<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JULY 11, 1996
REGISTRATION NO. 333-
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------
FORM S-3
REGISTRATION STATEMENT
AND
POST-EFFECTIVE AMENDMENTS
UNDER
THE SECURITIES ACT OF 1933
DEAN WITTER, DISCOVER & CO.
(EXACT NAME OF EACH REGISTRANT AS SPECIFIED IN ITS CHARTER)
<TABLE>
<S> <C> <C>
DELAWARE 6211; 6141; 7374 36-3145972
(STATE OR OTHER JURISDICTION OF (PRIMARY STANDARD INDUSTRIAL CLASSIFICATION (I.R.S. EMPLOYER IDENTIFICATION
INCORPORATION OR ORGANIZATION) CODE NUMBER) NUMBER)
</TABLE>
----------------
TWO WORLD TRADE CENTER
NEW YORK, NEW YORK 10048
(212) 392-2222
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
----------------
CHRISTINE A. EDWARDS
EXECUTIVE VICE PRESIDENT & GENERAL COUNSEL
DEAN WITTER, DISCOVER & CO.
TWO WORLD TRADE CENTER
66TH FLOOR
NEW YORK, NEW YORK 10048
(212) 392-2222
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)
----------------
COPIES TO:
JOSEPH W. ARMBRUST, JR. LANCE C. BALK
BROWN & WOOD KIRKLAND & ELLIS
ONE WORLD TRADE CENTER CITICORP CENTER, 153 EAST 53RD STREET
NEW YORK, NEW YORK 10048 NEW YORK, NEW YORK 10022
(212) 839-5300 (212) 446-4800
----------------
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, please 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 Table on next page)
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 THIS REGISTRATION
STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING
PURSUANT TO SAID SECTION 8(a), MAY DETERMINE.
----------------
Pursuant to Rule 429 under the Securities Act of 1933, the prospectuses
included in this Registration Statement are combined prospectuses that also
relate to the Registrant's Registration Statements Nos. 33-57202, 33-60734 and
33-89748 on Form S-3. The following registration statements, each having the
original effective date indicated parenthetically, are amended hereby (the
number of such post-effective amendment applicable to a registration statement
being also indicated parenthetically), all as follows: 33-57202 (February 24,
1993-No.2); and 33-60734 (April 26, 1993-No. 2); and 33-89748 (June 28, 1995-
No. 1). Each such post-effective amendment shall hereafter become effective
concurrently with the effectiveness of this Registration Statement in
accordance with Section 8(c) of the Securities Act of 1933.
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- -------------------------------------------------------------------------------
<PAGE>
CALCULATION OF REGISTRATION FEE
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PROPOSED
MAXIMUM PROPOSED
TITLE OF EACH CLASS OF AMOUNT OFFERING MAXIMUM
SECURITIES TO BE PRICE PER AGGREGATE AMOUNT OF
TO BE REGISTERED REGISTERED(1) UNIT(2) OFFERING PRICE(2) REGISTRATION FEE
- ---------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Debt Securities........ $2,000,000,000(3) 100% $2,000,000,000 $689,655.17
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(1) This Registration Statement and the registration fee pertain to the initial
offering of $2,000,000,000 aggregate principal amount of Debt Securities
registered hereunder by the Registrant, and also offers and sales related to
market-making transactions by Dean Witter Reynolds Inc., an affiliate of the
Registrant, and offers and sales in connection with the proportionate share
of underwriters' stabilization activities (if any) by Dean Witter Reynolds
Inc., with respect to such $2,000,000,000 of Debt Securities.
(2) Estimated solely for the purpose of calculating the registration fee.
(3) Such amount shall be increased if any Debt Securities are issued at an
original issue discount, by an amount such that the aggregate gross proceeds
to be received by the Registrant shall be equal to the above amount to be
registered. Any offering of Debt Securities denominated other than in U.S.
dollars will be treated as the equivalent in U.S. dollars based on exchange
rates at the time of offering.
<PAGE>
EXPLANATORY NOTE
This Registration Statement contains two prospectuses. The first relates to
the initial offering of Debt Securities (the "Basic Prospectus"). The second is
for use in connection with offers and sales related to market making
transactions in the Debt Securities registered hereunder, or Debt Securities
issued under prior registration statements, by Dean Witter Reynolds Inc., a
wholly-owned subsidiary of the Registrant (the "DWR Prospectus").
Ten copies of each of the Basic Prospectus and the DWR Prospectus in the
exact form in which they are to be used after effectiveness will be filed with
the Securities and Exchange Commission pursuant to Rule 424(b), if required to
be filed pursuant to such Rule.
<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 July 11, 1996
DEAN WITTER, DISCOVER & CO.
DEBT SECURITIES
-----------
Dean Witter, Discover & Co. (the "Company") intends to sell from time to time
up to U.S. $3,939,725,000.00 aggregate principal amount (or net proceeds in
the case of securities issued at an original issue discount), or its
equivalent in such foreign currencies or units of two or more currencies,
based on the applicable exchange rate at the time of offering, as shall be
designated by the Company at the time of offering, of its debt securities
("Debt Securities"). The Debt Securities may be offered as separate
series in amounts, at prices and on terms to be determined at the time
of sale.
The Debt Securities will be unsecured obligations and will rank pari passu with
all other unsecured and unsubordinated indebtedness of the Company. Each issue
of Debt Securities may vary, where applicable, as to aggregate principal
amount, maturity date, public offering or purchase price, interest rate or
rates, if any, and timing of payments thereof, provisions for redemption,
sinking fund requirements, if any, currencies of denomination or
currencies otherwise applicable thereto and any other variable terms and
method of distribution. The accompanying Prospectus Supplement (the
"Prospectus Supplement") sets forth the specific terms with regard to
the Debt Securities in respect of which this Prospectus is being
delivered.
-----------
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 OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
-----------
The Debt Securities may be sold through underwriting syndicates represented
by one or more managing underwriters, which may include Dean Witter Reynolds
Inc., by underwriters without a syndicate, through agents designated from time
to time, or directly to purchasers. The names of any such managing
underwriters, underwriters or agents of the Company involved in the sale of the
Debt Securities in respect of which this Prospectus is being delivered and any
applicable commissions or discounts are set forth in the accompanying
Prospectus Supplement with respect to such Debt Securities. Debt Securities may
not be sold by the Company or any underwriter without delivery of a Prospectus
Supplement describing such issue of Debt Securities and the method and terms of
offering thereof.
This Prospectus and the accompanying Prospectus Supplement may be used by
Dean Witter Reynolds Inc., which is a wholly owned subsidiary of the Company,
in connection with offers and sales of Debt Securities in market-making
transactions at negotiated prices at the time of sale or otherwise. Dean Witter
Reynolds Inc. may act as principal or agent in such transactions.
-----------
DEAN WITTER REYNOLDS INC.
, 1996
<PAGE>
NO DEALER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATION OTHER THAN THOSE CONTAINED OR
INCORPORATED BY REFERENCE IN THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY ANY SECURITIES OTHER THAN THE REGISTERED
SECURITIES TO WHICH IT RELATES OR AN OFFER TO SELL OR THE SOLICITATION OF AN
OFFER TO BUY SUCH SECURITIES IN ANY JURISDICTION TO ANY PERSON TO WHOM IT IS
UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION IN SUCH JURISDICTION. NEITHER THE
DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY
CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE
AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF OR THAT THE INFORMATION IS CORRECT
AS OF ANY TIME SUBSEQUENT TO ITS DATE.
----------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Available Information...................................................... 3
Incorporation of Certain Documents by Reference............................ 3
The Company................................................................ 4
Use of Proceeds............................................................ 4
Ratio of Earnings to Fixed Charges......................................... 4
Description of Debt Securities............................................. 5
Plan of Distribution....................................................... 11
Legal Opinions............................................................. 12
Experts.................................................................... 12
</TABLE>
2
<PAGE>
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934 (the "Exchange Act") and in accordance therewith files
reports, proxy statements and other information with the Securities and
Exchange Commission (the "Commission"). Such reports, proxy statements and
other information can be inspected and copied at the public reference
facilities maintained by the Commission at Room 1024, 450 Fifth Street, N.W.,
Washington, D.C. 20549, and at the following Regional Offices of the
Commission: Chicago Regional Office, 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661-2511 and New York Regional Office, 7 World Trade
Center, 13th Floor, New York, New York 10048. Copies of such material can be
obtained from the Public Reference Section of the Commission at 450 Fifth
Street, N.W., Washington, D.C. 20549 at prescribed rates. Copies of such
material and other information concerning the Company may also be inspected at
the offices of the New York Stock Exchange, Inc., 20 Broad Street, New York,
New York 10005 and the Pacific Stock Exchange, Inc., 301 Pine Street, San
Francisco, California 94104. In addition, the Commission maintains a site on
the World Wide Web portion of the Internet that contains reports, proxy and
information statements and other information regarding registrants that file
electronically with the Commission. The address of such site is
http://www.sec.gov.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Company's Annual Report on Form 10-K for the fiscal year ended December
31, 1995, Quarterly Report on Form 10-Q for the quarter ended March 31, 1996
and Current Reports on Form 8-K dated January 4, 1996, January 8, 1996, January
23, 1996 and April 18, 1996 are hereby incorporated by reference in this
Prospectus.
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14 or
15(d) of the Exchange 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 in this Prospectus by reference and to be a part hereof from the
date of filing of such documents. Any statement contained in a document
incorporated or deemed to be incorporated by reference herein shall be deemed
to be modified or superseded for purposes of this Prospectus to the extent that
a statement contained herein or in any subsequently filed document which also
is or is deemed to be incorporated by reference herein modifies or supersedes
such statement. Any statement so modified or superseded shall not be deemed,
except as modified or superseded, to constitute a part of this Prospectus.
The Company hereby undertakes to provide without charge to each person to
whom a copy of this Prospectus has been delivered, on the written or oral
request of such person, a copy of any or all documents that have been or will
be incorporated in this Prospectus by reference, other than exhibits to such
documents, unless such exhibits are specifically incorporated by reference into
such documents. Requests for such copies should be directed to Investor
Relations, Dean Witter, Discover & Co., Two World Trade Center, New York, New
York 10048, Telephone No. (800) 733-2307.
IN CONNECTION WITH THE OFFERING OF CERTAIN OF THE SECURITIES, THE
UNDERWRITERS MAY OVER-ALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN
THE MARKET PRICES OF SUCH OFFERED SECURITIES OR OTHER SECURITIES OF THE COMPANY
AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH
STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
3
<PAGE>
THE COMPANY
The Company is a diversified financial services organization that provides a
broad range of nationally marketed credit and investment products, with a
primary focus on individual customers. The Company has two principal lines of
business: credit services and securities. Its credit services business ("Credit
Services") consists primarily of the issuance, marketing and servicing of
general purpose credit cards. Credit Services is the single largest domestic
issuer of general purpose credit cards as measured by number of accounts and
cardmembers. Discover (R) Card is the Company's most widely held proprietary
general purpose credit card and generated a majority of Credit Services
revenues and net income in 1995. The Company's securities business is conducted
primarily through its wholly owned subsidiaries, Dean Witter Reynolds Inc.
("DWR") and Dean Witter InterCapital Inc. ("InterCapital"). DWR is a full-
service securities firm that engages in a wide variety of securities
activities, with a particular focus on serving the investment needs of its
individual clients through over 8,500 Account Executives as of December 31,
1995. DWR is among the largest members of the New York Stock Exchange and is a
member of other major securities, futures and options exchanges in the United
States. InterCapital, with total assets of $83.4 billion under management and
administration as of March 31, 1996, is one of the largest asset management
operations in the United States.
The Company was incorporated under the laws of the State of Delaware in 1981.
Its principal executive offices are located at Two World Trade Center, New
York, New York 10048; its telephone number is (212) 392-2222.
USE OF PROCEEDS
Except as may be otherwise set forth in the Prospectus Supplement
accompanying this Prospectus, the net proceeds to be received by the Company
from the sale or sales of the Debt Securities will be used for general
corporate purposes, which may include the repayment of indebtedness, working
capital, capital expenditures and the repurchase of shares of the Company's
common stock. Funds not required immediately for such purposes may be invested
temporarily in short-term marketable securities. The Company anticipates that
it will raise additional funds from time to time through equity or debt
financings, including borrowings under revolving credit agreements.
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth the historical ratios of earnings to fixed
charges of the Company for the periods indicated:
<TABLE>
<CAPTION>
THREE MONTHS
ENDED MARCH 31, FISCAL YEAR ENDED DECEMBER 31,
--------------- -----------------------------------------------
1996 1995 1994 1993 1992 1991
---- ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C>
2.0 1.9 2.1 2.2 1.7 1.5
</TABLE>
For the purpose of calculating the ratio of earnings to fixed charges,
"earnings" consist of income before income taxes and fixed charges and in 1992
includes a cumulative effect of change in method of accounting for
postretirement benefits. Additionally, "earnings" in 1992 excludes a
nonrecurring gain of $32.1 million from the initial public offering of 25.7% of
SPS Transaction Services, Inc. "Fixed charges" consist of interest costs,
including interest on deposits, and that portion of rent expense estimated to
be representative of the interest factor.
4
<PAGE>
DESCRIPTION OF DEBT SECURITIES
The Debt Securities will be issued under an Indenture (the "Indenture")
between the Company and The First National Bank of Chicago (the "Trustee"). The
following summary of certain provisions of the Indenture does not purport to be
complete and is subject to, and is qualified in its entirety by reference to,
all provisions of the Indenture, a copy of which is filed as an exhibit to the
Registration Statement. The following provisions will apply to Debt Securities
unless otherwise provided in the Prospectus Supplement for such Debt
Securities. All capitalized terms appearing herein and not otherwise defined
herein have the meanings specified in the Indenture.
GENERAL
The Indenture provides that Debt Securities may be issued thereunder, without
limitation as to aggregate principal amount, in one or more series, by the
Company from time to time upon satisfaction of certain conditions precedent,
including the delivery by the Company to the Trustee of certified resolutions
of the Board of Directors of the Company which fix or provide for the
establishment of terms of such Debt Securities (in the event that such Debt
Securities are not provided for in a supplemental indenture), including: (1)
the aggregate principal amount of such Debt Securities; (2) the date or dates
on which such Debt Securities will mature; (3) the rate or rates per annum
(which may be fixed or variable) at which such Debt Securities will bear
interest, if any; (4) the dates on which such interest, if any, will be
payable; (5) the provisions for redemption of such Debt Securities, if any, the
redemption price and any remarketing arrangements relating thereto; (6) the
sinking fund requirements, if any, with respect to such Debt Securities; (7)
whether such Debt Securities are denominated or provide for payment in United
States dollars or a foreign currency or units of two or more of such foreign
currencies; (8) the form (registered or bearer or both) in which such Debt
Securities may be issued and any restrictions applicable to the exchange of one
form for another and to the offer, sale and delivery of such Debt Securities in
either form; (9) whether and under what circumstances the Company will pay
additional amounts ("Additional Amounts") in respect of such Debt Securities
held by a person who is not a U.S. person (as defined in the Prospectus
Supplement, as applicable) in respect of specified taxes, assessments or other
governmental charges and whether the Company has the option to redeem the
affected Debt Securities rather than pay such Additional Amounts; (10) whether
such Debt Securities are to be issued in global form; (11) any deletions from,
modifications of or additions to the provisions of the Indenture; and (12) the
title of the Debt Securities and the series of which such Debt Securities shall
be a part. Reference is made to the Prospectus Supplement for the terms of the
Debt Securities being offered thereby.
The provisions of the Indenture provide the Company with the ability to issue
Debt Securities with terms different from those of Debt Securities previously
issued and to "reopen" a previous issue of a series of Debt Securities and
issue additional Debt Securities of such series.
The Debt Securities will be unsecured and will rank pari passu with all other
unsecured and unsubordinated indebtedness of the Company. The Company's assets
consist primarily of receivables from its subsidiaries and the common stock of
its direct subsidiaries, and the Company conducts no substantial business or
operations itself. Accordingly, the right of the Company, and hence the right
of creditors of the Company (including the Holders of the Debt Securities), to
participate in any distribution of the assets of any subsidiary of the Company
upon its liquidation or reorganization will be subject to the prior claims of
creditors of such subsidiary, except to the extent that claims of the Company
itself as a creditor of such subsidiary may be recognized. Creditors of the
Company (including Holders of the Debt Securities) may be limited in their
ability to participate in any proceeding related to a liquidation or
reorganization of any such subsidiary. In addition,
5
<PAGE>
dividends, loans and advances from certain subsidiaries to the Company are
restricted by legal requirements, including (in the case of DWR) net capital
requirements under the Exchange Act and under rules of certain exchanges and
other regulatory bodies and (in the case of Greenwood Trust Company and other
bank subsidiaries) by banking regulations.
Principal and interest, premium and Additional Amounts, if any, will be
payable in the manner, at the places and subject to the restrictions set forth
in the Indenture, the Debt Securities and the Prospectus Supplement relating
thereto, provided that payment of any interest and any Additional Amounts may
be made at the option of the Company by check mailed to the Holders of
registered Debt Securities at their registered addresses.
Debt Securities may be presented for exchange, and registered Debt Securities
may be presented for transfer, in the manner, at the place and subject to the
restrictions set forth in the Indenture, the Debt Securities and the Prospectus
Supplement relating thereto. Debt Securities in bearer form and the coupons, if
any, pertaining thereto will be transferable by delivery. No service charge
will be made for any transfer or exchange of Debt Securities, but the Company
may require payment of a sum sufficient to cover any tax or other governmental
charge payable in connection therewith.
Debt Securities may bear interest at a fixed rate or a floating rate. Debt
Securities bearing no interest or interest at a rate that at the time of
issuance is below the prevailing market rate will be sold at a discount below
their stated principal amount. Special United States federal income tax
considerations applicable to any such discounted Debt Securities or to certain
Debt Securities issued at par which are treated as having been issued at a
discount for United States federal income tax purposes will be described in the
relevant Prospectus Supplement.
Debt Securities may be issued, from time to time, with the principal amount
payable on any principal payment date, or the amount of interest payable on any
interest payment date, to be determined by reference to one or more currency
exchange rates, commodity prices, equity indices or other factors. Holders of
such Debt Securities may receive a principal amount on any principal payment
date, or a payment of interest on any interest payment date, that is greater
than or less than the amount of principal or interest otherwise payable on such
dates, depending upon the value on such dates of the applicable currency,
commodity, equity index or other factor. Information as to the methods for
determining the amount of principal or interest payable on any date, the
currencies, commodities, equity indices or other factors to which the amount
payable on such date is linked and certain additional tax considerations will
be set forth in the applicable Prospectus Supplement.
GLOBAL SECURITIES
Except as provided in the Prospectus Supplement relating thereto, registered
Debt Securities will be issued in global form ("Book-Entry Securities"). Book-
Entry Securities will be issued in the form of one or more fully registered
global Debt Securities which will be deposited with, or on behalf of, The
Depository Trust Company (the "Depositary") and registered in the name of the
Depositary's nominee (each, a "Registered Global Security"). Except as set
forth below, a Registered Global Security may not be transferred except as a
whole by the Depositary to a nominee of the Depositary or by a nominee of the
Depositary to the Depositary or another nominee of the Depositary or by the
Depositary or any such nominee to a successor of the Depositary or a nominee of
such successor.
The Depositary has advised the Company as follows: The Depositary is a
limited-purpose trust company organized under the New York Banking Law, a
"banking organization" within the
6
<PAGE>
meaning of the New York Banking Law, a member of the Federal Reserve System, a
"clearing corporation" within the meaning of the New York Uniform Commercial
Code, and a "clearing agency" registered pursuant to the provisions of Section
17A of the Exchange Act. The Depositary was created to hold securities of its
participants ("Participants") and to facilitate the settlement of securities
transactions among its Participants in such securities through electronic book-
entry changes in accounts of the Participants, thereby eliminating the need for
physical movement of securities certificates. The Depositary's Participants
include securities brokers and dealers, banks, trust companies, clearing
companies and certain other organizations. The Depositary is owned by a number
of its Participants and by the New York Stock Exchange, Inc., the American
Stock Exchange, Inc., and the National Association of Securities Dealers, Inc.
Access to the Depositary's system is also available to others such as
securities brokers and dealers, banks and trust companies that clear through or
maintain a custodial relationship with a participant, either directly or
indirectly ("Indirect Participants").
Purchases of Book-Entry Securities must be made by or through Participants,
which will receive a credit for such Book-Entry Securities on the records of
the Depositary. The ownership interest of each actual purchaser of each Book-
Entry Security represented by a Registered Global Security ("Beneficial Owner")
is in turn to be recorded on the Participants' or Indirect Participants'
records. Beneficial Owners will not receive written confirmation from the
Depositary of their purchase, but Beneficial Owners are expected to receive
written confirmations providing details of the transaction, as well as periodic
statements or their holdings, from the Participant or Indirect Participant
through which such Beneficial Owner entered into the transaction. Ownership of
beneficial interests in a Registered Global Security will be limited to
Participants or persons that may hold interests through Participants.
Beneficial interests in a Registered Global Security will be shown on, and the
transfer thereof will be effected only through, records maintained by the
Depositary (with respect to beneficial interests of Participants) or by
Participants or persons that may hold interests through Participants (with
respect to beneficial interests held through Participants). The laws of some
states may require that certain purchasers of securities take physical delivery
of such securities in certificated form. Such limits and such laws may impair
the ability to transfer beneficial interests in a Registered Global Security.
For a Registered Global Security, so long as the Depositary or its nominee is
the registered owner of a Registered Global Security, the Depositary or its
nominee, as the case may be, will be considered the sole owner or Holder of the
Debt Securities represented by such Registered Global Security for all purposes
under the Indenture. Except as provided below, owners of beneficial interests
in a Registered Global Security will not be entitled to have Debt Securities
represented by such Registered Global Security registered in their names, will
not receive or be entitled to receive physical delivery of Debt Securities in
certificated form and will not be considered the owners or Holders thereof
under the Indenture. Accordingly, each person owning a beneficial interest in a
Registered Global Security must rely on the procedures of the Depositary and,
if such person is not a Participant, on the procedures of the Participant
through which such person owns its interest, to exercise any rights of a Holder
under the Indenture. The Company understands that under existing industry
practices, in the event that the Company requests any action of Holders or that
an owner of a beneficial interest in such a Registered Global Security desires
to give or take any action which a Holder is entitled to give or take under the
Indenture, the Depositary would authorize the Participants holding the relevant
beneficial interests to give or take such action, and such Participants would
authorize Beneficial Owners owning through such Participants to give or take
such action or would otherwise act upon the instructions of Beneficial Owners.
Conveyance of notices and other communications by the Depositary to
Participants, by Participants to Indirect Participants, and by Participants and
Indirect Participants to Beneficial Owners will be governed by arrangements
among them, subject to any statutory or regulatory requirements as may be in
effect from time to time.
7
<PAGE>
Principal and interest payments on Debt Securities issued in book-entry form
and represented by one or more Registered Global Securities will be made by the
Company to the Depositary or its nominee, as the case may be, as the registered
owner of the related Registered Global Security or Securities. Neither the
Company nor the Trustee will have any responsibility or liability for any
aspect of the records relating to or payments made on account of beneficial
ownership interests in the Registered Global Securities, or for maintaining,
supervising or reviewing any records relating to such beneficial ownership
interests. The Company expects that the Depositary, upon receipt of any payment
of principal or interest in respect of the Registered Global Securities, will
credit immediately the accounts of the related participants with payment in
amounts proportionate to their respective holdings in principal amount of
beneficial interests in such Registered Global Securities as shown on the
records of the Depositary. The Company also expects that payments by
participants to owners of beneficial interests in the Registered Global
Securities will be governed by standing customer instructions and customary
practices, as is now the case with securities held for the accounts of
customers in bearer form or registered in "street name", and will be the
responsibility of such participants.
If the Depositary is at any time unwilling or unable to continue as
Depositary and a successor depositary is not appointed by the Company within 90
days, the Company will issue Debt Securities in certificated form that will be
exchanged for each Registered Global Security. In addition, the Company may at
any time determine not to have Debt Securities represented by the Registered
Global Security or Securities. In any such instance, owners of beneficial
interests in such Registered Global Securities will be entitled to physical
delivery in certificated form of Debt Securities equal in principal amount to
such beneficial interest and to have such Debt Securities registered in its
name. Debt Securities so issued in certificated form will be issued in
denominations of $1,000 or any larger amount that is an integral multiple
thereof and will be issued in registered form only, without coupons.
The Debt Securities of a series may also be issued in the form of one or more
bearer global Debt Securities that will be deposited with a common depositary
for the Euroclear System and Cedel Bank, S.A., or with a nominee for such
depositary identified in the Prospectus Supplement relating to such series.
MERGER AND CONSOLIDATION
Nothing contained in the Indenture or in any of the Debt Securities shall
prevent any consolidation or merger of the Company with or into any other
Person or Persons (whether or not affiliated with the Company), or successive
consolidations or mergers in which the Company or its successor or successors
shall be a party or parties, or shall prevent any conveyance, transfer or lease
of the property of the Company as an entirety, or substantially as an entirety,
to any other Person (whether or not affiliated with the Company); provided,
however, that:
(1) in case the Company shall consolidate with or merge into another
Person or convey, transfer or lease its properties and assets substantially
as an entirety to any Person, the entity formed by such consolidation or
into which the Company is merged or the Person which acquires by conveyance
or transfer, or which leases, the properties and assets of the Company
substantially as an entirety shall be a corporation organized and existing
under the laws of the United States of America, any state thereof or the
District of Columbia and shall expressly assume the due and punctual
payment of the principal of, any premium and interest on and any Additional
Amounts with respect to all the Debt Securities and the performance of
every other covenant of the Indenture on the part of the Company to be
performed or observed;
8
<PAGE>
(2) immediately after giving effect to such transaction, no event which,
after notice or lapse of time, would become an event of default under the
Indenture (an "Event of Default"), shall have occurred and be continuing;
and
(3) either the Company or the successor Person shall have delivered to
the Trustee an officers' certificate and an opinion of counsel, stating
that such consolidation, merger, conveyance, transfer or lease and such
supplemental indenture comply with the Indenture and that all conditions
precedent herein provided for relating to such transaction have been
complied with.
Except as provided above or as may otherwise be provided in the accompanying
Prospectus Supplement, there are no "event risk" or similar provisions of the
Indenture or the Debt Securities that are intended to afford protection to
Holders in the event of a merger or other significant corporate event involving
the Company.
Upon any consolidation or merger or any conveyance, transfer or lease of the
properties and assets of the Company substantially as an entirety to any Person
in accordance with the provisions of the Indenture described above, the
successor Person will succeed to, and be substituted for, and may exercise
every right and power of, the Company under the Indenture and thereafter,
except in the case of a lease to another Person, the Company shall be released
from all obligations and covenants under the Indenture and the Debt Securities.
MODIFICATION AND WAIVER
Modification and amendment of the Indenture may be effected by the Company
and the Trustee with the consent of the Holders of 51% in principal amount of
the Outstanding Debt Securities of each series issued pursuant to the Indenture
and affected thereby, provided that no such modification or amendment may,
without the consent of the Holder of each Outstanding Debt Security affected
thereby, (a) change the Stated Maturity of, or any installment of interest or
Additional Amounts payable on, any Debt Security or any premium payable on the
redemption thereof, or change the Redemption Price; (b) reduce the principal
amount of, or the interest or Additional Amounts payable on, any Debt Security
or reduce the amount of principal which could be declared due and payable prior
to the Stated Maturity; (c) change the place or currency of any payment of
principal of, or any premium, interest or Additional Amounts on, any Debt
Security; (d) impair the right to institute suit for the enforcement of any
payment on or with respect to any Debt Security; (e) reduce the percentage in
principal amount of the Outstanding Debt Securities of any series, the consent
of whose Holders is required to modify or amend the Indenture; or (f) modify
the foregoing requirements or reduce the percentage in principal amount of
Outstanding Debt Securities necessary to waive any past default to less than a
majority. Except with respect to certain fundamental provisions, the Holders of
at least a majority in principal amount of Outstanding Debt Securities of any
series may, with respect to such series, waive past defaults under the
Indenture and waive compliance by the Company with certain provisions of the
Indenture.
EVENTS OF DEFAULT
Unless otherwise set forth in the Prospectus Supplement, the following will
be Events of Default with respect to Debt Securities of any series issued under
the Indenture: (a) default in the payment of any interest on or any Additional
Amounts payable in respect of any Debt Security of that series when due,
continued for 30 days; (b) default in the payment of any principal of or
premium, if any, on any Debt Security of that series when due; (c) default in
the deposit of any sinking fund payment, when due, in respect of any Debt
Security of that series; (d) default in the performance, or breach, of any
other covenant or warranty of the Company contained in the Indenture or the
Debt Securities for the benefit of such series, continued for 60 days after
written
9
<PAGE>
notice thereof has been given to the Company by either the Trustee or the
Holders of at least 25% in principal amount of the Outstanding Debt Securities
of such series as provided in the Indenture; (e) certain events of bankruptcy,
insolvency or reorganization of the Company or a Principal Subsidiary (defined
below); and (f) any other Event of Default provided with respect to Debt
Securities of that series. The Trustee or the Holders of 25% in principal
amount of the Outstanding Debt Securities of that series may declare the
principal amount (or such lesser amount as may be provided for in the Debt
Securities of that series) of all Outstanding Debt Securities of that series
and the interest accrued thereon and Additional Amounts payable in respect
thereof, if any, to be due and payable immediately if an Event of Default with
respect to Debt Securities of such series shall occur and be continuing at the
time of declaration. At any time after a declaration of acceleration has been
made with respect to Debt Securities of any series but before a judgment or
decree for payment of money due has been obtained by the Trustee, the Holders
of a majority in principal amount of the Outstanding Debt Securities of that
series may rescind any declaration of acceleration and its consequences, if all
payments due (other than those due as a result of acceleration) have been made
and all Events of Default have been remedied or waived. Any Event of Default
with respect to Debt Securities of any series may be waived by the Holders of a
majority in principal amount of all Outstanding Debt Securities of that series,
except in a case of failure to pay principal of or premium, if any, or interest
or Additional Amounts, if any, on any Debt Security of that series for which
payment has not been subsequently made or in respect of a covenant or provision
which cannot be modified or amended without the consent of the Holder of each
Outstanding Debt Security of such series affected.
The Holders of a majority in principal amount of the Outstanding Debt
Securities of a series may direct the time, method and place of conducting any
proceeding for any remedy available to the Trustee or exercising any trust or
power conferred on the Trustee with respect to Debt Securities of such series,
provided that such direction shall not be in conflict with any rule of law or
the Indenture. Before proceeding to exercise any right or power under the
Indenture at the direction of such Holders, the Trustee shall be entitled to
receive from such Holders reasonable security or indemnity against the costs,
expenses and liabilities which might be incurred by it in complying with any
such direction.
The Company will be required to furnish to the Trustee annually a statement
as to the fulfillment by the Company of all of its obligations under the
Indenture.
LIMITATION ON LIENS
The Indenture provides that the Company may not at any time directly or
indirectly create, assume, incur, or suffer to be created, assumed or incurred
or suffer to exist any mortgage, pledge, encumbrance or lien (except for
certain liens specifically permitted by the Indenture) by which there may be
issued, or by which there may be secured or evidenced, any indebtedness of the
Company or any Principal Subsidiary for money borrowed (except for any bona
fide option or agreement to sell), upon (1) any shares of capital stock of any
Principal Subsidiary (other than directors' qualifying shares) or (2) any
shares of capital stock owned by the Company of a subsidiary of the Company
that owns, directly or indirectly, capital stock of any of the Principal
Subsidiaries (other than directors' qualifying shares) without, in each case,
making effective provision whereby the Debt Securities (and any other
indebtedness of the Company or such Subsidiary entitled to the benefit of a
covenant similar to this covenant, subject to applicable priorities of payment)
will be secured equally and ratably with any and all other obligations thereby
secured. The Indenture defines "Principal Subsidiaries" to mean each of
Greenwood Trust Company and DWR, so long as they continue, directly or
indirectly, to be subsidiaries of the Company, and any subsidiary of the
Company succeeding to any substantial part of the business now conducted by any
of such corporations.
10
<PAGE>
PLAN OF DISTRIBUTION
The Company may sell the Debt Securities (i) through underwriters or dealers;
(ii) directly to one or more purchasers; or (iii) through agents. Any such
underwriters, dealers or agents in the United States may include DWR, a wholly-
owned subsidiary of the Company, and any such underwriters, dealers or agents
outside the United States may include Dean Witter International Ltd., a wholly-
owned subsidiary of the Company. The Prospectus Supplement with respect to the
Debt Securities being offered thereby sets forth the terms of the offering of
such Debt Securities, including the name or names of any underwriters, the
purchase price of such Debt Securities and the proceeds to the Company from
such sale, any underwriting discounts and other items constituting
underwriters' compensation, any initial offering price, any discounts or
concessions allowed or reallowed or paid to dealers and any securities
exchanges on which such Debt Securities may be listed. Only underwriters so
named in the Prospectus Supplement shall be deemed to be underwriters in
connection with the Debt Securities offered thereby.
If underwriters are used in the sale, the Debt Securities will be acquired by
the underwriters for their own account and may be resold from time to time in
one or more transactions, including negotiated transactions, at a fixed price
or at varying prices determined at the time of sale or at negotiated prices.
Such Debt Securities may be offered to the public either through underwriting
syndicates represented by managing underwriters or by underwriters without a
syndicate. The obligations of the underwriters to purchase such Debt Securities
will be subject to certain conditions precedent, and the underwriters will be
obligated to purchase all the Debt Securities of the series offered by the
Company's Prospectus Supplement if any of such Debt Securities are purchased.
Any initial public offering price and any discounts or concessions allowed or
reallowed or paid to dealers may be changed from time to time.
Debt Securities may also be sold directly by the Company or though agents
designated by the Company from time to time. Any agent involved in the offering
and sale of the Securities will be named, and any commissions payable by the
Company to such agent will be set forth, in the Prospectus Supplement. Unless
otherwise indicated in the Prospectus Supplement, any such agent is acting
solely as an agent for the period of its appointment.
If so indicated in the Prospectus Supplement, the Company will authorize
agents, underwriters or dealers to solicit offers by certain institutional
investors to purchase Debt Securities providing for payment and delivery on a
future date specified in the Prospectus Supplement. There may be limitations on
the minimum amount which may be purchased by any such institutional investor or
on the portion of the aggregate principal amount of the particular Debt
Securities which may be sold pursuant to such arrangements. Institutional
investors to which such offers may be made, when authorized, include commercial
and savings banks, insurance companies, pension funds, investment companies,
educational and charitable institutions and such other institutions as may be
approved by the Company. The obligations of any such purchasers pursuant to
such delayed delivery and payment arrangements will not be subject to any
conditions except (i) the purchase by an institution of the particular Debt
Securities shall not at the time of delivery be prohibited under the laws of
any jurisdiction of the United States to which such institution is subject, and
(ii) if the particular Debt Securities are being sold to underwriters, the
Company shall have sold to such underwriters the total principal amount of such
Debt Securities less the principal amount thereof covered by such arrangements.
Underwriters will not have any responsibility in respect of the validity of
such arrangements or the performance of the Company or such institutional
investors thereunder.
Underwriters, dealers and agents that participate in the distribution of
Securities may be deemed to be underwriters, and any discounts or commissions
received by them from the Company and any profit on the resale of Debt
Securities by them may be deemed to be underwriting
11
<PAGE>
discounts and commissions, under the Securities Act of 1933, as amended (the
"Act"). Under arrangements which may be entered into by the Company and as may
be described in the Prospectus Supplement with respect to the Debt Securities
being issued, underwriters, dealers and agents who participate in the
distribution of such Debt Securities may be entitled to indemnification by the
Company against certain civil liabilities, including liabilities under the Act,
or to contribution with respect to payments that the underwriters, dealers or
agents may be required to make with respect thereto. Underwriters, dealers and
agents may engage in transactions with, or perform services for, the Company
and its subsidiaries in the ordinary course of their respective businesses.
The Debt Securities may or may not be listed on a national securities
exchange. If at the time of issuance it is intended that any Debt Securities
shall be listed on a national securities exchange, such exchange shall be
identified in the Prospectus Supplement with respect to such Debt Securities.
There is no assurance that a secondary market will develop for the Debt
Securities or, if it does develop, that it will continue.
The distribution of Debt Securities will conform to the requirements set
forth in the applicable sections of Conduct Rule 2720 of the National
Association of Securities Dealers, Inc.
LEGAL OPINIONS
The validity of the Debt Securities will be passed upon for the Company by
Brown & Wood, New York, New York and for the underwriters, dealers or agents,
if any, by Kirkland & Ellis, New York, New York.
EXPERTS
The consolidated financial statements and related supplemental schedules of
the Company and its subsidiaries incorporated in this Prospectus by reference
to the Company's Annual Report on Form 10-K for the fiscal year ended December
31, 1995 have been audited by Deloitte & Touche LLP, independent auditors, as
stated in their reports incorporated by reference herein, and have been so
incorporated by reference in reliance upon such reports given upon the
authority of that firm as experts in accounting and auditing.
With respect to the unaudited interim financial information for the periods
ended March 31, 1996 and 1995 which is incorporated herein by reference,
Deloitte & Touche LLP have applied limited procedures in accordance with
professional standards for a review of such information. However, as stated in
their report included in the Company's Quarterly Report on Form 10-Q for the
quarter ended March 31, 1996 and incorporated by reference herein, they did not
audit and they do not express an opinion on that interim financial information.
Accordingly, the degree of reliance on their report on such information should
be restricted in light of the limited nature of the review procedures applied.
Deloitte & Touche LLP are not subject to the liability provisions of Section 11
of the Securities Act of 1933 for their reports on the unaudited interim
financial information because those reports are not "reports" or a "part" of
the registration statement prepared or certified by an accountant within the
meaning of Sections 7 and 11 of the Act.
12
<PAGE>
DEAN WITTER, DISCOVER & CO.
DEBT SECURITIES
PROSPECTUS
DEAN WITTER REYNOLDS INC.
, 1996
<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 July 11, 1996
PROSPECTUS
DEAN WITTER, DISCOVER & CO.
DEBT SECURITIES
-----------
Dean Witter, Discover & Co. (the "Company") has issued and intends from time
to time to issue debt securities (the "Debt Securities") pursuant to an
indenture, dated as of February 24, 1993, between the Company and The First
National Bank of Chicago. The following Debt Securities have been issued and
the indicated aggregate principal amounts are outstanding as of July 11, 1996:
$750,000,000 aggregate principal amount of 6% Notes due March 1, 1998 (the
"6% Notes");
$750,000,000 aggregate principal amount of 6 7/8% Notes due March 1, 2003
(the "6 7/8% Notes");
$400,000,000 aggregate principal amount of 6 1/4% Notes due March 15, 2000
(the "6 1/4% Notes");
$250,000,000 aggregate principal amount of 6 3/4% Debentures due October 15,
2013 (the "6 3/4% Debentures due 2013");
$250,000,000 aggregate principal amount of 6 1/2% Notes due November 1, 2005
(the "6 1/2% Notes");
$350,000,000 aggregate principal amount of LIBOR Floating Rate Notes due
November 15, 1996 (the "Floating Rate LIBOR Notes due 1996");
$150,000,000 aggregate principal amount of Federal Funds Floating Rate Notes
due November 15, 1996 (the "Floating Rate Federal Funds Notes");
$150,000,000 aggregate principal amount of LIBOR Floating Rate Notes due
March 1, 2000 (the "Floating Rate LIBOR Notes due 2000");
$200,000,000 aggregate principal amount of 6.75% Notes due August 15, 2000
(the "6 3/4% Notes");
$150,000,000 aggregate principal amount of 6.75% Debentures due January 1,
2016 (the "6 3/4% Debentures due 2016");
$250,000,000 aggregate principal amount of 6.30% Notes due January 15, 2006
(the "6.30% Notes"); and
$2,508,875,000.00 aggregate principal amount of Floating Rate Medium-Term
Notes Series I due 1996-2000 and 5.88%-8.20% Fixed Rate Medium-Term Notes
Series I due 1996-2014 (the "Medium-Term Notes").
-----------
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 OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
-----------
This Prospectus has been prepared in connection with the Debt Securities and
is to be used by Dean Witter Reynolds Inc. ("DWR"), a wholly owned subsidiary
of the Company, in connection with offers and sales related to market-making
transactions in the Debt Securities. DWR may act as principal or agent in such
transactions. The Debt Securities may be offered on a national securities
exchange in the event the particular issue of Debt Securities has been listed
on such exchange, or off such exchange in negotiated transactions, or
otherwise. Sales will be made at prices related to prevailing prices at the
time of sale or otherwise.
-----------
DEAN WITTER REYNOLDS INC.
, 1996
<PAGE>
NO DEALER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATION OTHER THAN THOSE CONTAINED OR
INCORPORATED BY REFERENCE IN THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY ANY SECURITIES OTHER THAN THE REGISTERED
SECURITIES TO WHICH IT RELATES OR AN OFFER TO SELL OR THE SOLICITATION OF AN
OFFER TO BUY SUCH SECURITIES IN ANY JURISDICTION TO ANY PERSON TO WHOM IT IS
UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION IN SUCH JURISDICTION. NEITHER THE
DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY
CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE
AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF OR THAT THE INFORMATION IS CORRECT
AS OF ANY TIME SUBSEQUENT TO ITS DATE.
----------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Available Information...................................................... M-3
Incorporation of Certain Documents by Reference............................ M-3
The Company................................................................ M-4
Description of Debt Securities............................................. M-4
Experts.................................................................... M-24
</TABLE>
M-2
<PAGE>
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports, proxy statements and other information with the
Securities and Exchange Commission (the "Commission"). Such reports, proxy
statements and other information can be inspected and copied at the public
reference facilities maintained by the Commission at Room 1024, 450 Fifth
Street, N.W., Washington, D.C. 20549, and at the following Regional Offices of
the Commission: Chicago Regional Office, 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661-2511 and New York Regional Office, Seven World Trade
Center, 13th Floor, New York, New York 10048. Copies of such material can be
obtained from the Public Reference Section of the Commission at 450 Fifth
Street, N.W., Washington, D.C. 20549 at prescribed rates. Copies of such
material may also be inspected at the offices of the New York Stock Exchange,
Inc., 20 Broad Street, New York, New York 10005 and the Pacific Stock Exchange,
Inc., 301 Pine Street, San Francisco, California 94104. In addition, the
Commission maintains a site on the World Wide Web portion of the Internet that
contains reports, proxy and information statements and other information
regarding registrants that file electronically with the Commission. The address
of such site is http://www.sec.gov.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Company's Annual Report on Form 10-K for the fiscal year ended December
31, 1995, Quarterly Report on Form 10-Q for the quarter ended March 31, 1996
and Current Reports on Form 8-K dated January 4, 1996, January 8, 1996, January
23, 1996 and April 18, 1996 are hereby incorporated by reference into this
Prospectus.
All documents filed by the Company pursuant to Section 13(a), 13(c), 14 or
15(d) of the Exchange 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 in this Prospectus by reference and to be a part hereof from the
date of filing of such documents. Any statement contained in a document
incorporated or deemed to be incorporated by reference herein shall be deemed
to be modified or superseded for purposes of this Prospectus to the extent that
a statement contained herein or in any other subsequently filed document which
also is or is deemed to be incorporated by reference herein modifies or
supersedes such statement. Any such statement so modified or superseded shall
not be deemed, except as so modified or superseded, to constitute a part of
this Prospectus.
THE COMPANY HEREBY UNDERTAKES TO PROVIDE WITHOUT CHARGE TO EACH PERSON TO
WHOM A COPY OF THIS PROSPECTUS HAS BEEN DELIVERED, ON THE WRITTEN OR ORAL
REQUEST OF SUCH PERSON, A COPY OF ANY OR ALL DOCUMENTS THAT HAVE BEEN OR WILL
BE INCORPORATED IN THIS PROSPECTUS BY REFERENCE, OTHER THAN EXHIBITS TO SUCH
DOCUMENTS, UNLESS SUCH EXHIBITS ARE SPECIFICALLY INCORPORATED BY REFERENCE INTO
SUCH DOCUMENTS. REQUESTS FOR SUCH COPIES SHOULD BE DIRECTED TO INVESTOR
RELATIONS, DEAN WITTER, DISCOVER & CO., TWO WORLD TRADE CENTER, NEW YORK, NEW
YORK 10048, TELEPHONE NO. (800) 733-2307.
M-3
<PAGE>
THE COMPANY
OVERVIEW
The Company is a diversified financial services organization that provides a
broad range of nationally marketed credit and investment products, with a
primary focus on individual customers. The Company has two principal lines of
business: credit services and securities. Its credit services business ("Credit
Services") consists primarily of the issuance, marketing and servicing of
general purpose credit cards. Credit Services is the single largest domestic
issuer of general purpose credit cards as measured by number of accounts and
cardmembers. Discover (R) Card is the Company's most widely held proprietary
general purpose credit card and generated a majority of Credit Services
revenues and net income in 1995. The Company's securities business is conducted
primarily through its wholly owned subsidiaries, DWR and Dean Witter
InterCapital Inc. ("InterCapital"). DWR is a full-service securities firm that
engages in a wide variety of securities activities, with a particular focus on
serving the investment needs of its individual clients through over 8,500
Account Executives as of December 31, 1995. DWR is among the largest members of
the New York Stock Exchange and is a member of other major securities, futures
and options exchanges in the United States. InterCapital, with total assets of
$83.4 billion under management or administration as of March 31, 1996, is one
of the largest asset management operations in the United States.
The Company was incorporated under the laws of the State of Delaware in 1981.
The Company's principal executive offices are located at Two World Trade
Center, New York, New York 10048; its telephone number is (212) 392-2222.
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth the historical ratios of earnings to fixed
charges of the Company for the periods indicated:
<TABLE>
<CAPTION>
THREE MONTHS
ENDED MARCH 31, FISCAL YEAR ENDED DECEMBER 31,
--------------- ---------------------------------------------------------------------
1996 1995 1994 1993 1992 1991
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
2.0 1.9 2.1 2.2 1.7 1.5
</TABLE>
For the purpose of calculating the ratio of earnings to fixed charges,
"earnings" consist of income before income taxes and fixed charges and in 1992
includes a cumulative effect of change in method of accounting for
postretirement benefits. Additionally, "earnings" in 1992 excludes a
nonrecurring gain of $32.1 million from the initial public offering of 25.7% of
SPS Transaction Services, Inc. "Fixed charges" consist of interest costs,
including interest on deposits, and that portion of rent expense estimated to
be representative of the interest factor.
DESCRIPTION OF DEBT SECURITIES
The Debt Securities have been and are to be issued under an Indenture, dated
as of February 24, 1993 (the "Indenture"), between the Company and The First
National Bank of Chicago (the "Trustee"). The following summary of certain
provisions of the Indenture does not purport to be complete and is subject to,
and is qualified in its entirety by reference to, all provisions of the
Indenture. All capitalized terms appearing herein and not otherwise defined
herein have the meanings specified in the Indenture.
The Indenture provides that series of Debt Securities may from time to time
be issued thereunder, without limitation as to aggregate principal amount, and
upon such terms as the Company may establish pursuant to the provisions
thereof.
M-4
<PAGE>
The Indenture provides that the Indenture and the Debt Securities will be
governed by and construed in accordance with the laws of the State of New York.
Under present New York law, the maximum rate of interest that the Company could
pay on any series of Debt Securities is 25% per annum on a simple interest
basis. This limit may not apply to Debt Securities in which $2,500,000 or more
has been invested. While the Company believes that New York law would be given
effect by a state or Federal court sitting outside of New York, state laws
frequently regulate the amount of interest that may be charged to and paid by a
borrower (including, in some cases, corporate borrowers).
The Outstanding Debt Securities are issuable only in fully registered form
without coupons, in denominations set forth below under each description of
Outstanding Debt Securities. No service charge will be made for any
registration of transfer or exchange of such Debt Securities, but the Company
may require payment of a sum sufficient to cover any tax or other governmental
charges that may be imposed in connection therewith. Certain of the Debt
Securities have been issued in global form (see "Book-Entry Securities").
The Indenture provides the Company with the ability to issue Debt Securities
with terms different from those of Debt Securities previously issued and to
"reopen" a previous issue of a series of Debt Securities and issue additional
Debt Securities of such series.
The Debt Securities are unsecured and rank pari passu with all other
unsecured and unsubordinated indebtedness of the Company. Since the Company is
a holding company, the right of the Company, and hence the right of creditors
of the Company (including the Holders of the Debt Securities), to participate
in any distribution of the assets of any subsidiary of the Company upon its
liquidation or reorganization will be subject to the prior claims of creditors
of such subsidiary, except to the extent that claims of the Company itself as a
creditor of such subsidiary may be recognized. Creditors of the Company
(including Holders of the Debt Securities) may be limited in their ability to
participate in any proceeding related to a liquidation or reorganization of any
such subsidiary. In addition, dividends, loans and advances from certain
subsidiaries to the Company are restricted by legal requirements, including (in
the case of DWR) net capital requirements under the Exchange Act and under
rules of certain exchanges and other regulatory bodies and (in the case of
Greenwood Trust Company and other bank subsidiaries) by banking regulations.
Debt Securities may be presented for payment, registration of transfer, or
exchange at the office of the Trustee in New York City designated for such
purpose, or at such other places in New York as the Company may designate.
Payments of principal, premium, if any, and interest for Debt Securities issued
in global form will be made as described below under "Book-Entry Securities."
Unless otherwise specified with respect to a particular series of Debt
Securities, the Debt Securities are not subject to any sinking fund and are not
redeemable prior to maturity.
Unless otherwise specified, terms defined under a caption for a specific
series of Debt Securities shall have such meanings only as to the Debt
Securities described therein.
BOOK-ENTRY SECURITIES
Certain of the Outstanding Debt Securities have been issued in global form
(such Debt Securities are hereinafter referred to as "Book-Entry Securities").
Such Book-Entry Securities are represented by one or more fully registered
global securities (the "Global Notes"). Each such Global Note has been
deposited with, or on behalf of, The Depository Trust Company, as Depositary
(the "Depositary") registered in the name of the Depositary or a nominee
thereof. Unless and until it is exchanged in whole or in part for Debt
Securities in definitive form, no Global Note may be transferred except as a
whole by the Depositary to a nominee of such Depositary or by a nominee
M-5
<PAGE>
of such Depositary to such Depositary or another nominee of such Depositary or
by such Depositary or any such nominee to a successor of such Depositary or a
nominee of such successor.
The Depositary has advised the Company as follows: The Depositary is a
limited-purpose trust company organized under the New York Banking Law, a
"banking organization" within the meaning of the New York Banking Law, a member
of the Federal Reserve System, a "clearing corporation" within the meaning of
the New York Uniform Commercial Code, and a "clearing agency" registered
pursuant to the provisions of Section 17A of the Exchange Act. The Depositary
was created to hold securities of its participants ("Participants") and to
facilitate the clearance and settlement of securities transactions among its
Participants in such securities through electronic book-entry changes in
accounts of the Participants, thereby eliminating the need for physical
movement of securities certificates. The Depositary's Participants include
securities brokers and dealers, banks, trust companies, clearing corporations,
and certain other organizations. The Depositary is owned by a number of
Participants and by the New York Stock Exchange, Inc., the American Stock
Exchange, Inc. and the National Association of Securities Dealers, Inc. Access
to the Depositary's book-entry system is also available to others, such as
banks, brokers, dealers and trust companies that clear through or maintain a
custodial relationship with a Participant, either directly or indirectly
("Indirect Participants").
Purchases of Book-Entry Securities must be made by or through Participants,
which will receive a credit on the records of the Depositary. The ownership
interest of each actual purchaser of each Book-Entry Security (the "Beneficial
Owner") is in turn to be recorded on the Participants' or Indirect
Participants' records. Beneficial Owners will not receive written confirmation
from the Depositary of their purchase, but Beneficial Owners are expected to
receive written confirmations providing details of the transaction, as well as
periodic statements of their holdings, from the Participant or Indirect
Participant through which the Beneficial Owner entered into the transaction.
Ownership of beneficial interests in Global Notes will be shown on, and the
transfer of such ownership interests will be effected only through, records
maintained by the Depositary (with respect to interests of Participants) and on
the records of Participants (with respect to interests of persons held through
Participants). The laws of some states may require that certain purchasers of
securities take physical delivery of such securities in definitive form. Such
limits and such laws may impair the ability to own, transfer or pledge
beneficial interests in Global Notes.
So long as the Depositary, or its nominee, is the registered owner of a
Global Note, the Depositary or its nominee, as the case may be, will be
considered the sole owner or Holder of the Book-Entry Securities represented by
such Global Note for all purposes under the Indenture. Except as provided
below, Beneficial Owners of a Global Note will not be entitled to have the
Book-Entry Securities represented by such Global Note registered in their
names, will not receive or be entitled to receive physical delivery of the
Book-Entry Securities in definitive form and will not be considered the owners
or Holders thereof under the Indenture. Accordingly, each Person owning a
beneficial interest in a Global Note must rely on the procedures of the
Depositary and, if such Person is not a Participant, on the procedures of the
Participant through which such Person owns its interest, to exercise any rights
of a Holder under the Indenture. The Company understands that under existing
industry practices, in the event that the Company requests any action of
Holders or that an owner of a beneficial interest in such a Global Note desires
to give or take any action which a Holder is entitled to give or take under the
Indenture, the Depositary would authorize the Participants holding the relevant
beneficial interests to give or take such action, and such Participants would
authorize Beneficial Owners owning through such Participants to give or take
such action or would otherwise act upon the instructions of Beneficial Owners.
Conveyance of notices and other communications by the Depositary to
Participants, by Participants to Indirect Participants, and by Participants and
Indirect Participants to Beneficial Owners will be governed by arrangements
among them, subject to any statutory or regulatory requirements as may be in
effect from time to time.
M-6
<PAGE>
Payment of principal of, and interest on, Book-Entry Securities registered
in the name of the Depositary or its nominee will be made to the Depositary or
its nominee, as the case may be, as the Holder of the Global Note or Global
Notes representing such Book-Entry Securities. None of the Company, the
Trustee or any other agent of the Company or agent of the Trustee will have
any responsibility or liability for any aspect of the records relating to or
payments made on account of beneficial ownership interests or for supervising
or reviewing any records relating to such beneficial ownership interests. The
Company expects that the Depositary, upon receipt of any payment of principal
or interest in respect of a Global Note, will credit the accounts of the
Participants with payment in amounts proportionate to their respective
holdings in principal amount of beneficial interest in such Global Note as
shown on the records of the Depositary. The Company also expects that payments
by Participants to Beneficial Owners will be governed by standing customer
instructions and customary practices, as is now the case with securities held
for the accounts of customers in bearer form or registered in "street name",
and will be the responsibility of such Participants.
If the Depositary is at any time unwilling or unable to continue as
Depositary and a successor depository is not appointed by the Company within
90 days, the Company will issue Debt Securities in certificated form that will
be exchanged for each Global Note. In addition, the Company may at any time
determine not to have Debt Securities represented by the Global Note or Notes.
In any such instance, owners of beneficial interests in such Global Notes will
be entitled to physical delivery in certificated form of Debt Securities equal
in principal amount to such beneficial interest and to have such Debt
Securities registered in its name. Debt Securities so issued in certificated
form will be issued in denominations of $1,000 or any larger amount that is an
integral multiple thereof and will be issued in registered form only, without
coupons.
TERMS AND PROVISIONS OF THE NON-REDEEMABLE FIXED RATE NOTES
The 6% Notes, the 6 7/8% Notes, the 6 1/4% Notes, the 6 3/4% Debentures due
2013, the 6 1/2% Notes, the 6 3/4% Notes, the 6 3/4% Debentures due 2016 and
the 6.30% Notes (collectively referred to as the "Non-Redeemable Fixed Rate
Notes") bear interest at the rate specified in the title of each series,
payable semiannually on the Interest Payment Dates (as defined in the table
below), to the persons in whose names the Non-Redeemable Fixed Rate Notes are
registered on the preceding Record Date (as defined in the table below).
Interest on the Non-Redeemable Fixed Rate Notes is computed on the basis of a
360-day year of twelve 30-day months and is paid in immediately available
funds.
Interest payable on any Interest Payment Date and at maturity shall be the
amount of interest accrued from (and including) the next preceding Interest
Payment Date in respect of which interest has been paid (or from and including
the Original Interest Date, if no interest has been paid with respect to such
Non-Redeemable Fixed Rate Note) to (but excluding) the Interest Payment Date
or the date of maturity, as the case may be. If any Interest Payment Date or
the date of maturity of a Non-Redeemable Fixed Rate Note falls on a day that
is not a Business Day, the payment shall be made on the next Business Day as
if it were made on the date such payment was due and no interest shall accrue
on the amount so payable for the period from and after such Interest Payment
Date or the date of maturity, as the case may be. "Business Day" means any
day, other than a Saturday or Sunday, on which banks in The City of New York
are not required or authorized by law to close.
The Non-Redeemable Fixed Rate Notes are issued only in fully registered,
book-entry form without coupons, in denominations of $1,000 and integral
multiples thereof, except under the limited circumstances described under
"Description of Debt Securities--Book-Entry Securities" above.
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<PAGE>
The Non-Redeemable Fixed Rate Notes are not subject to redemption by the
Company prior to maturity.
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT INTEREST PAYMENT DATES RECORD DATES MATURITY DATE
--------- ---------------------- ------------ -------------
<S> <C> <C> <C> <C>
6% Notes $750,000,000 March 1 and September 1 February 15 and August 15 March 1, 1998
6 7/8% Notes $750,000,000 March 1 and September 1 February 15 and August 15 March 1, 2003
6 1/4% Notes $400,000,000 March 15 and September 15 March 1 and September 1 March 15, 2000
6 3/4% Debentures
due 2013 $250,000,000 April 15 and October 15 April 1 and October 1 October 15, 2013
6 1/2% Notes $250,000,000 May 1 and November 1 April 15 and October 15 November 1, 2005
6 3/4% Notes $200,000,000 February 15 and August 15 February 1 and August 1 August 15, 2000
6 3/4% Debentures
due 2016 $150,000,000 January 1 and July 1 December 15 and June 15 January 1, 2016
6.30% Notes $250,000,000 January 15 and July 15 January 1 and July 1 January 15, 2006
</TABLE>
SAME-DAY SETTLEMENT AND PAYMENT FOR CERTAIN NON-REDEEMABLE FIXED RATE NOTES
All payments of principal and interest on the 6 3/4% Debentures due 2013, the
6 1/2% Notes, the 6 3/4% Notes, the 6 3/4% Debentures due 2016 and the 6.30%
Notes (collectively referred to as the "Same-Day Settlement Notes") will be
made by the Company in immediately available funds. Secondary trading in long-
term notes and debentures of corporate issuers generally settles (as is the
case with the Non-Redeemable Fixed Rate Notes other than the Same-Day
Settlement Notes) in clearing-house or next-day funds. In contrast, each of the
Same-Day Settlement Notes trade in the Same-Day Funds Settlement System of the
Depositary until maturity or until the Depositary's Same-Day Funds Settlement
System is discontinued or such Same-Day Settlement Notes are issued in
certificated form. When the Same-Day Settlement Notes are trading in the
Depositary's Same-Day Funds Settlement System, secondary market trading
activity in the Same-Day Settlement Notes will be required by the Depositary to
settle in immediately available funds. No assurance can be given as to the
effect, if any, of settlement in immediately available funds on trading
activity in the Same-Day Settlement Notes.
TERMS AND PROVISIONS OF THE FLOATING RATE LIBOR NOTES DUE 1996
The Floating Rate LIBOR Notes due 1996 are limited to aggregate principal
amount of $350,000,000 and will mature on November 15, 1996. Interest on the
Floating Rate LIBOR Notes due 1996 will be payable in arrears on the fifteenth
day of each February, May, August and November (each an "Interest Payment
Date"), commencing February 15, 1995, at the rate per annum for each Interest
Period (as defined below) equal to Three-Month LIBOR (computed as described
below) plus 20 basis points (.20%). Interest payable on each Interest Payment
Date will include interest accrued from and including the first day of the
Interest Period (as defined below) relating to such Interest Payment Date to
and including the last day of such Interest Period. The interest so payable,
and punctually paid or duly provided for, on any Interest Payment Date prior to
maturity will be paid to the person in whose name the Floating Rate LIBOR Notes
due 1996 are registered at the close of business on the regular record date for
such interest, which will be the fifteenth day (whether or not a Business Day
(as defined below)) next preceding such Interest Payment Date. The interest
payment at maturity will include interest accrued to but excluding the date of
maturity and will be payable to the person to whom principal is payable. If any
Interest Payment Date (other than payment at maturity) 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 such Business Day is in the
next succeeding calendar month, such Interest Payment Date
M-8
<PAGE>
shall be the immediately preceding Business Day. If the maturity date of the
Floating Rate LIBOR Notes due 1996 falls on a day that is not a Business Day,
the payment of principal and interest will be made on the next succeeding
Business Day with the same force and effect as if made on the maturity date,
and no interest on such payment shall accrue for the period from and after such
maturity date. The rate of interest on the Floating Rate LIBOR Notes due 1996
will be reset quarterly on the fifteenth day of each February, May, August and
November (each an "Interest Reset Date"). If the Interest Reset Date for the
Floating Rate LIBOR Notes due 1996 would otherwise be a day that is not a
Business Day, the Interest Reset Date for such Floating Rate LIBOR Notes due
1996 shall be postponed to the next succeeding day that is a Business Day,
except if such Business Day is in the next succeeding calendar month, such
Interest Reset Date shall be the immediately preceding Business Day. "Interest
Period" shall mean the period beginning on and including November 23, 1994 and
ending on and including February 14, 1995, and thereafter, each successive
period beginning on and including the day after the last day of the preceding
Interest Period and ending on and including the day preceding the next
succeeding Interest Payment Date.
"Three-Month LIBOR" means that rate determined by The First National Bank of
Chicago (the "Calculation Agent") in accordance with the following provisions:
(i) With respect to any Interest Rate Determination Date (as defined
below), Three-Month LIBOR will be determined by the Calculation Agent on
the basis of the rate for deposits in U.S. dollars for the period of three
months commencing on the second London Banking Day (as defined below)
immediately following such Interest Rate Determination Date which appears
on the Telerate Screen Page 3750 (as defined below) as of 11:00 A.M.,
London time, on the Interest Rate Determination Date. If no rate appears,
Three-Month LIBOR for such Interest Rate Determination Date will be
determined as described in (ii) below. As used herein, "Telerate Screen
Page 3750" means the display designated as "Page 3750" on the Dow Jones
Telerate Service (or such other page as may replace Page 3750 on that
service) for the purpose of displaying London interbank offered rates of
major banks.
(ii) With respect to an Interest Rate Determination Date on which no rate
appears on Telerate Screen Page 3750, the Calculation Agent will request
that the principal London offices of four major reference banks in the
London interbank market selected by the Calculation Agent (the "LIBOR
Reference Banks") provide the Calculation Agent with their offered
quotations for deposits in U.S. dollars for the period of three months,
commencing on the second London Banking Day immediately following such
Interest Rate Determination Date, to prime banks in the London interbank
market at approximately 11:00A.M., London time, on such Interest Rate
Determination Date and in a principal amount equal to an amount of not less
than U.S. $1 million that is representative for a single transaction in
such market at such time. If at least two such quotations are provided,
Three-Month LIBOR for such Interest Rate Determination Date will be the
arithmetic mean of such quotations. If fewer than two quotations are
provided, Three-Month LIBOR for such Interest Rate Determination Date will
be the arithmetic mean of the rates quoted at approximately 11:00 A.M., New
York City time, on such Interest Rate 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, for a period of three months and
in a principal amount equal to an amount of not less than U.S. $1 million
that is representative for a single transaction in such market at such
time; provided, however, that if the banks selected as aforesaid by the
Calculation Agent are not quoting rates as mentioned in this sentence.
Three-Month LIBOR will be Three-Month LIBOR in effect on such Interest Rate
Determination Date.
"Interest Rate Determination Date" with respect to the initial Interest
Period will be November 21, 1994 and with respect to an Interest Reset Date for
the Floating Rate LIBOR Notes due 1996 will be the second London Banking Day
preceding such Interest Reset Date.
M-9
<PAGE>
"London Banking Day" means any day on which dealings in deposits in U.S.
dollars are transacted in the London interbank market.
Interest on the Floating Rate LIBOR Notes due 1996 will be computed and paid
on the basis of a year of 360 days and the actual number of days elapsed in
each period for which interest is payable.
The interest rate on the Floating Rate LIBOR Notes due 1996 will in no event
be higher than the maximum rate permitted by New York law as the same may be
modified by United States law of general application.
All percentages resulting from any of the above calculations will be rounded,
if necessary, to the nearest one hundred-thousandth of a percentage point, with
five one-millionths of a percentage point rounded upwards (e.g., 9.876545% (or
.09876545) being rounded to 9.87655% (or .0987655)), and all dollar amounts
used in or resulting from such calculations will be rounded to the nearest cent
(with one-half cent being rounded upwards).
"Business Day" means any day, other than a Saturday or Sunday, that is (i)
not a day on which banking institutions in The City of New York are authorized
or obligated by law to close and (ii) a London Banking Day.
The Floating Rate LIBOR Notes due 1996 are not redeemable at the option of
the Company prior to maturity and do not provide for any sinking fund.
All payments of principal and interest on the Floating Rate LIBOR Notes due
1996 will be made by the Company in immediately available funds. Secondary
trading in long-term notes and debentures of corporate issuers is generally
settled in clearing-house or next-day funds. In contrast, the Floating Rate
LIBOR Notes due 1996 will trade in the Depositary's Same-Day Funds Settlement
System until maturity or until the Depositary's Same-Day Funds Settlement
System is discontinued or the Floating Rate LIBOR Notes due 1996 are issued in
certificated form. When the Floating Rate LIBOR Notes due 1996 are trading in
the Depositary's Same-Day Funds Settlement System, secondary market trading
activity in the Floating Rate LIBOR Notes due 1996 will be required by the
Depositary to settle in immediately available funds. No assurance can be given
as to the effect, if any, of settlement in immediately available funds on
trading activity in the Floating Rate LIBOR Notes due 1996.
TERMS AND PROVISIONS OF THE FLOATING RATE FEDERAL FUNDS NOTES
The Floating Rate Federal Funds Notes are limited to $150,000,000 aggregate
principal amount and will mature on November 15, 1996. Interest on the Floating
Rate Federal Funds Notes is payable on the fifteenth day of each February, May,
August and November, commencing in February 1995 (each, an "Interest Payment
Date"). If any Interest Payment Date (other than payment at maturity) would
otherwise be a day that is not a Business Day (as defined below), the Interest
Payment Date shall be postponed to the next day that is a Business Day. If the
maturity date of the Floating Rate Federal Funds Notes falls on a day that is
not a Business Day, the payment of principal and interest will be made on the
next succeeding Business Day with the same force and effect as if made on the
maturity date, and no interest on such payment shall accrue for the period from
and after such maturity date. Interest payable prior to maturity will be
payable on any Interest Payment Date to the person in whose name a Floating
Rate Federal Funds Note is registered at the close of business on the fifteenth
day (whether or not a Business Day) prior to such Interest Payment Date (the
"Regular Record Date"). The interest payment at maturity will include interest
accrued to but excluding the date of maturity and will be payable to the person
to whom principal is payable. Interest payable on each Interest Payment Date
prior to maturity will include
M-10
<PAGE>
interest accrued from but excluding the last Regular Record Date to which
interest has been paid (or from and including the date of issue, if no interest
has been paid) to and including the Regular Record Date immediately preceding
the applicable Interest Payment Date. The interest rate in effect on the
Floating Rate Federal Funds Notes on each day that is not an Interest Reset
Date (as defined below) will be the interest rate determined as of the Interest
Determination Date (as defined below) pertaining to the immediately preceding
Interest Reset Date, and the interest rate in effect on any day that is an
Interest Reset Date will be the interest rate determined as of the Interest
Determination Date pertaining to such Interest Reset Date; provided, however,
that the interest rate in effect for the ten days immediately prior to maturity
will be the interest rate in effect on the tenth day (whether or not a Business
Day) prior to maturity.
The Floating Rate Federal Funds Notes will bear interest at a rate per annum
equal to the Federal Funds Rate (as defined below) plus 37 basis points (.37%).
The Federal Funds Rate will be determined by the Calculation Agent referred to
below in accordance with the following provisions.
The "Federal Funds Rate" means, with respect to any Interest Determination
Date, the rate on such date for Federal Funds as published by the Board of
Governors of the Federal Reserve System in "Statistical Release H.15(519)
Selected Interest Rates" or any successor publication of the Board of Governors
of the Federal Reserve System ("H.15(519)") under the heading "Federal Funds
(Effective)." In the event that such rate is not published prior to 9:00 A.M.,
New York City time, on the relevant Calculation Date, then the Federal Funds
Rate with respect to such Interest Determination Date will be the rate on such
Interest Determination Date 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 "Federal
Funds/Effective Rate." If by 3:00 P.M., New York City time, on such Calculation
Date such rate is not published in either H.15(519) or Composite Quotations,
the Federal Funds Rate with respect to such Interest Determination Date will be
calculated by the Calculation Agent and will be the arithmetic mean of the
rates, as of 9:00 A.M., New York City time, on such 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, after consultation with the Company; 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 with respect
to such interest Determination Date will be the Rate in effect on such Interest
Determination Date.
The "Interest Reset Date" for the Floating Rate Federal Funds Notes will be
each Business Day (as defined below).
The "Interest Determination Date" for the Floating Rate Federal Funds Notes
shall be the second Business Day prior to each Interest Reset Date. The
"Calculation Date" with respect to an Interest Determination Date shall be the
tenth Business Day after such Interest Determination Date.
Interest on the Floating Rate Federal Funds Notes will be computed and paid
on the basis of the actual number of days for which interest accrues divided by
360.
The interest rate on the Floating Rate Federal Funds Notes will in no event
be higher than the maximum rate permitted by New York law as the same may be
modified by United States law of general application.
All percentages resulting from any of the above calculations will be rounded,
if necessary, to the nearest one hundred-thousandth of a percentage point, with
five one-millionths of a percentage point rounded upwards (e.g., 9.876545% (or
.09876545) being rounded to 9.87655% (or .0987655)),
M-11
<PAGE>
and all dollar amounts used in or resulting from such calculations will be
rounded to the nearest cent (with one-half cent being rounded upwards).
"Business Day" shall mean any day other than a Saturday, a Sunday or a day on
which banking institutions in The City of New York are generally authorized or
obligated by law or executive order to close.
The Calculation Agent will, upon the request of the holder of any Floating
Rate Federal Funds Note, provide the interest rate then in effect. The
Calculation Agent is The First National Bank of Chicago. All calculations made
by the Calculation Agent in the absence of manifest error shall be conclusive
for all purposes and binding on the holders of the Floating Rate Federal Funds
Notes.
The Floating Rate Federal Funds Notes are not redeemable at the option of the
Company prior to maturity and do not provide for any sinking fund.
All payments of principal and interest on the Floating Rate Federal Funds
Notes will be made by the Company in immediately available funds. Secondary
trading in long-term notes and debentures of corporate issuers is generally
settled in clearing-house or next-day funds. In contrast, the Floating Rate
Federal Funds Notes will trade in the Depositary's Same-Day Funds Settlement
System until maturity or until the Depositary's Same-Day Funds Settlement
System is discontinued or the Floating Rate Federal Funds Notes are issued in
certificated form. When the Floating Rate Federal Funds Notes are trading in
the Depositary's Same-Day Funds Settlement System, secondary market trading
activity in the Floating Rate Federal Funds Notes will be required by the
Depositary to settle in immediately available funds. No assurance can be given
as to the effect, if any, of settlement in immediately available funds on
trading activity in the Floating Rate Federal Funds Notes.
TERMS AND PROVISIONS OF THE FLOATING RATE LIBOR NOTES DUE 2000
The Floating Rate LIBOR Notes due 2000 are limited to aggregate principal
amount of $150,000,000 and will mature on March 1, 2000. Interest on the
Floating Rate LIBOR Notes due 2000 will be payable in arrears on the first day
of each March, June, September and December (each an "Interest Payment Date"),
commencing June 1, 1995, at the rate per annum for each Interest Period (as
defined below) equal to Three-Month LIBOR (computed as described below) plus
37.5 basis points (.375%). Interest payable on each Interest Payment Date will
include interest accrued from and including the first day of the Interest
Period (as defined below) relating to such Interest Payment Date to and
including the last day of such Interest Period. The interest so payable, and
punctually paid or duly provided for, on any Interest Payment Date prior to
maturity will be paid to the person in whose name the Floating Rate LIBOR Notes
due 2000 are registered at the close of business on the regular record date for
such interest, which will be the fifteenth day (whether or not a Business Day
(as defined below)) next preceding such Interest Payment Date. The interest
payment at maturity will include interest accrued to but excluding the date of
maturity and will be payable to the person to whom principal is payable. If any
Interest Payment Date (other than payment at maturity) 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 such Business Day is in the
next succeeding calendar month, such Interest Payment Date shall be the
immediately preceding Business Day. If the maturity date of the Floating Rate
LIBOR Notes due 2000 falls on a day that is not a Business Day, the payment of
principal and interest will be made on the next succeeding Business Day with
the same force and effect as if made on the maturity date, and no interest on
such payment shall accrue for the period from and after such maturity date. The
rate of interest on each Floating Rate LIBOR Note due 2000 will be reset
quarterly on the first day of each March, June, September and December (each an
"Interest Reset Date"). If the Interest Reset Date for any Floating Rate LIBOR
Note due 2000 would otherwise be a day that is not a Business Day,
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<PAGE>
the Interest Reset Date for such Floating Rate LIBOR Note due 2000 shall be
postponed to the next succeeding day that is a Business Day, except if such
Business Day is in the next succeeding calendar month, such Interest Reset Date
shall be the immediately preceding Business Day. "Interest Period" shall mean
the period beginning on and including March 1, 1995 and ending on and including
May 31, 1995, and thereafter, each successive period beginning on and including
the day after the last day of the preceding Interest Period and ending on and
including the day preceding the next succeeding Interest Payment Date.
"Three-Month LIBOR" means that rate determined by The First National Bank of
Chicago (the "Calculation Agent") in accordance with the following provisions:
(i) With respect to any Interest Rate Determination Date (as defined
below), Three-Month LIBOR will be determined by the Calculation Agent on
the basis of the rate for deposits in U.S. dollars for the period of three
months commencing on the second London Banking Day (as defined below)
immediately following such Interest Rate Determination Date which appears
on the Telerate Screen Page 3750 (as defined below) as of 11:00 A.M.,
London time, on the Interest Rate Determination Date. If no rate appears,
Three-Month LIBOR for such Interest Rate Determination Date will be
determined as described in (ii) below. As used herein, "Telerate Screen
Page 3750" means the display designated as "Page 3750" on the Dow Jones
Telerate Service (or such other page as may replace Page 3750 on that
service) for the purpose of displaying London interbank offered rates of
major banks.
(ii) With respect to an Interest Rate Determination Date on which no rate
appears on Telerate Screen Page 3750, the Calculation Agent will request
that the principal London offices of four major reference banks in the
London interbank market selected by the Calculation Agent (the "LIBOR
Reference Banks") provide the Calculation Agent with their offered
quotations for deposits in U.S. dollars for the period of three months,
commencing on the second London Banking Day immediately following such
Interest Rate Determination Date, to prime banks in the London interbank
market at approximately 11:00A.M., London time, on such Interest Rate
Determination Date and in a principal amount equal to an amount of not less
than U.S. $1 million that is representative for a single transaction in
such market at such time. If at least two such quotations are provided,
Three-Month LIBOR for such Interest Rate Determination Date will be the
arithmetic mean of such quotations. If fewer than two quotations are
provided, Three-Month LIBOR for such Interest Rate Determination Date will
be the arithmetic mean of the rates quoted at approximately 11:00 A.M., New
York City time, on such Interest Rate 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, for a period of three months and
in a principal amount equal to an amount of not less than U.S. $1 million
that is representative for a single transaction in such market at such
time; provided, however, that if the banks selected as aforesaid by the
Calculation Agent are not quoting rates as mentioned in this sentence.
Three-Month LIBOR will be Three-Month LIBOR in effect on such Interest Rate
Determination Date.
"Interest Rate Determination Date" with respect to the initial Interest
Period will be February 27, 1995 and with respect to an Interest Reset Date for
the Floating Rate LIBOR Notes due 2000 will be the second London Banking Day
preceding such Interest Reset Date.
"London Banking Day" means any day on which dealings in deposits in U.S.
dollars are transacted in the London interbank market.
Interest on the Floating Rate LIBOR Notes due 2000 will be computed and paid
on the basis of a year of 360 days and the actual number of days elapsed in
each period for which interest is payable.
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The interest rate on the Floating Rate LIBOR Notes due 2000 will in no event
be higher than the maximum rate permitted by New York law as the same may be
modified by United States law of general application.
All percentages resulting from any of the above calculations will be rounded,
if necessary, to the nearest one hundred-thousandth of a percentage point, with
five one-millionths of a percentage point rounded upwards (e.g., 9.876545% (or
.09876545) being rounded to 9.87655% (or .0987655)), and all dollar amounts
used in or resulting from such calculations will be rounded to the nearest cent
(with one-half cent being rounded upwards).
"Business Day" means any day, other than a Saturday or Sunday, that is (i)
not a day on which banking institutions in The City of New York are authorized
or obligated by law to close and (ii) a London Banking Day.
The Floating Rate LIBOR Notes due 2000 are not redeemable at the option of
the Company prior to maturity and do not provide for any sinking fund.
All payments of principal and interest on the Floating Rate LIBOR Notes due
2000 will be made by the Company in immediately available funds. Secondary
trading in long-term notes and debentures of corporate issuers is generally
settled in clearing-house or next-day funds. In contrast, the Floating Rate
LIBOR Notes due 2000 will trade in the Depositary's Same-Day Funds Settlement
System until maturity or until the Depositary's Same-Day Funds Settlement
System is discontinued or the Floating Rate LIBOR Notes due 2000 are issued in
certificated form. When the Floating Rate LIBOR Notes due 2000 are trading in
the Depositary's Same-Day Funds Settlement System, secondary market trading
activity in the Floating Rate LIBOR Notes due 2000 will be required by the
Depositary to settle in immediately available funds. No assurance can be given
as to the effect, if any, of settlement in immediately available funds on
trading activity in the Floating Rate LIBOR Notes due 2000.
MEDIUM-TERM NOTES SERIES I
Each of the Medium-Term Notes Series I bears interest at either a fixed rate
("Fixed Rate Notes") or a variable rate ("Floating Rate Notes"). Interest on
the Medium-Term Notes Series I is payable: (i) in the case of Fixed Rate Notes,
on April 1 and October 1 of each year and (ii) in the case of Floating Rate
Notes, on the dates shown in Appendix B of this Prospectus (each an "Interest
Payment Date"). All of the Medium-Term Notes Series I have been denominated in
U.S. dollars and have been issued in denominations of $1,000 and integral
multiples thereof.
Fixed Rate Notes
The principal amounts, original issue dates, maturity dates and interest
rates of the Fixed Rate Notes are shown in Appendix A to this Prospectus. Each
of the Fixed Rate Notes bears interest from the date of original issuance at
the annual rate stated on the face thereof and in Appendix A payable semi-
annually on April 1 and October 1 of each year to the holder thereof on the
immediately preceding March 15 and September 15, respectively, and at maturity,
redemption or repayment, subject to certain exceptions. Payments of interest on
any Fixed Rate Note with respect to any Interest Payment Date or maturity date
(or date of redemption or repayment) will include interest accrued from and
including the next preceding Interest Payment Date (or, if no interest has been
paid, the date of issuance of such Fixed Rate Note) to but excluding such
Interest Payment Date or maturity date (or date of redemption or repayment). If
any Interest Payment Date for any Fixed Rate Note falls on a day that is not a
Business Day (as defined below), the interest payment shall be made on the next
day that is a Business Day, and no interest on such payment shall accrue for
the period from and after the Interest Payment Date. If the maturity date (or
date of redemption or
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repayment) of any Fixed Rate Note falls on a day that is not a Business Day,
the related payment of principal, premium, if any, or interest will be made on
the next succeeding Business Day with the same force and effect as if made on
the maturity date (or date of redemption or repayment), and no interest on such
payment shall accrue for the period from and after the maturity date (or date
of redemption or repayment). Interest on the Fixed Rate Notes is computed on
the basis of a 360-day year of twelve 30-day months. The term "Business Day"
when used with respect to the Fixed Rate Notes means each Monday, Tuesday,
Wednesday, Thursday and Friday that is not a legal holiday for banking
institutions in The City of New York.
Floating Rate Notes
The principal amounts and original issue dates, as well as other information
described below relating to maturities and interest rate bases with respect to
the Floating Rate Notes are shown in Appendix B to this Prospectus.
Interest. Each Floating Rate Note bears interest at a variable rate
determined by reference to an interest rate basis (the "Interest Rate Basis"),
adjusted by the Spread or Spread Multiplier, specified on the face thereof and
in Appendix B to this Prospectus, until the principal thereof is paid or made
available for payment in accordance with the terms thereof. Interest on each
Floating Rate Note (other than an Alternate Federal Funds Rate Note (as defined
below)) is payable on each Interest Payment Date to the holder thereof on the
date 15 calendar days prior to such Interest Payment Date (the "Regular Record
Date"), whether or not such date is a Business Day. Interest on an Alternate
Federal Funds Rate Note is payable on each Interest Payment Date to the holder
thereof on the date one Business Day prior to such Interest Payment Date.
Payments of interest on any Floating Rate Note (except Floating Rate Notes that
reset daily or weekly) with respect to any Interest Payment Date or maturity
date (or date of redemption or repayment) will include interest accrued from
and including the next preceding Interest Payment Date (or, if no interest has
been paid, the date of issuance of such Floating Rate Note) to but excluding
such Interest Payment Date or maturity date (or date of redemption or
repayment). If the Interest Reset Dates with respect to any Floating Rate Note
(other than an Alternate Federal Funds Rate Note) are daily or weekly, interest
payable on such Floating Rate Note on any Interest Payment Date will include
interest accrued from and excluding the last date through which interest has
been accrued and paid (or, if no interest has been paid, the date of issuance
of such Floating Rate Notes) to and including the Regular Record Date
immediately preceding such Interest Payment Date and interest payable on such
Floating Rate Note at maturity (or date of redemption or repayment) will
include interest accrued to, but excluding, the maturity date (or date of
redemption or repayment). If the Interest Reset Dates with respect to an
Alternate Federal Funds Rate Note are daily or weekly, interest payable on such
Note with respect to any Interest Payment Date or maturity date (or date of
redemption or repayment) will include interest accrued from and including the
next preceding Interest Payment Date (or, if no interest has been paid the
original issue date) to but excluding such Interest Payment Date or maturity
date (or date of redemption or repayment).
If any Interest Payment Date for any Floating Rate Note would otherwise fall
on a day that is not a Business Day with respect to such Note, such Interest
Payment Date will be postponed to the next succeeding Business Day (or, in the
case of a LIBOR Note (as defined below), if such day falls in the next calendar
month, such Interest Payment Date will be the next preceding Business Day) and
interest on such payment shall continue to accrue until such Business Day on
which interest is actually paid. If the maturity date (or date of redemption or
repayment) of a Floating Rate Note falls on a day that is not a Business Day,
the payment of principal, premium, if any, and interest will be made on the
next succeeding Business Day with the same force and effect as if made on the
maturity date (or date of redemption or repayment), and no interest on such
payment shall accrue for the period from and after such maturity date (or date
of redemption or repayment).
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The Interest Rate Basis for each Floating Rate Note is either (a) the
Commercial Paper Rate (a "Commercial Paper Rate Note"), (b) LIBOR (a "LIBOR
Note"), (c) the Treasury Rate (a "Treasury Rate Note"), (d) an alternate form
of the Treasury Rate (an "Alternate Treasury Rate Note"), (e) the CMT Rate (a
"CMT Rate Note"), (f) the Federal Funds Rate (a "Federal Funds Rate Note") or
(g) an alternate form of the Federal Funds Rate (an "Alternate Federal Funds
Rate Note") as specified in Appendix B hereof. Appendix B also specifies the
Spread and/or the Spread Multiplier, the Index Maturity, the date as of which
the initial rate of interest is set (the "Initial Interest Determination
Date"), the Interest Reset Dates and the Interest Payment Dates with respect to
each Floating Rate Note. The term "Business Day" when used with respect to the
Floating Rate Notes (other than CMT Rate Notes) means each Monday, Tuesday,
Wednesday, Thursday and Friday which is (a) not a legal holiday for banking
institutions in The City of New York, and (b) with respect to Notes denominated
in a Specified Currency other than U.S. dollars, any such day that is not a
legal holiday for banking institutions in the Principal Financial Center (as
defined below) of the country of the Specified Currency, and (c) with respect
to LIBOR Notes, is also a London Business Day (as defined below). The term
"Business Day" when used with respect to CMT Rate Notes means any day other
than a Saturday or Sunday or a day on which the Federal Reserve Bank of New
York is closed. A "London Business Day" is any day on which dealings in
deposits in U.S. dollars are transacted in the London interbank market.
"Principal Financial Center" will generally be the capital city of the country
of the Specified Currency, except that with respect to U.S. dollars, Deutsche
marks, and European Currency Units, the Principal Financial Center shall be The
City of New York, Frankfurt and Luxembourg, respectively. "Index Maturity"
means the period to maturity of the instrument or obligation on which the
interest rate formula is based. The "Calculation Agent" with respect to the
Floating Rate Notes is The First National Bank of Chicago.
The initial rate of interest on each Floating Rate Note was set on the
Initial Interest Determination Date. The interest rates applicable to the
Floating Rate Notes (other than the Alternate Treasury Rate Notes) are adjusted
on each Interest Reset Date. The interest rate in effect with respect to a
Floating Rate Note on each day that is not an Interest Reset Date will be the
interest rate determined as of the Interest Determination Date pertaining to
the immediately preceding Interest Reset Date (or the Initial Interest
Determination Date if there is no preceding Interest Reset Date), and the
interest rate in effect on any day that is an Interest Reset Date) will be the
interest rate determined as of the Interest Determination Date pertaining to
such Interest Reset Date; provided, however, that, with respect to Floating
Rate Notes other than Alternate Federal Funds Rate Notes, the interest rate in
effect for the ten days immediately prior to maturity, redemption or repayment
of a Floating Rate Note will be that in effect on the tenth day preceding such
maturity, redemption or repayment. The interest rate in effect with respect to
Alternate Federal Funds Rate Notes will continue to be adjusted on each
Interest Reset Rate for the ten days immediately prior to maturity, redemption
or repayment. The Interest Reset Dates for the Floating Rate Notes are
specified in Appendix B hereto. If any Interest Reset Date for any Floating
Rate Note would otherwise be a day that is not a Business Day with respect to
such Floating Rate Note, the Interest Reset Date for such Floating Rate Note
shall be postponed to the next day that is a Business Day with respect to such
Floating Rate Note, except that (i) in the case of a LIBOR Note, if such
Business Day is in the next succeeding calendar month, such Interest Reset Date
shall be the immediately preceding Business Day and (ii) in the case of a
Treasury Rate Note or an Alternate Treasury Note, if an auction for Treasury
bills having the designated Index Maturity falls on any Interest Reset Date,
then such Interest Reset Date shall instead be the first Business Day
immediately following such auction date.
The interest rate on Alternate Treasury Rate Notes will be adjusted weekly on
each Interest Reset Date except that (i) the interest rate in effect from the
first day of each interest payment period, including the initial interest
payment period, through the day of the first auction for Treasury bills having
the Index Maturity on or after the first day of each interest payment period
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shall be based upon the results of the most recent auction for Treasury bills
having the Index Maturity prior to such date and (ii) the interest rate in
effect for the period beginning six Business Days prior to an Interest Payment
Date and ending on the calendar day preceding such Interest Payment Date shall
be based upon the results of the most recent auction for Treasury bills having
the Index Maturity prior to such period.
The Interest Determination Date pertaining to an Interest Reset Date for a
Commercial Paper Rate Note (the "Commercial Paper Interest Determination Date")
is the second Business Day preceding such Interest Reset Date. The Interest
Determination Date pertaining to an Interest Reset Date for a LIBOR Note (the
"LIBOR Interest Determination Date") is the second London Business Day next
preceding the Interest Reset Date. The Interest Determination Date pertaining
to an Interest Reset Date for a Treasury Rate Note (the "Treasury Interest
Determination Date") is 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 the 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, except in the case of the
Initial Interest Determination Date. The Interest Determination Date pertaining
to an Interest Reset Date for an Alternate Treasury Rate Note (the "Alternate
Treasury Interest Determination Date") is the Interest Reset Date. The Interest
Determination Date pertaining to an Interest Reset Date for a CMT Rate Note
(the "CMT Interest Determination Date") is the second Business Day preceding
such Interest Reset Date. The Interest Determination Date pertaining to an
Interest Reset Date for a Federal Funds Rate Note (the "Federal Funds Interest
Determination Date") is the second business day preceding such Interest Reset
Date. The Interest Determination Date pertaining to an Interest Reset Date for
an Alternate Federal Funds Rate Note (the "Alternate Federal Funds Interest
Determination Date") is the first business day preceding each Interest Reset
Date.
All percentages resulting from any calculations referred to in this
Prospectus with respect to Floating Rate Notes will be rounded, if necessary,
to the nearest one hundred-thousandth of a percentage point (e.g., 9.876545%
(or .09876545) being rounded to 9.87655% or (.0987655) and 9.876544% (or
.09876544) being rounded to 9.87654% (or .0987654)), and all dollar amount used
in or resulting from such calculations will be rounded to the nearest cent
(with one half cent being rounded upwards).
The "Calculation Date" pertaining to any Interest Determination Date (other
than a CMT Interest Determination Date) will be the earlier of (i) the tenth
calendar day after such Interest Determination Date, or, if such day is not a
Business Day, the next succeeding Business Day or (ii) the Business Day
preceding the applicable Interest Payment Date or Maturity Date (or date or
redemption or repayment), as the case may be. The "Calculation Date" pertaining
to any CMT Interest Determination Date will be the Monday next following such
Interest Determination Date, provided that if such Monday is not a Business
Day, then the Calculation Date will be the first Business Day following such
Monday.
Interest rates will be determined by the Calculation Agent as follows:
Commercial Paper Rate Notes. Commercial Paper Rate Notes bear interest at
interest rates calculated with reference to the applicable Commercial Paper
Rate and the applicable Spread and/or Spread Multiplier, and will be payable on
the dates specified on the face of the Commercial Paper Rate Note and in
Appendix B.
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"Commercial Paper Rate" means, with respect to any Commercial Paper Interest
Determination Date, the Money Market Yield (calculated as described below) of
the rate on that date for commercial paper having the applicable Index Maturity
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." In the event that such rate
is not published by 9:00 A.M., New York City time, on the relevant Calculation
Date, then the Commercial Paper Rate with respect to such Interest
Determination Date shall be the Money Market Yield of such rate on such
Commercial Paper Interest Determination Date for commercial paper having the
applicable Index Maturity 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." If by 3:00 P.M., New York City time, on such Calculation Date such rate
is not yet published in either H.15(519) or Composite Quotations, then the
Commercial Paper Rate with respect to such Interest Determination Date shall be
calculated by the Calculation Agent and shall be the Money Market Yield of the
arithmetic mean of the offered per annum rates (quoted on a bank discount
basis), 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, after consultation with the
Company, for commercial paper of the specified Index Maturity placed for an
industrial issuer whose bond rating is "AA," or the equivalent, from a
nationally recognized rating agency; provided, however, that if fewer than
three dealers selected as aforesaid by the Calculation Agent are quoting as
mentioned in this sentence, the Commercial Paper Rate with respect to such
Interest Determination Date will be the Commercial Paper Rate in effect on such
Commercial Paper Interest Determination Date.
"Money Market Yield" means a yield (expressed as a percentage rounded upwards
to the nearest one hundred-thousandth of a percentage point) calculated in
accordance with the following formula:
D X 360
Money Market Yield = ----------- X 100
360-(D X M)
where "D" refers to the per annum 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 period for which interest is being calculated.
LIBOR Notes. LIBOR Notes bear interest at interest rates calculated with
reference to LIBOR and the applicable Spread and/or Spread Multiplier, if any,
and will be payable on the dates specified on the face of the LIBOR Note and in
Appendix B.
"LIBOR" with respect to any LIBOR Interest Determination Date will be
determined by the Calculation Agent in accordance with the following
provisions:
(i) With respect to a LIBOR Interest Determination Date, LIBOR will be
either: (a) the arithmetic mean of the offered rates for deposits in U.S.
dollars having the applicable Index Maturity, 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, if at least two such
offered rates appear on the Reuters Screen LIBO Page ("LIBOR Reuters"), or
(b) the rate for deposits in U.S. dollars having the applicable Index
Maturity, 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"). "Reuters Screen LIBO Page" means the
display designated as page "LIBO" on the Reuters Monitor Money Rates
Service (or such other page as may replace page
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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). Appendix B
specifies whether LIBOR with respect to a LIBOR Note is determined with
respect to LIBOR Reuters or LIBOR Telerate. If fewer than two offered rates
appear on the Reuters Screen LIBO Page, or 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 specified
in (i)(a) above, or on which no rate appears on Telerate Page 3750, as
specified in (i)(b) above, as applicable, LIBOR will be determined on the
basis of the rates at which deposits in U.S. dollars having the applicable
Index Maturity are offered at approximately 11:00 A.M., London time, on
such LIBOR Interest Determination Date by four major banks (the "Reference
Banks") in the London interbank market selected by the Calculation Agent,
after consultation with the Company, to prime banks in the London interbank
market, 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 $1,000,000 that is representative for a single
transaction in such market at such time. The Calculation Agent will request
the principal London office of each of the Reference Banks to provide a
quotation of its rate. If at least two such quotations are provided, LIBOR
in respect of such LIBOR Interest Determination Date will be the arithmetic
mean of such quotations. If fewer than two quotations are provided, LIBOR
with respect to such LIBOR Interest Determination Date will be the
arithmetic mean 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, after
consultation with the Company, for loans in U.S. dollars to leading
European banks having the applicable Index Maturity, 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 $1,000,000 that is representative for a single transaction in such
market at such time; provided, however, that if the banks selected as
aforesaid by the Calculation Agent are not quoting as mentioned in this
sentence, LIBOR with respect to such Interest Determination Date will be
the interest rate otherwise in effect on such LIBOR Interest Determination
Date.
Treasury Rate Notes. Treasury Rate Notes bear interest at interest rates
calculated with reference to the Treasury Rate and the applicable Spread and/or
Spread Multiplier, and will be payable on the dates specified on the face of
the Treasury Rate Note and in Appendix B to this Prospectus.
"Treasury Rate" means, with respect to any Treasury Interest Determination
Date, the rate for the most recent auction on such date of direct obligations
of the United States ("Treasury bills") having the applicable Index Maturity as
published in H.15(519) under the heading "U.S. Government Securities/Treasury
bills/auction average (investment)" or, if not so published by 9:00 A.M., New
York City time, on the relevant Calculation Date, the auction average rate
(expressed as a bond equivalent, on the basis of a year of 365 or 366 days, as
applicable, and applied on a daily basis) for such auction as otherwise
announced by the United States Department of the Treasury. In the event such
rate is not so published by 3:00 P.M., New York City time, on the relevant
Calculation Date, the Treasury Rate with respect to such Interest Determination
Date shall be calculated by the Calculation Agent and shall be a yield to
maturity (expressed as a bond equivalent, on the basis of a year of 365 or 366
days, as applicable, and applied on a daily basis) of the arithmetic
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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 primary
United States government securities dealers in The City of New York selected by
the Calculation Agent, after consultation with the Company, for the issue of
Treasury bills with a remaining maturity closest to the applicable Index
Maturity; provided, however, that if fewer than three dealers selected as
aforesaid by the Calculation Agent are quoting as mentioned in this sentence,
the Treasury Rate with respect to such Interest Determination Date will be the
Treasury Rate in effect on such Treasury Interest Determination Date.
Alternate Treasury Rate Notes. Alternate Treasury Rate Notes bear interest at
interest rates calculated with reference to the Alternate Treasury Rate and the
applicable Spread and/or Spread Multiplier, and will be payable on the dates
specified on the face of the Alternate Treasury Rate Note and in Appendix B to
this Prospectus.
"Alternate Treasury Rate" means, with respect to any Alternate Treasury
Interest Determination Date, the rate for the most recent auction on such date
of Treasury bills having the applicable Index Maturity as such rate is set
forth in H.15(519) for that day opposite the Index Maturity under the caption
"U.S. Government Securities/Treasury bills/auction average (investment)." If on
the Calculation Date with respect to an Alternate Treasury Interest
Determination Date, Treasury bills of the Index Maturity have been auctioned on
an Alternate Treasury Interest Determination Date during that Reset Period but
such rate for such Alternate Treasury Interest Determination Date is not yet
published in H.15(519), the rate for that Alternate Treasury Interest
Determination Date will be the bond equivalent yield of the auction average
rate for those Treasury bills as announced by the United States Department of
the Treasury. If Treasury bills of the Index Maturity are not auctioned during
any period of seven consecutive calendar days ending on and including any
Friday and an Alternate Treasury Interest Determination Date would have
occurred if such Treasury bills had been auctioned during that seven-day
period, an Alternate Treasury Interest Determination Date will be deemed to
have occurred on the day during that seven-day period on which such Treasury
bills would have been auctioned in accordance with the usual practices of the
United States Department of the Treasury, and the rate for the Alternate
Treasury Interest Determination Date will be the bond equivalent yield of the
rate set forth in H.15(519) for that day opposite the Index Maturity under the
caption "U.S. Government Securities/Treasury bills/secondary market." If on the
Calculation Date with respect to the relevant Alternate Treasury Interest
Determination Date such rate is not yet published in H.15(519), the rate for
that Alternate Treasury Interest Determination Date will be the bond equivalent
yield of the arithmetic mean of the secondary market bid rates of three primary
United States government securities dealers in The City of New York selected by
the Calculation Agent, after consultation with the Company, as of approximately
3:30 P.M., New York City time, on that day for the issue of Treasury bills with
a remaining maturity closest to the Index Maturity; provided, however, that if
fewer than three dealers selected as aforesaid by the Calculation Agent are
quoting as mentioned in this sentence, the "Alternate Treasury Rate" with
respect to such Alternate Treasury Interest Determination Date will be the
Alternate Treasury Rate in effect on the day immediately preceding such
Alternate Treasury Interest Determination Date.
CMT Rate Notes. CMT Rate Notes bear interest at interest rates calculated
with reference to the CMT Rate and the applicable Spread and/or Spread
Multiplier, and will be payable on the dates specified on the face of the CMT
Rate Note and in Appendix B to this Prospectus.
(i) "CMT Rate" means, with respect to any CMT Interest Determination
Date, the rate equal to the yield as published in H.15(519) for such date
in the row "U.S. Government Securities-- Treasury Constant Maturities," for
the relevant Index Maturity and appearing under the date that is the CMT
Interest Determination Date in such column.
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(ii) If the CMT Rate as described in clause (i) is not published in
H.15(519) for the applicable Interest Determination Date by 3:30 p.m., on
the relevant Calculation Date, the CMT Rate will be calculated by the
Calculation Agent and will be a yield to maturity (expressed as a bond
equivalent and as a decimal rounded, if necessary, to the nearest one
hundred-thousandth of a percentage point with five one-millionths of a
percentage point rounded up) based on the arithmetic mean of the secondary
market offer prices as of approximately 3:30 P.M. (New York City time) on
such Calculation Date of three leading primary United States government
securities dealers in The City of New York selected by the Calculation
Agent, after consultation with the Company, for the most recently issued
"on-the-run" Treasury Note with the relevant Index Maturity, or, if there
is no such "on-the-run" Treasury Note, for any Treasury Note with a
remaining term to maturity closest to the Index Maturity. If there are two
Treasury Notes with remaining terms to maturity equally close to the Index
Maturity, the quotes for the Treasury Note with the shorter remaining term
to maturity will be used. If only two of such dealers are quoting as
described in this clause (ii), then the CMT Rate will be based on the
arithmetic mean of the offer prices obtained. If only one of the dealers
provides an offer price, the CMT Rate will be such offer price provided to
the Calculation Agent.
Federal Funds Rate Notes. Federal Funds Rate Notes bear interest at the
interest rates (calculated with reference to the Federal Funds Rate and the
Spread and/or Spread Multiplier, if any), and will be payable on the dates,
specified on the face of the Federal Funds Rate Note and in Appendix B to this
Prospectus.
"Federal Funds Rate" means, with respect to any Federal Funds Interest
Determination Date, the rate on such date for Federal Funds as published in
H.15(519) under the heading "Federal Funds (Effective)." In the event that such
rate is not published prior to 9:00 A.M., New York City time, on the relevant
Calculation Date, then the Federal Funds Rate with respect to such Federal
Funds Interest Determination Date will be the rate on such Federal Funds
Interest Determination Date as published in Composite Quotations under the
heading "Federal Funds/Effective Rate." If by 3:00 P.M., New York City time, on
such Calculation Date such rate is not published in either H.15(519) or
Composite Quotations, the Federal Funds Rate with respect to such Federal Funds
Interest Determination Date will be calculated by the Calculation Agent and
will be the arithmetic mean 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, after
consultation with the Company; 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 with respect to such Interest Determination
Date will be the Federal Funds Rate in effect on such Federal Funds Interest
Determination Date.
Alternate Federal Funds Rate Notes. Alternate Federal Funds Rate Notes bear
interest at interest rates calculated with reference to the Alternate Federal
Funds Rate and the applicable Spread and/or Spread Multiplier.
"Alternate Federal Funds Rate" as used with respect to the Notes means, with
respect to any Alternate Federal Funds Interest Determination Date, the
effective rate on such date for Federal Funds that appears on Telerate Page 120
(as defined below) under the heading "Daily Selected Money Market Rates From
The Federal Reserve". In the event that such rate is not published prior to
9:00 A.M., New York City time, on the relevant Calculation Date, then the
Alternate Federal Funds Rate with respect to such Alternate Federal Funds
Interest Determination Date will be the rate on such Alternate Federal Funds
Interest Determination Date as published in Composite Quotations under the
heading "Federal Funds/Effective Rate". "Telerate Page 120" means the display
designated as page "120" on the Telerate Service (or such other page as may
replace the 120 page on that service). If by 3:00 P.M., New York City time, on
such Calculation Date such rate
M-21
<PAGE>
is not published in either Telerate Page 120 or Composite Quotations, the
Alternate Federal Funds Rate with respect to such Alternate Federal Funds
Interest Determination Date will be calculated by the Calculation Agent and
will be the arithmetic mean of the rates, as of 9:00 A.M., New York City time,
on such Alternate 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, after consultation with the Company; provided, however, that if the
brokers selected as aforesaid by the Calculation Agent are not quoting as
mentioned in this sentence, the Alternate Federal Funds Rate with respect to
such Alternate Federal Funds Interest Determination Date will be the Federal
Funds Rate in effect on such Alternate Federal Funds Interest Determination
Date.
MERGER AND CONSOLIDATION
Nothing contained in the Indenture or in any of the Debt Securities prevents
any consolidation or merger of the Company with or into any other Person or
Persons (whether or not affiliated with the Company), or successive
consolidations or mergers in which the Company or its successor or successors
shall be a party or parties, or shall prevent any conveyance, transfer or lease
of the property of the Company as an entirety or substantially as an entirety,
to any other Person (whether or not affiliated with the Company); provided,
however, that:
(1) in case the Company shall consolidate with or merge into another
Person or convey, transfer or lease its properties and assets substantially
as an entirety to any Person, the entity formed by such consolidation or
into which the Company is merged or the Person which acquires by conveyance
or transfer, or which leases, the properties and assets of the Company
substantially as an entirety shall be a corporation organized and existing
under the laws of the United States of America, any state thereof or the
District of Columbia and shall expressly assume the due and punctual
payment of the principal of, any premium and interest on and any Additional
Amounts with respect to all the Debt Securities and the performance of
every other covenant of the Indenture on the part of the Company to be
performed or observed;
(2) immediately after giving effect to such transaction, no event which,
after notice or lapse of time, would become an event of default under the
Indenture (an "Event of Default"), shall have occurred and be continuing;
and
(3) either the Company or the successor Person shall have delivered to
the Trustee an officers' certificate and an opinion of counsel, stating
that such consolidation, merger, conveyance, transfer or lease and such
supplemental indenture comply with the Indenture and that all conditions
precedent herein provided for relating to such transaction have been
complied with.
Except as provided above, there are no "event risk" or similar provisions of
the Indenture or the Debt Securities that are intended to afford protection to
Holders in the event of a merger or other significant corporate event involving
the Company.
Upon any consolidation or merger or any conveyance, transfer or lease of the
properties and assets of the Company substantially as an entirety to any Person
in accordance with the provisions of the Indenture described above, the
successor Person will succeed to, and be substituted for, and may exercise
every right and power of, the Company under the Indenture and thereafter,
except in the case of a lease to another Person, the Company shall be released
from all obligations and covenants under the Indenture and the Debt Securities.
MODIFICATION AND WAIVER
Modification and amendment of the Indenture may be effected by the Company
and the Trustee with the consent of the Holders of 51% in principal amount of
the Outstanding Debt
M-22
<PAGE>
Securities of each series issued pursuant to the Indenture and affected
thereby, provided that no such modification or amendment may, without the
consent of the Holder of each Outstanding Debt Security affected thereby, (a)
change the Stated Maturity of, or any installment of interest or Additional
Amounts payable on, any Debt Security or any premium payable on the redemption
thereof, or change the Redemption Price; (b) reduce the principal amount of, or
the interest or Additional Amounts payable on, any Debt Security or reduce the
amount of principal which could be declared due and payable prior to the Stated
Maturity; (c) change the place or currency of any payment of principal of, or
any premium, interest or Additional Amounts on, any Debt Security; (d) impair
the right to institute suit for the enforcement of any payment on or with
respect to any Debt Security; (e) reduce the percentage in principal amount of
the Outstanding Debt Securities of any series, the consent of whose Holders is
required to modify or amend the Indenture; or (f) modify the foregoing
requirements or reduce the percentage in principal amount of Outstanding Debt
Securities necessary to waive any past default to less than a majority. Except
with respect to certain fundamental provisions, the Holders of at least a
majority in principal amount of Outstanding Debt Securities of any series may,
with respect to such series, waive past defaults under the Indenture and waive
compliance by the Company with certain provisions of the Indenture.
EVENTS OF DEFAULT
Under the Indenture, the following will be Events of Default with respect to
Debt Securities of any series: (a) default in the payment of any interest on or
any Additional Amounts payable in respect of any Debt Security of that series
when due, continued for 30 days; (b) default in the payment of any principal of
or premium, if any, on any Debt Security of that series when due; (c) default
in the deposit of any sinking fund payment, when due, in respect of any Debt
Security of that series; (d) default in the performance, or breach, of any
other covenant or warranty of the Company contained in the Indenture or the
Debt Securities for the benefit of such series, continued for 60 days after
written notice thereof has been given to the Company by either the Trustee or
the Holders of at least 25% in principal amount of the Outstanding Debt
Securities of such series as provided in the Indenture; (e) certain events of
bankruptcy, insolvency or reorganization of the Company or a Principal
Subsidiary (as defined below); and (f) any other Event of Default provided with
respect to Debt Securities of that series. The Trustee or the Holders of 25% in
principal amount of the Outstanding Debt Securities of that series may declare
the principal amount (or such lesser amount as may be provided for in the Debt
Securities of that series) of all Outstanding Debt Securities of that series
and the interest accrued thereon and Additional Amounts payable in respect
thereof, if any, to be due and payable immediately if an Event of Default with
respect to Debt Securities of such series shall occur and be continuing at the
time of declaration. At any time after a declaration of acceleration has been
made with respect to Debt Securities of any series but before a judgment or
decree for payment of money due has been obtained by the Trustee, the Holders
of a majority in principal amount of the Outstanding Debt Securities of that
series may rescind any declaration of acceleration and its consequences, if all
payments due (other than those due as a result of acceleration) have been made
and all Events of Default have been remedied or waived. Any Event of Default
with respect to Debt Securities of any series may be waived by the Holders of a
majority in principal amount of all Outstanding Debt Securities of that series,
except in a case of failure to pay principal of or premium, if any, or interest
or Additional Amounts, if any, on any Debt Security of that series for which
payment has not been subsequently made or in respect of a covenant or provision
which cannot be modified or amended without the consent of the Holder of each
Outstanding Debt Security of such series affected.
The Holders of a majority in principal amount of the Outstanding Debt
Securities of a series may direct the time, method and place of conducting any
proceeding for any remedy available to the Trustee or exercising any trust or
power conferred on the Trustee with respect to Debt Securities of such series,
provided that such direction shall not be in conflict with any rule of law or
M-23
<PAGE>
the Indenture. Before proceeding to exercise any right or power under the
Indenture at the direction of such Holders, the Trustee shall be entitled to
receive from such Holders reasonable security or indemnity against the costs,
expenses and liabilities which might be incurred by it in complying with any
such direction.
The Company will be required to furnish to the Trustee annually a statement
as to the fulfillment by the Company of all of its obligations under the
Indenture.
LIMITATION ON LIENS
The Indenture provides that the Company may not at any time directly or
indirectly create, assume, incur or suffer to be created, assumed or incurred
or suffer to exist any mortgage, pledge, encumbrance or lien (except for
certain liens specifically permitted by the Indenture) by which there may be
issued, or by which there may be secured or evidenced, any indebtedness of the
Company or any Principal Subsidiary for money borrowed (except for any bona
fide option or agreement to sell), upon (1) any shares of capital stock of any
Principal Subsidiary (other than directors' qualifying shares) or (2) any
shares of capital stock owned by the Company or a subsidiary of the Company
that owns, directly or indirectly, capital stock of any of the Principal
Subsidiaries (other than directors' qualifying shares) without, in each case,
making effective provision whereby the Debt Securities (and any other
indebtedness of the Company or such Subsidiary entitled to the benefit of a
covenant similar to this covenant, subject to applicable priorities of payment)
will be secured equally and ratably with any and all other obligations thereby
secured. The Indenture defines "Principal Subsidiaries" to mean each of
Greenwood Trust Company and DWR, so long as they continue, directly or
indirectly, to be subsidiaries of the Company, and any subsidiary of the
Company succeeding to any substantial part of the business conducted by any of
such corporations on the date of the Indenture.
EXPERTS
The consolidated financial statements and related supplemental schedules of
the Company and its subsidiaries incorporated in this Prospectus by reference
to the Company's Annual Report on Form 10-K for the fiscal year ended December
31, 1995 have been audited by Deloitte & Touche LLP, independent auditors, as
stated in their reports incorporated by reference herein, and have been so
incorporated by reference in reliance upon such reports given upon the
authority of that firm as experts in accounting and auditing.
With respect to the unaudited interim financial information for the periods
ended March 31, 1996 and 1995 which is incorporated herein by reference,
Deloitte & Touche LLP have applied limited procedures in accordance with
professional standards for a review of such information. However, as stated in
their report included in the Company's Quarterly Report on Form 10-Q for the
quarter ended March 31, 1996 and incorporated by reference herein, they did not
audit and they do not express an opinion on that interim financial information.
Accordingly, the degree of reliance on their report on such information should
be restricted in light of the limited nature of the review procedures applied.
Deloitte & Touche LLP are not subject to the liability provisions of Section 11
of the Securities Act of 1933 for their reports on the unaudited interim
financial information because those reports are not "reports" or a "part" of
the registration statement prepared or certified by an accountant within the
meaning of Sections 7 and 11 of the Act.
M-24
<PAGE>
APPENDIX A
FIXED RATE MEDIUM-TERM NOTES SERIES I
<TABLE>
<CAPTION>
PRINCIPAL ORIGINAL MATURITY INTEREST RATE
AMOUNT ISSUE DATE DATE % PER ANNUM
--------- ---------- ---------- -------------
<S> <C> <C> <C>
$10,000,000.00 02-07-94 02-07-2001 5.88%
$10,000,000.00 02-07-94 02-09-2004 6.26%
$10,000,000.00 02-07-94 02-09-2004 6.27%
$200,000.00 02-07-94 02-07-2006 6.37%
$3,000,000.00 02-08-94 02-08-2001 5.97%
$2,275,000.00 02-08-94 02-09-2004 6.34%
$3,000,000.00 02-08-94 02-08-2006 6.45%
$10,000,000.00 02-08-94 02-08-2001 6.00%
$3,500,000.00 02-08-94 02-09-2004 6.37%
$40,000,000.00 02-09-94 02-10-2014 7.07%
$3,000,000.00 02-10-94 02-12-2001 5.98%
$5,000,000.00 06-01-94 06-01-1999 7.40%
$5,000,000.00 06-01-94 06-01-2001 7.75%
$300,000.00 06-01-94 06-01-1999 7.38%
$5,000,000.00 06-01-94 06-01-2001 7.75%
$6,000,000.00 06-08-94 06-08-1999 7.44%
$5,000,000.00 06-08-94 06-08-2004 8.05%
$10,000,000.00 06-09-94 06-09-2004 7.94%
$50,000,000.00 06-09-94 06-11-2001 7.58%
$10,000,000.00 06-10-94 06-11-2001 7.53%
$10,000,000.00 06-10-94 06-10-2004 7.82%
$10,000,000.00 06-10-94 06-10-2004 7.81%
$10,000,000.00 06-21-94 05-15-2002 7.62%
$10,000,000.00 06-22-94 06-22-2004 7.76%
$10,000,000.00 06-23-94 06-23-2004 7.89%
$13,000,000.00 06-27-94 06-28-2004 7.94%
$10,000,000.00 06-30-94 07-01-2004 7.85%
$10,000,000.00 06-30-94 05-01-2001 7.55%
$10,000,000.00 07-06-94 07-06-2004 8.02%
$19,000,000.00 07-07-94 07-09-2001 7.75%
$10,000,000.00 07-08-94 07-08-2004 7.97%
$10,000,000.00 07-08-94 07-08-2004 8.09%
$10,000,000.00 07-14-94 08-01-2001 7.78%
$5,000,000.00 07-18-94 07-19-1999 7.62%
$8,000,000.00 07-20-94 07-20-2004 8.14%
$15,000,000.00 07-21-94 07-21-2004 8.06%
$15,000,000.00 07-22-94 07-23-2001 7.62%
$20,000,000.00 08-24-94 08-24-1999 7.26%
$5,000,000.00 09-08-94 09-08-2004 7.86%
$5,000,000.00 10-03-94 10-04-2004 8.20%
$16,000,000.00 04-12-95 09-30-1996 6.92%
$10,000,000.00 05-31-95 05-31-2000 6.87%
</TABLE>
A-1
<PAGE>
APPENDIX B
MEDIUM-TERM NOTES SERIES I
(FLOATING RATE)
<TABLE>
<CAPTION>
INITIAL
INTEREST
ORIGINAL INTEREST DETER- INTEREST INTEREST
PRINCIPAL ISSUE MATURITY RATE INDEX SPREAD MINATION RESET PAYMENT
AMOUNT DATE DATE BASIS MATURITY % DATE DATES DATES
--------- -------- -------- ------------- ------------ ------ -------- ------------------------ ------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
$20,000,000.00 01-27-94 01-27-97 LIBOR - one month +0.22% 01-25-94 The third Wednesday The third Wednesday
Telerate of each month of each month and
Page 3750 on the maturity date
20,000,000.00 01-27-94 01-27-97 Commercial one month +0.28% 01-25-94 The third Wednesday The third Wednesday
Paper Rate of each month of each month and
on the maturity date
3,000,000.00 01-28-94 01-28-97 Commercial one month +0.26% 01-26-94 The third Wednesday The third Wednesday
Paper Rate of each month of each month and
on the maturity date
8,000,000.00 01-28-94 01-28-97 LIBOR - one month +0.20% 01-26-94 The third Wednesday The third Wednesday
Telerate of each month of each month and
Page 3750 on the maturity date
50,000,000.00 02-01-94 02-03-97 Commercial one month +0.24% 01-28-94 The third Wednesday The third Wednesday
Paper Rate of each month of each month and
on the maturity date
2,100,000.00 02-24-94 02-24-97 LIBOR - one month +0.18% 02-22-94 The third Wednesday The third Wednesday
Telerate of each month of each month and
Page 3750 on the maturity date
125,000,000.00 03-02-94 03-02-99 Alternate three months +0.47% 02-28-94 The Tuesday The 2nd day of March,
Treasury Rate of each week June, September and
December
30,000,000.00 03-03-94 03-03-97 LIBOR - one month +0.18% 03-01-94 The third Wednesday The third Wednesday
Telerate of each month of each month and
Page 3750 on the maturity date
50,000,000.00 03-10-94 03-10-99 CMT Rate two years -0.22% 03-08-94 The 10th day The 10th day of March,
of March, June, June, September and
September and December December
50,000,000.00 03-17-94 03-17-97 Alternate three months +0.31% 03-14-94 The Tuesday The 17th day of June,
Treasury of each week September, December
Rate and March
50,000,000.00 06-01-94 06-02-97 LIBOR - one month +0.21% 05-27-94 The third Wednesday The third Wednesday
Telerate of each month of each month
Page 3750
3,000,000.00 06-10-94 06-10-99 LIBOR - one month +0.37% 06-08-94 The third Wednesday The third Wednesday
Telerate of each month of each month commencing
Page 3750 commencing July 20, 1994 July 20, 1994
<CAPTION>
REDEMPTION
DATES
(AND
REDEMPTION
PRICE
(% OF
PRINCIPAL
AMOUNT)
PRINCIPAL IF OTHER
AMOUNT THAN 100%)
--------- ----------
<S> <C>
$20,000,000.00 N.A.
20,000,000.00 N.A.
3,000,000.00 N.A.
8,000,000.00 N.A.
50,000,000.00 N.A.
2,100,000.00 N.A.
125,000,000.00 N.A.
30,000,000.00 N.A.
50,000,000.00 N.A.
50,000,000.00 N.A.
50,000,000.00 N.A.
3,000,000.00 N.A.
</TABLE>
B-1
<PAGE>
<TABLE>
<CAPTION>
INITIAL
INTEREST
ORIGINAL INTEREST DETER- INTEREST INTEREST
PRINCIPAL ISSUE MATURITY RATE INDEX SPREAD MINATION RESET PAYMENT
AMOUNT DATE DATE BASIS MATURITY % DATE DATES DATES
--------- -------- -------- ---------- --------- ------ -------- --------------------------- ---------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
$ 5,000,000.00 06-14-94 06-14-99 LIBOR - one month +0.37% 06-10-94 The third Wednesday The third Wednesday
Telerate of each month of each month commencing
Page 3750 commencing July 20, 1994 July 20, 1994
45,000,000.00 06-17-94 06-17-99 LIBOR - one month +0.37% 06-15-94 The third Wednesday The third Wednesday
Telerate of each month of each month commencing
Page 3750 commencing July 20, 1994 July 20, 1994 and on the
maturity date
25,000,000.00 07-18-94 07-19-99 LIBOR - one month +0.35% 07-14-94 The third Wednesday The third Wednesday
Telerate of each month of each month commencing
Page 3750 commencing August 17, 1994 August 17, 1994 and on the
maturity date
27,500,000.00 08-01-94 08-02-99 LIBOR - one month +0.25% 07-28-94 The Wednesday The third Wednesday
Telerate of each week of each month commencing
Page 3750 commencing August 3, 1994 August 17, 1994 and on the
maturity date
25,000,000.00 08-02-94 08-04-97 LIBOR - one month +0.14% 07-29-94 The third Wednesday The third Wednesday
Telerate of each month of each month commencing
Page 3750 commencing August 17, 1994 August 17, 1994 and on the
maturity date
3,000,000.00 09-15-94 09-15-99 LIBOR - one month +0.30% 09-13-94 The third Wednesday The third Wednesday
Telerate of each month of each month commencing
Page 3750 commencing October 19, 1994 October 19, 1994 and on the
maturity date
25,000,000.00 09-29-94 09-29-97 LIBOR - one month +0.21% 09-27-94 The third Wednesday The third Wednesday
Telerate of each month of each month commencing
Page 3750 commencing October 19, 1994 October 19, 1994 and on the
maturity date
25,000,000.00 09-29-94 09-30-96 LIBOR - one month +0.14% 09-27-94 The third Wednesday The third Wednesday
Telerate of each month of each month commencing
Page 3750 commencing October 19, 1994 October 19, 1994 and on the
maturity date
25,000,000.00 09-29-94 10-01-96 LIBOR - one month +0.13% 09-27-94 The third Wednesday The third Wednesday
Telerate of each month of each month commencing
Page 3750 commencing October 19, 1994 October 19, 1994 and on the
maturity date
50,000,000.00 09-29-94 09-29-96 Alternate one day +0.31% 09-28-94 Each Business Day The 29th day of December,
Federal March, June and
Funds Rate September, commencing
December 29, 1994 and on
the maturity date
<CAPTION>
REDEMPTION
DATES
(AND
REDEMPTION
PRICE
(% OF
PRINCIPAL
AMOUNT)
PRINCIPAL IF OTHER
AMOUNT THAN 100%)
--------- ----------
<S> <C>
$ 5,000,000.00 N.A.
45,000,000.00 N.A.
25,000,000.00 N.A.
27,500,000.00 N.A.
25,000,000.00 N.A.
3,000,000.00 N.A.
25,000,000.00 N.A.
25,000,000.00 N.A.
25,000,000.00 N.A.
50,000,000.00 N.A.
</TABLE>
B-2
<PAGE>
<TABLE>
<CAPTION>
INITIAL
INTEREST
ORIGINAL INTEREST DETER- INTEREST INTEREST
PRINCIPAL ISSUE MATURITY RATE INDEX SPREAD MINATION RESET PAYMENT
AMOUNT DATE DATE BASIS MATURITY % DATE DATES DATES
--------- -------- -------- ---------- ------------ ------ -------- --------------------------- ---------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
$ 50,000,000.00 09-29-94 09-29-97 Alternate one day +0.40% 09-28-94 Each Business Day The 29th day of December,
Federal March, June and
Funds Rate September, commencing
December 29, 1994 and on
the maturity date
20,000,000.00 09-30-94 09-30-97 LIBOR - one month +0.20% 09-28-94 The third Wednesday The third Wednesday
Telerate of each month of each month commencing
Page 3750 commencing October 19, 1994 October 19, 1994 and on the
maturity date
20,000,000.00 10-04-94 10-06-97 LIBOR - one month +0.19% 09-30-94 The third Wednesday The third Wednesday
Telerate of each month of each month commencing
Page 3750 commencing October 19, 1994 October 19, 1994 and on the
maturity date
30,000,000.00 10-04-94 10-06-97 LIBOR - three months +0.20% 09-30-94 The third Wednesday The third Wednesday of
Telerate of December, March, June December, March, June and
Page 3750 and September, commencing September, commencing
December 21, 1994 December 21, 1994 and on
the maturity date
10,000,000.00 10-06-94 10-06-97 LIBOR - one month +0.18% 10-04-94 The third Wednesday The third Wednesday
Telerate of each month of each month commencing
Page 3750 commencing October 19, 1994 October 19, 1994 and on the
maturity date
30,000,000.00 09-29-94 09-29-97 LIBOR - one month +0.20% 09-27-94 The third Wednesday The third Wednesday
Telerate of each month of each month commencing
Page 3750 commencing October 19, 1994 October 19, 1994 and on the
maturity date
150,000,000.00 11-22-94 11-22-96 LIBOR - three months +0.18% 11-18-94 The third Wednesday The third Wednesday of
Telerate of December, March, June December, March, June and
Page 3750 and September, commencing September, commencing
December 21, 1994 December 21, 1994
5,000,000.00 11-23-94 01-03-97 LIBOR - three months +0.19% 11-21-94 The third Wednesday The third Wednesday of
Telerate of December, March, June December, March, June and
Page 3750 and September, commencing September, commencing
December 21, 1994 December 21, 1994
100,000,000.00 11-25-94 01-15-97 LIBOR - three months +0.19% 11-23-94 The third Wednesday The third Wednesday of
Telerate of December, March, June December, March, June and
Page 3750 and September, commencing September, commencing
December 21, 1994 December 21, 1994
5,000,000.00 11-29-94 12-01-97 LIBOR - three months +0.22% 11-25-94 The third Wednesday The third Wednesday of
Telerate of December, March, June December, March, June and
Page 3750 and September, commencing September, commencing
December 21, 1994 December 21, 1994
<CAPTION>
REDEMPTION
DATES
(AND
REDEMPTION
PRICE
(% OF
PRINCIPAL
AMOUNT)
PRINCIPAL IF OTHER
AMOUNT THAN 100%)
--------- ----------
<S> <C>
$ 50,000,000.00 N.A.
20,000,000.00 N.A.
20,000,000.00 N.A.
30,000,000.00 N.A.
10,000,000.00 N.A.
30,000,000.00 N.A.
150,000,000.00 N.A.
5,000,000.00 N.A.
100,000,000.00 N.A.
5,000,000.00 N.A.
</TABLE>
B-3
<PAGE>
<TABLE>
<CAPTION>
INITIAL
INTEREST
ORIGINAL INTEREST DETER- INTEREST
PRINCIPAL ISSUE MATURITY RATE INDEX SPREAD MINATION RESET
AMOUNT DATE DATE BASIS MATURITY % DATE DATES
--------- -------- -------- --------- ------------ ------- -------- ----------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
$20,000,000.00 11-29-94 10-06-97 LIBOR - three months +0.22% 11-25-94 The third Wednesday
Telerate of December, March, June
Page 3750 and September, commencing
December 21, 1994
10,000,000.00 11-25-94 11-25-97 LIBOR - three months +0.22% 11-23-94 The third Wednesday
Telerate of December, March, June
Page 3750 and September, commencing
December 21, 1994
5,000,000.00 02-01-95 02-01-00 LIBOR - one month +0.35% 01-30-95 The third Wednesday
Telerate of each month commencing
Page 3750 February 15, 1995
30,000,000.00 03-06-95 03-06-97 LIBOR - one month +0.13% 03-02-95 The third Wednesday
Telerate of each month commencing
Page 3750 March 15, 1995
25,000,000.00 03-07-95 03-07-97 LIBOR - one month +0.13% 03-03-95 The third Wednesday
Telerate of each month commencing
Page 3750 March 15, 1995
25,000,000.00 03-15-95 03-17-97 LIBOR - one month +0.12% 03-13-95 The third Wednesday
Telerate of each month commencing
Page 3750 April 19, 1995
50,000,000.00 03-21-95 03-21-97 LIBOR - one month +0.12% 03-17-95 The third Wednesday
Telerate of each month commencing
Page 3750 April 19, 1995
10,000,000.00 03-24-95 04-01-99 LIBOR - one month +0.30% 03-22-95 The third Wednesday
Telerate of each month commencing
Page 3750 April 19, 1995
75,000,000.00 03-31-95 03-31-00 LIBOR - three months +0.375% 03-29-95 The third Wednesday
Telerate of June, September, December
Page 3750 and March commencing
June 21, 1995
5,000,000.00 03-31-95 03-31-99 LIBOR - one month +0.30% 03-29-95 The third Wednesday
Telerate of each month commencing
Page 3750 April 19, 1995
30,000,000.00 04-05-95 04-05-99 LIBOR - one month +0.30% 04-03-95 The third Wednesday
Telerate of each month commencing
Page 3750 April 19, 1995
25,000,000.00 04-07-95 04-07-00 LIBOR - three months +0.375% 04-05-95 The third Wednesday
Telerate of June, September, December
Page 3750 and March commencing
June 21, 1995
<CAPTION>
REDEMPTION
DATES
(AND
REDEMPTION
PRICE
(% OF
PRINCIPAL
INTEREST AMOUNT)
PRINCIPAL PAYMENT IF OTHER
AMOUNT DATES THAN 100%)
--------- ---------------------------- ----------
<S> <C> <C>
$20,000,000.00 The third Wednesday of N.A.
December, March, June and
September, commencing
December 21, 1994
10,000,000.00 The third Wednesday of N.A.
December, March, June and
September, commencing
December 21, 1994
5,000,000.00 The third Wednesday N.A.
of each month commencing
February 15, 1995
30,000,000.00 The third Wednesday N.A.
of each month commencing
March 15, 1995
25,000,000.00 The third Wednesday N.A.
of each month commencing
March 15, 1995
25,000,000.00 The third Wednesday N.A.
of each month commencing
April 19, 1995
50,000,000.00 The third Wednesday N.A.
of each month commencing
April 19, 1995
10,000,000.00 The third Wednesday N.A.
of each month commencing
April 19, 1995
75,000,000.00 The third Wednesday N.A.
of June, September, December
and March commencing
June 21, 1995
5,000,000.00 The third Wednesday N.A.
of each month commencing
April 19, 1995
30,000,000.00 The third Wednesday N.A.
of each month commencing
April 19, 1995
25,000,000.00 The third Wednesday N.A.
of June, September, December
and March commencing
June 21, 1995
</TABLE>
B-4
<PAGE>
<TABLE>
<CAPTION>
INITIAL
INTEREST
ORIGINAL INTEREST DETER- INTEREST
PRINCIPAL ISSUE MATURITY RATE INDEX SPREAD MINATION RESET
AMOUNT DATE DATE BASIS MATURITY % DATE DATES
--------- -------- -------- --------- ------------ ------- -------- ----------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
$10,000,000.00 04-12-95 04-12-00 LIBOR - three months +0.375% 04-10-95 The third Wednesday
Telerate of June, September, December
Page 3750 and March commencing
June 21, 1995
50,000,000.00 05-23-95 05-23-97 LIBOR - three months +0.05% 05-19-95 The third Wednesday
Telerate of June, September, December
Page 3750 and March commencing
June 21, 1995
25,000,000.00 07/05/95 07/06/98 LIBOR - three months +0.25% 07/03/95 The third Wednesday
Telerate of September, December,
Page 3750 March and June, commencing
September 20, 1995
10,000,000.00 07/05/95 07/06/99 LIBOR - three months +0.3% 07/03/95 The third Wednesday
Telerate of September, December,
Page 3750 March and June, commencing
September 20, 1995
50,000,000.00 07/12/95 07/12/00 LIBOR - three months +0.35% 07/10/95 The third Wednesday
Telerate of September, December,
Page 3750 March and June, commencing
September 20, 1995
20,000,000.00 07/13/95 07/13/99 LIBOR - three months +0.3% 07/11/95 The third Wednesday
Telerate of September, December,
Page 3750 March and June, commencing
September 20, 1995
75,000,000.00 02/01/96 02/02/98 LIBOR - one month +0.08% 01/30/96 The third Wednesday
Telerate of each month commencing
Page 3750 February 21, 1996
50,000,000.00 02/01/96 02/01/99 LIBOR - one month +0.18% 01/30/96 The third Wednesday
Telerate of each month commencing
Page 3750 February 21, 1996
100,000,000.00 02/05/96 02/05/99 LIBOR - one month +0.18% 02/01/96 The third Wednesday
Telerate of each month commencing
Page 3750 February 21, 1996
50,000,000.00 02/05/96 02/05/98 LIBOR - one month +0.08% 02/01/96 The third Wednesday
Telerate of each month commencing
Page 3750 February 21, 1996
32,000,000.00 02/06/96 02/06/98 LIBOR - one month +0.08% 02/02/96 The third Wednesday
Telerate of each month commencing
Page 3750 February 21, 1996
25,000,000.00 02/08/96 02/08/99 LIBOR - one month +0.18% 02/06/96 The third Wednesday
Telerate of each month commencing
Page 3750 February 21, 1996
93,000,000.00 02/12/96 02/12/98 LIBOR - one month +0.08% 02/08/96 The third Wednesday
Telerate of each month commencing
Page 3750 February 21, 1996
<CAPTION>
REDEMPTION
DATES
(AND
REDEMPTION
PRICE
(% OF
PRINCIPAL
INTEREST AMOUNT)
PRINCIPAL PAYMENT IF OTHER
AMOUNT DATES THAN 100%)
--------- ---------------------------- ----------
<S> <C> <C>
$10,000,000.00 The third Wednesday N.A.
of June, September, December
and March commencing
June 21, 1995
50,000,000.00 The third Wednesday N.A.
of June, September, December
and March commencing
June 21, 1995
25,000,000.00 The third Wednesday N.A.
of September, December,
March and June, commencing
September 20, 1995
10,000,000.00 The third Wednesday N.A.
of September, December,
March and June, commencing
September 20, 1995
50,000,000.00 The third Wednesday N.A.
of September, December,
March and June, commencing
September 20, 1995
20,000,000.00 The third Wednesday N.A.
of September, December,
March and June, commencing
September 20, 1995
75,000,000.00 The third Wednesday N.A.
of each month commencing
February 21, 1996
50,000,000.00 The third Wednesday N.A.
of each month commencing
February 21, 1996
100,000,000.00 The third Wednesday N.A.
of each month commencing
February 21, 1996
50,000,000.00 The third Wednesday N.A.
of each month commencing
February 21, 1996
32,000,000.00 The third Wednesday N.A.
of each month commencing
February 21, 1996
25,000,000.00 The third Wednesday N.A.
of each month commencing
February 21, 1996
93,000,000.00 The third Wednesday N.A.
of each month commencing
February 21, 1996
</TABLE>
B-5
<PAGE>
<TABLE>
<CAPTION>
INITIAL
INTEREST
ORIGINAL INTEREST DETER- INTEREST INTEREST
PRINCIPAL ISSUE MATURITY RATE INDEX SPREAD MINATION RESET PAYMENT
AMOUNT DATE DATE BASIS MATURITY % DATE DATES DATES
--------- -------- -------- --------- --------- -------- -------- ------------------------ ------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
$25,000,000.00 03/01/96 03/02/98 LIBOR - one month +0.0625% 02/28/96 The third Wednesday The third Wednesday
Telerate of each month commencing of each month commencing
Page 3750 March 20, 1996 March 20, 1996
10,000,000.00 04/23/96 10/23/97 LIBOR - one month +0.04% 04/19/96 The third Wednesday The third Wednesday
Telerate of each month commencing of each month commencing
Page 3750 May 15, 1996 May 15, 1996
25,000,000.00 05/14/96 05/14/99 LIBOR - one month +0.14% 05/10/96 The third Wednesday The third Wednesday
Telerate of each month commencing of each month commencing
Page 3750 June 19, 1996 June 19, 1996
30,000,000.00 05/17/96 05/18/98 LIBOR - one month +0.06% 05/15/96 The third Wednesday The third Wednesday
Telerate of each month commencing of each month commencing
Page 3750 June 19, 1996 June 19 1996
<CAPTION>
REDEMPTION
DATES
(AND
REDEMPTION
PRICE
(% OF
PRINCIPAL
AMOUNT)
PRINCIPAL IF OTHER
AMOUNT THAN 100%)
--------- ----------
<S> <C>
$25,000,000.00 N.A.
10,000,000.00 N.A.
25,000,000.00 N.A.
30,000,000.00 N.A.
</TABLE>
B-6
<PAGE>
DEAN WITTER, DISCOVER & CO.
DEBT SECURITIES
PROSPECTUS
DEAN WITTER REYNOLDS INC.
, 1996
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
Estimated expenses (other than underwriting discounts and commissions)
payable by the Company in connection with the sale of the Debt Securities
covered hereby are as follows:
<TABLE>
<S> <C>
Registration fee -- Securities and Exchange Commission..... $ 689,655.17
NASD filing fee............................................ 30,500.00
Printing and engraving expenses............................ 150,000.00
Blue sky fees and expenses (including counsel)............. 40,000.00
Accounting fees and expenses............................... 175,000.00
Legal fees and expenses.................................... 300,000.00
Trustee's fees and expenses................................ 5,000.00
Miscellaneous.............................................. 49,844.83
-------------
Total.................................................. $1,440,000.00
=============
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 102 of the General Corporation Law of the State of Delaware ("GCL")
allows a corporation to eliminate the personal liability of a director to the
corporation or its stockholders for monetary damages for breach of fiduciary
duty as a director, except in cases where the director breached his duty of
loyalty, failed to act in good faith, engaged in intentional misconduct or a
knowing violation of law, authorized the unlawful payment of a dividend or
approved an unlawful stock redemption or repurchase or obtained an improper
personal benefit. The Registrant's Amended and Restated Certificate of
Incorporation, as amended, contains a provision which eliminates directors'
personal liability as set forth above.
The Registrant's Amended and Restated Certificate of Incorporation, as
amended, and the Registrant's Bylaws provide in effect that the Registrant
shall indemnify its directors and officers, and may indemnify its employees, to
the extent permitted by Section 145 of the GCL. Section 145 of the GCL provides
that a Delaware corporation has the power to indemnify its officers, directors
and employees in certain circumstances.
Subsection (a) of Section 145 of the GCL empowers a corporation to indemnify
any director or officer or employee, or former director or officer or employee,
who was or is a party or is threatened to be made a party to any threatened,
pending or completed action, suit or proceeding, whether civil, criminal,
administrative or investigative (other than an action by or in the right of the
corporation), against expenses (including attorneys' fees), judgments, fines
and amounts paid in settlement actually and reasonably incurred in connection
with such action, suit or proceeding provided that such director or officer or
employee acted in good faith and in a manner reasonably believed to be in or
not opposed to the best interests of the corporation, and, with respect to any
criminal action or proceeding, provided that such director or officer or
employee had no cause to believe his or her conduct was unlawful.
Subsection (b) of Section 145 empowers a corporation to indemnify any
director or officer or employee, or former director or officer or employee, who
was or is a party or is threatened to be made a party to any threatened,
pending or completed action or suit by or in the right of the corporation to
procure a judgment in its favor by reason of the fact that such person acted in
any of the capacities set forth above, against expenses (including attorneys'
fees) actually and reasonably incurred in connection with the defense or
settlement of such action or suit provided that such
II-1
<PAGE>
person acted in good faith and in a manner reasonably believed to be in or not
opposed to the best interests of the corporation, except that no
indemnification may be made in respect of any claim, issue or matter as to
which such person shall have been adjudged to be liable to the corporation
unless and only to the extent that the Court of Chancery shall determine that
despite the adjudication of liability such person is fairly and reasonably
entitled to indemnity for such expenses which the court shall deem proper.
Section 145 further provides that to the extent a director or officer or
employee of a corporation has been successful in the defense of any action,
suit or proceeding referred to in subsections (a) and (b) or in the defense of
any claim, issue or matter therein, he or she shall be indemnified against
expenses (including attorneys' fees) actually and reasonably incurred by him or
her in connection therewith; that indemnification provided for by Section 145
shall not be deemed exclusive of any other rights to which the indemnified
party may be entitled; and empowers the corporation to purchase and maintain
insurance on behalf of a director or officer or employee of the corporation
against any liability asserted against him or her or incurred by him or her in
any such capacity or arising out of his or her status as such whether or not
the corporation would have the power to indemnify him or her against such
liabilities under Section 145.
The Registrant has in effect insurance policies in the amount of $75 million
for general officers' and directors' liability insurance and $25 million for
fiduciary liability insurance covering all of the Registrant's directors and
officers in certain instances where by law they may not be indemnified by the
Registrant.
The Underwriting Agreement and the Distribution Agreement, filed as Exhibits
1(a) and 1(b) hereto, respectively, and incorporated herein by reference,
contain certain provisions relating to the indemnification of the Registrant's
directors, officers and controlling persons.
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
(a) Exhibits. The following is a list of exhibits to this Registration
Statement.
1(a) --Form of Underwriting Agreement for Debt Securities, including
forms of Terms Agreement and Delayed Delivery Contract.
1(b) --Distribution Agreement, including form of Terms Agreement, dated
November 19, 1993 (the "Distribution Agreement"), between
Registrant and Dean Witter Reynolds Inc. relating to Medium-Term
Notes (a series of Debt Securities). Filed as Exhibit 1(b) to the
Registrant's Registration Statement No. 33-89748 on Form S-3, and
incorporated herein by reference.
1(c) --Form of Amendment No. 1 to the Distribution Agreement.
4(a) --Indenture, dated as of February 24, 1993, between Registrant and
The First National Bank of Chicago, as trustee, pursuant to which
the Debt Securities will be issued. Filed as Exhibit 4 to the
Registrant's Registration Statement No. 33-60734 on Form S-3, and
incorporated herein by reference.
4(b) --Form of Fixed Rate Medium-Term Note. Filed as Exhibit 4.1 to the
Registrant's Current Report on Form 8-K dated November 18, 1993,
and incorporated herein by reference.
4(c) --Form of Floating Rate Medium-Term Note. Filed as Exhibit 4.2 to
the Registrant's Current Report on Form 8-K dated November 18,
1993, and incorporated herein by reference.
II-2
<PAGE>
5 --Opinion of Brown & Wood.
12 --Computation of Ratio of Earnings to Fixed Charges.
15 --Letter of awareness from Deloitte & Touche llp concerning
unaudited interim financial information.
23(a) --Consent of Brown & Wood (included as part of Exhibit 5).
23(b) --Consent of Deloitte & Touche llp.
24 --Power of Attorney (included on signature page).
25 --Form T-1 Statement of Eligibility and Qualification under the
Trust Indenture Act of 1939 of The First National Bank of
Chicago.
ITEM 17. UNDERTAKINGS.
The undersigned registrant hereby undertakes:
(a)(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-ef-
fective amendment thereof) which, individually or in the aggregate, repre-
sent a fundamental change in the information set forth in the registration
statement. Notwithstanding the foregoing, any increase or decrease in vol-
ume 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 maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b) if, in the ag-
gregate, the changes in volume and price represent no more than a 20%
change in the maximum offering price set forth in the "Calculation of Reg-
istration 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;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the
registration statement is on Form S-3 and the information required to be
included in a post-effective amendment by those paragraphs is contained in
periodic reports filed by the registrant pursuant to Section 13 or 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 the 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.
(b) 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 15(d) of the Securities Exchange Act of 1934 that is incorporated by
reference in this 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.
II-3
<PAGE>
(c) 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 foregoing provisions, 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 such
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 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-4
<PAGE>
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, AS AMENDED, THE
REGISTRANT CERTIFIES THAT IT HAS REASONABLE GROUNDS TO BELIEVE THAT IT MEETS
ALL OF THE REQUIREMENTS FOR FILING ON FORM S-3 AND HAS DULY CAUSED THIS
REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO
DULY AUTHORIZED, IN NEW YORK, STATE OF NEW YORK, ON THIS 11TH DAY OF JULY,
1996.
Dean Witter, Discover & Co.
/s/ Philip J. Purcell
By:__________________________________
Philip J. Purcell
Chairman of the Board and Chief
Executive Officer
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS that each person whose signature appears
below hereby constitutes and appoints Christine A. Edwards, Mitchell M. Merin,
Ronald T. Carman and Michael T. Gregg, and each of them singly, his or her true
and lawful attorney-in-fact and agent with full power of substitution and
resubstitution, for him or her and in his or her name, place and stead, in any
and all capacities, to sign any and all amendments, including post-effective
amendments, to this Registration Statement (any of which amendments may make
such changes and additions to this Registration Statement as such attorneys-in-
fact may deem necessary or appropriate) and to file the same, with all exhibits
thereto, and any other documents that may be required in connection therewith,
granting unto said attorneys-in-fact and agents full power and authority to be
done in and about the premises, as fully to all intents and purposes as he or
she might or could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents, or their substitutes, may lawfully do or cause to
be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Registration Statement has been signed below by the following persons in the
capacities indicated on this 11th day of July, 1996.
SIGNATURE TITLE
/s/ Philip J. Purcell Chairman of the Board, Chief
- ------------------------------------- Executive Officer and Director
PHILIP J. PURCELL (Principal Executive Officer)
/s/ Thomas C. Schneider Executive Vice President and
- ------------------------------------- Chief Financial Officer
THOMAS C. SCHNEIDER (Principal Financial Officer)
/s/ Robert P. Seass Senior Vice President and
- ------------------------------------- Controller (Principal
ROBERT P. SEASS Accounting Officer)
II-5
<PAGE>
SIGNATURE TITLE
/s/ Edward A. Brennan Director
- ------------------------------------
EDWARD A. BRENNAN
/s/ Alfred C. DeCrane, Jr. Director
- ------------------------------------
ALFRED C. DECRANE, JR.
/s/ Robert M. Gardiner Director
- ------------------------------------
ROBERT M. GARDINER
/s/ C. Robert Kidder Director
- ------------------------------------
C. ROBERT KIDDER
/s/ Michael A. Miles Director
- ------------------------------------
MICHAEL A. MILES
/s/ Sybil C. Mobley Director
- ------------------------------------
SYBIL C. MOBLEY
/s/ Clarence B. Rogers, Jr. Director
- ------------------------------------
CLARENCE B. ROGERS, JR.
II-6
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
----------- -----------
<C> <S> <C>
1(a) --Form of Underwriting Agreement for Debt Securities,
including forms of Terms Agreement and Delayed Delivery
Contract.
1(b) --Distribution Agreement, including form of Terms
Agreement, dated November 19, 1993 (the "Distribution
Agreement"), between Registrant and Dean Witter
Reynolds Inc. relating to Medium-Term Notes (a series
of Debt Securities). Filed as Exhibit 1(b) to the
Registrant's Registration Statement No. 33-89748 on
Form S-3, and incorporated herein by reference.
1(c) --Form of Amendment No. 1 to the Distribution Agreement.
4(a) --Indenture, dated as of February 24, 1993, between
Registrant and The First National Bank of Chicago, as
trustee, pursuant to which the Debt Securities will be
issued. Filed as Exhibit 4 to the Registrant's
Registration Statement No. 33-60734 on Form S-3, and
incorporated herein by reference.
4(b) --Form of Fixed Rate Medium-Term Note. Filed as Exhibit
4.1 to the Registrant's Current Report on Form 8-K
dated November 18, 1993, and incorporated herein by
reference.
4(c) --Form of Floating Rate Medium-Term Note. Filed as
Exhibit 4.2 to the Registrant's Current Report on Form
8-K dated November 18, 1993, and incorporated herein by
reference.
5 --Opinion of Brown & Wood.
12 --Computation of Ratio of Earnings to Fixed Charges.
15 --Letter of awareness from Deloitte & Touche llp
concerning unaudited interim Financial Information.
23(a) --Consent of Brown & Wood (included as part of Exhibit
5).
23(b) --Consent of Deloitte & Touche llp.
24 --Power of Attorney (included on signature page).
25 --Form T-1 Statement of Eligibility and Qualification
under the Trust Indenture Act of 1939 of The First
National Bank of Chicago.
</TABLE>
<PAGE>
EXHIBIT 1(a)
$2,000,000,000
DEAN WITTER, DISCOVER & CO.
Debt Securities
UNDERWRITING AGREEMENT
----------------------
_________, 1996
DEAN WITTER REYNOLDS INC.
and the other Representatives named
in the respective Terms Agreements
hereinafter described Acting on
their own behalf and on behalf of
the several Underwriters named in
the respective Terms Agreement
c/o Dean Witter Reynolds Inc.
2 World Trade Center
65th Floor
New York, New York 10048
Dear Sirs:
1. Introductory. Dean Witter, Discover Co., a Delaware corporation (the
------------
"Company"), proposes to sell from time to time up to U.S. $2,000,000,000
aggregate principal amount (or net proceeds in the case of securities issued at
an original issue discount), or its equivalent in such foreign currencies or
units of two or more currencies, based on the applicable exchange rate at the
time of offering, as shall be designated by the Company at the time of offering,
of its debt securities ("Debt Securities") pursuant to this Agreement. Unless
otherwise specified in the applicable Terms Agreement (as defined below), the
Debt Securities are to be issued under an indenture (the "Indenture"), dated as
of February 24, 1993, between the Company and The First National Bank of
Chicago, as trustee (the "Trustee"). Each issue of Debt Securities may vary,
where applicable, as to aggregate principal amount, maturity, interest rate or
rates and timing of payments thereof, redemption provisions and sinking fund
requirements, if any, exercise provisions and any other variable terms which the
Indenture contemplates may be set forth in the Debt Securities as issued from
time to time. As used herein,
<PAGE>
"Securities" shall mean the securities covered by the applicable Terms
Agreement; and "you" or "your", unless the context otherwise requires, shall
mean such of the parties to whom this Agreement is addressed as are named in the
applicable Terms Agreement.
Each offering of Debt Securities will be made through one or more of you or
through an underwriting syndicate managed by one or more of you. Whenever the
Company determines to make an offering of Debt Securities to be made through one
or more of you, it will enter into an agreement (a "Terms Agreement") providing
for the sale of such Securities to, and the purchase and offering thereof by,
one or more of you and such other underwriters, if any, selected by you as have
authorized you to enter into such Terms Agreement on their behalf (the
"Underwriters", which term shall include you whether acting alone in the sale of
Securities or as members of an underwriting syndicate and any Underwriters
substituted pursuant to Section 11 hereof). The Terms Agreement, which shall be
substantially in the form of Exhibit A hereto, may take the form of an exchange
of any standard form of written telecommunication between you and the Company.
The Terms Agreement relating to each offering of Securities shall specify such
applicable information as is indicated in Exhibit A hereto. Each offering of
Securities will be governed by this Agreement, as supplemented by the applicable
Terms Agreement, and this Agreement and such Terms Agreement shall inure to the
benefit of and be binding upon each Underwriter participating in the offering of
such Securities.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 333-_____) such
registration statement relating to the Debt Securities and the offering thereof
from time to time in accordance with Rule 415 under the Securities Act of 1933
(the "1933 Act"), and has filed such amendments thereto as may have been
required to the date hereof. Such registration statement as amended has been
declared effective by the Commission, and the Indenture has been qualified under
the Trust Indenture Act of 1939 (the "1939 Act"). Such registration statement
as amended and the prospectuses relating to the sale of Debt Securities by the
Company constituting a part thereof, including all documents incorporated
therein by reference, as from time to time amended or supplemented pursuant to
the Securities Exchange Act of 1934 (the "1934 Act"), the 1933 Act or otherwise,
are collectively referred to herein as the "Registration Statement" and the
"Prospectus", respectively; provided, however, that a supplement of the
Prospectus contemplated by Section 4(a) hereof (a "Prospectus Supplement") shall
be deemed to have supplemented the Prospectus only with respect to the offering
of Securities to which it relates.
- 2 -
<PAGE>
2. (a) Representations and Warranties of the Company. The Company
---------------------------------------------
represents and warrants to, and agrees with, each of you, as of the date hereof,
and to each Underwriter named in a Terms Agreement and as of the date thereof
(in each case, the "Representation Date"), that:
(i) The Registration Statement and the Prospectus, at the time the
Registration Statement became effective and as of the applicable Representation
Date, complied in all material respects with the requirements of the 1933 Act,
the rules and regulations thereunder (the "Regulations") and the 1939 Act. The
Registration Statement, at the time the Registration Statement became effective
and as of the applicable Representation Date, did not, and will not, contain any
untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary to make the statements therein not misleading.
The Prospectus, at the time the Registration Statement became effective and as
of the applicable Representation Date, did not, and will not, contain an untrue
statement of a material fact or omit to state a material fact necessary in order
to make the statements therein, in the light of the circumstances under which
they were made, not misleading; provided, however, that the representations and
warranties in this subsection shall not apply to statements in or omissions from
the Registration Statement or Prospectus made in reliance upon and in conformity
with information furnished to the Company in writing by any Underwriter directly
or through you expressly for use in the Registration Statement or Prospectus or
to that part of the Registration Statement which shall constitute the Statement
of Eligibility and Qualification under the 1939 Act (Form T-1) of the Trustee.
(ii) The documents incorporated by reference in the Prospectus, at the time
they were or hereafter are filed with the Commission, complied and will comply
in all material respects with the requirements of the 1934 Act and the rules and
regulations thereunder, and, when read together with the other information in
the Prospectus, at the time the Registration Statement and any amendments
thereto became or become effective, did not and will not 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, in the light of the
circumstances under which they are made, not misleading.
(iii) Subsequent to the respective dates as of which information is given in
the Registration Statement and Prospectus, and except as set forth or
contemplated thereby, neither the Company nor any of its subsidiaries has
incurred any liabilities or obligations, direct or contingent, nor entered into
any transactions not in the ordinary course of business which in either case are
material to the Company and its
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<PAGE>
subsidiaries considered as a whole; there has not been any material adverse
change in the condition (financial or otherwise), business, prospects or results
of operations of the Company and its subsidiaries considered as a whole, whether
or not arising in the ordinary course of business; and there has not been any
material change in the capital stock or long-term debt of the Company and its
subsidiaries considered as a whole.
(iv) The financial statements, together with the related notes and schedules,
set forth in the Prospectus and elsewhere in the Registration Statement fairly
present, on the basis stated in the Registration Statement, the financial
position and the results of operations and changes in financial position of the
Company and its consolidated subsidiaries at the respective dates or for the
respective periods therein specified. Such financial statements and related
notes and schedules have been prepared in accordance with generally accepted
accounting principles applied on a consistent basis except as may be set forth
in the Prospectus. The selected financial and operating data set forth in the
Prospectus in response to Items 301 and 303 of Regulation S-K fairly presents,
when read in conjunction with the Company's financial statements and the related
notes and on the basis stated in the Registration Statement, the information set
forth therein.
(v) To the best of the Company's knowledge, Deloitte & Touche, who have
expressed their opinion on the audited financial statements and related
schedules included in the Registration Statement, are independent public
accountants as required by the 1933 Act and the Regulations.
(vi) The Company has been duly organized and is validly existing and in good
standing as a corporation under the laws of Delaware, with corporate power and
authority to own, lease and operate its properties and to conduct its business
as described in the Registration Statement and Prospectus; each of Greenwood
Trust Company, NOVUS Credit Services Inc., SPS Transaction Services, Inc. Dean
Witter Reynolds Inc. and Dean Witter InterCapital Inc. (the "Significant
Subsidiaries") has been duly organized and is validly existing and in good
standing as a corporation under the laws of the state of its incorporation, with
corporate power and authority to own, lease and operate its properties and to
conduct its business as described in the Registration Statement and Prospectus;
the Company and each of its subsidiaries is in possession of and operating in
compliance with all franchises, grants, authorizations, licenses, permits,
easements, consents, certificates and orders required for the conduct of its
business, all of which are valid and in full force and effect (except where any
failure to do so would not result in a material adverse change in the condition
(financial or otherwise), business, prospects or results of operations of the
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<PAGE>
Company and its subsidiaries considered as a whole), and neither the Company nor
any of its subsidiaries has received any notice of proceedings relating to the
revocation or modification of any such franchise, grant, authorization, license,
permit, easement, consent, certificate or order which, singly or in the
aggregate, if the subject of an unfavorable decision, would result in a material
adverse change in the condition (financial or otherwise), business, prospects or
results of operations of the Company and its subsidiaries considered as a whole;
the Company and each of the Significant Subsidiaries are duly qualified to do
business and are in good standing as foreign corporations in all other
jurisdictions where their ownership or leasing of properties or the conduct of
their businesses requires such qualification except in any case where the
failure to so qualify or be in good standing would not result in a material
adverse change in the condition (financial or otherwise), business, prospects or
results of operations of the Company and its subsidiaries considered as a whole.
(vii) Except as disclosed in the Prospectus, there are no legal or
governmental proceedings pending to which the Company or any of its subsidiaries
is a party or of which any property of the Company or any subsidiary is the
subject, which are required to be disclosed in the Registration Statement (other
than as described therein), or which, if determined adversely to the Company or
any subsidiary, the Company reasonably believes would individually or in the
aggregate result in a material adverse change in the condition (financial or
otherwise), business, prospects or results of operations of the Company and its
subsidiaries taken as a whole or which would materially and adversely affect the
consummation of this Agreement; and to the best of the Company's knowledge no
such proceedings are threatened or contemplated by governmental authorities or
threatened by others.
(viii) Neither the Company nor any of its Significant Subsidiaries is in
violation of its charter or in default in the performance or observance of any
material obligation, agreement, covenant or condition contained in any statute,
contract, indenture, mortgage, deed of trust, loan agreement, note, lease
or other agreement or instrument to which it is a party or by which it or its
property may be bound, which violations or defaults would individually or in the
aggregate result in a material adverse change in the condition (financial or
otherwise), business, prospects or results of operations of the Company and its
subsidiaries taken as a whole; the performance of this Agreement and the
consummation of the transactions herein contemplated will not result in a breach
or violation of any of the terms or provisions of or constitute a default under
any statute, contract, indenture, mortgage, deed of trust, loan agreement, note,
lease or other agreement or instrument to which
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<PAGE>
the Company or any of its subsidiaries is a party or by which they are bound,
the Company's Certificate of Incorporation or Bylaws, or any order, rule or
regulation of any court or governmental agency or body having jurisdiction over
the Company or any of its subsidiaries or any of their property, which breaches,
violations or defaults would individually or in the aggregate result in a
material adverse change in the condition (financial or otherwise), business,
prospects or results of operations of the Company and its subsidiaries
considered as a whole.
(ix) The Securities have been duly authorized for issuance and sale pursuant
to this Agreement (or will have been so authorized prior to each issuance of
Securities) and, when issued, authenticated and delivered pursuant to the
provisions of this Agreement and of the Indenture, against payment of the
consideration therefor in accordance with this Agreement, the Securities will be
valid and legally binding obligations of the Company enforceable in accordance
with their terms, except as enforcement thereof may be limited by bankruptcy,
insolvency or other laws of general applicability relating to or affecting
enforcement of creditors' rights or by general equity principles, and will be
entitled to the benefits of the Indenture; the Indenture has been duly
authorized, and, when executed and delivered by the Company and the Trustee,
will constitute a valid and legally binding instrument enforceable in accordance
with its terms except as it may be limited by bankruptcy, insolvency,
reorganization or other laws relating to or affecting the enforcement of
creditors' rights; and the Securities and the Indenture conform or will conform
at the time of their issuance and execution, as the case may be, in all material
respects to the descriptions thereof in the Prospectus.
(x) Except as otherwise set forth in the Prospectus, (A) the Company and its
subsidiaries own, possess, currently have the right to use or can acquire on
reasonable terms, the patents, patent rights, licenses, inventions, copyrights,
know-how (including trade secrets and other unpatented and unpatentable
proprietary or confidential information, systems or procedures), trademarks,
service marks and trade names presently employed by them in connection with the
businesses now operated by them, and neither the Company nor any of its
subsidiaries have received any notice of infringement of or conflict with
asserted rights of others with respect to any of the foregoing which, singly or
in the aggregate, if the subject of an unfavorable decision, ruling or finding,
would result in any material adverse change in the condition (financial or
otherwise), business, prospects or results of operations of the Company and its
subsidiaries considered as a whole and (B) the Company has good and marketable
title to all real and personal property owned by it, free and clear of any
security interest, lien or other encumbrance which
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<PAGE>
would impair the use, occupancy or value, or the marketability of title, of the
property subject thereto, except such as are described in the Prospectus or such
as do not materially affect the value of the property and do not interfere with
the use made and proposed to be made of such property by the Company and its
subsidiaries.
(xi) No consent, approval, authorization or order of any court or governmental
agency or body is required for the consummation by the Company of the
transactions contemplated by this Agreement, the Indenture and the Debt
Securities, except such as may be required by the National Association of
Securities Dealers, Inc. or under the 1933 Act or the securities or Blue Sky
laws of any jurisdiction in connection with the purchase and distribution of the
Securities by you.
(xii) The Company is not an "investment company" or an entity "controlled" by
an "investment company" as such terms are defined in the Investment Company Act
of 1940, as amended.
(xiii) The Company and its Significant Subsidiaries are, to the best of the
Company's knowledge, in compliance with any and all applicable federal, state
and local laws and regulations relating to the protection of the environment or
hazardous or toxic substances or wastes, pollutants or contaminants
("Environmental Laws") with such exceptions as would not, singly or in the
aggregate, result in a material adverse change in the condition (financial or
otherwise), business, prospects or results of operations of the Company and its
subsidiaries considered as a whole.
(xiv) This Agreement has been duly authorized, executed and delivered by the
Company.
(xv) No material labor dispute with the employees of the Company or any of its
subsidiaries, exists or, to the best of the Company's knowledge, is imminent;
and the Company is not aware of any existing or imminent labor disturbance by
the employees of any of its principal suppliers, manufacturers or contractors
which might be expected to result in any material adverse change in the
condition (financial or otherwise), business, prospects or results of operations
of the Company and its subsidiaries considered as a whole.
(xvi) Except as otherwise disclosed in the Prospectus, none of the Company
and its subsidiaries has been assessed a tax deficiency or is the subject of a
pending tax dispute which, if adversely determined, would have a material
adverse effect on the condition (financial or otherwise), business, prospects or
results of operations of the Company and its subsidiaries considered as a whole.
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<PAGE>
(b) Any certificate signed by an officer of the Company and delivered to you
or counsel for the Underwriters at a Closing Time in connection with an offering
of Securities shall be deemed a representation and warranty of the Company, as
to the matters covered thereby, to each Underwriter participating in such
offering.
3. Purchase and Sale. The several commitments of the Underwriters to
-----------------
purchase Securities pursuant to any Terms Agreement shall be deemed to have been
made on the basis of the representations and warranties herein contained and
shall be subject to the terms and conditions herein set forth.
Payment of the purchase price for, and delivery of, any Securities to be
purchased by the Underwriters shall be made (i) in the case of Securities in
registered form, at the office of Brown & Wood, One World Trade Center, New
York, New York 10048, or (ii) in the case of Securities in bearer form, at the
office of Brown & Wood, One World Trade Center, New York, New York 10048, or at
such other place as shall be agreed upon by you and the Company, at 10:00 A.M.,
New York City time, on the third business day (unless postponed in accordance
with the provisions of Section 11) following the date of the applicable Terms
Agreement or such other time as shall be agreed upon by you and the Company
(each such time and date being referred to as a "Closing Time"). Payment shall
be made to the Company by certified or official bank check or checks in New York
Clearing House or similar next day funds payable to the order of the Company
against delivery to you for the respective accounts of the Underwriters of the
Securities to be purchased by them (unless such Securities are issuable only in
the form of a single global Security registered in the name of a depository or a
nominee of a depository, in which event the Underwriters' interest in such
global certificate shall be noted in a manner satisfactory to the Underwriters
and their counsel). Such Securities shall be in such authorized denominations
and registered in such names as you may request in writing at least two business
days prior to the applicable Closing Time. Such Securities, which may be in
temporary form, will be made available for examination and packaging by you on
or before the first business day prior to Closing Time.
If authorized by the applicable Terms Agreement, the Underwriters named
therein may solicit offers to purchase Debt Securities from the Company pursuant
to delayed delivery contracts ("Delayed Delivery Contracts") substantially in
the form of Exhibit B hereto with such changes therein as the Company may
approve. As compensation for arranging Delayed Delivery Contracts, the Company
will pay to Dean Witter Reynolds Inc. ("DWR") at Closing Time, for the accounts
of the Underwriters, a fee relating to the principal amount of Debt Securities
for which
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<PAGE>
Delayed Delivery Contracts are made at Closing Time as is specified in
the applicable Terms Agreement. Any Delayed Delivery Contracts are to be with
institutional investors of the types set forth in the Prospectus. At Closing
Time the Company will enter into Delayed Delivery Contracts (for not less than
the minimum principal amount of Debt Securities per Delayed Delivery Contract
specified in the applicable Terms Agreement) with all purchasers proposed by the
Underwriters and previously approved by the Company as provided below, but not
for an aggregate principal amount of Debt Securities in excess of that specified
in the applicable Terms Agreement. The Underwriters will not have any
responsibility for the validity or performance of Delayed Delivery Contracts.
You are to submit to the Company, at least two business days prior to Closing
Time, the names of any institutional investors with which it is proposed that
the Company will enter into Delayed Delivery Contracts and the principal amount
of Debt Securities to be purchased by each of them, and the Company will advise
you, at least one business day prior to Closing Time, of the names of the
institutions with which the making of Delayed Delivery Contracts is approved by
the Company and the principal amount of Debt Securities to be covered by each
such Delayed Delivery Contract.
The principal amount of Debt Securities agreed to be purchased by the
respective Underwriters pursuant to the applicable Terms Agreement shall be
reduced by the principal amount of Debt Securities covered by Delayed Delivery
Contracts, as to each Underwriter as set forth in a written notice delivered by
you to the Company; provided, however, that the total principal amount of Debt
Securities to be purchased by all Underwriters shall be the total amount of Debt
Securities covered by the applicable Terms Agreement, less the principal amount
of Debt Securities covered by Delayed Delivery Contracts.
4. Covenants of the Company. The Company covenants with each of you, and
------------------------
with each Underwriter participating in the applicable offering of Securities, as
follows:
(a) Immediately following the execution of each Terms Agreement, the Company
will prepare a Prospectus Supplement setting forth the principal amount of Debt
Securities covered thereby and their terms not otherwise specified in the
Indenture, the names of the Underwriters participating in the offering and the
principal amount of Debt Securities which each severally has agreed to purchase,
the names of the Underwriters acting as co-managers in connection with the
offering, the price at which the securities are to be purchased by the
Underwriters from the Company, the initial public offering price, the selling
concession and
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<PAGE>
reallowance, if any, any delayed delivery arrangements, and such other
information as you and the Company deem appropriate in connection with the
offering of the Securities. The Company will promptly transmit copies of the
Prospectus Supplement to the Commission for filing pursuant to Rule 424 of the
Regulations and will furnish to the Underwriters named therein as many copies of
the Prospectus and such Prospectus Supplement as you shall reasonably request.
(b) If at any time when the Prospectus is required by the 1933 Act to be
delivered in connection with sales of the Securities any event shall occur or
condition exist as a result of which it is necessary, in the view of your
counsel or counsel for the Company, to further amend or supplement the
Prospectus in order that the Prospectus will not include an untrue statement of
a material fact or omit to state any material fact necessary to make the
statements therein not misleading in the light of the circumstances existing at
the time it is delivered to a purchaser or if it shall be necessary, in the view
of either such counsel, at any such time to amend or supplement the Registration
Statement or the Prospectus in order to comply with the requirements of the 1933
Act or the Regulations, the Company will promptly prepare and file with the
Commission such amendment or supplement, whether by filing documents pursuant to
the 1934 Act or otherwise, as may be necessary to correct such untrue statement
or omission or to make the Registration Statement comply with such
requirements.
(c) With respect to each sale of Securities, the Company will make generally
available to its security holders as soon as practicable, but not later than 60
days after the close of the period covered thereby, earnings statements (in form
complying with the provisions of Rule 158 under the 1933 Act) covering twelve
month periods beginning, in each case, not later than the first day of the
Company's fiscal quarter next following the "Effective Date" (as defined in Rule
158) of the Registration Statement relating to such Securities.
(d) The Company will give you notice of its intention to file any amendment to
the Registration Statement or any amendment or supplement to the Prospectus,
whether pursuant to the 1934 Act, the 1933 Act or otherwise, will furnish you
with copies of any such amendment or supplement or other documents proposed to
be filed a reasonable time in advance of filing, and will not file any such
amendment or supplement or other documents in a form to which you or your
counsel shall reasonably object.
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<PAGE>
(e) The Company will notify each of you immediately, and confirm the notice in
writing, (i) of the effectiveness of any amendment to the Registration
Statement, (ii) of the mailing or the delivery to the Commission for filing of
any supplement to the Prospectus or any document to be filed pursuant to the
1934 Act, (iii) of the receipt of any comments from the Commission with respect
to the Registration Statement, the Prospectus or any Prospectus Supplement, (iv)
of any request by the Commission for any amendment to the Registration Statement
or any amendment or supplement to the Prospectus or for additional information,
and (v) of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or the initiation of any proceedings
for that purpose. The Company will make every reasonable effort to prevent the
issuance of any stop order and, if any stop order is issued, to obtain the
lifting thereof at the earliest possible moment.
(f) The Company will deliver to each of you one signed and as many conformed
copies of the Registration Statement (as originally filed) and of each amendment
thereto (including exhibits filed therewith or incorporated by reference therein
and documents incorporated by reference in the Prospectus) as you may reasonably
request and will also deliver to you a conformed copy of the Registration
Statement and each amendment thereto for each of the Underwriters.
(g) The Company will endeavor, in cooperation with you, to qualify the
Securities for offering and sale under the applicable securities laws of such
states and other jurisdictions of the United States as you may designate, and
will maintain such qualifications in effect for as long as may be required for
the distribution of the Securities; provided, however, that the Company shall
not be required to qualify to do business or to file a general consent to
service of process in any such jurisdiction. The Company will, from time to
time, prepare and file such statements and reports as are or may be required by
the laws of each jurisdiction in which the Securities have been qualified as
above provided.
(h) The Company, during the period when the Prospectus is required to be
delivered under the 1933 Act, will file promptly all documents required to be
filed with the Commission pursuant to Section 13 or 14 of the 1934 Act.
(i) Between the date of any Terms Agreement and the later of termination of
any trading restrictions or Closing Time with respect to the Securities, the
Company will not,
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<PAGE>
without your prior consent, offer or sell, or enter into any agreement to sell,
any new issue of debt securities of the Company with a maturity of more than one
year, including additional Debt Securities (except for (i) medium-term notes of
the Company issued in the ordinary course of business through Dean Witter
Reynolds Inc. (and the other agents, if any) (A) acting as agent for the
Company, or (B) acting as principal and purchasing up to $10 million aggregate
principal amount of medium-term notes of the Company for resale, or (ii) any
debt securities of the Company denominated in a currency other than the currency
in which the Securities subject to such Terms Agreement shall be denominated) or
any warrants for the purchase of debt securities of the Company with a maturity
of more than one year.
(j) The Company will use the net proceeds received by it from the sale of the
Debt Securities in the manner specified in the Prospectus under "Use of
Proceeds."
5. Payment of Expenses. The Company will pay all expenses incident to the
-------------------
performance of its obligations under this Agreement, including (i) the printing
and filing of the Registration Statement and all amendments thereto, and the
printing of this Agreement and each Terms Agreement, (ii) the preparation,
issuance and delivery of the Securities to the Underwriters, (iii) the
reasonable fees and disbursements of the Company's counsel and accountants, (iv)
the qualification of the Securities under securities laws in accordance with the
provisions of Section 4(g), including filing fees and the reasonable fees and
disbursements of counsel for the Underwriters in connection therewith and in
connection with the preparation of any Blue Sky Surveys and Legal Investment
Surveys, (v) the printing and delivery to the Underwriters in quantities as
hereinabove stated of copies of the Registration Statement and any amendments
thereto, and of the Prospectus and any amendments or supplements thereto, (vi)
the printing and delivery to the Underwriters of copies of the Indenture and any
Blue Sky Surveys and Legal Investment Surveys, (vii) the fees of rating
agencies, (viii) the fees and expenses, if any, incurred in connection with the
listing of the Securities on the New York Stock Exchange or any other national
exchange, and (ix) the fees and expenses incurred with respect to the filing
with the National Association of Securities Dealers, Inc.
If a Terms Agreement is terminated by you in accordance with the provisions of
Section 8 or Section 9(i), the Company shall reimburse the Underwriters named in
such Terms Agreement for all of their out-of-pocket expenses, including the
reasonable fees and disbursements of counsel for the Underwriters.
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<PAGE>
6. Indemnification and Contribution. (a) The Company agrees to indemnify and
--------------------------------
hold harmless each Underwriter, each of its employees, officers, directors and
agents, and each person, if any, who controls such Underwriter within the
meaning of the 1933 Act, against any losses, claims, damages, liabilities or
expenses (including the reasonable cost of investigating and defending against
any claims therefor and counsel fees incurred in connection therewith), joint or
several, as incurred, which may be based upon the 1933 Act, or any other federal
or state statute or at common law, arising out of any untrue statement or
alleged untrue statement of a material fact contained in the Registration
Statement (or any amendment thereto), or the omission or alleged omission
therefrom of a material fact required to be stated therein or necessary to make
the statements therein not misleading or arising out of any untrue statement or
alleged untrue statement of a material fact contained in the Prospectus (or any
amendment or supplement thereto) or the omission or alleged omission therefrom
of a material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading, unless
such statement or omission was made in reliance upon, and in conformity with,
written information furnished to the Company by such Underwriter, directly or
through you, specifically for use in the preparation thereof.
Notwithstanding the above, the Company shall not be liable with respect to any
claims made against any Underwriter or any other indemnified person under this
subsection (a) unless such Underwriter or indemnified person shall have notified
the Company in writing within a reasonable time after the summons or other first
legal process giving information of the nature of the claim shall have been
served upon such Underwriter or indemnified person (such notification by an
Underwriter shall suffice as notification on behalf of its officers, directors,
employees, agents and controlling persons), but failure to notify the Company of
any such claim shall not relieve it from any liability which it may have to such
Underwriter or indemnified person otherwise than on account of the indemnity
agreement contained in this subsection (a). In addition, the Company shall not
be liable to any Underwriter, employee, officer, director or agent of any
Underwriter, or any person controlling such Underwriter under the indemnity
agreement in this section (a) to the extent that any such loss, claim, damage,
liability or expense of such Underwriter, employee, officer, director, agent or
controlling person results solely from the fact that such Underwriter 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 or of the Prospectus
as then amended or supplemented if the Company has previously furnished copies
thereof to such Underwriter.
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<PAGE>
The Company shall be entitled to participate at its own expense in the
defense, or, if it so elects, to assume the defense of any suit brought to
enforce any such liability, but, if the Company elects to assume the defense,
such defense shall be conducted by counsel chosen by it and reasonably
satisfactory to such Underwriter or indemnified person, as the case may be. In
the event the Company elects to assume the defense of any such suit and retain
such counsel, the Underwriter or Underwriters or other indemnified person or
persons, defendant or defendants in the suit, may retain additional counsel but
shall bear the reasonable fees and expenses of such counsel unless (i) the
Company shall have specifically authorized the retaining of such counsel or (ii)
the parties to such suit include such Underwriter or Underwriters or other
indemnified person or persons and such Underwriter or Underwriters or other
indemnified person or persons have been advised by counsel that one or more
legal defenses may be available to it or them which may not be available to the
Company or Dean Witter Reynolds Inc. ("DWR") in which case the Company shall not
be entitled to assume the defense of such suit notwithstanding its obligation to
bear the reasonable fees and expenses of such counsel and the Underwriters other
than DWR shall be entitled to use separate legal counsel and DWR shall be
entitled to use separate legal counsel. The Company will not, without the prior
written consent of a majority of the Representatives of the Underwriters,
excluding Dean Witter Reynolds Inc. (except in the case where Dean Witter
Reynolds Inc. is the sole Representative), settle or compromise or consent to
the entry of any judgment in any pending or threatened claim, action, suit or
proceeding in respect of which indemnification may be sought hereunder (whether
or not such Underwriter or employee, officer, director or agent of such
Underwriter or any person who controls such Underwriter is a party to such
claim, action, suit or proceeding), unless such settlement, compromise or
consent includes an unconditional release of such Underwriter and each such
employee, officer, director, agent or controlling person of the Underwriter from
all liability arising out of such claim, action, suit or proceeding.
(b) Each Underwriter severally agrees to indemnify and hold harmless the
Company, each of its directors, each of its officers who has signed the
Registration Statement, each of its employees and agents and each person, if
any, who controls the Company within the meaning of the 1933 Act, against any
losses, claims, damages, liabilities or expenses (including, unless the
Underwriter or Underwriters elect to assume the defense, the reasonable cost of
investigating and defending against any claims therefor and counsel fees
incurred in connection therewith), joint or several, as incurred, which may be
based upon the 1933 Act, or any other statute or at common law, arising out of
any untrue statement or alleged untrue statement of a material fact contained in
the Registration Statement (or any amendment
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<PAGE>
thereto), or the omission or alleged omission therefrom of a material fact
required to be stated therein or necessary to make the statements therein not
misleading, or arising out of anyuntrue statement or alleged untrue statement of
a material fact contained in the Prospectus (or any amendment or supplement
thereto), or the omission or alleged omission therefrom of a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading, but only insofar as
any such statement or omission was made in reliance upon, and in conformity
with, written information furnished to the Company by such Underwriter, directly
or through you, specifically for use in the preparation thereof; provided,
--------
however, that in no case is such Underwriter to be liable with respect to any
- -------
claims made against the Company or any indemnified person under this subsection
(b) unless the Company or such person shall have notified such Underwriter in
writing within a reasonable time after the summons or other first legal
process giving information of the nature of the claim shall have been served
upon the Company or such person, but failure to notify such Underwriter of such
claim shall not relieve it from any liability which it may have to the Company
or such person otherwise than on account of its indemnity agreement contained in
this subsection (b). Such Underwriter shall be entitled to participate at its
own expense in the defense, or, if it so elects, to assume the defense of any
suit brought to enforce any such liability, but, if such Underwriter elects to
assume the defense, such defense shall be conducted by counsel chosen by it and
reasonably satisfactory to the Company or such person, as the case may be. In
the event that any Underwriter elects to assume the defense of any such suit and
retain such counsel, the Company, said employees, agents, officers and directors
and any other Underwriter or Underwriters or employee or employees or agent or
agents or controlling person or persons, defendant or defendants in the suit,
shall bear the fees and expenses of any additional counsel retained by them,
respectively. The Underwriter against whom indemnity may be sought shall not be
liable to indemnify any person for any settlement of any such claim effected
without such Underwriter's consent.
(c) If the indemnification provided for in this Section 6 is unavailable to an
indemnified party under subsection (a) or (b) above in respect of any losses,
claims, damages, liabilities or expenses (or actions in respect thereof)
referred to therein, then the indemnifying party shall contribute to the amount
paid or payable by such indemnified party as a result of such losses, claims,
damages, liabilities or expenses (or actions in respect thereof), in such
proportion as is appropriate to reflect the respective relative benefits
received by the Company and the Underwriters from the offering of the Securities
and the respective relative fault of the Company and the Underwriters in
connection with the statements or omissions which resulted in
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<PAGE>
such losses, claims, damages, liabilities or expenses (or actions in respect
thereof), as well as any other relevant equitable considerations. The respective
relative benefits received by the Company and the Underwriters shall be deemed
to be in the same proportion as the total net proceeds from the offering (before
deducting expenses) received by the Company bear to the total underwriting
discounts and commissions received by the Underwriters, in each case as set
forth in the table on the cover page of the Prospectus. 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 relates to information supplied by the Company or the
Underwriters and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission. With respect
to any Underwriter, such relative fault shall also be determined by reference to
the extent (if any) to which such losses, claims, damages, liabilities or
expenses (or actions in respect thereof) result solely from the fact that such
Underwriter 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 or
of the Prospectus as then amended or supplemented if the Company has previously
furnished copies thereof to such Underwriter. The Company and the Underwriters
agree that it would not be just and equitable if contribution were determined by
pro rata allocation (even if the Underwriters were treated as one entity for
such purpose) or by any other method of allocation which does not take account
of the equitable considerations referred to above. The amount paid or payable by
an indemnified party as a result of the losses, claims, damages, liabilities or
expenses (or actions in respect thereof) referred to above shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any such claim.
Notwithstanding the provisions of this subsection (c), no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Securities underwritten by it and distributed to the public
were offered to the public exceeds the amount of any damages which such
Underwriter 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 1933
Act) shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. The Underwriters' obligations to contribute
are several in proportion to their respective underwriting obligations and not
joint.
(d) The obligations of the Company under this Section 6 shall be in addition
to any liability which the Company may otherwise have and shall extend, upon the
same terms and
- 16 -
<PAGE>
conditions, to each person, if any, who controls any Underwriter
within the meaning of the 1933 Act and each employee, officer, director and
agent of each Underwriter, and the obligations of the Underwriters under this
Section 6 shall be in addition to any liability which the respective
Underwriters 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 1933 Act.
7. Survival of Indemnities, Representations, Warranties, etc. The respective
---------------------------------------------------- ---
indemnities, covenants, agreements, representations, warranties and other
statements of the Company and the several Underwriters, as set forth in this
Agreement or made by them respectively, pursuant to this Agreement, shall .
remain in full force and effect, regardless of any investigation made by or on
behalf of any Underwriter, the Company or any of its officers or directors or
any controlling person, and shall survive delivery of and payment for any
Securities.
8. Conditions of Underwriters' Obligations. The obligations of the
---------------------------------------
Underwriters to purchase Securities pursuant to any Terms Agreement are subject
to the accuracy of the representations and warranties on the part of the Company
herein contained, to the accuracy of the statements of the Company's officers
made in any certificate furnished pursuant to the provisions hereof, to the
performance by the Company of all of its covenants and other obligations
hereunder and to the following further conditions:
(a) At the applicable Closing Time (i) no stop order suspending the
effectiveness of the Registration Statement shall have been issued under the
1933 Act, no order suspending trading or striking or withdrawing any Securities
to be listed on a national securities exchange from listing and registration
under the 1934 Act shall be in effect, and no proceedings under the 1933 Act or
the 1934 Act therefor shall have been initiated or threatened by the Commission,
or, with respect to the filing of any Form 8-A, by any national securities
exchange, (ii) the rating assigned by any nationally recognized securities
rating agency to any debt securities, preferred stock or other obligations of
the Company as of the date of the applicable Terms Agreement shall not have been
lowered since the execution of such Terms Agreement, (iii) any Securities for
which application has been made to list on a national securities exchange shall
have been approved for listing, subject to official notice of issuance and (iv)
there shall not have come to your attention any facts that would cause you to
believe that the Prospectus, together with the applicable Prospectus Supplement,
at the time it was required to be delivered to a purchaser of the Securities,
contained an untrue statement of a material fact or omitted to state a material
fact necessary in order to make the statements
- 17 -
<PAGE>
therein, in the light of the circumstances existing at such time, not
misleading.
(b) At the applicable Closing Time you shall have received:
(1) The favorable opinion, dated as of the applicable Closing Time, of
Brown & Wood, counsel for the Company, in form and substance satisfactory to
you, to the effect that:
(i) The Company has been duly incorporated, is validly existing as a
corporation in good standing under the laws of Delaware and has the requisite
corporate power and authority to own or lease its properties and conduct its
business as described in the Prospectus; and the Company is duly qualified as a
foreign corporation in good standing in all other jurisdictions where its
ownership or leasing of properties or the conduct of its business requires such
qualification, except in any case where the failure to so qualify or be in good
standing would not result in a material adverse change in the condition
(financial or otherwise), business or results of operations of the Company and
its subsidiaries considered as a whole.
(ii) Each of the Significant Subsidiaries is a corporation validly
existing and in good standing under the laws of the jurisdiction of its
incorporation and has the requisite corporate power and authority to own or
lease its properties and conduct its business as described in the Prospectus and
each such corporation is duly qualified as a foreign corporation in good
standing in all other jurisdictions where its ownership or leasing of properties
or the conduct of its business requires such qualification, except in any case
where the failure to so qualify or be in good standing would not result in a
material adverse change in the condition (financial or otherwise), business or
results of operations of the Company and its subsidiaries considered as a whole.
(iii) This Agreement, the applicable Terms Agreement, and the Delayed
Delivery Contracts, if any, have been duly authorized, executed and delivered by
the Company.
(iv) The Indenture has been duly and validly authorized, executed and
delivered by the Company and constitutes the valid and binding agreement of the
Company, enforceable in accordance with its terms, except as enforcement thereof
may be limited by
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<PAGE>
bankruptcy, insolvency or other laws of general applicability relating to or
affecting enforcement of creditors' rights or by general equity principles.
(v) The Securities, including any Securities in global form, are in the form
contemplated by the Indenture; the Securities have been duly and validly
authorized by all necessary corporate action and, when executed and
authenticated as specified in the Indenture and delivered against payment
pursuant to this Agreement, as supplemented by the applicable Terms Agreement,
or any Delayed Delivery Contracts, will be valid and binding obligations of the
Company, enforceable in accordance with their terms, except as enforcement
thereof may be limited by bankruptcy, insolvency or other laws of general
applicability relating to or affecting enforcement of creditors' rights or by
general equity principles, and except further as enforcement thereof may be
limited by requirements that a claim (or a foreign currency judgment in respect
of such claim) be converted into United States dollars at a rate exchange
prevailing on a date determined pursuant to applicable law, and will be entitled
to the benefits of the Indenture. The definitive Securities in bearer form
issuable in exchange for any global Security, when duly executed, authenticated,
issued and delivered in exchange for such global Security as specified in the
Indenture, will be valid and binding obligations of the Company, enforceable in
accordance with their terms, except as enforcement thereof may be limited by
bankruptcy, insolvency or other laws relating to or affecting the enforcement of
creditors, rights or by general equity principles, and except further as
enforcement thereof may be limited by requirements that a claim (or a foreign
currency judgment in respect of such claim) be converted into United States
dollars at a rate of exchange prevailing on a date determined pursuant to
applicable law, and will be entitled to the benefits of the Indenture.
(vi) The Indenture and the Securities conform in all material respects to the
descriptions thereof in the Prospectus and the applicable Prospectus Supplement.
(vii) The Indenture is qualified under the 1939 Act.
(viii) The Registration Statement is effective under the 1933 Act and,
to the best of their knowledge
- 19 -
<PAGE>
and information, no stop order suspending the effectiveness of the Registration
Statement has been issued under the 1933 Act or proceedings therefor initiated
or threatened by the Commission.
(ix) The Registration Statement, at the time it became effective and
as of the date of the applicable Terms Agreement (other than the financial
statements included therein, as to which no opinion need be rendered) complied
as to form in all material respects with the requirements of the 1933 Act, the
1939 Act, and the Regulations.
(x) Each document, if any, filed pursuant to the 1934 Act (other than
the financial statements included therein, as to which no opinion need be
rendered) and incorporated by reference in the Prospectus complied when so filed
as to form in all material respects with the 1934 Act and the rules and
regulations thereunder.
(xi) No consent, approval, authorization or order of any court or
governmental authority or agency is required in connection with the sale of the
Securities to the Underwriters, except such as may be required under the 1933
Act and state securities laws; and to the best of their knowledge and
information, the execution and delivery of this Agreement and the applicable
Terms Agreement, any Delayed Delivery Contracts, the Indenture and the
consummation of the transactions contemplated herein and therein will not
conflict with or constitute a breach of, or default under, or result in the
creation or imposition of any lien, charge or encumbrance upon any property or
assets of the Company or any Significant Subsidiary pursuant to, any contract,
indenture, mortgage, loan agreement, note, lease or other instrument set forth
in a certificate of the Chief Executive Officer, a Vice President, the Treasurer
or the Controller of the Company, dated as of the date of such opinion of
counsel (which certificate shall set forth all material contracts, indentures,
mortgages, deeds of trust, loan agreements, notes, leases or other agreements or
instruments to which the Company is a party or by which it may be bound or to
which any of its properties or assets are subject), nor will such action result
in any violation of the provisions of the charter or by-laws of the Company, or
any law, administrative regulation or administrative or court decree, other than
such breaches, defaults or violations which individually or in the aggregate
would not result in a material adverse change in the condition (financial or
otherwise),
- 20 -
<PAGE>
business or results of operations of the Company and its subsidiaries taken as
a whole.
You shall also have received from such counsel a letter advising that
nothing has come to such counsel's attention that would lead such counsel to
believe that the Registration Statement, at the time it became effective, or if
an amendment to the Registration Statement or an annual report on Form 10-K has
been filed by the Company with the Commission subsequent to the effectiveness of
the Registration Statement (other than the financial statements and supporting
schedules and other financial or statistical information set forth therein, as
to which no advice is given), then at the time of the most recent such filing,
and as of the date of the applicable Terms Agreement, contained any untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not misleading or
that the Prospectus, as amended or supplemented at the date of the applicable
Terms Agreement and at Closing Time, contained or contains an untrue statement
of a material fact or omitted or omits to state any material fact necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading.
(2) The opinion or opinions, dated as of the applicable Closing Time, of
Kirkland and Ellis, counsel for the Underwriters, with respect to the validity
of the Securities, the Registration Statement, the Prospectus and such other
related matters as you may reasonably require. In giving such opinion or
opinions, such counsel may rely, as to all matters governed by the laws of
jurisdictions other than the law of the State of New York, the State of Delaware
and the federal law of the United States, upon opinions of counsel satisfactory
to you. The Company shall have furnished to such counsel such documents as they
may request for the purpose of enabling them to pass upon such matters.
(c) At the applicable Closing Time there shall not have been, since the date
of the applicable Terms Agreement or since the respective dates as of which
information is given in the Registration Statement, any material adverse change
in the condition, financial or otherwise, of the Company and its subsidiaries
considered as one enterprise, or in the earnings, business affairs or business
prospects of the Company and its subsidiaries considered as one enterprise,
whether or not arising in the ordinary course of business, and you shall have
received a certificate of the Chief Executive Officer, a Vice President, the
Treasurer or the Controller of the Company, dated as of such
- 21 -
<PAGE>
Closing Time, to the effect that there has been no such material adverse change
and to the effect that the representations and warranties of the Company
contained in Section 2 are true and correct with the same force and effect as
though such Closing Time were a Representation Date.
(d) You shall have received from Deloitte & Touche a letter, dated as of the
date hereof or the date of the most recent report filed with the Commission
containing financial statements or unaudited consolidated information and
incorporated by reference in the Registration Statement, if the date of such
report is later than the date hereof, and delivered at such time, in form
heretofore agreed to.
(e) You shall receive from Deloitte & Touche or other independent certified
public accountants acceptable to you a letter, dated as of the applicable
Closing Time, reconfirming or updating the letter required by subsection (d) of
this Section to the extent that may be reasonably requested.
(f) At the applicable Closing Time counsel for the Underwriters shall have
been furnished with such documents and opinions as they may reasonably require
for the purpose of enabling them to pass upon the issuance and sale of the
Securities as herein contemplated and related proceedings or in order to
evidence the accuracy and completeness of any of the representations and
warranties, or the fulfillment of any of the conditions, herein contained; and
all proceedings taken by the Company in connection with the issuance and sale of
the Securities as herein contemplated shall be satisfactory in form and
substance to you.
If any condition specified in this Section shall not have been fulfilled when
and as required to be fulfilled, the applicable Terms Agreement may be
terminated by you by notice to the Company at any time at or prior to the
applicable Closing Time, and such termination shall be without liability of any
party to any other party except as provided in Section 5.
9. Termination. This Agreement may be terminated for any reason at any time
-----------
by either the Company or a majority of you upon the giving of thirty days'
written notice of such termination to the other parties hereto. Such of you as
may be named in any Terms Agreement may also terminate such Terms Agreement,
immediately upon notice to the Company, at any time at or prior to the
applicable Closing Time (i) if there has been, since the date of such Terms
Agreement or since the respective dates as of which information is given in the
Registration Statement, any material adverse change in the condition, financial
or otherwise, of the Company and its subsidiaries considered as one enterprise,
or in the earnings, business
- 22 -
<PAGE>
affairs or business prospects of the Company and its subsidiaries considered as
one enterprise, whether or not arising in the ordinary course of business; or
(ii) if there has occurred any downgrading in the rating accorded the debt
securities of the Company by any rating agency; or (iii) if trading in the
Common stock of the Company has been suspended by the Commission or a national
securities exchange, or if trading generally on either the American Stock
Exchange or the New York Stock Exchange has been suspended, or minimum or
maximum prices for trading have been fixed, or maximum ranges for prices for
securities have been required, by either of said exchanges or by order of the
Commission or any other governmental authority, if a banking moratorium in the
United States generally or in the City or State of New York has been declared by
either Federal or New York authorities or if a banking moratorium has been
declared by the relevant authorities in the country or countries of origin of
any foreign currency or currencies underlying the Securities; or (iv) if there
has been any material adverse change in the financial markets of the United
States, Japan or Europe or any outbreak or material escalation of hostilities
between the United States and any foreign power, or of any other insurrection or
armed conflict involving the United States which, in the judgment of such of you
as are named in such Terms Agreement, makes it impracticable or inadvisable to
offer or sell the Securities or enforce contracts for the sale of the
Securities. In the event of any such termination, (x) the covenants set forth in
Section 4 with respect to any offering of Securities shall remain in effect so
long as any Underwriter owns any such Securities purchased from the Company
pursuant to the applicable Terms Agreement and (y) the covenant set forth in
Section 4(c), the provisions of Section 5, the indemnity agreement set forth in
Section 6, the contribution provisions set forth in Section 6, and the
provisions of Sections 7 and 13 shall remain in effect.
10. Default. If one or more of the Underwriters participating in an offering
-------
of Securities shall fail at the applicable Closing Time to purchase the
Securities which it or they are obligated to purchase hereunder and under the
applicable Terms Agreement (the "Defaulted Securities"), then such of you as are
named therein shall have the right, within 24 hours thereafter, to make
arrangements for one or more of the nondefaulting Underwriters, or any other
underwriters, to purchase all, but not less than all, of the Defaulted
Securities in such amounts as may be agreed upon and upon the terms herein set
forth. If, however, during such 24 hours you shall not have completed such
arrangements for the purchase of all of the Defaulted Securities, then:
(a) if the aggregate amount of Defaulted Securities does not exceed
10% of the aggregate amount of the Securities to be purchased pursuant to such
Terms Agreement,
- 23 -
<PAGE>
the non-defaulting Underwriters named in such Terms Agreement shall be obligated
to purchase the full amount thereof in the proportions that their respective
underwriting obligations thereunder bear to the underwriting obligations of all
such non-defaulting Underwriters, or
(b) if the aggregate amount of Defaulted Securities exceeds 10% of the
aggregate amount of the Securities to be purchased pursuant to such Terms
Agreement, the applicable Terms Agreement shall terminate, without any liability
on the part of any non-defaulting Underwriter or the Company.
As used in this Section only, the "aggregate amount" of Securities shall mean
the aggregate principal amount of any Debt Securities. No action taken pursuant
to this Section shall relieve any defaulting Underwriter from liability in
respect of any default of such Underwriter under this Agreement and the
applicable Terms Agreement.
In the event of a default by any Underwriter or Underwriters as set forth in
this Section, either you or the Company shall have the right to postpone the
applicable Closing Time for a period not exceeding seven days in order that any
required changes in the Registration Statement or Prospectus or in any other
documents or arrangements may be effected.
11. Covenants of the Underwriters. Each Underwriter severally covenants with
-----------------------------
the Company that (i) it will not offer, sell or deliver any Securities in bearer
form (whether temporary or definitive) during the "restricted period" (as
hereinafter defined) with respect to such Securities in the United States (as
hereinafter defined), or to any United States person (as hereinafter defined)
other than a financial institution (as hereinafter defined), and (ii) it has in
effect, in connection with the offer and sale of the Securities in bearer form
during the restricted period, procedures reasonably designed to ensure that its
employees or agents who are directly involved in selling the Securities are
aware that the Securities cannot be offered or sold during the restricted period
to a person who is within the United States or its possessions or is a United
States person. An offer or sale of a Security in bearer form will not be treated
as made to a person within the United States or to a United States person if the
person to whom the offer or sale is made is the United States office of (i) an
international organization (as defined in Section 7701(a)(18) of the Internal
Revenue Code of 1986, as amended (the "Code")), (ii) a foreign central bank (as
defined in Section 895 of the Code), or (iii) an exempt distributor (as
hereinafter defined). A sale of a Security in bearer form will not be treated
as made to a United States person if such person acquires the Security through a
financial institution and certain other conditions are met. As used
- 24 -
<PAGE>
herein,"United States person" means a citizen or resident of the United States
of America, its territories, its possessions or any area subject to its
jurisdiction ("United States"), or a corporation, partnership or other entity
created or organized in or under the laws of the United States or any political
subdivision thereof, or an estate or trust the income of which is subject to
United States Federal income taxation, regardless of its source. As used herein,
"financial institution" means a branch located outside the United States of a
financial institution as defined in Section 1.165-12(c)(1)(v) of the Treasury
Department Regulations that is purchasing the Securities for its own account or
for resale and that complies with the requirements of Section 165(j)(3)(A), (B)
or (C) of the Code and the regulations thereunder. As used herein, "exempt
distributor" means a distributor (as hereinafter defined) that covenants in its
contract with the Company or with a distributor that offers or sells a Security
during the restricted period with respect to such Security pursuant to a written
contract with the Company that it is buying such Security for the purpose of
resale in connection with its original issuance, and if such distributor retains
the obligation for its own account, it will do so only if it complies with the
limitations described above for offers or sales to financial institutions. As
used herein, "distributor" includes a person that offers or sells a Security
during the restricted period with respect to such Security pursuant to a written
contract with the Company or another distributor. As used herein, the term
"restricted period" with respect to a Security means the period that begins on
the earlier of the closing date or the first date on which such Security is
offered to a person other than a distributor, and ends 40 days after the Closing
Time with respect to such Security, except that any offer or sale of a Security
by the Company or a distributor is deemed to be made during the restricted
period if the Company or distributor holds the obligation as part of an unsold
allotment or subscription.
12. Notices. All notices and other communications hereunder shall be in
-------
writing and shall be deemed to have been duly given if mailed or transmitted by
any standard form of telecommunication. Notices to the Underwriters shall be
directed to you c/o Dean Witter Reynolds Inc. at Two World Trade Center, New
York, N.Y. 10048, attention of Samuel H. Wolcott, III, or, in respect of any
Terms Agreement, to such other person and place as may be specified therein;
notices to the Company shall be directed to it at Two World Trade Center, New
York, New York 10048, attention of Executive Vice President and General Counsel.
13. Parties. This Agreement shall inure to the benefit of and be binding upon
-------
you and the Company, and any Terms Agreement shall inure to the benefit of and
be binding upon the Company and any Underwriter who becomes a party to a Terms
Agreement, and
- 25 -
<PAGE>
their respective successors. Nothing expressed or mentioned in this Agreement or
a Terms Agreement is intended or shall be construed to give any person, firm or
corporation, other than the parties hereto or thereto and their respective
successors and the controlling persons and officers and directors referred to in
Section 6 and their heirs and legal representatives, any legal or equitable
right, remedy or claim under or in respect of this Agreement or a Terms
Agreement or any provision herein or therein contained. This Agreement and any
Terms Agreement and all conditions and provisions hereof or thereof are intended
to be for the sole and exclusive benefit of the parties and their respective
successors and said controlling persons and officers and directors and their
heirs and legal representatives, and for the benefit of no other person, firm or
corporation. No purchaser of Securities from any Underwriter shall be deemed to
be a successor by reason merely of such purchase.
14. Governing Law. This Agreement and each Terms Agreement shall be governed
-------------
by and construed in accordance with the laws of the State of New York without
giving effect to any choice of law or conflict of law provision or rule (whether
of the State of New York or any other jurisdiction) that would cause the
application of the laws of any jurisdiction other than the State of New York.
- 26 -
<PAGE>
If the foregoing correctly sets forth our understanding, please indicate your
acceptance thereof in the space provided below for that purpose, whereupon this
letter and your acceptance shall constitute a binding agreement between us.
Very truly yours,
DEAN WITTER, DISCOVER & CO.
By:
-------------------------------
Title:
-----------------------------
Accepted and delivered,
as of the date first above written:
DEAN WITTER REYNOLDS INC.
and the other Representatives named
in the respective Terms Agreements
By: DEAN WITTER REYNOLDS INC.
By:
---------------------------------
Authorized Signature
- 27 -
<PAGE>
EXHIBIT A
DEAN WITTER, DISCOVER & CO.
(A DELAWARE CORPORATION)
DEBT SECURITIES
TERMS AGREEMENT
---------------
Dated: , 19
TO: DEAN WITTER, DISCOVER & CO.
Two World Trade Center
New York, New York 10048
Attention:
Re: Underwriting Agreement dated ________ __, 1996.
DEBT SECURITIES
---------------
Title of Debt Securities:
Indenture (if other than as specified in the Underwriting Agreement):
Principal amount to be issued: $
Current ratings:
Interest rate: % Payable:
Date of maturity:
[Currency of Denomination:
Currency of Payment:
Form and Denomination:
Overseas Paying Agent:]
Redemption provisions:
Sinking fund requirements:
- 1 -
<PAGE>
Delayed Delivery Contracts: [authorized] [not authorized].
Delivery Date:
Minimum Contract:
Maximum aggregate principal amount:
Fee: %.
[Public offering price: %, plus accrued interest, or amortized original
issue discount, if any, from , 19 .]
Purchase price: %, plus accrued interest, or amortized original issue
discount, if any, from , 19 .](payable in next day funds).
-----------------------
Closing date and location with respect to registered Securities:
Closing date and location with respect to bearer Securities:
Additional Representatives, if any:
[Additional Termination Events: To the list of termination events included in
Section 9 of the Underwriting Agreement is added the following:
(iv) a general moratorium in foreign exchange trading, or a moratorium in
or U.S. dollar trading, by major international banks or persons has been
declared, or exchange controls have been imposed or proposed, affecting the
or the U.S. dollar by any competent governmental authority in the United States
or ; or
(v) there shall be pending any legal proceedings against the Company or the
Underwriters relating to the Securities,]
[Additional Agreement of the Underwriters: To the agreements of the Underwriters
included in Section 11 of the Underwriting Agreement is added the following:
The Underwriters agree that they will not offer, sell, resell or deliver,
directly or indirectly, any Securities in or to residents of
, or to others for the reoffering, resale or delivery of any Securities
directly or indirectly in or to any resident of .]
- 1 -
<PAGE>
Each Underwriter severally agrees, subject to the terms and provisions of
the above referenced Underwriting Agreement, which is incorporated herein in its
entirety and made a part hereof, to purchase the principal amount of Debt
Securities set forth opposite its name.
[PRINCIPAL AMOUNT
OF
NAME DEBT SECURITIES
---- -----------------
$ _________
TOTAL: $ ========= ]
This Terms Agreement may be executed by any one or more of the parties
thereto in any number of counterparts, each of which shall be deemed to be an
original, but all such respective counterparts shall together constitute one and
the same instrument.
DEAN WITTER REYNOLDS INC.
(OTHER REPRESENTATIVES]
By: DEAN WITTER REYNOLDS INC.
By:
------------------------------------
[TITLE]
Acting on behalf of themselves and the other named
Underwriters.
Accepted:
By: DEAN WITTER, DISCOVER & CO.
By:
---------------------------
[TITLE]
<PAGE>
EXHIBIT B
DEAN WITTER, DISCOVER & CO.
(a Delaware corporation)
Debt Securities
DELAYED DELIVERY CONTRACT
-------------------------
, 19
DEAN WITTER, DISCOVER & CO.
Two World Trade Center
New York, N.Y. 10048
Attention:
Dear Sirs:
The undersigned hereby agrees to purchase from Dean Witter, Discover & Co.
(the "Company"), and the Company agrees to sell to the undersigned on
, 19 (the "Delivery Date"),
principal amount of the Company's [insert title of security] (the "Securities"),
offered by the Company's Prospectus dated , 19 , as supplemented by
its Prospectus Supplement dated , 19 , receipt of which is hereby
acknowledged, at a purchase price of % of the principal amount of Debt
Securities, plus accrued interest from , 19 , to the Delivery Date,
and on the further terms and conditions set forth in this contract.
Payment for the Securities which the undersigned has agreed to purchase on
the Delivery Date shall be made to the Company or its order by certified or
official bank check in New York Clearing House funds, at the office of Dean
Witter Reynolds Inc., Two World Trade Center, New York, New York 10048, on the
Delivery Date, upon delivery to the undersigned of the Securities to be
purchased by the undersigned in definitive form and in such denominations and
registered in such names as the undersigned may designate by written or
telegraphic communication addressed to the Company not less than five full
business days prior to the Delivery Date.
The obligation of the undersigned to take delivery of and make payment for
Securities on the Delivery Date shall be subject
only to the conditions that (1) the purchase of Securities to be made by the
undersigned shall not on the Delivery Date be
- 1 -
<PAGE>
prohibited under the laws of the jurisdiction to which the undersigned is
subject and (2) the Company, on or before , 19 , shall have sold to
the Underwriters of the Securities (the "Underwriters") such principal amount
of the Securities as is to be sold to them pursuant to the Terms Agreement
dated , 19 , between the Company and the Underwriters. The obligation
of the undersigned to take delivery of and make payment for Securities shall not
be affected by the failure of any purchaser to take delivery of and make payment
for Securities pursuant to other contracts similar to this contract. The
undersigned represents and warrants to you that its investment in the Securities
is not, as of the date hereof, prohibited under the laws of any jurisdiction to
which the undersigned is subject and which govern such investment.
Promptly after completion of the sale to the Underwriters the Company will
mail or deliver to the undersigned at its address set forth below notice to such
effect, accompanied by a copy of the opinion of counsel for the Company
delivered to the Underwriters in connection therewith.
By the execution hereof, the undersigned represents and warrants to the
Company that all necessary corporate action for the due execution and delivery
of this contract and the payment for and purchase of the Securities has been
taken by it and no further authorization or approval of any governmental or
other regulatory authority is required for such execution, delivery, payment or
purchase, and that, upon acceptance hereof by the Company and mailing or
delivery of a copy as provided below, this contract will constitute a valid and
binding agreement of the undersigned in accordance with its terms.
This contract will inure to the benefit of and be binding upon the parties
hereto and their respective successors, but will not be assignable by either
party hereto without the written consent of the other.
It is understood that the Company will not accept Delayed Delivery
Contracts for an aggregate amount of Securities in excess of $ and that the
acceptance of any Delayed Delivery Contracts is in the Company's sole discretion
and, without limiting the foregoing, need not be on a first-come, first-served
basis. If this contract is acceptable to the Company, it is requested that the
Company sign the form of acceptance on a copy hereof and mail or deliver a
signed copy hereof to the undersigned at its address set forth below. This will
become a binding contract between the Company and the undersigned when such
copy is so mailed or delivered.
- 2 -
<PAGE>
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO ANY CHOICE OF LAW OR
CONFLICT OF LAW PROVISION OR RULE (WHETHER OF THE STATE OF NOW YORK OR ANY OTHER
JURISDICTION) THAT WOULD CAUSE THE APPLICATION OF THE LAWS OF ANY JURISDICTION
OTHER THAN THE STATE OF NEW YORK.
Yours very truly,
-------------------------------
(Name of Purchaser)
By
-------------------------------
(Title)
-------------------------------
-------------------------------
(Address)
Accepted as of the date first above written.
DEAN WITTER, DISCOVER & CO.
By
-------------------------------
- 3 -
<PAGE>
PURCHASER -- PLEASE COMPLETE AT TIME OF SIGNING
The name and telephone number of the representative of the Purchaser
with whom details of delivery on the Delivery Date may be discussed are as
follows: (Please print)
Telephone No.
Name (Including Area Code)
- ---- ---------------------
- 4 -
<PAGE>
EXHIBIT 1(c)
________ __, 1996
AMENDMENT NO. 1 TO
DISTRIBUTION AGREEMENT
DATED NOVEMBER 19, 1993
-----------------------
DEAN WITTER REYNOLDS INC.
Two World Trade Center
New York, New York 10048
Dear Sirs:
The Distribution Agreement, dated November 19, 1993, between Dean
Witter, Discover & Co. (the "Company") and you relating to up to $3,250,000,000
aggregate principal amount of the Company's Medium-Term Notes Series I (the
"Distribution Agreement") is hereby amended as set forth in the numbered
paragraphs below.
1. Subparagraph (a) of paragraph 1 of the Agreement is hereby amended
to read as follows:
"(a) Registration statements on Form S-3 (Registration Nos. 33-
57202, 33-60734, 33-89748 and ________) in respect of U.S.
$11,000,000,000 aggregate principal amount (or the equivalent in
foreign currency or currency units) of debt securities of the Company,
including the Notes, have been prepared by the Company in conformity
with the requirements of the Securities Act of 1933, as amended (the
"Act"), and have been filed with the Securities and Exchange
Commission (the "Commission") in the form heretofore delivered to the
Agent, excluding exhibits (whether or not incorporated by reference)
to such registration statement but including all documents
incorporated by reference in the prospectus included therein, and such
registration statements in such forms have been declared effective by
the Commission and no stop order suspending the effectiveness of such
registration statements has been issued and no proceeding for that
purpose has been initiated or threatened by the Commission (any
preliminary prospectus included in such registration statements prior
to such registration statements being declared effective being
hereinafter called a "Preliminary Prospectus";
<PAGE>
the various parts of such registration statements, 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 relating to the Notes, in the
form in which it has most recently been filed with the Commission
(including any Pricing Supplement (as defined below)) 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
supplement to the Prospectus that sets forth only the terms of a
particular issue of Notes being hereinafter called a "Pricing
Supplement"; 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 amended or supplemented with respect to Notes sold pursuant to this
Agreement, in the form in which it is filed with the Commission
pursuant to Rule 424(b) of Regulation C under the Act, including any
documents incorporated by reference therein as of the date of such
filing);"
2. Subparagraph (e) of paragraph 1 of the Agreement is hereby
amended to read as follows:
"(e) The financial statements, together with the related notes,
set forth in the Prospectus and elsewhere in the Registration
Statement, fairly present, on the basis stated in the Registration
Statement, the financial position and the results of operations and
changes in financial position of the Company and its consolidated
subsidiaries at the respective dates or for the respective periods
therein specified. Such financial statements and related notes have
been prepared in accordance with generally accepted accounting
principles applied on a consistent basis except as may be set forth in
the Prospectus;"
3. The first paragraph of text on the first page of Annex I of
the Distribution Agreement is amended by adding after the reference to
"November 19, 1993" in the second line thereof the following language: ",
as amended by Amendment No. 1, dated ________ __, 1996, to the Distribution
Agreement".
2
<PAGE>
4. The third sentence of the first paragraph of text on the first
page of Annex II of the Distribution Agreement is amended to read as
follows: "The Notes are being sold pursuant to a Distribution Agreement,
dated November 19, 1993, as amended by Amendment No. 1 thereto, dated
________ __, 1996 (such Distribution Agreement, as so amended, the
"Distribution Agreement"), between the Company and the Agent, to which this
Administrative Procedure is attached as Annex II."
This Amendment shall be governed by and construed in accordance with
the laws of the State of New York.
3
<PAGE>
If the foregoing is in accordance with your understanding, please sign
and return to us four counterparts hereof, whereupon this letter and the
acceptance by you thereof shall constitute a binding agreement between the
Company and in accordance with its terms.
Very truly yours,
DEAN WITTER, DISCOVER & CO.
By:____________________________
Name:
Title:
Accepted in New York, New York,
as of the date hereof:
DEAN WITTER REYNOLDS INC.
By:_________________________________
Name:
Title:
4
<PAGE>
EXHIBIT 5
July 11, 1996
Dean Witter, Discover & Co.
Two World Trade Center
New York, NY 10048
Ladies and Gentlemen:
We have acted as counsel to Dean Witter, Discover & Co., a Delaware
corporation (the "Company"), in connection with the registration under the
Securities Act of 1933, as amended ("1933 Act"), pursuant to a Registration
Statement on Form S-3 under the 1933 Act (the "Registration Statement"), of up
to $2,000,000,000 aggregate principal amount of debt securities of the Company
(the "Debt Securities"), to be issued pursuant to the Indenture, dated February
24, 1993 (the "Indenture"), between the Company and the First National Bank of
Chicago (the "Bank"), as trustee. This opinion is being furnished to you in
connection with the registration of the Debt Securities under the 1933 Act.
In rendering this opinion, we have examined the originals or copies,
certified to our satisfaction, of such corporate records and other documents and
certificates as we deemed necessary. In such examination, we have assumed the
genuineness of all signatures, the authenticity of all documents submitted to us
as originals, the conformity to the original documents of all documents
submitted to us as copies and the authenticity of the originals of all such
latter documents. As to any facts material to this opinion, we have, when
relevant
<PAGE>
facts were not independently established by us, relied upon the aforesaid
records, certificates and documents.
Based upon and subject to the foregoing, we are of the opinion that:
1. The Indenture has been duly and validly authorized, executed and
delivered by the Company and, assuming due authorization, execution and delivery
by the Bank, constitutes a valid and binding agreement of the Company,
enforceable in accordance with its terms, except as enforcement thereof may be
limited by bankruptcy, insolvency or other laws of general applicability
relating to or affecting enforcement of creditors' rights or by general equity
principles.
2. The Debt Securities have been duly and validly authorized by the
Company and, when duly executed and authenticated in accordance with the terms
of the Indenture and delivered against payment therefor, will constitute valid
and legally binding obligations enforceable in accordance with their terms,
except as enforcement thereof may be limited by bankruptcy, insolvency or other
laws of general applicability relating to or affecting enforcement of creditors'
rights or by general equity principles, and except further as enforcement of any
Debt Securities denominated in other than United States dollars may be limited
by requirements that a claim (or foreign currency judgment in respect of such
claim) be converted into United States dollars at a rate of exchange prevailing
on a date determined pursuant to applicable law.
We hereby consent to the filing of this opinion with the Securities and
Exchange Commission as Exhibit 5 to the Registration Statement. We also consent
to the reference to
2
<PAGE>
our firm under the heading "Legal Opinion" in the Registration Statement. In
giving such consent, we do not thereby admit that we are in the category of
persons whose consent is required under Section 7 of the 1933 Act.
Very truly yours,
BROWN & WOOD LLP
3
<PAGE>
EXHIBIT 12
DEAN WITTER, DISCOVER & CO.
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(DOLLARS IN MILLIONS)
<TABLE>
<CAPTION>
THREE MONTHS
ENDED FOR THE YEAR ENDED DECEMBER 31,
MARCH 31, ---------------------------------------------
1996 1995 1994 1993 1992 1991
------------ -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Earnings:
Income before income
taxes................ $400.4 $1,395.9 $1,214.6 $ 996.2 $ 702.9 $ 555.6
Interest expense...... 390.7 1,514.8 1,048.5 815.3 965.8 1,081.8
Interest factor in
rent expense......... 13.0 42.7 41.8 41.6 44.8 54.1
Gain on sale of
subsidiary stock..... -- -- -- -- (32.1) --
------ -------- -------- -------- -------- --------
Total earnings...... $804.1 $2,953.4 $2,304.9 $1,853.1 $1,681.4 $1,691.5
====== ======== ======== ======== ======== ========
Fixed charges:
Interest expense...... $390.7 $1,514.8 $1,048.5 $ 815.3 $ 965.8 $1,081.8
Interest factor in
rent expense......... 13.0 42.7 41.8 41.6 44.8 54.1
------ -------- -------- -------- -------- --------
Total fixed charges. $403.7 $1,557.5 $1,090.3 $ 856.9 $1,010.6 $1,135.9
------ -------- -------- -------- -------- --------
Ratio of earnings to
fixed charges.......... 2.0 1.9 2.1 2.2 1.7 1.5
====== ======== ======== ======== ======== ========
</TABLE>
"Earnings" consist of income before income taxes and fixed charges and in
1992 includes a cumulative effect of change in method of accounting for
postretirement benefits. Additionally, "Total earnings" for 1992 excludes a
nonrecurring gain of $32.1 from the initial public offering of 25.7% of SPS
Transaction Services, Inc., a subsidiary of the Company. "Fixed charges"
consist of interest costs, including interest on deposits, and that portion of
rent expense estimated to be representative of the interest factor.
<PAGE>
EXHIBIT 15
To the Board of Directors and Shareholders of
Dean Witter, Discover & Co.:
We have made a review, in accordance with standards established by the American
Institute of Certified Public Accountants, of the unaudited interim financial
information of Dean Witter, Discover & Co. and subsidiaries for the periods
ended March 31, 1996 and 1995, as indicated in our report dated May 15, 1996;
because we did not perform an audit, we expressed no opinion on that
information.
We are aware that our report referred to above, which was included in your
Quarterly Report on Form 10-Q for the quarter ended March 31, 1996, is being
used in this Registration Statement.
We also are aware that the aforementioned report, pursuant to Rule 436(c) under
the Securities Act of 1933, is not considered a part of the Registration
Statement prepared or certified by an accountant or a report prepared or
certified by an accountant within the meaning of Sections 7 and 11 of that Act.
/s/ Deloitte & Touche LLP
New York, New York
July 10, 1996
<PAGE>
EXHIBIT 23(b)
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
Dean Witter, Discover & Co. on Form S-3 of our report dated February 21, 1996,
appearing in and incorporated by reference in the Annual Report on Form 10-K of
Dean Witter, Discover & Co. for the year ended December 31, 1995, and to the
reference to us under the heading "Experts" in the Prospectus, which is part of
this Registration Statement.
/s/ Deloitte & Touche LLP
New York, New York
July 10, 1996
<PAGE>
EXHIBIT 25
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM T-1
--------
STATEMENT OF ELIGIBILITY
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) ____
---------------------------------
THE FIRST NATIONAL BANK OF CHICAGO
(EXACT NAME OF TRUSTEE AS SPECIFIED IN ITS CHARTER)
A NATIONAL BANKING ASSOCIATION 36-0899825
(I.R.S. EMPLOYER
IDENTIFICATION NUMBER)
ONE FIRST NATIONAL PLAZA, CHICAGO, ILLINOIS 60670-0126
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
THE FIRST NATIONAL BANK OF CHICAGO
ONE FIRST NATIONAL PLAZA, SUITE 0286
CHICAGO, ILLINOIS 60670-0286
ATTN: LYNN A. GOLDSTEIN, LAW DEPARTMENT (312) 732-6919
(NAME, ADDRESS AND TELEPHONE NUMBER OF AGENT FOR SERVICE)
-----------------------------------
DEAN WITTER, DISCOVER & CO.
(EXACT NAME OF OBLIGOR AS SPECIFIED IN ITS CHARTER)
DELAWARE 36-3145972
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION
NUMBER)
TWO WORLD TRADE CENTER
NEW YORK, NEW YORK 10048
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
DEBT SECURITIES
(TITLE OF 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.
Comptroller of Currency, Washington, D.C.,
Federal Deposit Insurance Corporation,
Washington, D.C., The Board of Governors of
the Federal Reserve System, Washington D.C.
(b) WHETHER IT IS AUTHORIZED TO EXERCISE
CORPORATE TRUST POWERS.
The trustee is authorized to exercise corporate
trust powers.
ITEM 2. AFFILIATIONS WITH THE OBLIGOR. IF THE OBLIGOR
------------------------------
IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH
SUCH AFFILIATION.
No such affiliation exists with the trustee.
ITEM 16. LIST OF EXHIBITS. LIST BELOW ALL EXHIBITS FILED AS A
-----------------
PART OF THIS STATEMENT OF ELIGIBILITY.
1. A copy of the articles of association of the
trustee now in effect.*
2. A copy of the certificates of authority of the
trustee to commence business.*
3. A copy of the authorization of the trustee to
exercise corporate trust powers.*
4. A copy of the existing by-laws of the trustee.*
5. Not Applicable.
6. The consent of the trustee required by
Section 321(b) of the Act.
2
<PAGE>
7. A copy of the latest report of condition of the
trustee published pursuant to law or the
requirements of its supervising or examining
authority.
8. Not Applicable.
9. Not Applicable.
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, The First National Bank of Chicago, 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 Chicago and State of Illinois, on the 10th day of June, 1996.
THE FIRST NATIONAL BANK OF CHICAGO,
TRUSTEE
BY /S/ JOHN R. PRENDIVILLE
JOHN R. PRENDIVILLE
VICE PRESIDENT
* EXHIBIT 1,2,3 AND 4 ARE HEREIN INCORPORATED BY REFERENCE TO EXHIBITS BEARING
IDENTICAL NUMBERS IN ITEM 12 OF THE FORM T-1 OF THE FIRST NATIONAL BANK OF
CHICAGO, FILED AS EXHIBIT 26 TO THE REGISTRATION STATEMENT ON FORM S-3 OF THE
CIT GROUP HOLDINGS, INC., FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON
FEBRUARY 16, 1993 (REGISTRATION NO. 33-58418).
3
<PAGE>
EXHIBIT 6
THE CONSENT OF THE TRUSTEE REQUIRED
BY SECTION 321(b) OF THE ACT
June 10, 1996
Securities and Exchange Commission
Washington, D.C. 20549
Gentlemen:
In connection with the qualification of an indenture between Dean Witter,
Discover & Co. and The First National Bank of Chicago, the undersigned, in
accordance with Section 321(b) of the Trust Indenture Act of 1939, as amended,
hereby consents that the reports of examinations of the undersigned, made by
Federal or State authorities authorized to make such examinations, may be
furnished by such authorities to the Securities and Exchange Commission upon its
request therefor.
Very truly yours,
THE FIRST NATIONAL BANK OF CHICAGO
BY: /S/ JOHN R. PRENDIVILLE
JOHN R. PRENDIVILLE
VICE PRESIDENT
4
<PAGE>
EXHIBIT 7
<TABLE>
<CAPTION>
Legal Title of Bank: The First National Bank of Chicago Call Date: 03/31/96 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Suite 0460 Page RC-1
City, State Zip: Chicago, IL 60670-0460
FDIC Certificate No.: 0/3/6/1/8
---------
CONSOLIDATED REPORT OF CONDITION FOR INSURED COMMERCIAL
AND STATE-CHARTERED SAVINGS BANKS FOR MARCH 31, 1996
All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount outstanding of the last business day of the
quarter.
SCHEDULE RC--BALANCE SHEET
<S> <C> <C> <C>
C400 (see
DOLLAR AMOUNTS IN ------------ "ASSETS")
THOUSANDS RCFD BIL MIL THOU ---------
----------------- ---- ------------
ASSETS
1. Cash and balances due from depository institutions
(from Schedule RC-A):
a. Noninterest-bearing balances and currency and coin(1)............ 0081 3,047,140 1.a.
b. Interest-bearing balances(2)..................................... 0071 8,488,390 1.b
2. Securities
a. Held-to-maturity securities(from Schedule RC-B, column A)........ 1754 0 2.a.
b. Available-for-sale securities (from Schedule RC-B, column D)..... 1773 997,155 2.b.
3. Federal funds sold and securities purchased under agreements to
resell in domestic offices of the bank and its Edge and Agreement
subsidiaries, and in IBFs:
a. Federal Funds sold............................................... 0276 3,384,301 3.a.
b. Securities purchased under agreements to resell.................. 0277 685,531 3.b.
4. Loans and lease financing receivables:
a. Loans and leases, net of unearned income (from Schedule RC-C).... RCFD 2122 16,884,488 4.a.
b. LESS: Allowance for loan and lease losses........................ RCFD 3123 358,448 4.b.
c. LESS: Allocated transfer risk reserve............................ RCFD 3128 0 4.c.
d. Loans and leases, net of unearned income, allowance, and
reserve (item 4.a minus 4.b and 4.c)............................. 2125 16,526,040 4.d.
5. Assets held in trading accounts..................................... 3545 10,974,841 5.
6. Premises and fixed assets (including capitalized leases)............ 2145 592,581 6.
7. Other real estate owned (from Schedule RC-M)........................ 2150 9,952 7.
8. Investments in unconsolidated subsidiaries and
associated companies (from Schedule RC-M)........................... 2130 42,098 8.
9. Customers' liability to this bank on acceptances
outstanding......................................................... 2155 564,435 9.
10. Intangible assets (from Schedule RC-M).............................. 2143 96,463 10.
11. Other assets (from Schedule RC-F)................................... 2160 1,703,124 11.
12. Total assets (sum of items 1 through 11)............................ 2170 47,112,051 12.
- ------------------
</TABLE>
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held in trading accounts.
5
<PAGE>
<TABLE>
<CAPTION>
Legal Title of Bank: The First National Bank of Chicago Call Date: 03/31/96 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Suite 0460 Page RC-2
City, State Zip: Chicago, IL 60670-0460
FDIC Certificate No.: 0/3/6/1/8
---------
SCHEDULE RC-CONTINUED
DOLLAR AMOUNTS IN
Thousands BIL MIL THOU
------------------- -----------
<S> <C> <C> <C> <C>
LIABILITIES
13. Deposits:
a. In domestic offices (sum of totals of columns A and C
from Schedule RC-E, part 1)...................................... RCON 2200 14,251,874 13.a.
(1) Noninterest-bearing(1)....................................... RCON 6631 5,707,786 13.a.(1)
(2) Interest-bearing............................................. RCON 6636 8,544,088 13.a.(2)
b. In foreign offices, Edge and Agreement subsidiaries, and
IBFs (from Schedule RC-E, part II)............................... RCFN 2200 12,839,836 13.b.
(1) Noninterest bearing.......................................... RCFN 6631 196,311 13.b.(1)
(2) Interest-bearing............................................. RCFN 6636 12,643,525 13.b.(2)
14. Federal funds purchased and securities sold under
agreements to repurchase in domestic offices of the bank and
of its Edge and Agreement subsidiaries, and in IBFs:
a. Federal funds purchased....................................... RCFD 0278 2,692,008 14.a.
b. Securities sold under agreements to repurchase................ RCFD 0279 1,165,032 14.b.
15. a. Demand notes issued to the U.S. Treasury...................... RCON 2840 77,000 15.a.
b. Trading Liabilities........................................... RCFD 3548 7,103,300 15.b.
16. Other borrowed money:
a. With original maturity of one year or less.................... RCFD 2332 2,223,560 16.a.
b. With original maturity of more than one year.................. RCFD 2333 144,665 16.b.
17. Mortgage indebtedness and obligations under
capitalized leases............................................... RCFD 2910 283,041 17.
18. Bank's liability on acceptance executed and outstanding.......... RCFD 2920 564,435 18.
19. Subordinated notes and debentures................................ RCFD 3200 1,275,000 19.
20. Other liabilities (from Schedule RC-G)........................... RCFD 2930 1,411,087 20.
21. Total liabilities (sum of items 13 through 20)................... RCFD 2948 44,030,838 21.
22. Limited-Life preferred stock and related surplus................. RCFD 3282 0 22.
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus.................... RCFD 3838 0 23.
24. Common stock..................................................... RCFD 3230 200,858 24.
25. Surplus (exclude all surplus related to preferred stock)......... RCFD 3839 2,320,326 25.
26. a. Undivided profits and capital reserves........................ RCFD 3632 559,707 26.a.
b. Net unrealized holding gains (losses) on
available-for-sale securities................................. RCFD 8434 730 26.b.
27. Cumulative foreign currency translation adjustments.............. RCFD 3284 (408) 27.
28. Total equity capital (sum of items 23 through 27)................ RCFD 3210 3,081,213 28.
29. Total liabilities, limited-life preferred stock, and
equity capital (sum of items 21, 22, and 28)..................... RCFD 3300 47,112,051 29.
<CAPTION>
Memorandum
<S>
To be reported only with the March Report of Condition.
1. Indicate in the box at the right the number of the
statement below that best describes the most
comprehensive level of auditing work performed for
the bank by independent external Number
--------------
auditors as of any date during 1995 ................................... RCFD 6724 2 M.1.
--------------
</TABLE>
1 = Independent audit of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm which
submits a report on the bank
2 = Independent audit of the bank's parent holding company conducted in
accordance with generally accepted auditing standards by a certified public
accounting firm which submits a report on the consolidated holding company
(but not on the bank separately)
3 = Directors' examination of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm (may be
required by state chartering authority)
4 = Directors' examination of the bank performed by other external auditors
(may be required by state chartering authority)
5 = Review of the bank's financial statements by external auditors
6 = Compilation of the bank's financial statements by external auditors
7 = Other audit procedures (excluding tax preparation work)
8 = No external audit work
- -------------------
(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.
6
