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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
________________
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported):
August 9, 1996
GS FINANCIAL PRODUCTS U.S., L.P.
(Exact name of registrant as specified in its charter)
Cayman Islands No. 000-25178 No. 52-1919759
(State or Other Jurisdiction of (Commission (IRS Employer
Incorporation) File Number) Identification No.)
P.O. Box 896
Harbour Centre, North Church Street
Grand Cayman, Cayman Islands N/A
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (809)945-1326
(Former name or former address, if changes since last report)
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Item 5. Other Events.
Accompanying this Current Report on Form 8-K as exhibits 8.1
and 99.1 hereto, respectively, are (i) the opinion letter of GS Financial
Products U.S., L.P.'s (the "Company") U.S. counsel regarding tax matters
addressed in the Pricing Supplement, dated August 5, 1996 (the "Pricing
Supplement"), for the S&P 500 Enhanced Stock Index Growth Notes due August
9, 2002 (the "E-SIGNS") and (ii) the form of Note for the E-SIGNS.
Item 7. Financial Statements, Pro Forma Financial Information and
Exhibits.
(c) The following exhibits are filed as part of this
Form 8-K:
8.1 Opinion letter of the Company's U.S. counsel
regarding tax matters in the Pricing
Supplement.
99.1 Form of Note
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
GS FINANCIAL PRODUCTS U.S., L.P.
(Registrant)
acting by its general partner GS
Financial Products US Co.
Date: August 9, 1996 By: /s/ Greg Swart
Name: Greg Swart
Title: President
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Index to Exhibits
Exhibit Description Page No.
No.
8.1 Opinion letter of the Company's U.S. 5
counsel regarding tax matters in the
Pricing Supplement.
99.1 Form of Note 7
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Exhibit 8.1
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August 9, 1996
GS Financial Products U.S., L.P.,
P.O. Box 896,
Harbour Centre, North Church Street,
Grand Cayman, Cayman Islands,
British West Indies.
Dear Sirs:
This is with reference to the registration under the Securities
Act of 1933, as amended, and offering of $73,000,000 aggregate principal
amount of S&P Enhanced Stock Index Growth Notes, due August 9, 2002 (the
"Notes") of GS Financial Products U.S., L.P. (the "Company"). It is our
opinion that the statements of law set forth under the heading "Certain
United States Federal Tax Considerations" in the Pricing Supplement dated
August 5, 1996 to the Prospectus dated December 28, 1995 and Prospectus
Supplement dated January 3, 1996 relating to the Notes are a fair and
accurate summary of the matters therein discussed.
We hereby consent to the filing with the Securities and
Exchange Commission of this opinion as an exhibit to the Company's current
report on Form 8-K. By giving the foregoing consent, we do not admit that
we come within the category of persons whose consent is required under
Section 7 of the Securities Act of 1933, as amended.
Very truly yours,
SULLIVAN & CROMWELL
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Exhibit 99.1
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SPECIMEN
THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF GS
FINANCIAL PRODUCTS U.S., L.P. THAT, IF THE HOLDER PROPOSES TO SELL OR
TRANSFER THIS SECURITY TO ANY PENSION OR WELFARE PLAN (AS DEFINED IN
SECTION 3 OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974
("ERISA")), THE HOLDER WILL DO SO ONLY:
(U) TO THE EXTENT SUCH PURCHASE IS MADE BY OR ON BEHALF OF A
BANK COLLECTIVE INVESTMENT FUND MAINTAINED BY THE PURCHASER IN WHICH
AT ANY TIME WHILE THIS SECURITY IS OUTSTANDING NO PLAN, TOGETHER WITH
ANY OTHER PLANS MAINTAINED BY THE SAME EMPLOYER OR EMPLOYEE
ORGANIZATION, HAS AN INTEREST IN EXCESS OF 10% OF THE TOTAL OF ALL
ASSETS IN SUCH COLLECTIVE INVESTMENT FUND;
(V) TO THE EXTENT SUCH PURCHASE IS MADE BY OR ON BEHALF OF AN
INSURANCE COMPANY POOLED SEPARATE ACCOUNT MAINTAINED BY THE PURCHASER
IN WHICH AT ANY TIME WHILE THIS SECURITY IS OUTSTANDING NO PLAN,
TOGETHER WITH ANY OTHER PLANS MAINTAINED BY THE SAME EMPLOYER OR
EMPLOYEE ORGANIZATION, HAS AN INTEREST IN EXCESS OF 10% OF THE TOTAL
OF ALL ASSETS IN SUCH POOLED SEPARATE ACCOUNT;
(W) TO THE EXTENT SUCH PURCHASE IS MADE BY OR ON BEHALF OF AN
INSURANCE COMPANY GENERAL ACCOUNT IN WHICH AT ANY TIME WHILE THIS
SECURITY IS OUTSTANDING THE RESERVES AND LIABILITIES FOR THE GENERAL
ACCOUNT CONTRACTS HELD BY OR ON BEHALF OF ANY PLAN, AS DEFINED BY THE
ANNUAL STATEMENT APPROVED BY THE NATIONAL ASSOCIATION OF INSURANCE
COMMISSIONERS ("NAIC"), TOGETHER WITH SUCH RESERVES AND LIABILITIES
WITH RESPECT TO ANY OTHER PLANS MAINTAINED BY THE SAME EMPLOYER OR
EMPLOYEE ORGANIZATION, DO NOT EXCEED 10% OF THE TOTAL OF RESERVES AND
LIABILITIES OF THE GENERAL ACCOUNT (EXCLUSIVE OF SEPARATE ACCOUNT
LIABILITIES) PLUS SURPLUS AS SET FORTH IN THE NAIC ANNUAL STATEMENT
FILED WITH THE STATE OF DOMICILE OF THE INSURER;
(X) TO THE EXTENT THAT SUCH PURCHASE IS MADE ON BEHALF OF A
PLAN BY: (i) AN INVESTMENT ADVISER REGISTERED UNDER THE INVESTMENT
ADVISERS ACT OF 1940, WITH, AS OF THE LAST DAY OF ITS MOST RECENT
FISCAL YEAR, TOTAL ASSETS UNDER ITS MANAGEMENT AND CONTROL IN EXCESS
OF $50,000,000 AND SHAREHOLDERS' OR PARTNERS' EQUITY IN EXCESS OF
$750,000 AS SHOWN IN ITS MOST RECENT BALANCE SHEET PREPARED IN
ACCORDANCE WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES; (ii) A BANK
AS DEFINED IN SECTION 202(A)(2) OF THE INVESTMENT ADVISERS ACT OF
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1940, WITH EQUITY CAPITAL IN EXCESS OF $1,000,000 AS OF THE LAST DAY
OF ITS MOST RECENT FISCAL YEAR; OR (iii) AN INSURANCE COMPANY
QUALIFIED UNDER THE LAWS OF MORE THAN ONE STATE TO MANAGE ASSETS WITH
NET WORTH IN EXCESS OF $1,000,000 AS OF THE LAST DAY OF ITS MOST
RECENT FISCAL YEAR; AND, IN ANY CASE, IS OTHERWISE A QUALIFIED
PROFESSIONAL ASSET MANAGER, AS SUCH TERM IS USED IN PROHIBITED
TRANSACTION CLASS EXEMPTION 84-14 ISSUED BY THE DEPARTMENT OF LABOR,
PROVIDED SUCH PURCHASE WILL NOT BE MADE FOR OR ON BEHALF OF ANY
PENSION OR WELFARE PLAN (AS DEFINED ABOVE) WHICH, TOGETHER WITH ANY
OTHER PLANS MAINTAINED BY THE SAME EMPLOYER OR EMPLOYEE ORGANIZATION,
REPRESENTS MORE THAN 20% OF THE TOTAL CLIENT ASSETS MANAGED BY SUCH
PURCHASER; OR
(Y) IF THE GOLDMAN SACHS GROUP L.P. ("GROUP") HAS NOTIFIED
PURCHASERS THAT PROHIBITED TRANSACTION EXEMPTION 93-78 MAY BE
APPLICABLE TO THE PURCHASE OF THIS SECURITY AND GROUP HAS OBTAINED A
LETTER FROM THE INITIAL ISSUANCE PURCHASER OF THIS SECURITY TO THE
EFFECT SET OUT IN PROHIBITED TRANSACTION EXEMPTION 93-78, TO THE
EXTENT: (1) THE PURCHASE OF AND DECISION TO INVEST IN THIS SECURITY
IS MADE BY A FIDUCIARY INDEPENDENT OF GROUP; (2) EACH PLAN PURCHASING
THIS SECURITY EITHER (i) HAS ASSETS EXCEEDING $500 MILLION, (ii) HAS
ASSETS EXCEEDING $25 MILLION AND THE FIDUCIARY RESPONSIBLE FOR
INVESTMENT HAS INVESTMENT RESPONSIBILITY FOR CONTROLLED GROUP PLANS
(DETERMINED USING THE DEFINITION OF CONTROLLED GROUP IN SECTION 1563
OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE")) WHICH,
IN THE AGGREGATE, HAVE ASSETS OF AT LEAST $500 MILLION OR (iii) IS
PART OF A MASTER TRUST FOR MEMBERS OF A CONTROLLED GROUP (AS DEFINED
IN SECTION 1563 OF THE CODE) WITH ASSETS EXCEEDING $500 MILLION,
PROVIDED THE INVESTMENT FIDUCIARY MAKING THE INVESTMENT DECISION ON
BEHALF OF THE MASTER TRUST HAS INVESTMENT RESPONSIBILITY FOR ALL
PLANS IN THE MASTER TRUST; AND (3) AFTER THE ACQUISITION OF THIS
SECURITY, NO MORE THAN 10% OF ANY PLAN'S ASSETS ARE INVESTED IN ALL
"INSTRUMENTS" OF GROUP, WITHIN THE MEANING OF PROHIBITED TRANSACTION
EXEMPTION 93-78; OR
(Z) TO THE EXTENT SUCH PLAN IS A GOVERNMENTAL PLAN (AS DEFINED
IN SECTION 3(32) OF ERISA) THAT IS NOT SUBJECT TO THE PROVISIONS OF
TITLE I OF ERISA OR SECTION 401(a) OF THE CODE.
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE
INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A
DEPOSITARY OR A NOMINEE THEREOF.
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THIS SECURITY MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A SECURITY
REGISTERED, AND NO TRANSFER OF THIS SECURITY IN WHOLE OR IN PART MAY BE
REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH DEPOSITARY OR A
NOMINEE THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
INDENTURE.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION
("DTC"), TO GS FINANCIAL PRODUCTS U.S., L.P. OR ITS AGENT FOR REGISTRATION
OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED
IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR
TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR
TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE &
CO., HAS AN INTEREST HEREIN.
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No. FRN-[2]
CUSIP REGISTERED
No. 362276107 PRINCIPAL AMOUNT: $73,000,000
GS FINANCIAL PRODUCTS U.S., L.P.
MEDIUM-TERM NOTE, SERIES B
(Floating Rate)
SPECIFIED CURRENCY -- INTEREST RATE
PRINCIPAL: U.S. Dollars BASIS: N/A
__ Commercial Paper
Rate
SPECIFIED CURRENCY -- __ Prime Rate
INTEREST: U.S. Dollars __ LIBOR
__ Treasury Rate
__ CD Rate
__ Federal Funds
CALCULATION Rate
AGENT: Goldman, Sachs & Co.
INTEREST PAYMENT
PERIOD: N/A
EXCHANGE RATE
AGENT: N/A INTEREST RESET
PERIOD: N/A
ISSUE DATE: August 9, 1996
MINIMUM
INTEREST RATE: N/A
STATED MATURITY DATE: August 9, 2002
MAXIMUM
INTEREST RATE: N/A
INDEX MATURITY: N/A
SPREAD (plus
INITIAL or minus): N/A
INTEREST RATE: N/A
SPREAD
MULTIPLIER: N/A
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INTEREST PAYMENT REDEMPTION
DATES: This Security shall not PERIODS: N/A
bear interest.
REDEMPTION
COMMENCEMENT
INTEREST RESET DATE: N/A
DATES: N/A
REDEMPTION
PRICES: N/A
REPAYMENT
DATE: N/A
OTHER TERMS:
Redemption Amount
The amount payable on this Security (the "Redemption Amount") on the
Stated Maturity Date will be calculated by the Calculation Agent on the
Calculation Date and will be determined in accordance with the following
formula:
Principal Amount {1 + 113% x [(Final Index Value) -1]}
-------------------
Initial Index Value
provided, however, that in no event will the Redemption Amount of this
Security be less than 100% of its Principal Amount or be greater than the
product of the Maximum Return and the Principal Amount of this Security;
provided further, however, that if the Closing Index Value on any Business
Day prior to the Valuation Period is greater than or equal to the Threshold
Value, then the Redemption Amount shall be equal to the product of the
Maximum Return and the Principal Amount of this Security.
"Business Day" means any day on which the New York Stock Exchange,
Inc. (the "NYSE") is open for business.
"Calculation Date" means the fifth Business Day prior to the Stated
Maturity Date.
"Closing Index Value" means the closing value of the Index (such
value as calculated by S&P) at the close of business on any Business
Day.
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"Final Index Value" means the unweighted arithmetic average of the
closing values of the Index (such values as calculated by S&P) at the
close of business of the NYSE on the five Business Days immediately
preceding and including the Calculation Date.
"Index" means the S&P 500 Composite Stock Price Index.
"Initial Index Value" means 660.23.
"Index Sponsor" or "S&P" means Standard & Poor's, a division of the
McGraw Hill Companies, Inc.
"Maximum Return" means 213%.
"Threshold Value" means (200% x Initial Index Value).
"Valuation Period" means the five Business Days immediately preceding
and including the Calculation Date.
The Final Index Value of the Index shall be determined by the
Calculation Agent by the following method: (i) the Calculation Agent shall
add the closing values of the Index as calculated by S&P on and for the
five Business Days during the Valuation Period and then divide such sum by
five; or (ii) if S&P discontinues publication of the Index and S&P or
another entity publishes a successor or substitute index that the
Calculation Agent determines, in its sole discretion, to be comparable to
the Index (any such index being referred to hereinafter as a "Successor
Index"), then, upon the Calculation Agent's notification of such
determination to the Issuer, the Calculation Agent shall add the closing
values of the Successor Index as calculated by S&P or such other entity for
the Valuation Period and shall divide such sum by the applicable number of
Business Days.
Notwithstanding the foregoing, if the Calculation Agent determines on
any day during the Valuation Period that a Market Disruption Event (as
hereinafter defined) has occurred, then the Redemption Amount shall be
calculated by omitting the Closing Index Value of the Index for such day
and dividing the sum of the remaining Closing Index Values during the
Valuation Period by the remaining number of Business Days during the
Valuation Period; provided, however, that if, there are no Business Days
during the Valuation Period on which there is not a Market Disruption Event
occurring or continuing (i) the Valuation Period shall be deemed to be the
Calculation Date, notwithstanding the Market Disruption Event, and (ii) the
Calculation Agent shall determine the Final Index Value as the closing
value
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of the Index on the Calculation Date in accordance with the method for
calculating the Index last in effect prior to the commencement of the
Market Disruption Event using the closing value (or, if trading in any
relevant security has been materially suspended or materially limited, its
good faith estimate of the closing value that would have prevailed but for
that suspension or limitation) on the Calculation Date of each security
comprising the Index.
Market Disruption Event
Market Disruption Event means the occurrence or existence on any
Business Day of:
(i) a suspension, absence or material limitation of trading of 100
or more of the securities included in the Index on the primary
market for such securities for more than two hours of trading
or during the one-half hour period preceding the close of
trading in such market; or the suspension, absence or material
limitation of trading on the primary market for trading in
futures or options contracts related to the Index during the
one-half hour period preceding the close of trading in the
applicable market, in each case as determined by the
Calculation Agent in its sole discretion; and
(ii) a determination by the Calculation Agent in its sole discretion
that the event described in clause (i) above materially
interfered with the ability of the Issuer or any of its
affiliates to unwind all or a material portion of the hedge
with respect to the Securities.
For purposes of determining whether a Market Disruption Event has
occurred: (1) a limitation on the hours or number of days of trading will
not constitute a Market Disruption Event if it results from an announced
change in the regular business hours of the relevant exchange or market,
(2) a decision to permanently discontinue trading in the relevant futures
or options contract will not constitute a Market Disruption Event, (3)
limitations pursuant to NYSE Rule 80A (or any applicable rule or regulation
enacted or promulgated by the NYSE, any other self-regulatory organization
or the Securities and Exchange Commission of similar scope, as determined
by the Calculation Agent) on trading during significant market fluctuations
shall constitute a Market Disruption Event, (4) a suspension of trading in
a futures or options contract on the Index by the primary securities market
related to such contract by reason of (x) a price
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change exceeding limits set by such exchange or market, (y) an imbalance of
orders relating to such contracts or (z) a disparity in bid and ask quotes
relating to such contracts will constitute a suspension or material
limitation of trading in futures or options contracts related to the Index
and (5) "a suspension, absence or material limitation on trading" on the
primary market on which futures or options contracts relating to the Index
are traded will not include any time when such market is itself closed for
trading under ordinary circumstances.
Discontinuance of the Index
If S&P discontinues publication of the Index and a Successor Index is
available, then the Redemption Amount will be determined by reference to
the Successor Index as provided above.
If the publication of the Index is discontinued and S&P or another
entity does not publish a Successor Index on any of the five Business Days
during the Valuation Period, the Redemption Amount will be computed by the
Calculation Agent by reference to the following:
(1) determining the component stocks of the Index or any
Successor Index as of the last date on which either of such indices
was calculated by S&P or another entity and quoted on any publicly
available information source (each such component stock a "Last
Component Stock");
(2) for each Last Component Stock, calculating as of each
Business Day the product of the market price per share and the number
of the then outstanding shares (such product referred to as the
"Market Value" of such stock), by reference to (a) the closing market
price per share of such Last Component Stock as quoted by the New
York Stock Exchange, Inc. or the American Stock Exchange or any other
nationally recognized stock exchange, or if no such quotation is
available, then the closing market price as quoted by any major
regional stock exchange or the Nasdaq National Market System
("NASDAQ") (collectively the "Exchanges") and (b) the most recent
publicly available statement of the number of outstanding shares of
such Last Component Stock;
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(3) aggregating the Market Values obtained in clause (2) of all
Last Component Stocks;
(4) determining the S&P Base Value as of the last day on which
either the Index or any Successor Index was published by S&P or
another entity, as adjusted thereafter as described below;
(5) dividing the aggregate Market Value of all Last Component
Stocks by the S&P Base Value (adjusted as aforesaid); and
(6) multiplying the resulting quotient (expressed in decimals)
by ten.
If any Last Component Stock is no longer publicly traded on any
Exchange, the last available market price per share for such Last Component
Stock as quoted by any Exchange, and the number of outstanding shares
thereof at such time, will be used in computing the last available Market
Value of such Last Component Stock. Such Market Value will be used in all
computations of the Index thereafter.
If a company that has issued a Last Component Stock and another
company that has issued a Last Component Stock are consolidated to form a
new company, the common stock of such new company will be considered a Last
Component Stock and the common stocks of the constituent companies will no
longer be considered Last Component Stocks. If any company that has issued
a Last Component Stock merges with, or acquires, a company that has not
issued a Last Component Stock, the common stock of the surviving
corporation will, upon the effectiveness of such merger or acquisition, be
considered a Last Component Stock. However, in each case, the S&P Base
Value will be adjusted (in accordance with the formula described below).
As a result of this adjustment, the S&P Base Value immediately after such
consolidation, merger or acquisition will equal (a) the S&P Base Value
immediately prior to such event, multiplied by (b) the quotient of the
aggregate Market Value of all Last Component Stocks immediately after such
event, divided by the aggregate Market Value for all Last Component Stocks
immediately prior to such event.
If a company that has issued a Last Component Stock issues a stock
dividend, declares a stock split or issues new shares pursuant to the
acquisition of another company, then, in each case, the S&P Base Value will
be adjusted (in accordance with the formula described below) so that the
S&P Base Value immediately after the time the particular Last
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Component Stock commences trading ex-dividend, the effectiveness of the
stock split or the time new shares of such Last Component Stock commence
trading equals (a) the S&P Base Value immediately prior to such event,
multiplied by (b) the quotient of the aggregate Market Value for all Last
Component Stocks immediately after such event, divided by the aggregate
Market Value of all Last Component Stocks immediately prior to such event.
If at any time the method of calculating the Index or a Successor
Index, or the value thereof, is changed in a material respect, or if the
Index or a Successor Index is in any other way modified so that such Index
does not, in the opinion of the Calculation Agent, fairly represent the
value of the Index or such Successor Index had such changes or
modifications not been made, then, from and after such time, the
Calculation Agent shall, at the close of business in New York, New York, on
each Business Day, make such adjustments as, in the good faith judgment of
the Calculation Agent, may be necessary in order to arrive at a calculation
of a value of a stock index comparable to the Index or such Successor
Index, as the case may be, as if such changes or modifications had not been
made, and calculate the Closing Index Value with reference to the Index or
such Successor Index, as adjusted. Accordingly, if the method of
calculating the Index or a Successor Index is modified so that the value of
such Index is a fraction of what it would have been if it had not been
modified (e.g., due to a split in the Index), then the Calculation Agent
shall adjust such Index in order to arrive at a value of the Index or such
Successor Index as if it had not been modified (e.g., as if such split had
not occurred).
Upon any adoption by the Calculation Agent of a Successor Index, it
shall cause notice thereof to be published in The Wall Street Journal (or
another newspaper of general circulation) within three Business Days of
such determination. If S&P discontinues publication of the Index prior to
the Valuation Period and the Calculation Agent determines that no Successor
Index is available at such time, then on each Business Day until the
earlier to occur of (i) the commencement of the Valuation Period and (ii) a
determination by the Calculation Agent that a Successor Index is available,
the Calculation Agent shall determine the value that would be used in
computing the Redemption Amount by reference to the method set forth in
clauses (1) through (6) above as if such day were one of the five Business
Days used in calculating the Redemption Amount.
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S&P Base Value means a value determined on any Business Day in
accordance with the following formula:
(1) The mean average of the Market Values as of each week in the
base period of the years 1941 through 1943 of the common stock of
each company in a group of 500 companies similar to those in the
Index is determined; and
(2) The mean average Market Values of all such common stocks over
such base period (as determined under clause (1) above) are
aggregated.
In any case where the S&P Base Value is to be adjusted, the
Calculating Agent shall first recalculate the aggregate Market Value of all
component stocks (after taking account of the new market price per share of
the particular component stock or the new number of outstanding shares
thereof or both, as the case may be) and then adjust the S&P Base Value in
accordance with the following formula:
Old S&P Base Value X New Market Value = New S&P Base Value
----------------
Old Market Value
Redemption
Any redemption of this Security pursuant to the first sentence of
Paragraph 4(b) on the reverse hereof will be made as a whole and not in
part and the Redemption Price will equal the greater of (i) 105% of the
average of the Closing Values of the Securities on the 10 Business Days
immediately preceding the date of the mailing of the notice of redemption
(the "Mailing Date"), or (ii) 100% of the Principal Amount of the
Securities to be redeemed. "Closing Value" means, with respect to any
Business Day, the closing price of the Securities, regular way, as reported
by the NYSE on such Business Day or, if there is no such closing price on
such Business Day, the average of the bid and ask prices as reported by the
NYSE on such Business Day or, if the Securities are not then listed on the
NYSE, the Issuer will select a broker-dealer (which may be the Calculation
Agent) to determine the Closing Value.
Events of Default and Acceleration
In case an Event of Default with respect to this Security shall have
occurred and be continuing prior to the Calculation Date, the amount
payable to the holder of this Security upon any acceleration permitted by
this Security will be equal to the amount that would be payable as though
the Stated Maturity Date of this Security was the date on
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which early repayment is due, and the Final Index Value was calculated
based on the Closing Index Value of the Index on the date of early
repayment, or the first succeeding Business Day in the event that the date
of early repayment is not a Business Day. If prior to the date of such
early repayment, the Closing Index Value exceeds the Threshold Value, the
amount payable to the holder of this Security upon acceleration will be
equal to the sum of (x) 100% of the Principal Amount of this Security, plus
(y) 113% of Principal Amount of this Security. In either event, the amount
in excess of the Principal Amount of this Security determined pursuant to
either of the preceding two sentences will be discounted from the Stated
Maturity Date to the date of early repayment in accordance with generally
accepted financial practice on a semi-annual basis at a discount rate equal
to the LIBOR rate, determined by the Calculation Agent in accordance with
the procedures set forth on the reverse hereof for Securities with an
Interest Rate Basis of LIBOR using the rate for an Index Maturity similar
to the period from the date of early repayment to the Stated Maturity Date.
If an Event of Default occurs on or after the Calculation Date, the amount
payable upon acceleration shall equal the Redemption Amount. For the
purpose of determining whether holders of the aggregate principal amount of
Securities required for any consent, waiver, authorization or other action
to be taken by holders of Securities have taken such action, the principal
amount of the Securities offered hereby will equal up to and including the
Calculation Date the Principal Amount and after the Calculation Date, the
Redemption Amount.
Calculation Agent
The Calculation Agent shall have no liability to the Issuer or
any holder of any Security for any action taken or omitted to be taken as
Calculation Agent in good faith.
- ----------------
GS Financial Products U.S., L.P., a Cayman Islands exempted
limited partnership (hereinafter called the "Issuer", which term includes
any successor Person under the Indenture hereinafter referred to), for
value received, hereby promises to pay to Cede & Co., or registered
assigns, the Redemption Amount shown above in the Specified Currency shown
above on the Stated Maturity Date shown above, and to pay interest thereon,
from the Issue Date specified above (the "Issue Date") or from the most
recent Interest Payment Date to which interest on this Security (or any
predecessor Security) has been paid or duly provided for, provided,
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however, that if the Interest Reset Dates with respect to this Security are
weekly, from the day following the most recent Regular Record Date (as
hereinafter defined), at a rate per annum equal to the Initial Interest
Rate specified above until the first Interest Reset Date (as defined on the
reverse hereof) following the Issue Date and thereafter at a rate
determined in accordance with the provisions on the reverse hereof under
the heading "Determination of Commercial Paper Rate", "Determination of
Prime Rate", "Determination of LIBOR", "Determination of Treasury Rate",
"Determination of CD Rate" or "Determination of Federal Funds Rate"
depending upon whether the Interest Rate Basis specified above is
Commercial Paper Rate, Prime Rate, LIBOR, Treasury Rate, CD Rate or Federal
Funds Rate until the principal hereof is paid or duly made available for
payment, and at the rate then accruing on this Security on any overdue
principal and premium and on any overdue installment of interest.
Such interest shall be payable by the Issuer weekly, monthly,
quarterly, semi-annually or annually as specified above under "Interest
Payment Period" and, unless otherwise specified above under "Interest
Payment Date(s)", such interest shall be payable, if the Interest Reset
Dates with respect to this Security are weekly, on the third Wednesday of
March, June, September and December of each year; if the Interest Reset
Dates with respect to this Security are monthly, on the third Wednesday of
each month or on the third Wednesday of March, June, September and December
of each year, as specified on the face hereof; if the Interest Reset Dates
with respect to this Security are quarterly, on the third Wednesday of
March, June, September and December of each year; if the Interest Reset
Dates with respect to this Security are semi-annually, on the third
Wednesday of the two months of each year specified on the face hereof; and
if the Interest Reset Dates with respect to this Security are annually, on
the third Wednesday of the month specified on the face hereof (or, unless
otherwise specified on the face hereof, if any such day is not a Market Day
(as hereinafter defined) with respect to this Security, on the next
succeeding Market Day with respect to this Security or, if the Interest
Rate Basis specified above is LIBOR and such next succeeding Market Day
falls in the next calendar month, the next preceding Market Day) (each date
so specified above determined as herein provided, an "Interest Payment
Date") and at maturity.
The interest so payable, and punctually paid or duly provided
for, on any such Interest Payment Date will be paid to the person in whose
name this Security (or one or more predecessor Securities) is registered at
the close of
<PAGE>
<PAGE> 21
business on the fifteenth calendar day (whether or not a Market Day or a
Business Day (as hereinafter defined)) next preceding such Interest Payment
Date (the "Regular Record Date"); provided, however, that interest payable
at maturity will be payable to the person to whom principal shall be
payable; and, provided, further, that if the Issue Date is after a Regular
Record Date and before the next succeeding Interest Payment Date the first
payment of interest shall be payable on the Interest Payment Date following
the next succeeding Regular Record Date to the person in whose name this
Security (or one or more predecessor Securities) is registered at the close
of business on such next succeeding Regular Record Date.
Any such interest which is payable, but not punctually paid or
duly provided for, on any Interest Payment Date will forthwith cease to be
payable to the Holder on such Regular Record Date and such defaulted
interest may either be paid to the person in whose name this Security (or
one or more predecessor Securities) is registered at the close of business
on a special record date for the payment of such interest to be fixed by
the Issuer, notice whereof shall be given to the Holder of this Security
not less than 10 days prior to such special record date, or be paid at any
time in any other lawful manner not inconsistent with the requirements of
any securities exchange on which this Security may be listed, and upon such
notice as may be required by such exchange.
Payment of principal of (and premium, if any) and interest on
this Security will be made in the Specified Currency specified above;
provided, however, that, if this Security is denominated in other than U.S.
dollars, payments of principal of (and premium, if any) and interest due on
this Security on any date will nevertheless be made in U.S. dollars:
(a) at the option of the Holder of this Security under the procedures
described in the two next succeeding paragraphs and (b) at the option of
the Issuer in the case of imposition of exchange controls or other
circumstances beyond the control of the Issuer as described in the fifth
and sixth succeeding paragraphs. The Issuer will at all times appoint and
maintain a Paying Agent (which may be the Trustee) authorized by the Issuer
to pay the principal of (and premium, if any) or interest on any Securities
of this series on behalf of the Issuer and having an office or agency (the
"Paying Agency Office") in The City of New York (the "Place of Payment")
where Securities of this series may be presented or surrendered for payment
and where notices, designations or requests in respect of payments with
respect to Securities of this series may be served. The Issuer has
initially appointed The Bank of New York as Paying Agent.
<PAGE>
<PAGE> 22
Except as provided in the next paragraph, any payment of
principal (and premium, if any) and interest for any Security of this
series denominated in a Specified Currency other than U.S. dollars will be
made in U.S. dollars if the registered Holder of such Security on the
relevant Regular Record Date or at the maturity of such Security, as the
case may be, has transmitted a written request for such payment in U.S.
dollars to the Trustee at the Corporate Trust Office in The City of New
York on or before such Regular Record Date or the date 15 days before such
maturity, as the case may be. Such request may be in writing (mailed or
hand delivered) or by telecopier or, if promptly confirmed in writing, by
other form of facsimile transmission. Any such request made for any
Security by a registered Holder will remain in effect for any further
payments of interest and principal (and premium, if any) on such Security
payable to such Holder, unless such request is revoked on or before the
relevant Regular Record Date or the date 15 days before the maturity of
such Security, as the case may be.
The U.S. dollar amount to be received by a Holder of a Security
denominated in a Specified Currency other than U.S. dollars who elects to
receive payment in U.S. dollars will be determined by the Exchange Rate
Agent based upon the highest bid quotation in The City of New York for U.S.
dollars received by such Exchange Rate Agent as of 11:00 a.m., New York
City time, on the second Business Day next preceding the applicable payment
date from three recognized foreign currency dealers selected by the
Exchange Rate Agent (one of which may be the Exchange Rate Agent) for the
purchase by the quoting dealer of such Specified Currency for U.S. dollars
for settlement on such payment date in the aggregate amount of such Speci-
fied Currency payable to all Holders of Securities of this series
denominated in such Specified Currency electing to receive U.S. dollar
payments on such payment date and at which the applicable dealer commits to
execute a contract. If three such bid quotations are not available on the
second Business Day preceding the payment of principal (and premium, if
any) or interest on this Security, such payment will be made in the Speci-
fied Currency. All currency exchange costs associated with any payment in
U.S. dollars on this Security will be borne by the Holder hereof by deduc-
tions from such payment. Goldman, Sachs & Co. will initially serve as
Exchange Rate Agent.
Payments of principal of (and premium, if any) and any interest
due with respect to this Security at maturity to be paid in U.S. dollars
shall be made in immediately available funds against surrender of this
Security at the Corporate Trust Office of the Trustee in the Borough of
<PAGE>
<PAGE> 23
Manhattan, The City of New York or at such other offices or agencies as the
Issuer may designate and at the offices of such other Paying Agents as the
Issuer shall have appointed pursuant to the Indenture; provided that this
Security is presented to the Paying Agent in time for the Paying Agent to
make such payments in such funds in accordance with its normal procedures.
Payments of interest on this Security to be paid in U.S. dollars other than
at maturity shall be made by check mailed on or before the due date for
such payment to the person entitled thereto at such person's address
appearing on the register of this Security or by wire transfer to an
account maintained by the payee with a bank located in the Borough of
Manhattan, The City of New York, if such registered Holder so elects by
giving written notice to the Trustee at its Corporate Trust Office in The
City of New York, not less than 15 days (or such fewer days as the Trustee
may accept at its discretion) prior to the date of the payments to be
obtained, of such election and of the account to which payments are to be
made.
Payments of principal of (and premium, if any) and interest
with respect to this Security to be made in a Specified Currency other than
U.S. dollars will be made by wire transfer of immediately available funds
to such account with a bank located in the country issuing the Specified
Currency (or, if this Security is denominated in ECUs, to an ECU account)
or other jurisdiction acceptable to the Issuer and the Trustee as shall
have been designated at least 5 Business Days prior to the applicable
Interest Payment Date or the maturity of this Security, as the case may be,
by the Holder of this Security on the relevant Regular Record Date or at
maturity, provided that, in the case of payment of principal of (and
premium, if any) and any interest due at such maturity, this Security must
be presented to the Paying Agent in time for the Paying Agent to make such
payments in such funds in accordance with its normal procedures. Such
designation shall be made by filing the appropriate information with the
Trustee at its Corporate Trust Office in The City of New York, and, unless
revoked, any such designation made with respect to this Security by the
Holder hereof will remain in effect with respect to any further payments
with respect to this Security payable to the Holder hereof. If a payment
in a Specified Currency other than U.S. dollars with respect to this
Security cannot be made by wire transfer because the required designation
has not been received by the Trustee on or before the requisite date or for
any other reason, the Issuer will cause a notice to be mailed to the Holder
of this Security at its registered address requesting a designation
pursuant to which such wire transfer can be made and, upon the Trustee's
receipt of such a designation, such payment will be made within 5 Business
<PAGE>
<PAGE> 24
Days of such receipt. The Issuer will pay any administrative costs imposed
by banks in connection with making payments by wire transfer with respect
to this Security, but any tax, assessment or governmental charge imposed
upon payments will be borne by the Holder of this Security.
If the principal of (and premium, if any) or interest on this
Security is payable at any time (including at maturity) in other than U.S.
dollars and such Specified Currency (other than ECUs) is not available, due
to the imposition of exchange controls or other circumstances beyond the
control of the Issuer, the Issuer will be entitled to satisfy its
obligations to the Holder of this Security by making such payment in U.S.
dollars at a rate determined by the Exchange Rate Agent on the basis of the
most recently available Exchange Rate (as hereinafter defined).
If the principal of (and premium, if any) and interest on this
Security is payable at any time (including at maturity) in ECUs and ECUs
are unavailable due to the imposition of exchange controls or other
circumstances beyond the control of the Issuer or are no longer used in the
European Monetary System, the Issuer will be entitled to satisfy its
obligations to the Holder of this Security by making such payment in U.S.
dollars. The amount so payable on any payment date in ECUs shall be
converted into U.S. dollars at a rate determined by the Exchange Rate Agent
as of the second Business Day prior to the date on which such payment is
due on the following basis: The component currencies of the ECUs for this
purpose (the "Components") shall be the currency amounts that were
components of the ECUs as of the last date on which the ECUs were used in
the European Monetary System. The equivalent of ECUs in U.S. dollars shall
be calculated by aggregating the U.S. dollar equivalents of the Components.
The U.S. dollar equivalent of each of the Components shall be determined by
the Exchange Rate Agent on the basis of the most recently available
Exchange Rate for the Components, or as otherwise specified on the face
hereof.
If the official unit of any Component is altered by way of
combination or subdivision, the number of units of that currency as a
Component shall be divided or multiplied in the same proportion. If two or
more Components are consolidated into a single currency, the amounts of
those currencies as a Component shall be replaced by an amount in such
single currency equal to the sum of the amounts of the consolidated
Components expressed in such single currency. If any Component is divided
into two or more currencies, the
<PAGE>
<PAGE> 25
amount of that currency as a Component shall be replaced by amounts of such
two or more currencies, each of which shall have a value on the date of
division equal to the amount of the former Component divided by the number
of currencies into which that currency was divided.
Any payment made under such circumstances in U.S. dollars where
the required payment is in other than U.S. dollars will not constitute an
Event of Default under the Indenture or this Security.
All determinations made by the Exchange Rate Agent pursuant to
the terms of this Security shall be, absent manifest error, conclusive for
all purposes and binding on the Holder of this Security and the Issuer, and
the Exchange Rate Agent shall have no liability therefor.
Reference is hereby made to the further provisions of this
Security set forth on the reverse hereof, which further provisions shall
for all purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been
executed by the Trustee referred to on the reverse hereof by the manual
signature of an authorized signatory, this Security shall not be entitled
to any benefit under the Indenture or be valid or obligatory for any
purpose.
<PAGE>
<PAGE> 26
SPECIMEN
IN WITNESS WHEREOF, the Issuer has caused this instrument to be
duly executed.
Dated: August 9, 1996
GS FINANCIAL PRODUCTS U.S., L.P.
By:GS Financial Products US Co.
General Partner
By____________________________
Name:
Title:
Date of Authentication: August 9, 1996
This is one of the Securities
of the series designated
herein referred to in the
within-mentioned Indenture
THE BANK OF NEW YORK, as Trustee
By____________________________________
Authorized Signatory
<PAGE>
<PAGE> 27
1. This Security is one of a duly authorized issue of
securities of the Issuer issued and to be issued in one or more series
under the Indenture, dated as of October 11, 1994, (the "Indenture"),
between the Issuer and The Bank of New York, as Trustee (herein called the
"Trustee", which term includes any successor trustee under the Indenture),
to which Indenture and all indentures supplemental thereto, reference is
hereby made for a statement of the respective rights, limitations of
rights, duties and immunities thereunder of the Issuer, the Trustee, the
Holders of the Securities and of the terms upon which the Securities are,
and are to be, authenticated and delivered. The Securities issued and to
be issued in one or more series in accordance with the terms of the
Indenture are herein called the "Securities". Terms used and not defined
herein but defined in the Indenture are used herein as therein defined.
2. (a) This Security is one of the series designated on
the face hereof, limited to an aggregate initial offering price not to
exceed $500,000,000 (or the equivalent thereof in any other currency or
currencies or currency units) (which amount may be increased at the option
of the Issuer if in the future it determines that it may wish to sell
additional Securities of this series). The Securities of this series are
initially issuable only as registered Securities, without coupons, in
authorized denominations, if denominated in U.S. dollars, of $1,000 or any
greater amount. The authorized denomination upon initial issuance of any
Security denominated in other than U.S. dollars will be the amount of the
Specified Currency for such Security equivalent, at the noon buying rate
for cable transfers in The City of New York for such Specified Currency
(the "Exchange Rate") on the first Business Day (as hereinafter defined)
next preceding the date on which the Issuer accepts the offer to purchase
such Security, to $1,000 or any greater amount.
(b) The rate of interest on this Security will be reset
weekly, monthly, quarterly, semi-annually or annually or otherwise, as
specified on the face hereof under Interest Reset Period (each date upon
which interest is so reset as provided below being hereinafter referred to
as an "Interest Reset Date"). Unless otherwise specified on the face
hereof, the Interest Reset Date with respect to this Security will be, if
the Interest Reset Period specified on the face hereof is weekly (unless
the Interest Rate Basis specified on the face hereof is the Treasury Rate),
the Wednesday of each week; if the Interest Reset Period specified on the
face hereof is weekly and the Interest Rate Basis specified on the face
hereof is the Treasury Rate, except as otherwise provided below, the
Tuesday of each
<PAGE>
<PAGE> 28
week; if the Interest Reset Period specified on the face hereof is monthly,
the third Wednesday of each month; if the Interest Reset Period specified
on the face hereof is quarterly, the third Wednesday of each March, June,
September and December; if the Interest Reset Period specified on the face
hereof is semi-annually, the third Wednesday of two months in each year
specified under Interest Reset Date on the face hereof; and if the Interest
Reset Period specified on the face hereof is annually, the third Wednesday
of the month in each year specified under Interest Reset Date on the face
hereof; provided, however, that (i) the interest rate in effect from the
Issue Date of this Security (or a predecessor Security) to but excluding
the first Interest Reset Date will be the Initial Interest Rate specified
on the face hereof and (ii) the interest rate in effect for the ten
calendar days immediately prior to maturity of this Security will be that
in effect on the tenth calendar day preceding such maturity. If, pursuant
to the preceding sentence, any Interest Reset Date would otherwise be a day
that is not a Market Day with respect to this Security, the Interest Reset
Date shall be the next succeeding day that is a Market Day with respect to
this Security, except that, unless otherwise specified on the face hereof,
if the Interest Rate Basis specified on the face hereof is LIBOR and the
next succeeding Market Day falls in the next succeeding calendar month,
such Interest Reset Date shall be the immediately preceding Market Day.
Subject to applicable provisions of law and except as specified
herein, on each Interest Reset Date the rate of interest on this Security
shall be the rate determined in accordance with the provisions of the
applicable heading below corresponding to the Interest Rate Basis specified
herein.
Determination of Commercial Paper Rate. If the Interest Rate
Basis specified on the face hereof is the Commercial Paper Rate, the
interest rate with respect to this Security for any Interest Reset Date
shall equal the Money Market Yield (calculated as described below) of the
per annum rates (quoted on a bank discount basis) on the second Market Day
immediately preceding such Interest Reset Date (the "Commercial Paper
Interest Determination Date") for commercial paper having the Index
Maturity shown on the face hereof, as published by the Board of Governors
of the Federal Reserve System in "Statistical Release H.15(519), Selected
Interest Rates", or any successor publication published by the Board of
Governors of the Federal Reserve System ("H.15(519)"), under the heading
"Commercial Paper". In the event such rate is not so published prior to
3:00 P.M., New York City time, on the Calculation Date pertaining
<PAGE>
<PAGE> 29
to such Commercial Paper Interest Determination Date, then the Commercial
Paper Rate with respect to such Interest Reset Date shall be the Money
Market Yield of such rate on such Commercial Paper Interest Determination
Date for commercial paper having the specified 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
published in either H.15(519) or Composite Quotations, the Commercial Paper
Rate with respect to such Interest Reset 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 for commercial paper
having the Index Maturity shown on the face hereof placed for an industrial
issuer whose bond rating is "AAA", 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 shall be the
Commercial Paper Rate in effect on such Commercial Paper Interest
Determination Date (or, in the case of the first Interest Reset Date, the
Initial Interest Rate).
The interest rate determined in accordance with the foregoing
provisions (except in the case of an interest rate determined pursuant to
the proviso in the last sentence of the immediately preceding paragraph)
will be adjusted by the addition or subtraction of the Spread, if any,
specified on the face hereof, or by multiplication by the Spread
Multiplier, if any, specified on the face hereof.
"Money Market Yield" shall be a yield (expressed as a
percentage), 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 from the Interest Reset Date to but
excluding the day that numerically corresponds to such Interest Reset Date
(or, if
<PAGE>
<PAGE> 30
there is not any such numerically corresponding day, the last day) in the
calendar month that is the number of months corresponding to the specified
Index Maturity after the month in which such Interest Reset Date falls.
Determination of Prime Rate. If the Interest Rate Basis
specified on the face hereof is the Prime Rate, the interest rate with
respect to this Security for any Interest Reset Date shall equal the rate
on the second Market Day immediately preceding such Interest Reset Date
(the "Prime Rate Interest Determination Date") as published in H.15(519)
under the heading "Bank Prime Loan". In the event that such rate is not
published prior to 3:00 P.M., New York City time, on the Calculation Date
pertaining to such Prime Rate Interest Determination Date, then the Prime
Rate with respect to such Interest Reset Date will be the arithmetic mean
of the rates of interest publicly announced by each bank that appears on
the display designated as page "NYMF" on the Reuters Monitor Money Rates
Service (or such other page as may replace the NYMF page on that service
for the purpose of displaying prime rates or base lending rates of major
United States banks) ("Reuters Screen NYMF Page") as such bank's prime rate
or base lending rate as in effect for such Prime Rate Interest
Determination Date. If fewer than four such rates appear on the Reuters
Screen NYMF Page on such Prime Rate Interest Determination Date, the Prime
Rate with respect to such Interest Reset Date will be the arithmetic mean
of the prime rates or base lending rates (quoted on the basis of the actual
number of days in the year divided by a 360-day year) as of the close of
business on such Prime Rate Interest Determination Date by three major
banks in The City of New York selected by the Calculation Agent; provided,
however, that if fewer than three banks selected as aforesaid by the
Calculation Agent are quoting as mentioned in this sentence, the Prime Rate
shall be the Prime Rate in effect on such Prime Rate Interest Determination
Date (or in the case of the first Interest Reset Date, the Initial Interest
Rate).
The interest rate determined in accordance with the foregoing
provisions (except in the case of an interest rate determined pursuant to
the proviso of the last sentence of the immediately preceding paragraph)
will be adjusted by the addition or subtraction of the Spread, if any,
specified on the face hereof, or by multiplication by the Spread
Multiplier, if any, specified on the face hereof.
Determination of LIBOR. If the Interest Rate Basis specified
on the face hereof is LIBOR, the interest rate with respect to this
Security for any Interest Reset
<PAGE>
<PAGE> 31
Date shall be determined by the Calculation Agent in accordance with the
following provisions:
(i) On the second London Market Day prior to such
Interest Reset Date (a "LIBOR Interest Determination Date"),
the Calculation Agent will determine LIBOR on the basis of the
offered rate for deposits of not less than $1,000,000 having
the Index Maturity shown on the face hereof, commencing on the
second London Market Day immediately following such LIBOR
Interest Determination Date, which appears on 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) ("Telerate Page 3750") as of 11:00 A.M., London
time, on that LIBOR Interest Determination Date; provided,
however, that if no such offered rate so appears, LIBOR for
such LIBOR Interest Determination Date will be determined as
described in (ii) below.
(ii) If on any LIBOR Interest Determination Date no
offered rate for the applicable Index Maturity appears on
Telerate Page 3750 as described in (i) above, LIBOR will be
determined on the basis of the rates at approximately
11:00 A.M., London time, on such LIBOR Interest Determination
Date at which deposits in U.S. dollars having the Index
Maturity specified on the face hereof are offered to prime
banks in the London interbank market by four major banks
selected by the Calculation Agent commencing on the second
Market Day immediately following such LIBOR Interest Determina-
tion Date, and in a principal amount equal to an amount of not
less than $1,000,000 that in the Calculation Agent's judgment
is representative for a single transaction in such market at
such time (a "Representative Amount"). The Calculation Agent
will request the principal London office of each such bank to
provide a quotation of its rate. If at least two such
quotations are provided, LIBOR for such LIBOR Interest
Determination Date will be the arithmetic mean of such
quotations. If fewer than two quotations are provided, LIBOR
for 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
<PAGE>
<PAGE> 32
banks in The City of New York, selected by the Calculation Agent, for
loans in U.S. dollars to leading European banks, having the Index
Maturity shown on the face hereof and in a Representative Amount;
provided, however, that if fewer than three banks selected as
aforesaid by the Calculation Agent are quoting as mentioned in this
sentence, LIBOR will be the LIBOR in effect on such LIBOR Interest
Determination Date (or, in the case of the first Interest Reset Date,
the Initial Interest Rate).
The interest rate determined in accordance with the foregoing
provisions (except in the case of an interest rate determined pursuant to
the proviso of the last sentence of the immediately preceding paragraph)
will be adjusted by the addition or subtraction of the Spread, if any,
specified on the face hereof, or by multiplication by the Spread
Multiplier, if any, specified on the face hereof.
Determination of Treasury Rate. If the Interest Rate Basis
specified on the face hereof is the Treasury Rate, the interest rate with
respect to this Security for any Interest Reset Date shall equal (a) the
rate for the auction on the relevant Treasury Interest Determination Date
(as defined below) of direct obligations of the United States ("Treasury
bills") having the Index Maturity shown on the face hereof as published in
H.15(519) under the heading "U.S. Government Securities/Treasury
Bills/Auction Average (investment)" or (b) if such rate is not so published
by 3:00 P.M., New York City time, on the Calculation Date pertaining to
such Treasury Interest Determination Date, the auction average rate
(expressed as 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
that the results of the auction of Treasury bills having the Index Maturity
shown on the face hereof are not published or reported as provided in (a)
or (b) above by 3:00 P.M., New York City time, on such Calculation Date or
if no such auction is held in a particular week, then the Treasury Rate
shall be the rate set forth in H.15(519) for the relevant Treasury Interest
Determination Date for the Index Maturity shown on the face hereof under
the heading "U.S. Government Securities/Treasury Bills/Secondary Market".
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 Reset Date shall be calculated by the Calculation Agent and
shall be the yield to maturity (expressed as a bond equivalent on the basis
of a year of 365 or 366 days, as applicable, and
<PAGE>
<PAGE> 33
applied on a daily basis) of the arithmetic mean of the secondary market
bid rates as of approximately 3:30 P.M., New York City time, on such
Treasury Interest Determination Date, of three primary United States
government securities dealers in The City of New York selected by the
Calculation Agent for the issue of Treasury bills with a remaining maturity
closest to the Index Maturity shown on the face hereof; provided, however,
that if fewer than three such dealers selected as aforesaid by the
Calculation Agent are quoting as mentioned in this sentence, the Treasury
Rate shall be the Treasury Rate on such Treasury Interest Determination
Date (or, in the case of the first Interest Reset Date, the Initial
Interest Rate).
The interest rate determined in accordance with the foregoing
provisions (except in the case of an interest rate determined pursuant to
the proviso of the last sentence of the immediately preceding paragraph)
will be adjusted by the addition or subtraction of the Spread, if any,
specified on the face hereof, or by multiplication by the Spread
Multiplier, if any, specified on the face hereof.
The "Treasury Interest Determination Date" pertaining to an
Interest Reset Date will be the day of the week in which such Interest
Reset Date falls on which Treasury bills would normally be auctioned. If,
as the result of a legal holiday, an auction is so held on the Friday in
the week immediately preceding the week in which such Interest Reset Day
falls, such Friday will be the Treasury Interest Determination Date
pertaining to the Interest Reset Date occurring in the next succeeding
week. If an auction date shall fall on any Interest Reset Date for this
Security, then such Interest Reset Date shall instead be the first Market
Day immediately following such auction date.
Determination of CD Rate. If the Interest Rate basis specified
on the face hereof is the CD Rate, the interest rate with respect to this
Security for any Interest Reset Date shall equal the rate on the second
Market Day immediately preceding such Interest Reset Date (the "CD Rate
Interest Determination Date") for negotiable certificates of deposit having
the Index Maturity shown on the face hereof as published in H.15(519) under
the heading "CDs (Secondary Market)". In the event that such rate is not
published prior to 3:00 P.M., New York City time, on the relevant
Calculation Date, then the CD Rate with respect to such Interest Reset Date
shall be the rate on such CD Rate Interest Determination Date for
negotiable certificates of deposit having the Index Maturity shown on the
face hereof as published in Composite Quotations under the heading
<PAGE>
<PAGE> 34
"Certificates of Deposit". 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 CD Rate with respect to such Interest Reset Date
shall be calculated by the Calculation Agent and shall be the arithmetic
mean of the secondary market offered rates, as of 10:00 A.M., New York City
time, on such CD Rate Interest Determination Date, of three leading nonbank
dealers of negotiable U.S. dollar certificates of deposit in The City of
New York selected by the Calculation Agent for negotiable certificates of
deposit of major United States money market banks with a remaining maturity
closest to the Index Maturity shown on the face hereof in a denomination of
$5,000,000; provided, however, that if fewer than three dealers selected as
aforesaid by the Calculation Agent are quoting as mentioned in this
sentence, the CD Rate with respect to such Interest Reset Date will be the
CD Rate in effect on such CD Rate Interest Determination Date (or, in the
case of the first Interest Reset Date, the Initial Interest Rate).
The interest rate determined in accordance with the foregoing
provisions (except in the case of an interest rate determined pursuant to
the proviso of the last sentence of the immediately preceding paragraph)
will be adjusted by the addition or subtraction of the Spread, if any,
specified on the face hereof, or by multiplication by the Spread
Multiplier, if any, specified on the face hereof.
Determination of Federal Funds Rate. If the Interest Rate
Basis specified on the face hereof is the Federal Funds Rate, the interest
rate with respect to this Security for any Interest Reset Date shall equal
the rate on the second Market Day immediately preceding such Interest Reset
Date (the "Federal Funds Interest Determination Date") for Federal Funds as
published in H.15(519) under the heading "Federal Funds (Effective)" or in
the event that such rate is not so published prior to 3:00 P.M., New York
City time, on the Calculation Date pertaining to such Federal Funds
Interest Determination Date, then as published in Composite Quotations
under the heading "Federal Funds/ Effective Rate" or (b) 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, the arithmetic mean, as
calculated by the Calculation Agent on such Calculation Date, 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; provided, however, that if
fewer than
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<PAGE> 35
three brokers selected as aforesaid by the Calculation Agent are quoting as
mentioned in this sentence, the Federal Funds Rate will be the Federal
Funds Rate in effect on such Federal Funds Interest Determination Date (or,
in the case of the first Interest Reset Date, the Initial Interest Rate).
The interest rate determined in accordance with the foregoing
provisions (except in the case of an interest rate determined pursuant to
the proviso of the last sentence of the immediately preceding paragraph)
will be adjusted by the addition or subtraction of the Spread, if any,
specified on the face hereof, or by multiplication by the Spread
Multiplier, if any, specified on the face hereof.
Notwithstanding the foregoing, the interest rate hereon shall
not be greater than the Maximum Interest Rate, if any, or less than the
Minimum Interest Rate, if any, shown on the face hereof and in no event
shall be higher than the maximum rate permitted by New York law, as the
same may be modified by United States law of general application.
The "Calculation Date" pertaining to any Commercial Paper
Interest Determination Date, Prime Rate Interest Determination Date, LIBOR
Interest Determination Date, Treasury Interest Determination Date, CD Rate
Interest Determination Date or Federal Funds Rate Interest Determination
Date, as the case may be, shall be the tenth day after such interest
determination date or, if any such day is not a Market Day with respect to
this Security, the next succeeding Market Day.
The Calculation Agent's determination of the interest rate on
this Security shall be final and binding in the absence of manifest error.
Except as otherwise provided herein, all percentages resulting
from any calculation with respect to this Security will be rounded upwards,
if necessary, to the nearest one-hundred thousandth of a percentage point
(e.g., 9.876541% (or .09876541) being rounded to 9.87655% (or .0987655)),
and all U.S. dollar amounts will be rounded to the nearest cent (with one-
half cent being rounded upwards).
Payments of interest hereon with respect to any Interest
Payment Date or at maturity will include interest accrued to but excluding
such Interest Payment Date and such maturity date, as the case may be;
provided, however, that, if the Interest Reset Period with respect to this
Security is weekly, the interest payable on any Interest Payment Date,
other than interest payable on the date on which principal is payable, will
include interest accrued to but
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<PAGE> 36
excluding the day following the next preceding Regular Record Date.
Accrued interest from the date of issue or from the last date
to which interest has been paid or duly provided for shall be calculated by
multiplying the face amount hereof by an accrued interest factor. Such
accrued interest factor shall be computed by adding the interest factor
calculated for each day from the date of issue or from the last date to
which interest has been paid or duly provided for, to but excluding the
date for which accrued interest is being calculated. The interest factor
(expressed as a decimal) for each such day shall be computed by dividing
the interest rate (expressed as a decimal) applicable to such day by 360,
if the Interest Rate Basis specified on the face hereof is the Commercial
Paper Rate, Prime Rate, LIBOR, CD Rate or Federal Funds Rate, or by the
actual number of days in the year if the Interest Rate Basis specified on
the face hereof is the Treasury Rate.
Unless otherwise specified on the face hereof, if any payment
date would otherwise be a day which is not a Market Day, with respect to
this Security, such payment need not be made on such day, but may be made
on the next succeeding Market Day (or, if the Interest Rate Basis specified
on the face hereof is LIBOR, if such day falls in the next calendar month,
the next preceding Market Day) with the same force and effect as if made on
the due date, and no interest shall accrue on the period from and after
such date.
"Market Day" means (i) any Business Day (unless the Interest
Rate Basis on the face hereof is LIBOR) and (ii) if the Interest Rate Basis
on the face hereof is LIBOR, any Business Day on which dealings in deposits
in U.S. dollars are transacted in the London interbank market. Unless
otherwise specified on the face hereof, the term "Business Day" means each
Monday, Tuesday, Wednesday, Thursday and Friday, which is (i) not a day on
which banking institutions in The City of New York generally are authorized
or obligated by law or executive order to close, and (ii) if this Security
is denominated in a Specified Currency other than U.S. dollars, not a day
on which banking institutions are authorized or obligated by law or
executive order to close in the financial center of the country issuing the
Specified Currency (which in the case of ECUs shall be Brussels, in which
case "Business Day" shall not include any day that is a non-ECU clearing
day as determined by the ECU Banking Association in Paris). Unless
otherwise specified on the face hereof, "London Market Day" means any
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<PAGE> 37
day on which dealings in U.S. dollars are transacted in the London
interbank market.
3. This Security is not exchangeable for Securities registered
in the name of a person other than the Depositary or its nominee except in
the event (x) the Depositary has notified the Issuer that it is unwilling
or unable to continue as Depositary for such Global Security or the
Depositary has ceased to be a clearing agency registered under the
Securities Exchange Act of 1934, (y) the Issuer has delivered to the
Trustee a written notice that this Global Security shall be exchangeable or
(z) an Event of Default has occurred and is continuing with respect to the
Securities of this series, and no transfer of this Security (other than a
transfer of this Security as a whole by the Depositary to a nominee of the
Depositary or by a nominee of the Depositary to the Depositary or another
nominee of the Depositary) may be registered except in the limited
circumstances described in this paragraph.
4. (a) Unless a Redemption Commencement Date is specified on
the face hereof, and except as otherwise provided in Paragraph 4(b) below,
this Security shall not be redeemable at the option of the Issuer before
the Stated Maturity specified herein. If a Redemption Commencement Date is
so specified, this Security is subject to redemption upon not less than
60 days' nor more than 90 days' notice by first class mail at any time on
or after the Redemption Commencement Date, as a whole or in part, at the
election of the Issuer, at the Redemption Price specified on the face
hereof (expressed as a percentage of the principal amount of this Security)
applicable to the Redemption Period so specified during which this Security
is to be redeemed, together in the case of any such redemption with accrued
interest to the Redemption Date, but interest installments due on or prior
to such Redemption Date will be payable to the Holder of this Security, or
one or more Predecessor Securities, of record at the close of business on
the relevant Record Dates referred to herein, all as provided in the
Indenture.
(b) The Securities of this series are subject to redemption
upon not less than 60 days' notice by mail, as a whole or in part, at the
election of the Issuer, if the Issuer, in an Officers' Certificate,
certifies to the Trustee that it has determined to terminate its obligation
to file reports with the U.S. Securities and Exchange Commission (the
"Commission") pursuant to the Securities Exchange Act of 1934 (the
"Exchange Act"). Unless otherwise provided on the face hereof, any such
redemption will be made at a Redemption Price equal to the greater of 100%
of
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<PAGE> 38
the principal amount of the Securities to be redeemed and the average of
the final bid and ask prices (as determined by the Issuer) for the
Securities of this series and of a like tenor on the 10 Business Days
preceding the date of mailing by the Issuer of the notice of redemption,
expressed as a percentage of the principal amount of the Securities of this
series, together with accrued interest to the date fixed for redemption,
unless such accrued interest is reflected in the final bid and ask prices.
In the event that there are no bid or ask prices for the Securities of such
series on the 10 Business Days preceding the date the Issuer mails the
notice of redemption, such redemption will be made at a Redemption Price
equal to the greater of 100% of the Securities to be redeemed and the
market value for the Securities to be redeemed as determined by a broker-
dealer selected by the Issuer (which may be an affiliate of the Issuer),
together with accrued interest to the date fixed for redemption, unless
such accrued interest is reflected in the final bid and ask prices. Unless
otherwise provided on the face hereof, redemption pursuant to this
paragraph will take place by selecting for redemption Securities of the
smallest denomination first (as evidenced in the Security Register) in
order that, following the Redemption Date, all Securities that constitute a
single "class" of securities (within the meaning of the Exchange Act and
the rules thereunder) will be held of record by not more than the largest
number of holders at which the Issuer would not be subject to a reporting
or filing obligation under the Exchange Act (the "Maximum Number of
Holders"). In the event that selection for redemption of Securities of the
smallest denomination first (as evidenced in the Securities Register) does
not result in the Securities being held of record by not more than the
Maximum Number of Holders, the Trustee shall select such additional
Securities for redemption by such method as the Trustee shall deem fair and
appropriate in order that following the date fixed for redemption, all
Securities constituting a single "class" of securities for purposes of the
Exchange Act will be held of record by not more than the Maximum Number of
Holders. In connection with any such redemption, the Issuer and the
Trustee may, without the consent of any Holder of any Security of this
series, enter into a supplemental indenture increasing the minimum
denomination of the Securities of this series in a manner so that it is not
possible for such Securities to be held of record by more than the Maximum
Number of Holders.
(c) In the event of redemption of this Security in part only,
a new Security or Securities of this series and of like tenor and for a
principal amount equal to the
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<PAGE> 39
unredeemed portion will be issued to the registered Holder upon the
cancellation hereof.
5. (a) If an Event of Default with respect to Securities of
this series shall occur and be continuing, the principal of the Securities
of this series may be declared due and payable in the manner and with the
effect provided in the Indenture.
(b) As provided in and subject to the provisions of the
Indenture, the Holder of this Security shall not have the right to
institute any proceeding with respect to the Indenture or for the
appointment of a receiver or trustee or for any other remedy thereunder,
unless such Holder shall have previously given the Trustee written notice
of a continuing Event of Default with respect to the Securities of this
series, the Holders of not less than 25% in principal amount of the
Securities of this series at the time Outstanding shall have made written
request to the Trustee to institute proceedings in respect of such Event of
Default as Trustee and offered the Trustee reasonable indemnity, and the
Trustee shall not have received from the Holders of a majority in principal
amount of Securities of this series at the time Outstanding a direction
inconsistent with such request, and shall have failed to institute any such
proceeding, for 60 days after receipt of such notice, request an offer of
indemnity. The foregoing shall not apply to any suit instituted by the
Holder of this Security for the enforcement of any payment of principal
hereof or any premium or interest hereon on or after the respective due
dates expressed herein.
6. The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Issuer and the rights of the Holders of the Securities
of each series to be affected under the Indenture at any time by the Issuer
and the Trustee with the consent of the Holders of 50% in principal amount
of the Securities at the time Outstanding of each series to be affected.
The Indenture also contains provisions permitting the Holders of specified
percentages in principal amount of the Securities of each series at the
time Outstanding, on behalf of the Holders of all Securities of such
series, to waive compliance by the Issuer with certain provisions of the
Indenture and certain past defaults under the Indenture and their
consequences. Any such consent or waiver by the Holder of this Security
shall be conclusive and binding upon such Holder and upon all future
Holders of this Security and of any Security issued upon the registration
of transfer hereof or in
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<PAGE> 40
exchange herefor or in lieu hereof, whether or not notation of such consent
or waiver is made upon this Security.
7. No reference herein to the Indenture and no provision of
this Security or of the Indenture shall alter or impair the obligation of
the Issuer, which is absolute and unconditional, to pay the principal of
(and premium, if any) and interest on this Security at the times, place and
rate, and in the coin or currency, herein prescribed.
8. This Security shall be governed by and construed in
accordance with the laws of the State of New York.
