From 1 year to less than 18 months
From 18 months to less than 2 years
From 2 years to less than 3 years
From 3 years to less than 4 years
From 4 years to less than 5 years
From 5 years to less than 6 years
From 6 years to less than 7 years
From 7 years to less than 10 years
From 10 years to less than 15 years
From 15 years to less than 20 years
From 20 years to less than 30 years
Where the term of the Security is more than 30 years, the commission shall be as
agreed upon between the Company and the Agent at the time of sale.
Each Agent shall communicate to the Company, orally or in writing,
each offer to purchase Securities other than those rejected by such Agent. The
Company shall have the sole right to accept offers to purchase Securities and
may reject any proposed purchase of Securities as a whole or in part. Each of
the Agents shall have the right, in its discretion reasonably exercised, to
reject any offer received by it to purchase Securities, as a whole or in part,
and any such rejection by an Agent shall not be deemed a breach of its
agreements contained herein.
(b) Each sale of Securities to any Agent as principal shall be made in
accordance with the terms of this Agreement and (unless the Company and such
Agent shall otherwise
5
<PAGE>
agree) a Terms Agreement which will provide for the sale of such Securities to,
and the purchase thereof by, such Agent. Each Terms Agreement will take the form
of either (i) a written agreement between you and the Company which shall be
substantially in the form of Annex I hereto or (ii) an oral agreement between
you and the Company confirmed in writing by you to the Company. Any Agent's
commitment to purchase Securities pursuant to any Terms Agreement or otherwise
shall be deemed to have been made on the basis of the representations and
warranties of the Company herein contained and shall be subject to the terms and
conditions herein set forth; provided that for purposes of any Terms Agreement
all references in this Agreement to "you" or "the Agents" shall be deemed to
refer only to the Agent or Agents party to such Terms Agreement. Each Terms
Agreement shall include a specification of the principal amount of Securities to
be purchased by an Agent pursuant thereto, the price to be paid to the Company
for such Securities, any provisions relating to rights of, and default by,
underwriters acting together with such Agent in the reoffering of the
Securities, and the time (each a "Time of Delivery") and place of delivery of
and payment for such Securities. Such Terms Agreement shall also specify any
requirements for officers' certificates, opinions of counsel and accountants'
letters pursuant to Section 4 hereof and any additional agreements pursuant to
Section 5 hereof. In connection with any purchase of Securities by an Agent as
principal, such Agent may utilize dealer groups and reallow commissions and
discounts.
For each sale of Securities to an Agent as principal that is not made
pursuant to a Terms Agreement, the procedural details relating to the issue and
delivery of such Securities and payment thereof shall be as set forth in the
Administrative Procedure. For each such sale of Securities to an Agent as
principal that is not made pursuant to a Terms Agreement, the Company agrees to
pay such agent a commission (or grant an equivalent discount) as provided in
Section 2(a) hereof and in accordance with the schedule set forth therein.
(c) Procedural details relating to the issue and delivery of Securities,
the solicitation of offers to purchase, and purchases by any Agent as principal
of, Securities, and the payment in each case therefor, are set forth in the
Administrative Procedure attached hereto as Annex II (the "Procedure"). The
provisions of the Procedure shall apply to all transactions contemplated
hereunder other than those made pursuant to a Terms Agreement. Each of the
Agents and the Company agrees to perform the respective duties and obligations
specifically provided to be performed by each of them in the Procedure as it may
be amended from time to time by written agreement between you and the Company.
(d) Each Agent agrees, with respect to any Security denominated in a
currency other than U.S. dollars, as agent, directly or indirectly, not to
solicit offers to purchase, and as principal under any Terms Agreement or
otherwise, directly or indirectly, not to offer, sell or deliver, such Security
in, or to residents of, the country issuing such currency (or if such Security
is denominated in a composite currency, in any country issuing a currency
comprising a portion of such composite currency), except as permitted by
applicable law.
3. The documents required to be delivered pursuant to Section 6 hereof
shall be delivered at the offices of Sullivan & Cromwell, 125 Broad Street, New
York, New York at 11:00 a.m., New York City time, on the date of this Agreement,
which date and time of such delivery may be postponed by agreement between the
Agents and the Company but in no event
6
<PAGE>
shall be later than the day prior to the date on which Securities are first sold
hereunder, such time and date being herein called the "Closing Date."
4. The Company covenants and agrees with you:
(a) To make no amendment or supplement to the Registration Statement or the
Prospectus prior to the Closing Date or after the date of any Terms Agreement
and prior to the related Time of Delivery which shall be disapproved by you
promptly after reasonable notice thereof unless in the opinion of counsel to the
Company such amendment or supplement is required by law; to make no such
amendment or supplement, other than any Pricing Supplement, at any other time
prior to having afforded you a reasonable opportunity to review it; to file
promptly all reports and any definitive proxy or information statements required
to be filed by the Company with the Commission pursuant to Section 13(a), 13(c),
14 or 15(d) of the Exchange Act subsequent to the date of the Prospectus and for
so long as the delivery of a prospectus is required in connection with the
offering or sale of the Securities, and during such same period to advise you,
promptly after it receives notice thereof of the time when any amendment to the
Registration Statement has been filed or become effective or any supplement to
the Prospectus or any amended Prospectus (other than any Pricing Supplement
relating to Securities not purchased through or by such Agent) has been filed
with, or transmitted for filing to, the Commission, of the issuance by the
Commission of any stop order or of any order preventing or suspending the use of
any prospectus relating to the Securities, of the suspension of the
qualification of the Securities for offering or sale in any jurisdiction, of the
initiation or threatening of any proceeding for any such purpose, or of any
request by the Commission for the amendment or supplement of the Registration
Statement or Prospectus or for additional information; and, in the event of the
issuance of any such stop order or of any such order preventing or suspending
the use of any such prospectus or suspending any such qualification, to use
promptly its best efforts to obtain its withdrawal;
(b) Promptly from time to time to take such action as you reasonably may
request to qualify the Securities for offering and sale under the securities
laws of such jurisdictions as you may request and to comply with such laws so as
to permit the continuance of sales and dealings therein for as long as may be
necessary to complete the distribution or sale of the Securities; provided,
however, that in connection therewith the Company shall not be required to
qualify as a foreign corporation or to file a general consent to service of
process in any jurisdiction;
(c) To furnish you with copies of the Registration Statement and each
amendment thereto, and with copies of the Prospectus and each amendment or
supplement thereto, other than any Pricing Supplement (except as provided in the
Procedure), in the form in which it is filed with, or transmitted for filing to,
the Commission pursuant to Rule 424 under the Act, both in such quantities as
you may reasonably request from time to time; and, if the delivery of a
prospectus is required at any time in connection with the offering or sale of
the Securities (including Securities purchased from the Company by any Agent as
principal) and if at such time any event shall have occurred as a result of
which the Prospectus as then amended or supplemented would include an untrue
statement of a material fact or omit to state any material fact necessary in
order to make the statements therein, in the light of the circumstances under
which they were made when such Prospectus is delivered, not misleading, or, if
for any other
7
<PAGE>
reason it shall be necessary during such same period to amend or supplement the
Prospectus or to file under the Exchange Act any document incorporated by
reference in the Prospectus in order to comply with the Act, the Exchange Act or
the Trust Indenture Act, to notify you and request you to suspend solicitation
of offers to purchase Securities from the Company, in your capacity as agents of
the Company and, if so notified, you shall forthwith cease such solicitations;
and if the Company shall decide to amend or supplement the Registration
Statement or the Prospectus as then amended or supplemented, other than by any
Pricing Supplement (except as provided in the Procedure), to so advise you
promptly by telephone (with confirmation in writing) and to prepare and cause to
be filed promptly with the Commission an amendment or supplement to the
Registration Statement or the Prospectus as then amended or supplemented that
will correct such statement or omission or effect such compliance; provided,
however, that if during such same period any Agent continues to own Securities
purchased from the Company by such Agent as principal, the Company shall
promptly prepare and file with the Commission such an amendment or supplement;
(d) To make generally available to its security holders as soon as
practicable, but in any event not later than 90 days after the close of the
period covered thereby, an earning statement of the Company and its subsidiaries
(which need not be audited) complying with Section 11(a) of the Act and the
rules and regulations of the Commission thereunder (including, at the option of
the Company, Rule 158) and covering each twelve-month period beginning not later
than the first day of the Company's fiscal quarter next following the effective
date of the Registration Statement or a post-effective amendment thereto (within
the meaning of Rule 158);
(e) During the period when this Agreement is in effect, to deliver to you
(i) as soon as they are available, copies of any reports and financial
statements furnished to or filed with the Commission or any national securities
exchange on which any class of securities of the Company is listed; and (ii)
such additional information concerning the business and financial condition of
the Company as you may from time to time reasonably request (such financial
statements to be on a consolidated basis to the extent the accounts of the
Company and its subsidiaries are consolidated in reports furnished to the
Commission);
(f) That, from the date of any Terms Agreement or other agreement by such
Agent to purchase Securities as principal and continuing to and including the
earlier of (i) the termination of the trading restrictions for the Securities
purchased thereunder, as notified to the Company by the Agent or Agents party to
such Terms Agreement, and (ii) the related Time of Delivery, the Company will
not, without the prior written consent of such Agent or Agents, offer, sell,
contract to sell or otherwise dispose of any debt securities of the Company
which mature more than nine months after such Time of Delivery and which are
substantially similar to the Securities;
(g) That each acceptance by the Company of an offer to purchase Securities
hereunder (including any purchase by such Agent as principal not pursuant to a
Terms Agreement), and each sale of Securities to an Agent pursuant to a Terms
Agreement, shall be deemed to be an affirmation to the Agent or Agents which are
parties to such Terms Agreement that the representations and warranties of the
Company contained in or made pursuant to this Agreement are true and correct as
of the date of such acceptance or of such Terms Agreement as though made at and
as of such time, and an undertaking that such representations and warranties
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<PAGE>
will be true and correct as of the settlement date for the Securities relating
to such acceptance and as of the Time of Delivery relating to such sale, as
though made at and as of each such date (except that such representations and
warranties shall be deemed to relate to the Registration Statement and the
Prospectus as amended and supplemented relating to such Securities);
(h) That each time the Registration Statement or the Prospectus shall be
amended or supplemented (other than by an amendment or supplement relating
solely to a change in the terms of the Securities and other than by any Pricing
Supplement), each time a document filed under the Act or the Exchange Act is
incorporated by reference into the Prospectus, and each time, if so indicated in
the applicable Terms Agreement, the Company sells Securities to an Agent as
principal, the Company shall furnish or cause to be furnished forthwith to you a
certificate of officers of the Company satisfactory to you, dated the date of
such supplement, amendment, incorporation or Time of Delivery related to such
sale, in form satisfactory to you in your reasonable judgment, to the effect
that the statements contained in the certificate referred to in Section 6(f)
hereof which were last furnished to you are true and correct at such date, as
though made at and as of such date (except that such statements shall be deemed
to relate to the Registration Statement and the Prospectus as amended and
supplemented to such time) or, in lieu of such certificate, certificates of the
same tenor as the certificates referred to in said Section 6(f) but modified to
relate to the Registration Statement and the Prospectus as amended and
supplemented to such date;
(i) That each time the Registration Statement or the Prospectus shall be
amended or supplemented (other than by an amendment or supplement relating
solely to a change in the terms of the Securities and other than by any Pricing
Supplement), each time a document filed under the Act or the Exchange Act is
incorporated by reference into the Prospectus, and each time, if so indicated in
the applicable Terms Agreement, the Company sells Securities to an Agent as
principal, the Company shall furnish or cause to be furnished forthwith to you a
written opinion of counsel for the Company, or other counsel satisfactory to you
in your reasonable judgment, dated the date of such amendment, supplement,
incorporation or Time of Delivery relating to such sale, in form satisfactory to
you in your reasonable judgment, to the effect that you may rely on the opinion
referred to in Section 6(c) hereof which was last furnished to you to the same
extent as though it were dated the date of such letter authorizing reliance
(except that statements in such last opinion shall be deemed to relate to the
Registration Statement and the Prospectus as amended and supplemented to such
date) or, in lieu of such opinion, an opinion of the same tenor as the opinion
referred to in Section 6(c) hereof but modified to relate to the Registration
Statement and the Prospectus as amended and supplemented to such date;
(j) That each time the Registration Statement or the Prospectus shall be
amended or supplemented and each time that a document filed under the Act or the
Exchange Act is incorporated by reference into the Prospectus, in either case to
set forth financial information included in or derived from the Company's
consolidated financial statements, or, if so indicated in the applicable Terms
Agreement, each time the Company sells Securities to an Agent as principal, the
Company shall cause its independent public accountants forthwith to furnish you
a letter, dated the date of such amendment, supplement, incorporation or Time of
Delivery relating to such sale, in form satisfactory to you in your reasonable
judgment, of the same tenor as the letter referred to in Section 6(d) hereof but
modified to relate to the Registration Statement and the Prospectus as amended
or supplemented to the date of such letter, with such changes as may
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<PAGE>
be necessary to reflect changes in the financial statements and other
information derived from the accounting records of the Company, to the extent
such financial statements and other information are available as of a date not
more than five business days prior to the date of such letter; provided,
however, that where such amendment, supplement or document incorporated by
reference only sets forth unaudited quarterly financial information, the scope
of such letter may be limited to relate to such unaudited financial information
unless any other accounting or financial information included or incorporated by
reference therein is of such a character that, in your reasonable judgment, such
letter should address such other information;
(k) That, in the event the Company determines to solicit offers to purchase
and sell the Securities to or through agents other than the Agents, the Company
shall provide the Agents prompt notice of such determination; and
(l) To offer to any person who has agreed to purchase Securities as the
result of an offer to purchase solicited by such Agent the right to refuse to
purchase and pay for such Securities if, on the related settlement date fixed
pursuant to the Procedure, any condition set forth in Section 6(a), 6(e) or 6(g)
hereof shall not have been satisfied (it being understood that the judgment of
such person with respect to the impracticability or inadvisability of such
purchase of Securities shall be substituted, for purposes of this Section 4(l),
for the respective judgments of an Agent with respect to certain matters
referred to in such Sections 6(a), 6(e) and 6(g), and that such Agent shall have
no duty or obligation whatsoever to exercise the judgment permitted under such
Sections 6(a), 6(e) and 6(g) on behalf of any such person).
5. Unless otherwise provided in any applicable Terms Agreement, the
Company covenants and agrees with you that the Company will pay or cause to be
paid the following: (i) the fees and expenses of the Company's counsel and
accountants in connection with the registration of the Securities under the Act
and all other expenses in connection with the preparation, printing and filing
of the Registration Statement, any Preliminary Prospectus and the Prospectus and
amendments and supplements thereto and the mailing and delivering of copies
thereof to you; (ii) the fees and expenses of your counsel in connection with
the transactions contemplated hereunder; (iii) the cost of printing or
reproducing this Agreement, any Terms Agreement, any Indenture, any Blue Sky and
Legal Investment Memoranda and any other documents in connection with the
offering, purchase, sale and delivery of the Securities; (iv) all expenses in
connection with the qualification of the Securities for offering and sale under
state securities laws as provided in Section 4(b) hereof, including fees and
disbursements of your counsel in connection with such qualification and in
connection with the Blue Sky and legal investment surveys; (v) any fees charged
by security rating services for rating the Securities; (vi) the cost of
preparing the Securities; (vii) the fees and expenses of any Trustee and any
agent of any Trustee and the fees and disbursements of counsel for any Trustee
in connection with any Indenture and the Securities; (viii) the fees and
expenses of any Depositary (as defined in the Indenture) and any nominees
thereof in connection with the Securities; (ix) any advertising expenses
connected with the solicitation of offers to purchase and the sale of Securities
so long as such advertising expenses have been approved by the Company; and (x)
all other costs and expenses incident to the performance of its obligations
hereunder which are not otherwise specifically provided for in this Section.
Each Agent shall pay all other fees and expenses incurred by such Agent.
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6. The obligations of each Agent, as agent of the Company, to solicit
offers to purchase the Securities and the obligation of each Agent to purchase
Securities as principal pursuant to any Terms Agreement or otherwise, shall in
each case be subject, in such Agent's reasonable discretion, to the condition
that all representations and warranties and other statements of the Company
herein are true and correct at and as of the Closing Date, the date of each such
solicitation, any settlement date related to the acceptance of such an offer,
and each Time of Delivery, the condition that the Company shall have performed
all of its obligations hereunder theretofore in each case to be performed and
the following additional conditions:
(a) No stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceeding for that purpose shall have
been initiated or threatened by the Commission; and all requests for additional
information on the part of the Commission shall have been complied with to your
reasonable satisfaction;
(b) Your counsel shall have furnished to you such opinion or opinions,
dated the Closing Date, with respect to the incorporation of the Company, the
validity of the Indenture, the Securities, the Registration Statement, the
Prospectus as amended or supplemented and other related matters as you may
reasonably request, and such counsel shall have received such papers and
information as you may reasonably request to enable them to pass upon such
matters;
(c) Counsel for the Company satisfactory to you shall have furnished to you
their written opinion, dated the Closing Date or any applicable date referred to
in Section 4(i), as the case may be, in form and substance satisfactory to you,
to the effect that:
(i) The Company has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the State of
Delaware with corporate power and authority to own its properties and
conduct its business as described in the Prospectus;
(ii) The Company's authorized capital stock is as set forth in the
Prospectus and all of the issued shares of capital stock of the
Company have been duly and validly authorized and issued and are fully
paid and non-assessable;
(iii) Such counsel does not know of any litigation or any
governmental proceeding instituted or threatened against the Company
or any of its consolidated subsidiaries which in such counsel's
opinion would be likely to result in a judgment or decree having a
material adverse effect on the business or financial position of the
Company and its subsidiaries as a whole or be required to be disclosed
in the Registration Statement which is not disclosed and accurately
summarized in the Prospectus;
(iv) This Agreement (and any applicable Terms Agreement) has been
duly authorized, executed and delivered by the Company;
(v) The Securities have been duly authorized and, when the terms of
any Securities have been established in accordance with the Indenture
and so as not to violate any applicable law or agreement or instrument
then binding on the Company and such Securities have been duly
executed, authenticated, issued and
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delivered by the Company, such Securities will constitute valid and
legally binding obligations of the Company entitled to the benefits
provided by the Indenture; and the Indenture conforms and the
Securities will conform in all material respects to the descriptions
thereof in the Prospectus;
(vi) The Indenture has been duly authorized, executed and delivered
by the parties thereto and constitutes a valid and legally binding
obligation of the Company, enforceable in accordance with its terms,
subject, as to enforcement, to bankruptcy, insolvency, reorganization,
arrangement, fraudulent conveyance, moratorium or other laws relating
to or affecting creditors' rights generally, and to general principles
of equity, including without limitation concepts of materiality,
reasonableness, good faith and fair dealing, and the possible
unavailability of specific performance or injunctive relief,
regardless of whether considered in a proceeding in equity or at law;
and the Indenture has been duly qualified under the Trust Indenture
Act;
(vii) The issue and sale of the Securities and the compliance by
the Company with all of the provisions of the Securities, the
Indenture, this Agreement and any Terms Agreement, and the
consummation of the transactions herein and therein contemplated, will
not conflict with or result in a breach of any of the terms or
provisions of, or constitute a default under, any agreement or
instrument known to such counsel to which the Company or Caterpillar
is a party or by which the Company or Caterpillar is bound, and which
conflicts, breaches and defaults, if any, would individually or in the
aggregate have a material adverse effect on the business or financial
position of the Company and its subsidiaries as a whole; nor will such
action result in any violation of the provisions of the Certificate of
Incorporation or the By-Laws of the Company or any statute of the
United States of America or the State of Delaware or any rule or
regulation thereunder (provided that no opinion need be expressed in
this paragraph as to compliance with the Act, the Trust Indenture Act,
the Exchange Act, the Commodity Exchange Act (and the rules and
regulations of the Commodity Futures Trading Commission thereunder) or
the Delaware Securities Act, or with the Bankruptcy Code of 1978, as
amended, with respect to any proceeding in which the Company is the
debtor) or, to such counsel's knowledge, any order of any court or
governmental agency or body of the United States of America or the
State of Delaware; and no consent, approval, authorization, order,
registration or qualification of or with any such court or
governmental agency or body is required for the issue and sale of the
Securities by the Company or the consummation by the Company of the
other transactions contemplated by this Agreement or any Terms
Agreement or the Indenture, except such as have been obtained under
the Act and the Trust Indenture Act and such consents, approvals,
authorizations, registrations or qualifications as may be required
under Delaware securities or Blue Sky laws in connection with the
issue and sale of the Securities;
(viii) The documents incorporated by reference in the Prospectus
(other than the financial statements and related schedules and other
financial and statistical data therein, as to which such counsel need
express no opinion or
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<PAGE>
belief), when they were filed with the Commission, complied as to form
in all material respects with the requirements of the Act or the
Exchange Act and the rules and regulations of the Commission
thereunder; and
(ix) The Registration Statement, as of the date on which any part
thereof became effective, and the Prospectus, as of the date of such
opinion (other than the financial statements and related schedules and
other financial and statistical data therein, as to which such counsel
need express no opinion or belief) complied or complies as to form in
all material respects with the requirements of the Act and the Trust
Indenture Act and the rules and regulations thereunder.
In addition, such counsel shall state that while they make no
representation that they have independently verified the accuracy or
completeness of the information contained in the documents incorporated by
reference in the Prospectus, they have no reason to believe that any of such
documents (other than the financial statements and related schedules and other
financial and statistical data therein, as to which they need express no opinion
or belief), when they were so filed, contained an untrue statement of a material
fact or omitted to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were made
when such documents were so filed, not misleading, in each case after excluding
any statement in any such documents which does not constitute part of the
Registration Statement or Prospectus pursuant to Rule 412 of Regulation C under
the 1933 Act. Further, such counsel shall state that while they make no
representation that they have independently verified the accuracy or
completeness of the information contained in the Registration Statement and the
Prospectus (other than the statements made in the Prospectus under the captions
"Description of Notes", "Supplemental Plan of Distribution" and "Description of
Debt Securities", in each case insofar as they relate to the provisions of
documents therein described), they have no reason to believe that any part of
the Registration Statement, insofar as relevant to the offering of the
Securities, as of the date on which such part became effective, or the
Prospectus, as of the date of such opinion (other than the financial statements
and related schedules and other financial and statistical data therein, as to
which they need express no opinion or belief), contained or contains an untrue
statement of a material fact or omitted or omits to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading, in each case after excluding any statement in any such document
which does not constitute part of the Registration Statement or the Prospectus
pursuant to Rule 412 of Regulation C under the 1933 Act; and they do not know of
any contracts or other documents of a character required to be filed as an
exhibit to the Registration Statement or required to be incorporated by
reference into the Prospectus or required to be described in the Registration
Statement or the Prospectus which are not filed or incorporated by reference or
described as required;
(d) At 11:00 a.m., New York City time, on the Closing Date or on any
applicable date referred to in Section 4(j), as the case may be, the independent
accountants who have certified the financial statements of the Company and its
subsidiaries included or incorporated by reference in the Registration Statement
shall have furnished to you a letter, dated the Closing Date or such applicable
date, in form and substance satisfactory to you, to the effect set forth in
Annex III hereto;
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(e) (i) Neither the Company nor any of its subsidiaries shall have
sustained after the date of the latest audited financial statements included or
incorporated by reference in the Prospectus and (A) prior to the Closing Date,
any material loss or interference with its business from fire, explosion, flood
or other calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, otherwise than as set
forth or contemplated in the Prospectus as amended or supplemented through the
date of this Agreement and (B) prior to each Time of Delivery, any such material
loss or interference, otherwise than as set forth or contemplated in the
Prospectus as amended and supplemented through the date of each corresponding
Terms Agreement, and (ii) since the respective dates as of which information is
given in the Prospectus as amended or supplemented and (A) prior to the Closing
Date, there shall not have been any material change in the capital stock or any
material increase in the consolidated long-term debt of the Company or any of
its subsidiaries or any material adverse change, or any development involving a
prospective material adverse change, in or affecting the general affairs,
management, consolidated financial position, shareholders' equity or results of
operations of the Company and its subsidiaries, otherwise than as set forth or
contemplated in the Prospectus as amended or supplemented through the date of
this Agreement and (B) prior to each Time of Delivery, there shall not have been
any such material change or development, otherwise than as set forth or
contemplated in the Prospectus as amended and supplemented through the date of
each corresponding Terms Agreement, the effect of which, in any such case
described in clause (i) or (ii), is in your judgment so material and adverse as
to make it impracticable or inadvisable to proceed with your solicitation of
offers to purchase Securities from the Company or your purchase of Securities
from the Company as principal, as the case may be;
(f) The Company shall have furnished or caused to be furnished to you a
certificate of officers of the Company satisfactory to you, dated the Closing
Date or any applicable date referred to in Section 4(h), as the case may be, as
to the accuracy of the representations and warranties of the Company herein at
and as of the Closing Date or such applicable date, as to the performance by the
Company of all of its obligations hereunder to be performed at or prior to the
Closing Date or such applicable date, as to the matters set forth in subsections
(a) and (e) of this Section 6, and as to such other matters as you may
reasonably request; and
(g) During the period in which you are soliciting offers to purchase
Securities, including the period between the date of any Terms Agreement and the
related Time of Delivery, there shall not have occurred any of the following:
(i) a suspension or material limitation in trading in securities generally on
the New York Stock Exchange; (ii) a general moratorium on commercial banking
activities in New York declared by either Federal or New York State authorities;
(iii) the outbreak or material escalation of hostilities involving the United
States or the declaration by the United States of a national emergency or war,
if the effect of any such event specified in this clause (iii) in your judgment
(after consultation with the Company) makes it impracticable or inadvisable to
proceed with your solicitation of offers to purchase Securities or your purchase
of Securities from the Company as principal, pursuant to the applicable Terms
Agreement or otherwise, as the case may be; or (iv) any downgrading in the
rating accorded the Company's debt securities by Moody's Investors Service, Inc.
or Standard & Poor's, a division of The McGraw-Hill Companies, Inc., or a public
announcement by either such organization that it has under surveillance or
review, with possible negative implications, its rating of any of the Company's
debt securities.
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7. (a) The Company will indemnify and hold you harmless against any
losses, claims, damages or liabilities, joint or several, to which you may
become subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon an untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Prospectus, the Registration Statement, the
Prospectus as amended or supplemented, and any other prospectus relating to the
Securities or any amendment or supplement thereto, or arise out of or are based
upon the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading,
and will reimburse each Agent for any legal or other expenses reasonably
incurred by it in connection with investigating or defending any such action or
claim; provided, however, that the Company shall not be liable in any such case
to the extent that any such loss, claim, damage or liability arises out of or is
based upon an untrue statement or alleged untrue statement or omission or
alleged omission made in any Preliminary Prospectus, the Registration Statement,
the Prospectus as amended or supplemented and any other prospectus relating to
the Securities or any such amendment or supplement in reliance upon and in
conformity with written information furnished to the Company by you expressly
for use in the Prospectus as amended or supplemented relating to such
Securities; and provided, further, that the Company shall not be liable to any
Agent under the indemnity agreement in this subsection (a) with respect to any
Preliminary Prospectus to the extent that any such loss, claim, damage or
liability results from the fact that such Agent sold Securities to a person to
whom there was not sent or given, at or prior to the written confirmation of
such sale, a copy of the Prospectus (excluding documents incorporated by
reference) or of the Prospectus as then amended or supplemented (excluding
documents incorporated by reference) if the Company has previously furnished
copies thereof to such Agent.
(b) Each Agent will indemnify and hold harmless the Company against any
losses, claims, damages or liabilities to which the Company may become subject,
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact contained in any
Preliminary Prospectus, the Registration Statement, the Prospectus as amended or
supplemented and any other prospectus relating to the Securities, or any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, in each case
to the extent, but only to the extent, that such untrue statement or alleged
untrue statement or omission or alleged omission was made in any Preliminary
Prospectus, the Registration Statement, the Prospectus as amended or
supplemented and any other prospectus relating to the Securities, or any such
amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by such Agent expressly for use therein;
and will reimburse the Company for any legal or other expenses reasonably
incurred by the Company in connection with investigating or defending any such
action or claim.
(c) Promptly after receipt by an indemnified party under subsection (a) or
(b) above of notice of the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under such subsection, notify the indemnifying party in writing of the
commencement thereof; but the omission so to notify the indemnifying party shall
not relieve it from any liability which it may have to any indemnified
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party otherwise than under such subsection. In case any such action shall be
brought against any indemnified party and it shall notify the indemnifying party
of the commencement thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it shall wish, jointly with any
other indemnifying party similarly notified, to assume the defense thereof, with
counsel satisfactory to such indemnified party (who shall not, except with the
consent of the indemnified party, be counsel to the indemnifying party), and,
after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, the indemnifying party shall not be
liable to such indemnified party under such subsection for any legal expenses of
other counsel or any other expenses, in each case subsequently incurred by such
indemnified party, in connection with the defense thereof other than reasonable
costs of investigation.
(d) If the indemnification provided for in this Section 7 is unavailable to
or insufficient to hold harmless an indemnified party under subsection (a) above
in respect of any losses, claims, damages or liabilities (or actions in respect
thereof) referred to therein, then each indemnifying party shall contribute to
the amount paid or payable by such indemnified party as a result of such losses,
claims, damages or liabilities (or actions in respect thereof) in such
proportion as is appropriate to reflect the relative benefits received by the
Company on the one hand and the contributing Agent on the other from the
offering of the Securities to which such loss, claim, damage or liability (or
action in respect thereof) relates. If, however, the indemnification provided
for in this Section 7 is unavailable to or insufficient to hold harmless an
indemnified party under subsection (b) above in respect of any losses, claims,
damages or liabilities (or actions in respect thereof) referred to therein, if
the allocation provided by the immediately preceding sentence is not permitted
by applicable law or if the indemnified party failed to give the notice required
under subsection (c) above, then each indemnifying party shall contribute to
such amount paid or payable by such indemnified party in such proportion as is
appropriate to reflect not only such relative benefits but also the relative
fault of the Company on the one hand and the contributing Agent on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities (or actions in respect thereof), as well as any
other relevant equitable considerations. The relative benefits received by the
Company on the one hand and the contributing Agent on the other shall be deemed
to be in the same proportion as the total net proceeds from the sale of
Securities (before deducting expenses) received by the Company bear to the total
commissions or discounts received by the contributing Agent in respect thereof.
The relative fault shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact required to be stated
therein or necessary in order to make the statements therein not misleading
relates to information supplied by the Company on the one hand or by the
contributing Agent on the other and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The Company and the contributing Agent agree that it would not be
just and equitable if contribution pursuant to this subsection (d) were
determined by pro rata allocation or by any other method of allocation which
does not take account of the equitable considerations referred to above in this
subsection (d). The amount paid or payable by an indemnified party as a result
of the losses, claims, damages or liabilities (or actions in respect thereof)
referred to above in this subsection (d) shall be deemed to include 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 subsection (d), no Agent shall be required to contribute any
amount in excess of the amount by which the total price at which the Securities
purchased by
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or through such Agent were sold exceeds the amount of any damages which such
Agent has otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation.
(e) The obligations of the Company under this Section 7 shall be in
addition to any liability which the Company may otherwise have and shall extend,
upon the same terms and conditions, to each person, if any, who controls any
Agent within the meaning of the Act; and each Agent's obligations under this
Section 7 shall be in addition to any liability which such Agent may otherwise
have and shall extend, upon the same terms and conditions, to each officer and
director of the Company and to each person, if any, who controls the Company
within the meaning of the Act.
8. In soliciting offers by others to purchase Securities from the
Company, each Agent is acting solely as an agent for the Company, and not as
principal. Each Agent will make reasonable efforts to assist the Company in
obtaining performance by each purchaser whose offer to purchase Securities from
the Company was solicited by such Agent and has been accepted by the Company,
but such Agent shall not have any liability to the Company in the event such
purchase for any reason is not consummated. If the Company shall default on its
obligation to deliver Securities to a purchaser whose offer it has accepted, the
Company shall hold each Agent harmless against any loss, claim or damage arising
from or as a result of such default by the Company.
9. The respective indemnities, agreements, representations, warranties
and other statements by you and the Company set forth in or pursuant to this
Agreement, shall remain in full force and effect regardless of any investigation
(or any statement as to the results thereof) made by or on behalf of any of you
or the Company or any of its officers or directors or any controlling person,
and shall survive each delivery of and payment for any of the Securities.
10. The provisions of this Agreement relating to the solicitation of
offers to purchase the Securities may be suspended or terminated at any time by
the Company as to any or all Agents or by any Agent insofar as this Agreement
relates to such Agent, upon the giving of written notice of such suspension or
termination to the other parties hereto. In the event of any such suspension or
termination, no party shall have any liability to the other party hereto, except
as provided in the third paragraph of Section 2(a), Section 5, Section 7,
Section 8 and Section 9 and except that, if at the time of such suspension or
termination, an offer for the purchase of Securities shall have been accepted by
the Company but the delivery of the Securities relating thereto to the purchaser
or his agent shall not yet have occurred, the Company shall have the obligations
provided in subsections (g), (h), (i) and (j) of Section 4.
11. Except as otherwise specifically provided herein or in the
Administrative Procedure, all statements, requests, notices and advices
hereunder shall be in writing, or by telephone if promptly confirmed in writing,
and if to [Goldman, Sachs & Co. shall be sufficient in all respects when
delivered or sent by facsimile transmission or registered mail to 85 Broad
Street, New York, New York 10004, Facsimile Transmission No. (212) 902-3000,
Attention: Registration Department]; [if to Merrill Lynch & Co., Merrill Lynch,
Pierce, Fenner & Smith
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Incorporated shall be sufficient in all respects when delivered or sent by
facsimile transmission or registered mail to Merrill Lynch Headquarters, World
Financial Center, North Tower, 250 Vesey, New York, New York 10281-1310,
Facsimile Transmission No. (212) 449-2234, Attention: MTN Product Management];
[if to Lehman Brothers Inc. shall be sufficient in all respects when delivered
or sent by facsimile transmission or registered mail to 3 World Financial
Center, Twelfth Floor, New York, New York 10285, Facsimile Transmission No.
(212) 528-6669 (for facsimile transmissions of less than 10 pages) or (212) 619-
7165 (for facsimile transmissions of 10 pages or more), Attention: Medium Term
Note Department]; and if to the Company shall be sufficient in all respects when
delivered or sent by facsimile transmission or registered mail to Caterpillar
Financial Services Corporation, 3322 West End Avenue, Nashville, Tennessee
37203-0983, Attention: General Counsel.
12. This Agreement and any Terms Agreement shall be binding upon, and
inure solely to the benefit of, each of you and the Company, and to the extent
provided in Section 7, Section 8 and Section 9 hereof, the officers and
directors of the Company and any person who controls any of you or the Company,
and your respective personal representatives, successors and assigns, and no
other person shall acquire or have any right under or by virtue of this
Agreement or any Terms Agreement. No purchaser of any of the Securities through
or from any of you shall be deemed a successor or assign by reason of such
purchase.
13. This Agreement and any Terms Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York.
14. Time shall be of the essence in this Agreement and any Terms
Agreement.
15. This Agreement and any Terms Agreement may be executed by any one
or more of the parties hereto and thereto in any number of counterparts, each of
which shall be an original, but all of such respective counterparts shall
together constitute one and the same instrument.
18
<PAGE>
If the foregoing is in accordance with your understanding, please sign
and return to us six counterparts hereof, whereupon this letter and the
acceptance by you thereof shall constitute a binding agreement between the
Company and each of you in accordance with its terms.
Very truly yours,
Caterpillar Financial Services Corporation
By: _______________________________
President
Accepted in New York, New York,
as of the date hereof:
____________________________
[(Goldman, Sachs & Co.)]
[Lehman Brothers Inc.]
By: _______________________
[Merrill Lynch, Pierce, Fenner
& Smith Incorporated]
By: _______________________
19
<PAGE>
Exhibit 4.8
[FACE OF SECURITY]
REGISTERED REGISTERED
No. FXR
CUSIP
CATERPILLAR FINANCIAL SERVICES CORPORATION
MEDIUM-TERM NOTE, SERIES F
(Fixed Rate)
[Insert if the Security is to be a Global Security --This Note is a Global
Security within the meaning of the Indenture hereinafter referred to and is
registered in the name of a Depositary or a nominee of a Depositary. This
Global Security is exchangeable for Notes registered in the name of a Person
other than the Depositary or its nominee only in the limited circumstances
described in the Indenture, and no transfer of this Note (other than a transfer
of this Note as a whole by the Depositary to a nominee of the Depositary or by a
nominee of the Depositary to the Depositary or another nominee of the
Depositary) may be registered except in such limited circumstances.
Unless this Certificate is presented by an authorized representative of The
Depository Trust Company (55 Water Street, New York, New York) to the issuer or
its agent for registration of transfer, exchange or payment, and any certificate
issued is registered in the name of Cede & Co. or such other name as requested
by an authorized representative of The Depository Trust Company and any payment
hereon made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL since the registered owner hereof,
Cede & Co., has an interest herein.]
THE FOLLOWING SUMMARY OF TERMS IS SUBJECT TO THE INFORMATION SET FORTH ON
THE REVERSE HEREOF:
<TABLE>
<S> <C> <C>
PRINCIPAL AMOUNT:
ORIGINAL ISSUE DATE: INTEREST RATE: MATURITY DATE:
SPECIFIED CURRENCY: OPTION TO ELECT PAYMENT IN U.S. DOLLARS AUTHORIZED DENOMINATIONS (only
(only applicable if Specified Currency is applicable if Specified Currency is
[_] U.S. dollars other than U.S. dollars): other than U.S. dollars):
[_] Other: [_] Yes [_] No
EXCHANGE RATE AGENT (if other than First THIS NOTE IS A:
Trust of New York, N.A.):
[_] Global Note
[_] Certificated Note (only
applicable if Specified Currency is
other than U.S. dollars)
ORIGINAL ISSUE DISCOUNT NOTE: TOTAL AMOUNT OF OID: ISSUE PRICE (expressed as a percentage
of aggregate principal amount):
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C>
[_] Yes [_] No
REDEMPTION DATE(S) (including any REDEMPTION PRICE(S): TERMS OF AMORTIZING NOTES:
applicable regular or special record
dates):
REPAYMENT DATE(S) (including any REPAYMENT PRICE(S):
applicable regular or special record
dates):
OTHER TERMS: STATED MATURITY EXTENSION OPTION: INTEREST RATE RESET OPTION:
[_] Yes [_] No [_] Yes [_] No
EXTENSION PERIOD(S) AND FINAL MATURITY DATE OPTIONAL RESET DATES (only applicable if
(only applicable if option to extend stated option to reset interest rates):
maturity):
BASIS FOR INTEREST RATE DURING EXTENSION BASIS FOR INTEREST RATE RESET (only
PERIOD (only applicable if option to extend applicable if option to reset interest
stated maturity): rates):
</TABLE>
CATERPILLAR FINANCIAL SERVICES CORPORATION, a corporation duly organized
and existing under the laws of Delaware (herein called the "Company", which term
includes any successor Person under the Indenture referred to on the reverse
hereof), for value received, hereby promises to pay to [Insert if the Security
is to be a Certificated Security -- ] [Insert if the Security is to
be a Global Security -- Cede & Co., as nominee for The Depository Trust
Company], or registered assigns, the Principal Amount stated above on the
Maturity Date shown above, and to pay interest thereon from and including the
Original Issue Date shown above or, in the case of a Note issued upon
registration of transfer or exchange, from and including the most recent
Interest Payment Date to which interest has been paid or duly provided for,
semi-annually on April 1 and October 1 of each year and on the Maturity Date,
commencing on the first such Interest Payment Date next succeeding the Original
Issue Date, provided that if the Original Issue Date is after a Regular Record
Date and before the Interest Payment Date immediately following such Regular
Record Date, interest payments will commence on the second Interest Payment Date
following the Original Issue Date, at the rate per annum set forth above, until
the principal hereof is paid or made available for payment. The interest so
payable, and punctually paid or duly provided for, on any Interest Payment Date
will, as provided in such Indenture, be paid to the Person in whose name this
Note (or one or more Predecessor Notes) is registered at the close of business
on the Regular Record Date for such interest, which shall be the March 15 or
September 15 (whether or not a Business Day), as the case may be, next preceding
the April 1 and October 1 Interest Payment Dates; provided, however, that
-------- -------
interest payable at the Maturity Date will be payable to the Person to whom
principal shall be payable. Any such interest not so punctually paid or duly
provided for will forthwith cease to be payable to the Holder on such Regular
Record Date and may either be paid to the Person in whose name this Note (or one
or more Predecessor Notes) is registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest to be fixed by the
Trustee, notice whereof shall be given to Holders of Notes of this series not
less than 10 days prior to such Special Record Date, or be paid at any time in
any other lawful manner not inconsistent with the requirements of any securities
exchange on which the Notes of this series may be listed, and
2
<PAGE>
upon such notice as may be required by such exchange, all as more fully provided
in said Indenture.
Unless otherwise specified on the face hereof, payments of principal of
(and premium, if any) and interest on this Note will be made in the applicable
Specified Currency, provided, however, that if this Note is denominated in a
-------- -------
Specified Currency other than United States dollars (a "Foreign Currency Note")
payments of principal of (and premium, if any) and interest hereon will [insert
if the Security is to be a Global Security -- be made in United States dollars
unless the beneficial holder hereof gives notice to the Depositary that it
elects to receive payments in such Specified Currency. Upon receipt of such
notice, the Depositary will notify the Trustee of the portion of the payment to
be made by the Trustee which is to be made in the Specified Currency and the
applicable wire transfer instructions. In such event, the Trustee will pay the
beneficial holder directly.] [insert if the Security is to be a Certificated
Security -- nevertheless be made in United States dollars if the Holder hereof
elects to receive all payments in respect hereof in United States dollars by
delivery of a written request to the Trustee on or prior to the applicable
Regular Record Date or at least 15 days prior to Maturity, as the case may be.
Such election may be in writing (mailed or hand delivered) or by cable, telex or
other form of facsimile transmission. A Holder of such a Note may elect to
receive payment in United States dollars for all principal (and premium, if any)
and interest payments and need not file a separate election for each payment.
Such election will remain in effect until revoked by written notice to the
Trustee, but written notice of such revocation must be received by the Trustee
on or prior to the applicable Regular Record Date or at least 15 days prior to
Maturity, as the case may be.]
Payment of the principal of (and premium, if any) and interest on this Note
due at Maturity in United States dollars will be made in immediately available
funds, provided that this Note is presented to the Trustee in time for the
--------
Trustee to make such payment in accordance with its normal procedures.
[Insert if the Security is to be a Certificated Security -- Payment of the
principal of (and premium, if any) and interest on this Note due at Maturity in
United States dollars will be made at the office or agency of the Company
maintained for that purpose in the Borough of Manhattan, The City of New York,
in immediately available funds. Payment of interest (other than interest due at
Maturity) will be made by United States dollar check mailed to the address of
the Person entitled thereto as such address shall appear in the Security
Register. Notwithstanding the foregoing, unless otherwise specified on the face
hereof, a holder of U.S. $10,000,000 or more in aggregate principal amount of
Notes of like tenor and terms shall be entitled to receive such payment of
interest in United States dollars by wire transfer of immediately available
funds to such account with a bank located in the United States as shall be
designated by such person, but only if appropriate payment instructions have
been received in writing by the Trustee on or prior to the Regular Record Date.]
[Insert if the Security is to be a Global Security -- Payment of the principal
of (and premium, if any) and interest (other than interest payable at Maturity)
on this Note in United States dollars will be made by transfer of immediately
available funds to the Depositary or its nominee.]
3
<PAGE>
All payments of principal (and premium, if any) and interest in a Specified
Currency other than United States dollars will be made in the manner set forth
on the reverse hereof.
REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS NOTE SET FORTH
ON THE REVERSE HEREOF, WHICH FURTHER PROVISIONS SHALL FOR ALL PURPOSES HAVE THE
SAME EFFECT AS IF SET FORTH AT THIS PLACE.
Unless the certificate of authentication hereon has been executed by the
Trustee referred to on the reverse hereof, directly or through an Authenticating
Agent, by manual signature of an authorized signatory, this Note shall not be
entitled to any benefit under the Indenture or be valid or obligatory for any
purpose.
4
<PAGE>
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
Dated: CATERPILLAR FINANCIAL SERVICES
CORPORATION
[SEAL]
By: ______________________________________
President
ATTEST:
_________________________________________
Secretary
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes of the series
designated therein referred to in the within-
mentioned Indenture.
FIRST TRUST OF NEW YORK,
NATIONAL ASSOCIATION,
as Trustee
By _________________________________
Authorized Officer
5
<PAGE>
[BACK OF SECURITY]
CATERPILLAR FINANCIAL SERVICES CORPORATION
MEDIUM-TERM NOTE, SERIES F
(Fixed Rate)
This Note is one of a duly authorized issue of securities of the Company
(herein called the "Notes"), issued and to be issued in one or more series under
an Indenture dated as of April 15, 1985, as supplemented from time to time
(herein called the "Indenture"), between the Company and First Trust of New
York, National Association, as successor Trustee (herein called the "Trustee",
which term includes any successor trustee under the Indenture), to which
Indenture and all indentures supplemental thereto reference is hereby made for a
statement of the respective rights, limitations of rights, duties and immunities
thereunder of the Company, the Trustee and the Holders of the Notes and of the
terms upon which the Notes are, and are to be, authenticated and delivered.
This Note is one of the series designated on the face hereof. The Notes of this
series may be denominated in different currencies, bear different dates, mature
at different times and bear interest at different rates. The Notes of this
series may be issued from time to time in an aggregate principal amount of up to
$5,500,000,000 (including in such amount the offering price of any such Notes
sold at a discount), which amount may be increased if duly authorized by the
Company.
The United States dollar equivalent of Notes denominated in currencies
other than United States dollars will be determined by the Exchange Rate Agent
on the basis of the noon buying rate for cable transfers in the City of New York
as determined by the Federal Reserve Bank of New York (the "Market Exchange
Rate") for such currencies on the Business Day immediately preceding the
applicable issue dates; provided, however, that in the case of European Currency
-------- -------
Units, the Market Exchange Rate shall be the rate of exchange determined by the
Commission of the European Communities (or any successor thereof) as published
in the Official Journal of the European Communities or any successor publication
on the Business Day immediately preceding the applicable issue date.
Interest payments for this Note will include interest accrued from and
including the last date in respect of which interest has been paid or duly
provided for (or from and including the Original Issue Date if no interest has
been paid or provided for) to but excluding the Interest Payment Dates.
Interest payments for this Note shall be computed and paid on the basis of a
360-day year of twelve 30-day months.
If the Company has the option with respect to this Note to reset the
interest rate, such option will be indicated on the face hereof, together with
(i) the date or dates on which such interest rate may be reset (each an
"Optional Reset Date") and (ii) the basis or formula, if any, for such
resetting. The Company may exercise such option by notifying the Trustee of
such exercise at least 45 but not more than 60 days prior to an Optional Reset
Date. Not later than 40 days prior to such Optional Reset Date, the Trustee
will mail to the Holder hereof a notice (the
6
<PAGE>
"Reset Notice"), first class, postage prepaid, setting forth (i) the election of
the Company to reset the interest rate, (ii) such new interest rate, and (iii)
the provisions, if any, for redemption during the period from such Optional
Reset Date to the next Optional Reset Date or, if there is no such next Optional
Reset Date, to the Stated Maturity of this Note (each such period a "Subsequent
Interest Period"), including the date or dates on which or the period or periods
during which and the price or prices at which such redemption may occur during
such Subsequent Interest Period.
Notwithstanding the foregoing, not later than 20 days prior to an Optional
Reset Date, the Company may, at its option, revoke the interest rate provided
for in the Reset Notice and establish a higher interest rate for the Subsequent
Interest Period commencing on such Optional Reset Date by mailing or causing the
Trustee to mail notice of such higher interest rate first class, postage
prepaid, to the Holder hereof. Such notice shall be irrevocable. If the
interest rate is reset on an Optional Reset Date this Note will bear such higher
interest rate.
If the Company elects to reset the interest rate of this Note, the Holder
hereof will have the option to elect repayment of this Note by the Company on
any Optional Reset Date at a price equal to the principal amount hereof plus any
accrued interest to such Optional Reset Date. In order for this Note to be so
repaid on an Optional Reset Date, the Holder hereof must follow the procedures
set forth below for optional repayment, except that the period for delivery of
this Note or notification to the Trustee shall be at least 25 but not more than
35 days prior to such Optional Reset Date and except that a Holder who has
tendered this Note for repayment pursuant to a Reset Notice may, by written
notice to the Trustee, revoke any such tender for repayment until the close of
business on the tenth day prior to such Optional Reset Date.
If the Company has the option to extend the Stated Maturity of this Note
for one or more periods (each an "Extension Period") up to but not beyond a date
(the "Final Maturity Date") set forth on the face hereof, such option will be
indicated on the face hereof together with the basis or formula, if any, for
setting the interest rate applicable to any such Extension Period. The Company
may exercise such option with respect to this Note by notifying the Trustee of
such exercise at least 45 but not more than 60 days prior to the Stated Maturity
of this Note in effect prior to the exercise of such option (the "Original
Stated Maturity"). No later than 40 days prior to the Original Stated Maturity,
the Trustee will mail to the Holder hereof a notice (the "Extension Notice")
relating to such Extension Period, first class, postage prepaid, setting forth
(i) the election of the Company to extend the Stated Maturity of this Note, (ii)
the new Stated Maturity, (iii) the interest rate applicable to the Extension
Period, and (iv) the provisions, if any, for redemption during the Extension
Period, including the date or dates on which or the period or periods during
which and the price or prices at which such redemption may occur during the
Extension Period. Upon the mailing by the Trustee of an Extension Notice to the
Holder hereof, the Stated Maturity of this Note shall be extended automatically
as set forth in the Extension Notice, and, except as modified by the Extension
Notice and as described in the next paragraph, this Note will have the same
terms as prior to the mailing of such Extension Notice.
Notwithstanding the foregoing, not later than 20 days prior to the Original
Stated Maturity for this Note, the Company may, at its option, revoke the
interest rate provided for in the Extension Notice and establish a higher
interest rate for the Extension Period by mailing or causing the Trustee to mail
notice of such higher interest rate first class, postage prepaid, to the
7
<PAGE>
Holder hereof. Such notice shall be irrevocable. All Notes with respect to which
the Stated Maturity is extended will bear such higher interest rate for the
Extension Period.
If the Company elects to extend the Stated Maturity of this Note, the
Holder hereof will have the option to elect repayment of this Note by the
Company at the Original Stated Maturity at a price equal to the principal amount
hereof plus any accrued interest to such date. In order for this Note to be so
repaid on the Original Stated Maturity, the Holder hereof must follow the
procedures set forth below for optional repayment, except that the period for
delivery of this Note or notification to the Trustee shall be at least 25 but
not more than 35 days prior to the Original Stated Maturity and except that a
Holder who has tendered this Note for repayment pursuant to an Extension Notice
may, by written notice to the Trustee, revoke any such tender for repayment
until the close of business on the tenth day prior to the Original Stated
Maturity.
Unless one or more Redemption Dates is specified on the face hereof, this
Note shall not be redeemable at the option of the Company before the Maturity
Date specified on the face hereof. If one or more Redemption Dates (or ranges
of Redemption Dates) is so specified, this Note is subject to redemption on any
such date (or during any such range) at the option of the Company, upon notice
by first-class mail, mailed not less than 30 days nor more than 60 days prior to
the Redemption Date specified in such notice, at the applicable Redemption Price
specified on the face hereof (expressed as a percentage of the principal amount
of this Note), together in the case of any such redemption with accrued interest
to the Redemption Date, but interest installments whose Stated Maturity is prior
to the Redemption Date will be payable to the Holder of this Note, or one or
more predecessor Notes, of record at the close of business on the relevant
Regular or Special Record Dates referred to on the face hereof, all as provided
in the Indenture. The Company may elect to redeem less than the entire
principal amount hereof, provided that the principal amount, if any, of this
--------
Note that remains outstanding after such redemption is an Authorized
Denomination as defined herein.
Unless one or more Repayment Dates is specified on the face hereof, this
Note shall not be repayable at the option of the Holder on any date prior to the
Maturity Date specified on the face hereof. If one or more Repayment Dates (or
ranges of Repayment Dates) is so specified, this Note is subject to repayment on
any such date (or during any such range) at the option of the Holder at the
applicable Repayment Price specified on the face hereof (expressed as a
percentage of the principal amount of this Note), together in the case of any
such repayment with accrued interest to the Repayment Date, but interest
installments whose Stated Maturity is prior to the Repayment Date will be
payable to the Holder of this Note, or one or more predecessor Notes, of record
at the close of business on the relevant Regular or Special Record Dates
referred to on the face hereof, all as provided in the Indenture. For this Note
to be repaid at the option of the Holder, the Trustee must receive at the
principal office of its Corporate Trust Department in The City of New York, at
least 30 days but not more than 45 days prior to the Repayment Date on which
this Note is to be repaid, this Note and a statement that the option to elect
repayment is being exercised thereby. Exercise of the repayment option by the
Holder shall be irrevocable except to the extent permitted in connection with an
interest rate reset or an extension of maturity, each as described above. The
repayment option with respect to this Note may be exercised by the Holder for
less than the entire principal amount hereof, provided that the
--------
8
<PAGE>
principal amount, if any, of this Note that remains outstanding after such
repayment is an Authorized Denomination as defined herein.
[Insert if the Security is to be a Certificated Security -- In the event of
redemption or repayment of this Note in part only, a new Note or Notes of this
series and of like tenor and for a principal amount equal to the unredeemed or
unrepaid portion will be delivered to the registered Holder upon the
cancellation hereof.]
[Insert if the Security is to be a Global Security -- In the event of
redemption or repayment of this Note in part only, the principal amount shall be
reduced.]
If this is a Foreign Currency Note to be paid in United States dollars, the
United States dollar amount to be received in respect hereof will be based upon
the exchange rate as determined by the Exchange Rate Agent based on the highest
firm bid quotation for United States dollars received by such Exchange Rate
Agent at approximately 11:00 A.M. New York City time on the second Business Day
preceding the applicable payment date from three recognized foreign exchange
dealers in The City of New York selected by the Exchange Rate Agent and approved
by the Company (one of which may be the Exchange Rate Agent) for the purchase by
the quoting dealer, for settlement on such payment date, of the aggregate amount
of the Specified Currency payable on such payment date in respect of this Note.
If no such bid quotations are available, payments will be made in the Specified
Currency, unless such Specified Currency is unavailable due to the imposition of
exchange controls or to other circumstances beyond the Company's control, in
which case the Company will be entitled to make payments in respect hereof in
United States dollars as provided below. All currency exchange costs will be
borne by the Holder hereof by deductions from such payments.
If a Holder is to receive payments in a Specified Currency other than
United States dollars as described on the face hereof, payments of principal of
(and premium, if any) and interest will be paid in immediately available funds
by wire transfer to an account maintained by the Holder with a bank located in
the country issuing the Specified Currency (or, with respect to Notes
denominated in European Currency Units, to an ECU account) or other jurisdiction
acceptable to the Company and the Trustee as shall have been designated by the
Holder (which in the case of Global Securities will be the Depositary or its
nominee) on or prior to the Regular Record Date or at least 15 days prior to
Maturity, as the case may be, provided, however, that with respect to payments
-------- -------
of principal and premium, if any, and interest at Maturity this Note is
presented to the Trustee in time for the Trustee to make such payment in
accordance with its normal procedures, which shall require presentation no later
than two Business Days prior to Maturity in order to ensure the availability of
immediately available funds in the Specified Currency at Maturity.
If payment on this Note is required to be made in a Specified Currency
other than United States dollars and such currency is unavailable in the good
faith judgment of the Company due to the imposition of exchange controls or to
other circumstances beyond the Company's control, or is no longer used by the
government of the country issuing such currency or for the settlement of
transactions by public institutions of or within the international banking
community, then all payments with respect to this Note shall be made in United
States dollars until such currency is
9
<PAGE>
again available or so used. The amount so payable on any date in such Specified
Currency shall be converted into United States dollars at a rate determined by
the Exchange Rate Agent on the basis of the Market Exchange Rate on the second
Business Day prior to such payment, or, if the Market Exchange Rate is not then
available, the most recently available Market Exchange Rate or as otherwise
determined in good faith by the Company if the foregoing is impracticable.
If this is a Foreign Currency Note, in the event of an official
redenomination of such foreign currency (including, without limitation, an
official redenomination of a foreign currency that is a composite currency) the
obligations of the Company with respect to payments on this Note denominated in
such currency shall, in all cases, be deemed immediately following such
redenomination to provide for the payment of that amount of redenominated
currency representing the amount of such obligations immediately before such
redenomination. No adjustment will be made to any amount payable under this
Note as a result of (a) any change in the value of a foreign currency relative
to any other currency due solely to fluctuations in exchange rates or (b) any
redenomination of any component currency of any composite currency (unless such
composite currency is itself officially redenominated.
If an Event of Default with respect to Notes of this series shall occur and
be continuing, the principal of the Notes of this series may be declared due and
payable in the manner and with the effect provided in the Indenture. Unless
otherwise specified on the face hereof, if any Original Issue Discount Note (as
defined below) is redeemed by the Company or repaid at the option of the Holder,
each as described above, or if the principal of any Original Issue Discount Note
is declared to be due and payable immediately pursuant to this paragraph, the
amount of principal due and payable with respect to this Note shall be limited
to the sum of the aggregate principal amount of this Note multiplied by the
Issue Price (expressed as a percentage of the aggregate principal amount) plus
the original issue discount accrued from the date of issue to the date of
redemption, repayment or declaration, as applicable, which accrual shall be
calculated using the "interest method" (computed in accordance with generally
accepted accounting principles) in effect on the date of redemption, repayment
or declaration. Unless otherwise specified on the face hereof, an Original
Issue Discount Note is a Note which has a stated redemption price at maturity
that exceeds its Issue Price by at least 0.25% of its stated redemption price at
maturity, multiplied by the number of complete years from the Original Issue
Date to the Maturity Date for this Note.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Notes of each series to be affected
under the Indenture at any time by the Company and the Trustee with the consent
of the Holders of not less than 66 2/3% in principal amount of the Notes at the
time Outstanding of each series to be affected. The Indenture also contains
provisions permitting the Holders of specified percentages in principal amount
of the Notes of each series at the time Outstanding on behalf of the Holders of
all Notes of such series, to waive compliance by the Company with certain
provisions of the Indenture and certain past defaults under the Indenture and
their consequences. Any such consent or waiver by the Holder of this Note shall
be conclusive and binding upon such Holder and upon all future Holders of this
Note and of any Note issued upon the registration of transfer hereof or in
exchange herefor or in lieu hereof, whether or not notation of such consent or
waiver is made upon this Note.
10
<PAGE>
No reference herein to the Indenture and no provision of this Note or of
the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of (and premium, if any) and
interest on this Note at the times, places and rate, and in the coin or
currency, herein prescribed. However, the Indenture limits the Holder's right
to enforce the Indenture and this Note.
As provided in the Indenture and subject to certain limitations set forth
therein and as may be set forth on the face hereof, the transfer of this Note is
registrable in the Security Register, upon surrender of this Note for
registration of transfer at the office or agency of the Company in any place
where the principal of (and premium, if any) and interest on this Note are
payable, duly endorsed by, or accompanied by a written instrument of transfer in
form satisfactory to the Company and the Security Registrar duly executed by,
the Holder hereof or his attorney duly authorized in writing, and thereupon one
or more new Notes of this series of like tenor, of Authorized Denominations and
for the same aggregate principal amount, will be issued to the designated
transferee or transferees.
[Insert if the Security is a Global Security -- This Note is a Global Note
and shall be exchangeable for Notes registered in the names of Persons other
than the Depositary with respect to this Global Note or its nominee only if (A)
such Depositary notifies the Company that it is unwilling or unable to continue
as Depositary for this Global Note or at any time ceases to be a clearing agency
registered as such under the Securities Exchange Act of 1934, as amended, (B)
the Company in its discretion executes and delivers to the Trustee a Company
Order that this Global Note shall be exchangeable or (C) there shall have
occurred and be continuing an Event of Default with respect to the Notes. If
this Global Note is exchangeable pursuant to the preceding sentence, it shall be
exchangeable for Notes issuable in denominations of $1,000 and any integral
multiple of $1,000 in excess thereof, registered in such names as such
Depositary shall direct.]
The Notes of this series are issuable, in the case of Notes denominated in
United States dollars, in denominations of U.S. $1,000 and any integral multiple
of U.S. $1,000 in excess thereof and, in the case of Notes denominated in a
Specified Currency other than United States dollars, in the authorized
denominations set forth on the face hereof (in each case, an "Authorized
Denomination"). As provided in the Indenture and subject to certain limitations
set forth therein and as may be set forth on the face hereof, Notes of this
series are exchangeable for a like aggregate principal amount of Notes of this
series of like tenor of a different Authorized Denomination, as requested by the
Holder surrendering the same.
"Business Day" shall mean (a) with respect to any Note, any day that is not
a Saturday or Sunday and that, in The City of New York, is not a day on which
banking institutions generally are authorized or obligated by law to close, and
(b) if the Note is denominated in a Specified Currency other than United States
dollars, not a day on which banking institutions are authorized or required by
law to close in the financial center of the country issuing the Specified
Currency (unless the Specified Currency is European Currency Units ("ECU"), in
which case such day is also not a day that appears as an ECU non-settlement day
on the display designated as "ISDE" on the Reuter Monitor Money Rates Service
(or is not a day designated as an ECU non-
11
<PAGE>
settlement day by the ECU Banking Association), or, if ECU non-settlement days
do not appear on that page (and are not so designated), a day that is not a day
on which payments in ECU cannot be settled in the international interbank
market). As used in the preceding sentence, "financial center" means the capital
city of the country issuing the Specified Currency (except with respect to ECU)
except that with respect to United States dollars, Australian dollars, Canadian
dollars, Deutsche marks, Dutch guilders, Italian lire and Swiss francs, the
"financial center" shall be the City of New York, Sydney, Toronto, Frankfurt,
Amsterdam, Milan and Zurich, respectively.
No service charge shall be made for any such registration of transfer or
exchange, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
The Notes of this series may be issued in the form of one or more Global
Securities to The Depository Trust Company as depositary for the Global
Securities of this series (the "Depositary") or its nominee and registered in
the name of the Depositary or such nominee.
Prior to due presentment of this Note for registration of transfer, the
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name this Note is registered as the owner hereof for all
purposes, whether or not this Note is overdue, and neither the Company, the
Trustee nor any such agent shall be affected by notice to the contrary.
The Indenture and the Notes shall be governed by and construed in
accordance with the laws of the State of New York.
All terms used in this Note which are defined in the Indenture shall have
the meanings assigned to them in the Indenture.
12
<PAGE>
__________________________
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations.
TEN COM - as tenants in common
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of survivorship and not as tenants in
common
UNIF GIFT MIN ACT - _____________ Custodian __________________
(Cust) (Minor)
Under Uniform Gifts to Minors Act
_________________________________
(State)
Additional abbreviations may also be used though not in the above list.
__________________________
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s)
unto
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE
/_________________________/ ______________________________________
________________________________________________________________________________
PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS INCLUDING POSTAL ZIP CODE OF ASSIGNEE
______________________________________________________________________________
the within Note and all rights thereunder, hereby irrevocably constituting and
appointing ______
______________________________________________________________________________
attorney to transfer said Note on the books of the Company, with full power of
substitution in the premises.
Dated: _____________ ________________________________________________
NOTICE: The signature to this assignment must
correspond with the name as written upon the face of
the within instrument in every particular, without
alteration or enlargement or any change whatever.
13
<PAGE>
EXHIBIT 4.9
[FACE OF SECURITY]
REGISTERED REGISTERED
No. FLR
CUSIP
CATERPILLAR FINANCIAL SERVICES CORPORATION
MEDIUM-TERM NOTE, SERIES F
(Floating Rate)
[Insert if the Security is to be a Global Security -- This Note is a
Global Security within the meaning of the Indenture hereinafter referred to and
is registered in the name of a Depositary or a nominee of a Depositary. This
Global Security is exchangeable for Notes registered in the name of a Person
other than the Depositary or its nominee only in the limited circumstances
described in the Indenture, and no transfer of this Note (other than a transfer
of this Note as a whole by the Depositary to a nominee of the Depositary or by a
nominee of the Depositary to the Depositary or another nominee of the
Depositary) may be registered except in such limited circumstances.
Unless this Certificate is presented by an authorized representative
of The Depository Trust Company (55 Water Street, New York, New York) to the
issuer or its agent for registration of transfer, exchange or payment, and any
certificate issued is registered in the name of Cede & Co. or such other name as
requested by an authorized representative of The Depository Trust Company and
any payment hereon is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL since the
registered owner hereof, Cede & Co., has an interest herein.]
THE FOLLOWING SUMMARY OF TERMS IS SUBJECT TO THE INFORMATION SET FORTH
ON THE REVERSE HEREOF:
PRINCIPAL AMOUNT:
<TABLE>
<CAPTION>
ORIGINAL ISSUE DATE: INITIAL INTEREST RATE: MATURITY DATE:
<S> <C> <C>
SPECIFIED CURRENCY: OPTION TO ELECT PAYMENT IN U.S. AUTHORIZED DENOMINATIONS (only
[_] U.S. dollars DOLLARS (only if Specified applicable if Specified Currency is other
[_] Other: Currency is other than U.S. dollars): than U.S. dollars):
[_] Yes [_] No
EXCHANGE RATE AGENT (if other than First THIS NOTE IS A:
Trust of New York, N.A.): [_] Global Note
[_] Certificated Note (only applicable if
Specified Currency is other than U.S.
dollars)
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
INDEX MATURITY: INTEREST RATE BASIS OR BASES: SPREAD (plus or minus):
<S> <C> <C>
LIBOR SOURCE (only applicable if LIBOR SPREAD MULTIPLIER: INTEREST RESET DATES:
Interest Rate Basis):
[_] Reuters INTEREST RESET PERIOD:
[_] Telerate
INTEREST PAYMENT PERIOD:
MAXIMUM INTEREST RATE: MINIMUM INTEREST RATE: INTEREST PAYMENT DATES:
STATED MATURITY EXTENSION OPTION:
SPREAD/SPREAD MULTIPLIER RESET OPTION: [_] Yes [_] No
[_] Yes EXTENSION PERIOD(S) and FINAL
[_] No MATURITY DATE (only applicable if
OPTIONAL RESET DATES (only applicable if option to extend stated maturity):
option to reset spread or spread multiplier): BASIS FOR SPREAD/SPREAD MULTIPLIER
DURING
BASIS FOR SPREAD/SPREAD MULTIPLIER RESET EXTENSION PERIOD (only applicable
(only applicable if option to reset spread if option to
or spread multiplier): extend stated maturity):
INTEREST RESET DATES: CALCULATION DATES: TERMS OF AMORTIZING NOTES:
INTEREST DETERMINATION DATES: CALCULATION AGENT (if other than First Trust of
New York, N.A.):
ORIGINAL ISSUE DISCOUNT NOTE: TOTAL AMOUNT OF OID: ISSUE PRICE (expressed as a perc
entage of
[_] Yes [_] No aggregate principal amount):
REDEMPTION DATE(S) (including any applicable REDEMPTION PRICE(S):
regular or special record dates):
REPAYMENT DATE(S) (including any applicable REPAYMENT PRICE(S):
regular or special record dates):
OTHER TERMS:
</TABLE>
2
<PAGE>
CATERPILLAR FINANCIAL SERVICES CORPORATION, a corporation duly
organized and existing under the laws of Delaware (herein called the "Company",
which term includes any successor Person under the Indenture referred to on the
reverse hereof), for value received, hereby promises to pay to [Insert if the
Security is to be a Certificated Security -- ______________] [Insert if the
Security is to be a Global Security -- Cede & Co., as nominee for The Depository
Trust Company], or registered assigns, the Principal Amount stated above on the
Maturity Date shown above, and to pay interest thereon from and including the
Original Issue Date shown above or, in the case of a Note issued upon
registration of transfer or exchange, from and including the most recent
Interest Payment Date to which interest has been paid or duly provided for, on
the Interest Payment Dates set forth above and on the Maturity Date, commencing
on the first such Interest Payment Date next succeeding the Original Issue Date,
provided that if the Original Issue Date is after a Regular Record Date and
before the Interest Payment Date immediately following such Regular Record Date,
interest payments will commence on the second Interest Payment Date following
the Original Issue Date, at the rate per annum determined in accordance with the
provisions on the reverse hereof, depending on the Interest Rate Basis or Bases
specified above, until the principal hereof is paid or made available for
payment. The interest so payable, and punctually paid or duly provided for on
any Interest Payment Date will, as provided in such Indenture, be paid to the
Person in whose name this Note (or one or more Predecessor Notes) is registered
at the close of business on the Regular Record Date for such interest, which
shall be the fifteenth calendar day (whether or not such date is a Business Day)
next preceding each Interest Payment Date; provided, however, that interest
-----------------
payable at the Maturity Date will be payable to the person to whom principal
shall be payable. Any such interest not so punctually paid or duly provided for
will forthwith cease to be payable to the Holder on such Regular Record Date and
may either be paid to the Person in whose name this Note (or one or more
Predecessor Notes) is registered at the close of business on a Special Record
Date for the payment of such Defaulted Interest to be fixed by the Trustee,
notice whereof shall be given to Holders of Notes of this series not less than
10 days prior to such Special Record Date, or be paid at any time in any other
lawful manner not inconsistent with the requirements of any securities exchange
on which the Notes of this series may be listed, and upon such notice as may be
required by such exchange, all as more fully provided in said Indenture.
Unless otherwise specified on the face hereof, payments of principal
of (and premium, if any) and interest on this Note will be made in the
applicable Specified Currency, provided, however, that if this Note is
-----------------
denominated in a Specified Currency other than United States dollars (a "Foreign
Currency Note") payments of principal of (and premium, if any) and interest
hereon will [insert if the Security is to be a Global Security -- be made in
United States dollars unless the beneficial holder hereof gives notice to the
Depositary that it elects to receive payments in such Specified Currency. Upon
receipt of such notice, the Depositary will notify the Trustee of the portion of
the payment to be made by the Trustee which is to be made in the Specified
Currency and the applicable wire transfer instructions. In such event, the
Trustee will pay the beneficial holder directly.] [insert if the Security is to
be a Certificated Security -- nevertheless be made in United States dollars if
the Holder hereof elects to receive all payments in respect hereof in United
States dollars by delivery of a written request to the Trustee on or prior to
the applicable Regular Record Date or at least 15 days prior to Maturity, as the
case may be. Such election may be in writing (mailed or hand delivered) or by
cable, telex or other form of facsimile transmission. A Holder of such a Note
may elect to receive payment in United
3
<PAGE>
States dollars for all principal (and premium, if any) and interest payments and
need not file a separate election for each payment. Such election will remain in
effect until revoked by written notice to the Trustee, but written notice of
such revocation must be received by the Trustee on or prior to the applicable
Regular Record Date or at least 15 days prior to Maturity, as the case may be.]
Payment of the principal of (and premium, if any) and interest on this
Note due at Maturity in United States dollars will be made in immediately
available funds, provided that this Note is presented to the Trustee in time for
the Trustee to make such payment in accordance with its normal procedures.
[Insert if the Security is to be a Certificated Security -- Payment of
the principal of (and premium, if any) and interest on this Note due at Maturity
in United States dollars will be made at the office or agency of the Company
maintained for that purpose in the Borough of Manhattan, The City of New York,
in immediately available funds. Payment of interest (other than interest due at
Maturity) will be made by United States dollar check mailed to the address of
the Person entitled thereto as such address shall appear in the Security
Register. Notwithstanding the foregoing, unless otherwise specified on the face
hereof, a holder of U.S. $10,000,000 or more in aggregate principal amount of
Notes of like tenor and terms shall be entitled to receive such payment of
interest in United States dollars by wire transfer of immediately available
funds to such account with a bank located in the United States as shall be
designated by such person, but only if appropriate payment instructions have
been received in writing by the Trustee on or prior to the Regular Record Date.]
[Insert if the Security is to be a Global Security -- Payment of the principal
of (and premium, if any) and interest (other than interest payable at Maturity)
on this Note in United States dollars will be made by transfer of immediately
available funds to the Depositary or its nominee.]
All payments of principal (and premium, if any) and interest in a
Specified Currency other than United States dollars will be made in the manner
set forth on the reverse hereof.
REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS NOTE SET
FORTH ON THE REVERSE HEREOF, WHICH FURTHER PROVISIONS SHALL FOR ALL PURPOSES
HAVE THE SAME EFFECT AS IF SET FORTH AT THIS PLACE.
Unless the certificate of authentication hereon has been executed by
the Trustee referred to on the reverse hereof, directly or through an
Authenticating Agent, by manual signature of an authorized signatory, this Note
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
4
<PAGE>
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
Dated: CATERPILLAR FINANCIAL SERVICES CORPORATION
[SEAL] By:
President
ATTEST:
____________________________________________
Secretary
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes of the series designated therein referred to in
the within-mentioned Indenture.
FIRST TRUST OF NEW YORK,
NATIONAL ASSOCIATION,
as Trustee
By________________________________________
Authorized Officer
5
<PAGE>
[BACK OF SECURITY]
CATERPILLAR FINANCIAL SERVICES CORPORATION
MEDIUM-TERM NOTE, SERIES F
(Floating Rate)
This Note is one of a duly authorized issue of securities of the
Company (herein called the "Notes"), issued and to be issued in one or more
series under an Indenture dated as of April 15, 1985, as supplemented from time
to time (herein called the "Indenture"), between the Company and First Trust of
New York, National Association, as successor Trustee (herein called the
"Trustee", which term includes any successor trustee under the Indenture), to
which Indenture and all indentures supplemental thereto reference is hereby made
for a statement of the respective rights, limitations of rights, duties and
immunities thereunder of the Company, the Trustee and the Holders of the Notes
and of the terms upon which the Notes are, and are to be, authenticated and
delivered. This Note is one of the series designated on the face hereof. The
Notes of this series may be denominated in different currencies, bear different
dates, mature at different times and bear interest at different rates. The
Notes of this series may be issued from time to time in an aggregate principal
amount of up to $5,500,000,000 (including in such amount the offering price of
any such Notes sold at a discount), which amount may be increased if duly
authorized by the Company.
The United States dollar equivalent of Notes denominated in currencies
other than United States dollars will be determined by the Exchange Rate Agent
on the basis of the noon buying rate for cable transfers in the City of New York
as determined by the Federal Reserve Bank of New York (the "Market Exchange
Rate") for such currencies on the Business Day immediately preceding the
applicable issue dates; provided, however, that in the case of European Currency
-----------------
Units, the Market Exchange Rate shall be the rate of exchange determined by the
Commission of the European Communities (or any successor thereof) as published
in the Official Journal of the European Communities or any successor publication
on the Business Day immediately preceding the applicable issue date.
The rate of interest on this Note will be reset daily, weekly,
monthly, quarterly, semi-annually or annually (each an "Interest Reset Date"),
as specified on the face hereof. Unless otherwise specified on the face hereof,
the Interest Reset Date will be, if this Note resets daily, each Business Day;
if this Note resets weekly (unless the Interest Rate Basis on this Note is the
Treasury Rate), the Wednesday of each week; if this Note resets weekly and the
Interest Rate Basis on this Note is the Treasury Rate, the Tuesday of each week;
if this Note resets monthly, the third Wednesday of each month; if this Note
resets quarterly, the third Wednesday of March, June, September and December; if
this Note resets semi-annually, the third Wednesday of two months of each year,
as specified on the face hereof; and if this Note resets annually, the third
Wednesday of one month of each year, as specified on the face hereof; provided,
---------
however, that the interest rate in effect from the date of issue to the first
- -------
Interest Reset Date will be the Initial Interest Rate specified on the face
hereof. If any Interest Reset Date would otherwise be a day that is not a
Business Day, the Interest Reset Date shall be postponed to the next day that is
a Business Day except that if (i) the rate of interest on this Note will be
determined in accordance with the provisions of the heading "Determination of
LIBOR" below and (ii) such Business Day is in the next succeeding calendar
month, such Interest Reset Date
6
<PAGE>
shall be the immediately preceding Business Day. Subject to applicable
provisions of law and except as specified herein or on the face hereof, on each
Interest Reset Date, the rate of interest on this Note shall be the rate
determined in accordance with the provisions of the applicable heading below.
Determination of Commercial Paper Rate. Unless otherwise specified on
--------------------------------------
the face hereof, if the Interest Rate Basis on this Note is the Commercial Paper
Rate, the interest rate with respect to this Note shall equal (i) the Money
Market Yield (calculated as described below) of the rate on such Commercial
Paper Interest Determination Date (as defined below) for commercial paper having
the Index Maturity shown on the face hereof, as such rate is published by the
Board of Governors of the Federal Reserve System in "Statistical Release
H.15(519), Selected Interest Rates", or any successor publication of the Board
of Governors of the Federal Reserve System ("H.15(519)"), under the heading
"Commercial Paper--Nonfinancial", or if such rate is not published prior to 9:00
A.M., New York City time, on the Calculation Date pertaining to such Commercial
Paper Interest Determination Date, then the Commercial Paper Rate shall be the
Money Market Yield of the rate on such Commercial Paper Interest Determination
Date for commercial paper having the Index Maturity specified on the face hereof
as published by the Federal Reserve Bank of New York in its daily statistical
release, "Composite 3:30 P.M. Quotations for U.S. Government Securities" or any
successor publication published by the Federal Reserve Bank of New York
("Composite Quotations") under the heading "Commercial Paper", or (ii) if such
rate is not published in either H.15(519) or Composite Quotations by 3:00 P.M.,
New York City time, on such Calculation Date, the Money Market Yield of the
arithmetic mean (each as rounded, if necessary, to the nearest one hundred-
thousandth of a percentage point, with five millionths of a percentage point
rounded upwards) of the offered rates, as of 11:00 A.M., New York City time, on
such Commercial Paper Interest Determination Date, of three leading dealers of
commercial paper in The City of New York selected by the Calculation Agent for
commercial paper of the Index Maturity shown on the face hereof placed for an
industrial issuer whose bond rating is "AA", or the equivalent, from a
nationally recognized rating agency, adjusted in each of the above cases by the
addition or subtraction of the Spread, if any, specified on the face hereof,
and/or by multiplication by the Spread Multiplier, if any, specified on the face
hereof; provided, however, that if the dealers selected as aforesaid by the
-----------------
Calculation Agent are not quoting as mentioned in this sentence, the Commercial
Paper Rate will be the Commercial Paper Rate in effect hereon on such Commercial
Paper Interest Determination Date.
"Money Market Yield" shall be the yield (expressed as a percentage
rounded, if necessary, to the nearest one hundred-thousandth of a percentage
point, with five millionths of a percentage point rounded upwards) calculated in
accordance with the following formula:
Money Market Yield = D x 360
---------------------- x 100
360 - (D x M)
where "D" refers to the per annum rate for commercial paper, quoted on a bank
discount basis and expressed as a decimal and "M" refers to the actual number of
days in the interest period for which interest is being calculated.
7
<PAGE>
Determination of Federal Funds Rate. Unless otherwise specified on
-----------------------------------
the face hereof, if the Interest Rate Basis on this Note is the Federal Funds
Rate, the interest rate with respect to this Note shall equal the rate on such
date for Federal Funds as published in H.15(519) under the heading "Federal
Funds (Effective)" or, if not so published by 9:00 A.M., New York City time, on
the Calculation Date pertaining to such Federal Funds Interest Determination
Date, the Federal Funds Rate will be the rate on such Federal Funds Interest
Determination Date as published in Composite Quotations under the heading
"Federal Funds/Effective Rate," or if such rate is not published by 3:00 p.m.,
New York City time, on the Calculation Date pertaining to such Federal Funds
Interest Determination Date, then the Federal Funds Rate for such Federal Funds
Interest Determination Date will be calculated by the Calculation Agent and will
be the arithmetic mean (rounded, if necessary, to the nearest one hundred-
thousandth of a percentage point, with five millionths of a percentage point
rounded upwards) of the rates as of 9:00 a.m., New York City time, on such
Federal Funds Interest Determination Date for the last transaction in overnight
Federal Funds arranged by three leading brokers of Federal Funds transactions in
The City of New York selected by the Calculation Agent in each of the above
cases adjusted by the addition or subtraction of the Spread, if any, specified
on the face hereof, and/or by multiplication by the Spread Multiplier, if any,
specified on the face hereof; provided, however, that if the brokers selected as
-----------------
aforesaid by the Calculation Agent are not quoting as mentioned in this
sentence, the Federal Funds Rate will be the Federal Funds Rate in effect on
such Federal Funds Interest Determination Date.
Determination of CD Rate. Unless otherwise indicated on the face
------------------------
hereof, if the Interest Rate Basis on this Note is the CD Rate, the interest
rate with respect to this Note shall equal (i) the rate on such date for
negotiable certificates of deposit having the Index Maturity designated in the
applicable Pricing Supplement as published in H.15(519) under the heading "CDs
(Secondary Market)" or, if not so published by 9:00 A.M., New York City time, on
the Calculation Date pertaining to such CD Interest Determination Date, the CD
Rate will be the rate on such CD Interest Determination Date for negotiable
certificates of deposit having the Index Maturity designated in the applicable
Pricing Supplement as published in Composite Quotations under the heading
"Certificates of Deposit," or (ii) if such rate is not published by 3:00 P.M.,
New York City time, on the Calculation Date pertaining to such CD Interest
Determination Date, then the CD Rate for such CD Interest Determination Date
will be calculated by the Calculation Agent and will be the arithmetic mean
(rounded, if necessary, to the nearest one hundred-thousandth of a percentage
point, with five millionths of a percentage point rounded upwards) of the
secondary market offered rates as of 10:00 A.M., New York City time, on such CD
Interest Determination Date of three leading nonbank dealers in negotiable U.S.
dollar certificates of deposit in The City of New York selected by the
Calculation Agent for negotiable certificates of deposit of major United States
money center banks of the highest credit standing (in the market for negotiable
certificates of deposit) with a remaining maturity closest to the Index Maturity
designated in the applicable Pricing Supplement in a denomination of $5,000,000,
adjusted by the addition or subtraction of the Spread, if any, specified on the
face hereof, and/or by multiplication by the Spread Multiplier, if any,
specified on the face hereof; provided, however, that if the dealers selected as
-----------------
aforesaid by the Calculation Agent are not quoting as mentioned in this
sentence, the CD Rate will be the CD Rate in effect on such CD Interest
Determination Date.
Determination of Prime Rate. Unless otherwise specified on the face
---------------------------
hereof, if the Interest Rate Basis on this Note is the Prime Rate, the interest
rate with respect to this Note
8
<PAGE>
shall equal (i) the rate set forth for the relevant Prime Rate Interest
Determination Date (as defined below) in H.15(519) under the heading "Bank Prime
Loan", or (ii) if such rate is not published prior to 9:00 A.M., New York City
time on the Calculation Date pertaining to such Prime Rate Interest
Determination Date, the arithmetic mean (rounded, if necessary, to the nearest
one hundred-thousandth of a percentage point, with five millionths of a
percentage point rounded upwards) of the rates of interest publicly announced by
each bank that appears on the Reuters Screen USPRIME1 Page (as defined below) as
such bank's prime rate or base lending rate as in effect for that Prime Rate
Interest Determination Date, (iii) if fewer than four such quotations but more
than one such quotation appears on the Reuters Screen USPRIME1 Page for the
Prime Rate Interest Determination Date, the arithmetic mean (rounded, if
necessary, to the nearest one hundred-thousandth of a percentage point, with
five millionths of a percentage point rounded upwards) of the prime rates quoted
on the basis of the actual number of days in the year divided by a 360-day year
as of the close of business on such Prime Rate Interest Determination Date by at
least two major money center banks in The City of New York selected by the
Calculation Agent, or (iv) if fewer than two such quotations are quoted as
aforesaid, the rate determined by the Calculation Agent on the basis of the
rates furnished in The City of New York by the appropriate number of substitute
banks or trust companies organized and doing business under the laws of the
United States, or any State thereof, having total equity capital of at least
$500 million and being subject to supervision or examination by Federal or State
authority, selected by the Calculation Agent to provide such rate or rates,
adjusted in each case by the addition or subtraction of the Spread, if any,
specified on the face hereof, and/or by multiplication by the Spread Multiplier,
if any, specified on the face hereof; provided, however, that if the banks or
-----------------
trust companies selected as aforesaid are not quoting as mentioned in this
sentence, the Prime Rate will be the Prime Rate in effect on such Prime Rate
Interest Determination Date. "Reuters Screen USPRIME1 Page" means the display
designated as page "USPRIME1" on the Reuters Monitor Money Rates Service (or
such other page as may replace the USPRIME1 page on that service for the purpose
of displaying the prime rate or base lending rate of major United States banks).
Determination of LIBOR. Unless otherwise specified on the face
----------------------
hereof, if the Interest Rate Basis on this Note is LIBOR, the interest rate
payable with respect to this Note shall be determined in accordance with the
following provisions:
(i) With respect to any LIBOR Interest Determination Date (as defined
below), LIBOR will be, as specified on the face hereof, either: (a) the
arithmetic mean (rounded, if necessary, to the nearest one hundred-thousandth of
a percentage point, with five millionths of a percentage point rounded upwards)
of the offered rates for deposits in U.S. dollars having the Index Maturity
designated on the face hereof commencing on the second London Business Day
immediately following such LIBOR Interest Determination Date, that appear on the
Reuters Screen LIBO Page as of 11:00 A.M., London time, on such LIBOR Interest
Determination Date ("LIBOR Reuters"), or (b) the rate for deposits in U.S.
dollars having the Index Maturity designated in the applicable Pricing
Supplement, commencing on the second London Business Day immediately following
such LIBOR Interest Determination Date, that appears on Telerate Page 3750 as of
11:00 A.M., London time, on such LIBOR Interest Determination Date ("LIBOR
Telerate"), adjusted in each case by the addition or subtraction of the Spread,
if any, specified on the face hereof, and/or by multiplication by the Spread
Multiplier, if any, specified on the face hereof. "Reuters Screen LIBO Page"
means the display designated as page "LIBO"
9
<PAGE>
on the Reuters Monitor Money Rates Service (or such other page as may replace
page LIBO on that service for the purpose of displaying London interbank offered
rates of major banks). "Telerate Page 3750" means the display designated as page
"3750" on the Telerate Service (or such other page as may replace the 3750 page
on that service or such other service or services as may be nominated by the
British Bankers' Association for the purpose of displaying London interbank
offered rates for U.S. dollar deposits). If neither LIBOR Reuters nor LIBOR
Telerate is specified on the face hereof, LIBOR will be determined as if LIBOR
Telerate had been specified. If at least two such offered rates appear on the
Reuters Screen LIBO Page, the rate in respect of such LIBOR Interest
Determination Date will be the arithmetic mean of such offered rates as
determined by the Calculation Agent. In the case where (a) above applies, if
fewer than two offered rates appear on the Reuters Screen LIBO Page, or in the
case where (b) above applies, if no rate appears on Telerate Page 3750, as
applicable, LIBOR in respect of such LIBOR Interest Determination Date will be
determined as if the parties had specified the rate described in (ii) below.
(ii) With respect to a LIBOR Interest Determination Date on which
fewer than two offered rates appear on the Reuters Screen LIBO Page as described
in (i)(a) above, or on which no rate appears on Telerate Page 3750, as described
in (i)(b) above, as applicable, LIBOR will be deter-mined on the basis of the
rates at approximately 11:00 A.M., London time, on such LIBOR Interest
Determination Date at which deposits in U.S. dollars having the Index Maturity
shown on the face hereof are offered to prime banks in the London interbank
market by three major banks in the London interbank market selected by the
Calculation Agent commencing on the second London Business Day immediately
following such LIBOR Interest Determination Date and in a principal amount equal
to an amount of not less than U.S. $1 million that in the Calculation Agent's
judgment is representative for a single transaction in such market at such time,
adjusted by the addition or subtraction of the Spread, if any, specified on the
face hereof, and/or by multiplication of the Spread Multiplier, if any,
specified on the face hereof. The Calculation Agent will request the principal
London office of each of such banks to provide a quotation of its rate. If at
least two such quotations are provided, LIBOR for such LIBOR Interest
Determination Date will be the arithmetic mean (rounded, if necessary, to the
nearest one hundred-thousandth of a percentage point, with five millionths of a
percentage point rounded upwards) of such quotations as deter-mined by the
Calculation Agent, adjusted by the addition or subtraction of the Spread, if
any, specified on the face hereof, and/or by multiplication of the Spread
Multiplier, if any, specified on the face hereof. If fewer than two quotations
are provided, LIBOR for such LIBOR Interest Determination Date will be the
arithmetic mean (rounded, if necessary, to the nearest one hundred-thousandth of
a percentage point, with five millionths of a percentage point rounded upwards)
of the rates quoted at approximately 11:00 A.M., New York City time, on such
LIBOR Interest Determination Date by three major banks in The City of New York,
selected by the Calculation Agent, for loans in U.S. dollars to leading
European banks, having the Index Maturity shown on the face hereof commencing on
the second London Business Day immediately following such LIBOR Interest
Determination Date and in a principal amount equal to an amount of not less than
US$1 million that in the Calculation Agent's judgment is representative for a
single transaction in such market at such time, adjusted by the addition or
subtraction of the Spread, if any, specified on the face hereof, and/or by
multiplication by the Spread Multiplier, if any, specified on the face hereof;
provided, however, that if the banks selected as aforesaid by the Calculation
- -----------------
Agent are not quoting as mentioned in this sentence, LIBOR will be the LIBOR in
effect on such LIBOR Interest Determination Date.
10
<PAGE>
Determination of Treasury Rate. Unless otherwise specified on the
------------------------------
face hereof, if the Interest Rate Basis on this Note is the Treasury Rate, the
interest rate payable with respect to this Note shall equal the rate for the
most recent auction of direct obligations of the United States ("Treasury
bills") having the Index Maturity shown on the face hereof as published in
H.15(519), under the heading "Treasury bills - auction average (investment)" on
each Treasury Interest Determination Date (as defined below) or, if not so
published by 9:00 A.M., New York City time, on the Calculation Date pertaining
to such Treasury Interest Determination Date, the auction average rate
(expressed as a bond equivalent, rounded, if necessary, to the nearest one
hundred-thousandth of a percentage point, with five millionths of a percentage
point rounded upwards, on the basis of a year of 365 or 366 days as applicable,
and applied on a daily basis) for such auction as otherwise announced by the
United States Department of the Treasury, in either case, adjusted by the
addition or subtraction of the Spread, if any, specified on the face hereof, or,
by multiplication by the Spread Multiplier, if any, specified on the face
hereof. In the event that the results of the auction of Treasury bills having
the Index Maturity shown on the face hereof are not published or reported as
provided above by 3:00 P.M., New York City time, on such Calculation Date or if
no such auction is held in a particular week, then the Treasury Rate shall be
calculated by the Calculation Agent and shall be a yield to maturity (expressed
as a bond equivalent, rounded, if necessary, to the nearest one hundred-
thousandth of a percentage point, with five millionths of a percentage point
rounded upwards on the basis of a year of 365 or 366 days as applicable, and
applied on a daily basis) of the arithmetic mean of the secondary market bid
rates, as of approximately 3:30 P.M., New York City time, on such Treasury
Interest Determination Date, of three leading primary United States government
securities dealers selected by the Calculation Agent, for the issue of Treasury
bills with a remaining maturity closest to the Index Maturity shown on the face
hereof, adjusted by the addition or subtraction of the Spread, if any, specified
on the face hereof, and/or by multiplication by the Spread Multiplier, if any,
specified on the face hereof; provided, however, that if the dealers selected as
-----------------
aforesaid by the Calculation Agent are not quoting as mentioned in this
sentence, the Treasury Rate will be the Treasury Rate in effect on such Treasury
Interest Determination Date.
Indexed Notes. This Note may be issued with the principal amount
-------------
payable at Maturity and/or with interest payable hereon on an Interest Payment
Date to be determined by reference to the price or prices of specified
securities or commodities, securities or commodities exchange indices, the
relationship between two or more specified currencies or other factors (each an
"Indexed Note"), as shall be indicated above under "Other Terms". Specific
information pertaining to the method for determining the principal amount
payable at Maturity or the amount of interest to be paid on an Interest Payment
Date with reference to the specified index shall be included above under "Other
Terms".
Notwithstanding the foregoing, the interest rate hereon shall not be
greater than the Maximum Interest Rate, if any, or less than the Minimum
Interest Rate, if any, shown on the face hereof. The Calculation Agent shall
calculate the interest rate on this Note in accordance with the foregoing on or
before each Calculation Date. The interest rate on this Note will in no event
be higher than the maximum rate permitted by New York law as the same may be
modified by United States law of general applicability.
The Calculation Agent will, upon the request of the Holder of this
Note, provide to such Holder the interest rate hereon then in effect and, if
different, the interest rate which will
11
<PAGE>
become effective as a result of a determination made on the most recent Interest
Determination Date.
Unless otherwise indicated on the face hereof and except as provided
below, interest will be payable, in the case of Notes which reset daily, weekly
or monthly, on the third Wednesday of each month or on the third Wednesday of
March, June, September and December of each year, as indicated on the face
hereof; in the case of Notes which reset quarterly, on the third Wednesday of
March, June, September and December of each year; in the case of Notes which
reset semi-annually, on the third Wednesday of the two months of each year
specified on the face hereof; and in the case of Notes which reset annually, on
the third Wednesday of the month specified on the face hereof (each an "Interest
Payment Date"), and in each case, at Maturity. If any Interest Payment Date
specified on the face hereof would otherwise be a day that is not a Business
Day, the Interest Payment Date shall be postponed to the next day that is a
Business Day, except that if (i) the rate of interest on this Note shall be
determined in accordance with the provisions of the heading "Determination of
LIBOR" above, and (ii) such Business Day is in the next succeeding calendar
month, such Interest Payment Date shall be the immediately preceding Business
Day.
"Business Day" means (i) with respect to any Note, any day that is not
a Saturday or Sunday and that, in The City of New York, is not a day on which
banking institutions generally are authorized or obligated by law to close, and
(ii) if the Note is denominated in a Specified Currency other than United States
dollars, not a day on which banking institutions are authorized or required by
law to close in the financial center of the country issuing the Specified
Currency (unless the Specified Currency is European Currency Units ("ECU"), in
which case such day is also not a day that appears as an ECU non-settlement day
on the display designated as "ISDE" on the Reuter Monitor Money Rates Service
(or is not a day designated as an ECU non-settlement day by the ECU Banking
Association), or, if ECU non-settlement days do not appear on that page (and are
not so designated), a day that is not a day on which payments in ECU cannot be
settled in the international interbank market), and (iii) if the rate of
interest on this Note shall be determined in accordance with the provisions of
the heading "Determination of LIBOR" above, any such day on which dealings in
deposits in U.S. dollars are transacted in the London interbank market. As used
in the preceding sentence, "financial center" means the capital city of the
country issuing the Specified Currency (except with respect to ECU) except that
with respect to United States dollars, Australian dollars, Canadian dollars,
Deutsche marks, Dutch guilders, Italian lire and Swiss francs, the "financial
center" shall be the City of New York, Sydney, Toronto, Frankfurt, Amsterdam,
Milan and Zurich, respectively.
Unless otherwise specified on the face hereof, the Interest
Determination Date pertaining to an Interest Reset Date if the rate of interest
on this Note shall be determined in accordance with the provisions of the
headings (a) "Determination of Commercial Paper Rate" above (the "Commercial
Paper Interest Determination Date"), (b) "Determination of Federal Funds Rate"
above (the "Federal Funds Interest Determination Date"), (c) "Determination of
CD Rate" above (the "CD Interest Determination Date") or (d) "Determination of
Prime Rate" above (the "Prime Rate Interest Determination Date") will be the
second Business Day preceding such Interest Reset Date with respect to this
Note. Unless otherwise specified on the face hereof, the Interest Determination
Date pertaining to an Interest Reset Date if the rate of interest on this Note
shall be determined in accordance with the provisions of the heading
"Determination of
12
<PAGE>
LIBOR" above (the "LIBOR Interest Determination Date") will be the second London
Business Day preceding such Interest Reset Date. Unless otherwise specified on
the face hereof, the Interest Determination Date pertaining to an Interest Reset
Date if the rate of interest on this Note shall be determined in accordance with
the provisions of the heading "Determination of Treasury Rate" above (the
"Treasury Interest Determination Date") will be the day of the week in which
such Interest Reset Date falls on which Treasury bills would normally be
auctioned. Treasury bills are usually sold at auction on Monday of each week,
unless that day is a legal holiday, in which case the auction is usually held on
the following Tuesday, except that such auction may be held on the preceding
Friday. If, as the result of a legal holiday, an auction is so held on the
preceding Friday, such Friday will be the Treasury Interest Determination Date
pertaining to the Interest Reset Date occurring in the next succeeding week. If
an auction date shall fall on any Interest Reset Date for a Treasury Rate Note,
then such Interest Reset Date shall instead be the first Business Day
immediately following such auction date.
Unless otherwise specified on the face hereof, the Calculation Date
pertaining to any Interest Determination Date, other than with respect to LIBOR
Notes, is the earlier of (i) the tenth day after such Interest Determination
Date or, if any such day is not a Business Day, the next succeeding Business
Day, or (ii) the Business Day preceding the applicable Interest Payment Date or
Maturity, as the case may be.
Unless otherwise specified on the face hereof, interest payments, if
any, will be the amount of interest accrued from and including the last date in
respect of which interest has been paid or duly provided for (or from and
including the Original Issue Date if no interest has been paid or provided for
with respect to this Note) to but excluding the Interest Payment Date or the
date of Maturity. Accrued interest hereon from the Original Issue Date or from
the last date to which interest hereon has been paid is calculated by
multiplying the face amount hereof by an accrued interest factor. Such accrued
interest factor is computed by adding the interest factor calculated for each
day from the Original Issue Date or from the last date to which interest shall
have been paid, to the date for which accrued interest is being calculated. The
interest factor (expressed as a decimal rounded, if necessary, to the nearest
one hundred-thousandth of a percentage point, with five millionths of a
percentage point rounded upwards (e.g., 9.876545% or .09876545 being rounded to
9.87655% or .0987655, respectively)) for each such day shall be computed by
dividing the interest rate (expressed as a decimal rounded, if necessary, to the
nearest one hundred-thousandth of a percentage point, with five millionths of a
percentage point rounded upwards) applicable to such day by 360, in the case of
the Commercial Paper Rate, Federal Funds Rate, Prime Rate, CD Rate or LIBOR, or
by the actual number of days in the year in the case of the Treasury Rate.
If the Company has the option with respect to this Note to reset the
Spread and/or Spread Multiplier, such option will be indicated on the face
hereof, together with (i) the date or dates on which such Spread and/or Spread
Multiplier may be reset (each an "Optional Reset Date") and (ii) the basis or
formula, if any, for such resetting. The Company may exercise such option by
notifying the Trustee of such exercise at least 45 but not more than 60 days
prior to an Optional Reset Date. Not later than 40 days prior to such Optional
Reset Date, the Trustee will mail to the Holder hereof a notice (the "Reset
Notice"), first class, postage prepaid, setting forth (i) the election of the
Company to reset the Spread and/or Spread Multiplier, (ii) such new Spread
and/or Spread Multiplier, and (iii) the provisions, if any, for redemption
during the period
13
<PAGE>
from such Optional Reset Date to the next Optional Reset Date or, if there is no
such next Optional Reset Date, to the Stated Maturity of this Note (each such
period a "Subsequent Interest Period"), including the date or dates on which or
the period or periods during which and the price or prices at which such
redemption may occur during such Subsequent Interest Period.
Notwithstanding the foregoing, not later than 20 days prior to an
Optional Reset Date, the Company may, at its option, revoke the Spread and/or
Spread Multiplier provided for in the Reset Notice and establish a higher Spread
and/or Spread Multiplier for the Subsequent Interest Period commencing on such
Optional Reset Date by mailing or causing the Trustee to mail notice of such
higher Spread and/or Spread Multiplier first class, postage prepaid, to the
Holder hereof. Such notice shall be irrevocable. If the Spread and/or Spread
Multiplier is reset on an Optional Reset Date this Note will bear such higher
Spread and/or Spread Multiplier.
If the Company elects to reset the Spread and/or Spread Multiplier of
this Note, the Holder hereof will have the option to elect repayment of this
Note by the Company on any Optional Reset Date at a price equal to the principal
amount hereof plus any accrued interest to such Optional Reset Date. In order
for this Note to be so repaid on an Optional Reset Date, the Holder hereof must
follow the procedures set forth below for optional repayment, except that the
period for delivery of this Note or notification to the Trustee shall be at
least 25 but not more than 35 days prior to such Optional Reset Date and except
that a Holder who has tendered this Note for repayment pursuant to a Reset
Notice may, by written notice to the Trustee, revoke any such tender for
repayment until the close of business on the tenth day prior to such Optional
Reset Date.
If the Company has the option to extend the Stated Maturity of this
Note for one or more periods (each an "Extension Period") up to but not beyond
the date (the "Final Maturity Date") set forth on the face hereof, such option
will be indicated on the face hereof together with the basis or formula, if any,
for setting the Spread and/or Spread Multiplier applicable to any such Extension
Period. The Company may exercise such option with respect to this Note by
notifying the Trustee of such exercise at least 45 but not more than 60 days
prior to the Stated Maturity in effect prior to the exercise of such option (the
"Original Stated Maturity"). No later than 40 days prior to the Original Stated
Maturity, the Trustee will mail to the Holder hereof a notice (the "Extension
Notice") relating to such Extension Period, first class, postage prepaid,
setting forth (i) the election of the Company to extend the Stated Maturity
hereof, (ii) the new Stated Maturity, (iii) the Spread and/or Spread Multiplier
applicable to the Extension Period, and (iv) the provisions, if any, for
redemption during the Extension Period, including the date or dates on which or
the period or periods during which and the price or prices at which such
redemption may occur during the Extension Period. Upon the mailing by the
Trustee of an Extension Notice to the Holder of this Note, the Stated Maturity
of this Note shall be extended automatically as set forth in the Extension
Notice, and, except as modified by the Extension Notice and as described in the
next paragraph, this Note will have the same terms as prior to the mailing of
such Extension Notice.
Notwithstanding the foregoing, not later than 20 days prior to the
Original Stated Maturity for this Note, the Company may, at its option, revoke
the Spread and/or Spread Multiplier provided for in the Extension Notice and
establish a higher Spread and/or Spread Multiplier for the Extension Period by
mailing or causing the Trustee to mail notice of such
14
<PAGE>
higher Spread and/or Spread Multiplier first class, postage prepaid, to the
Holder hereof. Such notice shall be irrevocable. All Notes with respect to which
the Stated Maturity is extended will bear such higher Spread and/or Spread
Multiplier for the Extension Period.
If the Company elects to extend the Stated Maturity of this Note, the
Holder hereof will have the option to elect repayment of this Note by the
Company at the Original Stated Maturity at a price equal to the principal amount
hereof plus any accrued interest to such date. In order for this Note to be so
repaid on the Original Stated Maturity, the Holder hereof must follow the
procedures set forth below for optional repayment, except that the period for
delivery of this Note or notification to the Trustee shall be at least 25 but
not more than 35 days prior to the Original Stated Maturity and except that a
Holder who has tendered this Note for repayment pursuant to an Extension Notice
may, by written notice to the Trustee, revoke any such tender for repayment
until the close of business on the tenth day prior to the Original Stated
Maturity.
Unless one or more Redemption Dates is specified on the face hereof,
this Note shall not be redeemable at the option of the Company before the
Maturity Date specified on the face hereof. If one or more Redemption Dates (or
ranges of Redemption Dates) is so specified, this Note is subject to redemption
on any such date (or during any such range) at the option of the Company, upon
notice by first-class mail, mailed not less than 30 days nor more than 60 days
prior to the Redemption Date specified in such notice, at the applicable
Redemption Price specified on the face hereof (expressed as a percentage of the
principal amount of this Note), together in the case of any such redemption with
accrued interest to the Redemption Date, but interest installments whose Stated
Maturity is prior to the Redemption Date will be payable to the Holder of this
Note, or one or more Predecessor Notes, of record at the close of business on
the relevant Regular or Special Record Dates referred to on the face hereof, all
as provided in the Indenture. The Company may elect to redeem less than the
entire principal amount hereof, provided that the principal amount, if any, of
--------
this Note that remains outstanding after such redemption is an Authorized
Denomination as defined herein.
Unless one or more Repayment Dates is specified on the face hereof,
this Note shall not be repayable at the option of the Holder on any date prior
to the Maturity Date specified on the face hereof. If one or more Repayment
Dates (or ranges of Repayment Dates) is so specified, this Note is subject to
repayment on any such date (or during any such range) at the option of the
Holder at the applicable Repayment Price specified on the face hereof (expressed
as a percentage of the principal amount of this Note), together in the case of
any such repayment with accrued interest to the Repayment Date, but interest
installments whose Stated Maturity is prior to the Repayment Date will be
payable to the Holder of this Note, or one or more Predecessor Notes, of record
at the close of business on the relevant Regular or Special Record Dates
referred to on the face hereof, all as provided in the Indenture. For this Note
to be repaid at the option of the Holder, the Trustee must receive at the
principal office of its Corporate Trust Department in The City of New York, at
least 30 days but not more than 45 days prior to the Repayment Date on which
this Note is to be repaid, this Note and a statement that the option to elect
repayment is being exercised thereby. Exercise of the repayment option by the
Holder shall be irrevocable except to the extent permitted in connection with an
interest rate reset or an extension of maturity, each as described above. The
repayment option with respect to this Note may be exercised by the Holder for
less than the entire principal amount hereof, provided that the
--------
15
<PAGE>
principal amount, if any, of this Note that remains outstanding after such
repayment is an Authorized Denomination as defined herein.
[Insert if the Security is to be a Certificated Security -- In the
event of redemption or repayment of this Note in part only, a new Note or Notes
of this series and of like tenor and for a principal amount equal to the
unredeemed or unrepaid portion will be delivered to the registered Holder upon
the cancellation hereof.]
[Insert if the Security is to be a Global Security -- In the event of
redemption or repayment of this Note in part only, the principal amount shall be
reduced.]
If this is a Foreign Currency Note to be paid in United States
dollars, the United States dollar amount to be received in respect hereof will
be based upon the exchange rate as determined by the Exchange Rate Agent based
on the highest firm bid quotation for United States dollars received by such
Exchange Rate Agent at approximately 11:00 A.M. New York City time on the second
Business Day preceding the applicable payment date from three recognized foreign
exchange dealers in The City of New York selected by the Exchange Rate Agent and
approved by the Company (one of which may be the Exchange Rate Agent) for the
purchase by the quoting dealer, for settlement on such payment date, of the
aggregate amount of the Specified Currency payable on such payment date in
respect of this Note. If no such bid quotations are available, payments will be
made in the Specified Currency, unless such Specified Currency is unavailable
due to the imposition of exchange controls or to other circumstances beyond the
Company's control, in which case the Company will be entitled to make payments
in respect hereof in United States dollars as provided below. All currency
exchange costs will be borne by the Holder hereof by deductions from such
payments.
If a Holder is to receive payments in a Specified Currency other than
United States dollars as described on the face hereof, payments of principal of
(and premium, if any) and interest will be paid in immediately available funds
by wire transfer to an account maintained by the Holder with a bank located in
the country issuing the Specified Currency (or, with respect to Notes
denominated in European Currency Units, to an ECU account) or other jurisdiction
acceptable to the Company and the Trustee as shall have been designated by the
Holder (which in the case of Global Securities will be the Depositary or its
nominee) on or prior to the Regular Record Date or at least 15 days prior to
Maturity, as the case may be, provided, however, that with respect to payments
-----------------
of principal and premium, if any, and interest at Maturity this Note is
presented to the Trustee in time for the Trustee to make such payment in
accordance with its normal procedures, which shall require presentation no later
than two Business Days prior to Maturity in order to ensure the availability of
immediately available funds in the Specified Currency at Maturity.
If payment on this Note is required to be made in a Specified Currency
other than United States dollars and such currency is unavailable in the good
faith judgment of the Company due to the imposition of exchange controls or to
other circumstances beyond the Company's control, or is no longer used by the
government of the country issuing such currency or for the settlement of
transactions by public institutions of or within the international banking
community, then all payments with respect to this Note shall be made in United
States dollars until such currency is again available or so used. The amount so
payable on any date in such
16
<PAGE>
Specified Currency shall be converted into United States dollars at a rate
determined by the Exchange Rate Agent on the basis of the Market Exchange Rate
on the second Business Day prior to such payment, or, if the Market Exchange
Rate is not then available, the most recently available Market Exchange Rate or
as otherwise determined in good faith by the Company if the foregoing is
impracticable.
If this is a Foreign Currency Note, in the event of an official
redenomination of such foreign currency (including, without limitation, an
official redenomination of a foreign currency that is a composite currency) the
obligations of the Company with respect to payments on this Note denominated in
such currency shall, in all cases, be deemed immediately following such
redenomination to provide for the payment of that amount of redenominated
currency representing the amount of such obligations immediately before such
redenomination. No adjustment will be made to any amount payable under this
Note as a result of (a) any change in the value of a foreign currency relative
to any other currency due solely to fluctuations in exchange rates or (b) any
redenomination of any component currency of any composite currency (unless such
composite currency is itself officially redenominated).
If an Event of Default with respect to Notes of this series shall
occur and be continuing, the principal of the Notes of this series may be
declared due and payable in the manner and with the effect provided in the
Indenture. Unless otherwise specified on the face hereof, if any Original Issue
Discount Note (as defined below) is redeemed by the Company or repaid at the
option of the Holder, each as described above, or if the principal of any
Original Issue Discount Note is declared to be due and payable immediately
pursuant to this paragraph, the amount of principal due and payable with respect
to this Note shall be limited to the sum of the aggregate principal amount of
this Note multiplied by the Issue Price (expressed as a percentage of the
aggregate principal amount) plus the original issue discount accrued from the
date of issue to the date of redemption, repayment or declaration, as
applicable, which accrual shall be calculated using the "interest method"
(computed in accordance with generally accepted accounting principles) in effect
on the date of redemption, repayment or declaration. Unless otherwise specified
on the face hereof, an Original Issue Discount Note is a Note which has a stated
redemption price at maturity that exceeds its Issue Price by at least 0.25% of
the stated redemption price at maturity, multiplied by the number of complete
years from the Original Issue Date to the Maturity Date for this Note.
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Notes of each series to be affected
under the Indenture at any time by the Company and the Trustee with the consent
of the Holders of not less than 66 2/3% in principal amount of the Notes at the
time Outstanding of each series to be affected. The Indenture also contains
provisions permitting the Holders of specified percentages in principal amount
of the Notes of each series at the time Outstanding, on behalf of the Holders of
all Notes of such series, to waive compliance by the Company with certain
provisions of the Indenture and certain past defaults under the Indenture and
their consequences. Any such consent or waiver by the Holder of this Note shall
be conclusive and binding upon such Holder and upon all future Holders of this
Note and of any Note issued upon the registration of transfer hereof or in
exchange herefor or in lieu hereof, whether or not notation of such consent or
waiver is made upon this Note.
17
<PAGE>
No reference herein to the Indenture and no provision of this Note or
of the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of (and premium, if any) and
interest on this Note at the times, places and rate, and in the coin or
currency, herein prescribed. However, the Indenture limits the Holder's right
to enforce the Indenture and this Note.
As provided in the Indenture and subject to certain limitations set
forth therein and as may be set forth on the face hereof, the transfer of this
Note is registrable in the Security Register, upon surrender of this Note for
registration of transfer at the office or agency of the Company in any place
where the principal of (and premium, if any) and interest on this Note are
payable, duly endorsed by, or accompanied by a written instrument of transfer in
form satisfactory to the Company and the Security Registrar duly executed by,
the Holder hereof or his attorney duly authorized in writing, and thereupon one
or more new Notes of this series of like tenor, of Authorized Denominations and
for the same aggregate principal amount, will be issued to the designated
transferee or transferees.
[Insert if the Security is a Global Security -- This Note is a Global
Note and shall be exchangeable for Notes registered in the names of Persons
other than the Depositary with respect to this Global Note or its nominee only
if (A) such Depositary notifies the Company that it is unwilling or unable to
continue as Depositary for this Global Note or at any time ceases to be a
clearing agency registered as such under the Securities Exchange Act of 1934, as
amended, (B) the Company in its discretion executes and delivers to the Trustee
a Company Order that this Global Note shall be exchangeable or (C) there shall
have occurred and be continuing an Event of Default with respect to the Notes.
If this Global Note is exchangeable pursuant to the preceding sentence, it shall
be exchangeable for Notes issuable in denominations of $1,000 and any integral
multiple of $1,000 in excess thereof, registered in such names as such
Depositary shall direct.]
The Notes of this series are issuable, in the case of Notes
denominated in United States dollars, in denominations of U.S. $1,000 and any
integral multiple of U.S. $1,000 in excess thereof and, in the case of Notes
denominated in a Specified Currency other than United States dollars, in the
authorized denominations set forth on the face hereof (in each case, an
"Authorized Denomination"). As provided in the Indenture and subject to certain
limitations set forth therein and as may be set forth on the face hereof, Notes
of this series are exchangeable for a like aggregate principal amount of Notes
of this series of like tenor of a different Authorized Denomination, as
requested by the Holder surrendering the same.
No service charge shall be made for any such registration of transfer
or exchange, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
The Notes of this series may be issued in the form of one or more
Global Securities to The Depository Trust Company as depositary for the Global
Securities of this series (the "Depositary") or its nominee and registered in
the name of the Depositary or such nominee.
Prior to due presentment of this Note for registration of transfer,
the Company, the Trustee and any agent of the Company or the Trustee may treat
the Person in whose name
18
<PAGE>
this Note is registered as the owner hereof for all purposes, whether or not
this Note is overdue, and neither the Company, the Trustee nor any such agent
shall be affected by notice to the contrary.
The Indenture and the Notes shall be governed by and construed in
accordance with the laws of the State of New York.
All terms used in this Note which are defined in the Indenture shall
have the meanings assigned to them in the Indenture.
______________________________
19
<PAGE>
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations.
TEN COM - as tenants in common
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of
survivorship and not as tenants in common
UNIF GIFT MIN ACT - _______________ Custodian ______________
(Cust) (Minor)
Under Uniform Gifts to Minors Act
________________________________
(State)
Additional abbreviations may also be used though not in the above list.
________________________________
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s)
unto
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE
/ /
- -------------------------------------------
- --------------------------------------------------------------------------------
PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS INCLUDING POSTAL ZIP CODE OF ASSIGNEE
- --------------------------------------------------------------------------------
the within Note and all rights thereunder, hereby irrevocably constituting and
appointing ___________________________attorney to transfer said Note on the
books of the Company, with full power of substitution in the premises.
<TABLE>
<S> <C>
--------------------------------------------------------
Dated: ________________ NOTICE: The signature to this assignment must correspond
with the name as written upon the face of the within
instrument in every particular, without alteration or
enlargement or any change whatever.
</TABLE>
20
<PAGE>
Exhibit 5
February 27, 1998
Caterpillar Financial Services Corporation
3322 West End Avenue
Nashville, Tennessee 37203-0983
Re: Caterpillar Financial Services Corporation
Registration Statement on Form S-3
Ladies and Gentlemen:
At your request, we have examined the Registration Statement on Form
S-3 (the "Registration Statement"), in the form being filed with the Securities
and Exchange Commission in connection with the registration under the Securities
Act of 1933, as amended (the "Act"), of $3,000,000,000 aggregate principal
amount of Debt Securities (the "Debt Securities") of Caterpillar Financial
Services Corporation, a Delaware corporation (the "Company"). The Debt
Securities are to be issued under an Indenture, dated as of April 15, 1985, as
supplemented by a First Supplemental Indenture, dated as of May 22, 1986, a
Second Supplemental Indenture, dated as of March 15, 1987, a Third Supplemental
Indenture, dated as of October 2, 1989, and a Fourth Supplemental Indenture,
dated as of October 1, 1990 (collectively, the "Indenture"), between the Company
and First Trust of New York, National Association, as successor trustee (the
"Trustee"), forms of which are included as exhibits to the Registration
Statement. The Debt Securities are to be issued in substantially the forms
filed as exhibits to the Registration Statement (with maturities, interest rates
and other terms of the Debt Securities appropriately filled in). The Debt
Securities are to be sold from time to time as set forth in the Registration
Statement, any amendment thereto, the prospectus contained therein (the
"Prospectus") and any supplements to the Prospectus (the "Prospectus
Supplements").
We have examined instruments, documents, and records which we deemed
relevant and necessary for the basis of our opinion hereinafter expressed.
Based on such examination, we are of the opinion that when the issuance of the
Debt Securities has been duly authorized by appropriate corporate action and the
Debt Securities have been duly completed, executed, authenticated and delivered
in accordance with the Indenture and sold as described in the Registration
Statement, any amendment thereto, the Prospectus and any Prospectus Supplement
relating thereto, the Debt Securities will be legal, valid, and binding
obligations of the Company, entitled to the benefits of the Indenture.
Our opinion that the Debt Securities are legal, valid, and binding is
qualified as to limitations imposed by bankruptcy, insolvency, reorganization,
arrangement, fraudulent conveyance, moratorium or other laws relating to or
affecting the enforcement of creditors' rights
<PAGE>
Caterpillar Financial Services Corporation
February 27, 1998
Page 2
generally; and general principles of equity, including without limitation
concepts of materiality, reasonableness, good faith and fair dealing, and the
possible unavailability of specific performance or injunctive relief, regardless
of whether such enforceability is considered in a proceeding in equity or at
law.
We express no opinion as to matters of law in jurisdictions other than
the State of New York, the federal law of the United States, and the corporate
law of the State of Delaware.
We hereby consent to the filing of this opinion as an exhibit to the
above-referenced Registration Statement and to the use of our name wherever it
appears in the Registration Statement, the Prospectus, any Prospectus
Supplement, and in any amendment or supplement thereto. In giving such consent,
we do not consider that we are "experts" within the meaning of such term as used
in the Act or the rules and regulations of the Securities and Exchange
Commission issued thereunder with respect to any part of the Registration
Statement, including this opinion as an exhibit or otherwise.
Very truly yours,
/s/ Orrick , Herrington & Sutcliffe LLP
ORRICK, HERRINGTON & SUTCLIFFE LLP
<PAGE>
EXHIBIT 12
CATERPILLAR FINANCIAL SERVICES CORPORATION
STATEMENT SETTING FORTH COMPUTATION OF RATIO
OF PROFIT TO FIXED CHARGES
(Dollars In Millions)
<TABLE>
<CAPTION>
Years Ended December 31,
----------------------------------------------
1997 1996 1995 1994 1993
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Income before cumulative effect of
change in accounting for income
taxes........................................ $ 94.2 $ 75.6 $ 65.2 $ 32.2 $ 37.8
Add:
Provision for income taxes.................... 53.5 40.2 38.5 19.3 21.3
Deduct:
Equity in profit of partnerships.............. (2.6) (2.2) (1.4) (1.7) (1.6)
------ ------ ------ ------ ------
Profit before taxes............................ $145.1 $113.6 $102.3 $ 49.8 $ 57.5
====== ====== ====== ====== ======
Fixed charges:
Interest on borrowed funds.................... $366.7 $315.4 $298.4 $212.1 $173.1
Rentals--at computed interest*................ 3.2 2.5 1.8 1.3 1.2
------ ------ ------ ------ ------
Total fixed charges............................ $369.9 $317.9 $300.2 $213.4 $174.3
====== ====== ====== ====== ======
Profit before taxes plus fixed
charges....................................... $515.0 $431.5 $402.5 $263.2 $231.8
====== ====== ====== ====== ======
Ratio of profit before taxes plus
fixed charges to fixed charges................ 1.39 1.36 1.34 1.23 1.33
====== ====== ====== ====== ======
</TABLE>
___________________
* Those portions of rent expense that are representative of interest cost.
<PAGE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
----------------------------------
We hereby consent to the incorporation by reference in the Prospectus
constituting part of this Registration Statement on Form S-3 of our report dated
January 30, 1998 appearing on page 14 of Caterpillar Financial Services
Corporation's Annual Report on Form 10-K for the year ended December 31, 1997.
We also consent to the reference to us under the heading "Experts" in such
Prospectus.
PRICE WATERHOUSE LLP
/s/ Price Waterhouse LLP
New York, New York
February 27, 1998
<PAGE>
EXHIBIT 24
POWER OF ATTORNEY
Each of the undersigned hereby appoints any one of James S. Beard,
James R. English, Edward J. Scott, and Paul J. Gaeto as his attorney-in-fact,
each acting alone, with full powers of substitution and resubstitution, to
execute for each of the undersigned and in his name and capacity with
Caterpillar Financial Services Corporation as listed below, and to file any of
the documents hereinafter described relating to the issuance and offering of the
Company's debt securities up to a total of US$3,000,000,000 or its equivalent in
the currency of countries other than the United States (including in such amount
the offering price rather than the face value of any such securities sold at a
discount from face value), such documents being: a Registration Statement to be
filed with the Securities and Exchange Commission, any all other documents
required to be filed with respect thereto with any regulatory authority, and all
amendments to any of the foregoing, with all exhibits and documents required to
be filed in connection therewith. The undersigned further grants unto said
attorneys, each acting alone, with full powers of substitution and
resubstitution, full power and authority to accomplish the foregoing
registration as fully as the undersigned might do.
Dated as of this 27th day of February, 1998.
Signature Title
/s/ James S. Beard President, Director and
- -----------------------
James S. Beard Principal Executive Officer
/s/ James R. English Executive Vice President
- ----------------------- and Director
James R. English
/s/ James W. Owens Director
- -----------------------
James W. Owens
/s/ Kenneth C. Springer Controller and Principal
- ----------------------- Accounting Officer
Kenneth C. Springer
/s/ Edward J. Scott Treasurer and Principal
- ----------------------- Financial Officer
Edward J. Scott
<PAGE>
Exhibit 25
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-----------------
FORM T-1
STATEMENT OF ELIGIBILITY AND QUALIFICATION
UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
-----------------
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY
OF A TRUSTEE PURSUANT TO SECTION 305(b)(2)_____
FIRST TRUST OF NEW YORK, NATIONAL ASSOCIATION
(Exact name of trustee as specified in its charter)
13-3781471
(I.R.S. Employer Identification No.)
100 Wall Street, New York, NY 10005
(Address of principal executive offices) (Zip Code)
-----------------
For information, contact:
Dennis Calabrese, President
First Trust of New York, National Association
100 Wall Street, 16th Floor
New York, NY 10005
(212)361-2502
-----------------
Caterpillar Financial Services Corporation
(exact name obligor as specified in its charter)
Delaware 37-1105865
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
3322 West End Avenue 37203-0983
Nashville, Tennessee (Zip Code)
(Address of principal executive offices)
-----------------
Debt Securities
(Title of the indenture securities)
<PAGE>
Item 1. General Information
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority to
which it is subject.
Name Address
---- -------
Comptroller of the Currency Washington D.C.
(b) Whether it is authorized to exercise corporate trust powers.
Yes
Item 2. Affiliations with Obligor
If the obligor is an affiliate of the trustee, describe each
such affiliation.
None
Item 16. List of Exhibits
Exhibit 1 Articles of Association of First Trust of New
York, National Association, incorporated herein
by reference to Exhibit 1 of Form T-1,
Registration No. 33-83774.
Exhibit 2 Certificate of Authority to Commence Business
for First Trust of New York, National
Association, incorporated herein by reference to
Exhibit 2 of Form T-1, Registration No. 33-
83774.
Exhibit 3 Authorization of the Trustee to exercise
corporate trust powers for First Trust of New
York, National Association, incorporated herein
by reference to Exhibit 3 of Form T-1,
Registration No. 33-83774.
Exhibit 4 By-Laws of First Trust of New York, National
Association, Incorporated herein by reference to
Exhibit 4 of Form T-1, Registration No. 33-
55851.
Exhibit 5 Not applicable
Exhibit 6 Consent of First Trust of New York, National
Association, required by Section 321(b) of the
Act, incorporated herein by reference to Exhibit
6 of Form T-1, Registration No. 33-83774.
Exhibit 7 Report of Condition of First Trust of New York,
National Association, as of the close of
business on December 31, 1997 published pursuant
to law or the requirements of its supervising or
examining authority.
-2-
<PAGE>
Exhibit 8 Not applicable.
Exhibit 9 Not applicable.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, First Trust of New York, National Association, a national
banking association organized and existing under the laws of the United States
of America, has duly caused this statement of eligibility to be signed on its
behalf by the undersigned, thereunto duly authorized, all in The City of New
York and State of New York, on the 27th day of February, 1998.
FIRST TRUST OF NEW YORK,
NATIONAL ASSOCIATION
By /s/ GEOVANNI BARRIS
___________________
Geovanni Barris
Assistant Vice President
<PAGE>
Exhibit 7
First Trust of New York, N.A.
Statement of Financial Condition
As of 12/31/97
($000's)
Assets 12/31/97
--------
Cash and Due From Depository Institutions $ 37,537
Federal Reserve Stock 3,439
Fixed Assets 698
Intangible Assets 74,459
Other Assets 6,072
--------
Total Assets $122,205
========
Liabilities
Other Liabilities 8,020
--------
Total Liabilities 8,020
Equity
Common and Preferred Stock 1,000
Surplus 120,932
Undivided Profits (7,747)
Total Equity Capital 114,185
--------
Total Liabilities and Equity Capital $122,205
========
- --------------------------------------------------------------------------
To the best of the undersigned's determination, as of this date the above
financial information is true and correct.
First Trust of New York, N.A.
By: /s/ GEOVANNI BARRIS
___________________________
Geovanni Barris
Assistant Vice President
Date: February 27, 1998
