DEERE & COMPANY
Medium-Term Notes, Series C
Due from 9 Months to 30 Years from Date of Issue
DISTRIBUTION AGREEMENT
, 1999
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
World Financial Center
North Tower, 10th Floor
New York, New York 10281-1310
GOLDMAN, SACHS & CO.
85 Broad Street
New York, New York 10004
Dear Sirs:
Deere & Company, a Delaware corporation (the "Company"), confirms its
agreement with Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith
Incorporated and Goldman, Sachs & Co. (each, an "Agent", and collectively,
the "Agents"), with respect to the issue and sale by the Company of its
Medium-Term Notes, Series C, Due from 9 Months to 30 Years from Date of Issue
described herein (the "Notes"). The Notes may be issued as senior
indebtedness (the "Senior Notes") or as subordinated indebtedness (the
"Subordinated Notes") of the Company. The Senior Notes are to be issued as a
series under an indenture, dated as of July 1, 1994 (the "Senior Indenture"),
between the Company and The Chase Manhattan Bank (successor by merger to The
Chase Manhattan Bank (National Association)), trustee (the "Senior Trustee")
and the Subordinated Notes are to be issued as a series under an indenture,
dated as of March 15, 1999 (the "Subordinated Indenture", and together with
the Senior Indenture, the "Indentures"), between the Company and The Bank of
New York, trustee (the "Subordinated Trustee", and together with the Senior
Trustee, the "Trustees"). As of the date hereof, the Company has authorized
the issuance and sale of up to U.S. $1,450,000,000 aggregate principal amount
(or its equivalent, based upon the applicable exchange rate at the time of
the applicable trade date, in one or more foreign currencies or currency
units or composite currencies designated by the Company) of Notes through or
to one or more of the Agents pursuant to the terms of this Agreement. It is
understood, however, that the Company may from time to time authorize the
issuance of additional Notes and that such additional Notes may be sold
through or to one or more of the Agents pursuant to the terms of this
Agreement, all as though the issuance of such Notes were authorized as of the
date hereof.
This Agreement provides both for the sale of Notes by the Company
through the Agents directly to purchasers, in which case the Agents will act
as agents of the Company in soliciting purchases of the Notes, and (as may
from time to time be agreed to by the Company and an Agent) to an Agent as
principal for resale to investors and other purchasers. In addition,
notwithstanding anything herein to the contrary, the Company may, without the
consent of the Agents, solicit or accept offers to purchase Notes from any
person for their account ("direct placements"). It is understood that the
Agents are not acting as agents of the Company in direct placements.
The Company has filed with the Securities and Exchange Commission (the
"SEC") registration statements on Form S-3 (Nos. 33-54165 and 333- ) and
post-effective amendment No. 1 to the registration statement No. 33-54165 for
the registration of debt securities, including the Notes, and warrants to
purchase such debt securities, under the Securities Act of 1933, as amended
(the "1933 Act"), and the offering thereof from time to time in accordance
with Rule 415 of the rules and regulations of the SEC under the 1933 Act (the
"1933 Act Regulations"). Registration statement on Form S-3 (No. 333- )
and post-effective amendment No. 1 to the registration statement on Form S-3
(No. 33-54165) have been declared effective by the SEC and each Indenture has
been qualified under the Trust Indenture Act of 1939, as amended (the "1939
Act"). Such registration statements (and any further registration statements
which may be filed by the Company for the purpose of registering additional
Notes and in connection with which this Agreement is included as an exhibit)
and the prospectuses constituting a part thereof, and any prospectus
supplements relating to the Notes, including all documents incorporated
therein by reference, as from time to time amended or supplemented by the
filing of documents pursuant to the Securities Exchange Act of 1934, as
amended (the "1934 Act"), or as otherwise amended or supplemented pursuant to
the 1933 Act or otherwise, are referred to herein collectively as the
"Registration Statement" and the "Prospectus", respectively, except that if
any revised prospectus shall be provided to the Agents by the Company for use
in connection with the offering of the Notes which is not required to be
filed by the Company pursuant to Rule 424(b) of the 1933 Act Regulations, the
term "Prospectus" shall refer to such revised prospectus from and after the
time it is first provided to the Agents for such use.
The Company and the Agents acknowledge that the Distribution Agreement,
dated July 14, 1994, between the Company and the Agents is hereby terminated
subject to the provisions of Section 12(c) and Section 14 thereof.
SECTION 1. APPOINTMENT AS AGENTS.
(a) APPOINTMENT OF AGENTS. Subject to the terms and conditions
stated herein and subject to the reservation by the Company of the right to
sell Notes directly on its own behalf, without the consent of the Agents, the
Company hereby (i) appoints the Agents as agents for the purpose of
soliciting purchases of Notes from the Company by others and (ii) agrees that
whenever the Company determines to sell Notes directly to an Agent as
principal for resale to others, it will enter into a Terms Agreement
(hereafter defined) relating to such sale in accordance with the provisions
of Section 3(b) hereof. Subject to the provisions of Section 3(b), the
Agents are not authorized to appoint sub-agents or to engage the services of
any other broker or dealer in connection with the offer or sale of the Notes.
The Company may, without the consent of the Agents, appoint other persons as
agents for the purpose of soliciting purchases of
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Notes from the Company by others; provided, however, that in the event that
the Company so appoints one or more other persons, the Company and such
person or persons shall execute a counterpart to this Agreement, whereupon
from and after the date of such execution, the term "Agent" shall include
such person or persons and such person or persons shall be subject to the
terms and conditions stated herein.
(b) REASONABLE BEST EFFORTS SOLICITATIONS; RIGHT TO REJECT OFFERS.
Upon receipt of instructions from the Company, each Agent will use its
reasonable best efforts to solicit purchases of such principal amount of
Notes as the Company and such Agent shall agree upon from time to time during
the term of this Agreement, it being understood that the Company shall not
approve the solicitation of purchases of Notes in excess of the amount which
shall be authorized by the Company from time to time. Each Agent will
communicate to the Company, orally or in writing, each offer to purchase
Notes, other than those offers rejected by such Agent. Each Agent shall have
the right, in its discretion reasonably exercised, to reject any proposed
purchase of Notes, in whole or in part, and any such rejection shall not be
deemed a breach of such Agent's agreement contained herein. The Company may
accept or reject any proposed purchase of Notes, in whole or in part.
(c) SOLICITATIONS AS AGENT; PURCHASES AS PRINCIPAL. In soliciting
purchases of Notes on behalf of the Company, each Agent shall act solely as
agent for the Company and not as principal. Each Agent shall make reasonable
efforts to assist the Company in obtaining performance by each purchaser
whose offer to purchase Notes has been solicited by such Agent and accepted
by the Company. Such Agent shall not have any liability to the Company in
the event that any such purchase is not consummated for any reason; provided,
however, that the foregoing shall not relieve any Agent for any liability
such Agent may have from a breach of its obligations hereunder. The Agents
shall not have any obligation to purchase Notes from the Company as
principal, but an Agent may agree from time to time to purchase Notes as
principal. Any such purchase of Notes by an Agent as principal shall be made
pursuant to a Terms Agreement in accordance with the provisions of Section
3(b) hereof.
(d) RELIANCE. The Company and the Agents agree that any Notes, the
placement of which an Agent arranges, shall be placed by such Agent, and any
Notes purchased by an Agent shall be purchased, in reliance upon the
representations, warranties, covenants and agreements of the Company
contained herein and on the terms and conditions and in the manner provided
herein.
SECTION 2. REPRESENTATIONS AND WARRANTIES.
(a) The Company represents and warrants to each Agent as of the date
hereof, as of the date of each acceptance by the Company of an offer for the
purchase of Notes (whether through such Agent as agent or to such Agent as
principal), as of the date of each delivery of Notes (whether through such
Agent as agent or to such Agent as principal) (the date of each such delivery
to an Agent as principal being hereafter referred to as a "Settlement Date"),
and as of the times referred to in Section 7(b) hereof (each of the times
referenced above being referred to hereafter as a "Representation Date") as
follows:
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(i) The Registration Statement and the Prospectus, at the time the
Registration Statement became effective, complied and, as of the
applicable Representation Date, will comply in all material respects with
the requirements of the 1933 Act, the 1933 Act Regulations and the 1939
Act and the rules and regulations of the SEC promulgated thereunder. The
Registration Statement, at the time the Registration Statement became
effective, did not, and, at each time thereafter at which any amendment to
the Registration Statement becomes effective and any Annual Report on Form
10-K is filed by the Company with the SEC and as of each Representation
Date, will not, include 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, as of the date
hereof, does not, and as of each Representation Date, will not, include an
untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in 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 Agent expressly for use in the
Registration Statement or Prospectus or to that part of the Registration
Statement which constitutes the Statements of Eligibility under the 1939
Act on Form T-1 of each Trustee under the applicable Indenture.
(ii) The financial statements and the supporting schedules included
or incorporated by reference in the Registration Statement and Prospectus
present fairly the financial position of the Company and its subsidiaries
on a consolidated basis, as at the dates indicated, and the respective
results of operations for the periods specified, in conformity with
generally accepted accounting principles applied on a consistent basis
during the periods involved.
(iii) The documents incorporated by reference in the Prospectus, at
the time they were or hereafter are filed with the SEC, complied or when
so filed will comply, as the case may be, in all material respects with
the requirements of the 1934 Act and the rules and regulations thereunder,
and, when read together and with the other information in the Prospectus,
do not and will not include 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.
(iv) Since the respective dates as of which information is given in
the Registration Statement and the Prospectus, except as may otherwise be
stated in or contemplated by the Registration Statement and Prospectus,
(A) there has not been any material adverse change in the financial
condition of the Company and its subsidiaries considered as one
enterprise, or in the results of operations or business prospects of the
Company and its subsidiaries considered as one enterprise, whether or not
arising in the ordinary course of business and (B) there have not been any
transactions entered into by the Company or its subsidiaries other than
(1) transactions in the ordinary course of business including borrowings
for the acquisition of receivables and other operations or
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(2) transactions which are not material in relation to the Company and its
subsidiaries considered as one enterprise.
(v) The Company has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the State of Delaware
with power and authority to own, lease and operate its properties and
conduct its business as described in the Registration Statement.
(vi) The execution and delivery of this Agreement and each
Indenture and the consummation of the transactions contemplated herein and
therein have been duly authorized by all necessary corporate action and
will not result in any breach of any of the terms, conditions or
provisions of, or constitute a 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 of its subsidiaries, pursuant to any indenture, loan
agreement, contract or other agreement or instrument to which the Company
or any of its subsidiaries is a party or by which the Company or any such
subsidiary may be bound or to which any of the property or assets of the
Company or any such subsidiary is subject, nor will such action result in
any violation of the provisions of the charter or by-laws of the Company
or any of its subsidiaries or, to the best of its knowledge, any order,
rule or regulation applicable to the Company or any of its subsidiaries of
any court or of any federal, state or other regulatory authority or other
governmental body having jurisdiction over the Company or any such
subsidiary.
(vii) The Notes have been duly authorized for issuance and sale
pursuant to this Agreement and, when issued, authenticated and delivered
pursuant to the provisions of this Agreement and of the applicable
Indenture against payment of the consideration therefor in accordance with
this Agreement, the Notes 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
relating to or affecting enforcement of creditors' rights or by general
equity principles and will be entitled to the benefits of the applicable
Indenture.
(viii) The statements in the Prospectus under the caption
"Description of Notes", "Special Provisions Relating to Foreign Currency
Notes" and "Description of Debt Securities", insofar as they purport to
summarize certain provisions of documents specifically referred to
therein, are accurate summaries of such provisions.
(ix) The accountants who certified the financial statements
included or incorporated by reference in the Registration Statement and
the Prospectus are independent public accountants within the meaning of
the 1933 Act and the 1933 Act Regulations.
(x) The Notes, when issued, authenticated and delivered pursuant
to the provisions of this Agreement and the applicable Indenture, will be
excluded or exempted from the provisions of the Commodity Exchange Act.
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(b) ADDITIONAL CERTIFICATIONS. Any certificate signed by any officer
of the Company and delivered to the Agents or to counsel for the Agents in
connection with an offering of Notes or the sale of Notes to an Agent as
principal shall be deemed a representation and warranty by the Company to the
Agents as to the matters covered thereby on the date of such certificate and,
to the extent therein provided, at each Representation Date subsequent
thereto.
SECTION 3. SOLICITATIONS AS AGENT; PURCHASES AS PRINCIPAL.
(a) SOLICITATIONS AS AGENT. On the basis of the representations and
warranties herein contained, but subject to the terms and conditions herein
set forth, each Agent agrees, as an agent of the Company, to use its
reasonable best efforts to solicit offers to purchase Notes upon the terms
and conditions set forth herein and in the Prospectus.
The Company reserves the right, in its sole discretion, to suspend
solicitation of purchases of Notes through the Agents, as agents, commencing
at any time for any period of time or permanently. Upon receipt of
instructions from the Company, the Agents will forthwith suspend solicitation
of purchases from the Company until such time as the Company has advised the
Agents that such solicitation may be resumed.
The Company agrees to pay each Agent a commission, in the form of a
discount or by such other means agreed to by the Company and such Agent,
equal to the applicable percentage of the price to the public of each Note
sold by the Company as a result of a solicitation made by such Agent as set
forth in Exhibit A hereto. Without the prior approval of the Company, the
Agents may not re-allow any portion of the commission payable pursuant hereto
to dealers or purchasers in connection with the offer and sale of any Notes
through any such Agent as agent.
The purchase price, interest rate or formula, maturity date and other
terms of the Notes shall be agreed upon by the Company and the applicable
Agent and set forth in a pricing supplement to the Prospectus to be prepared
following each acceptance by the Company of an offer for the purchase of
Notes. Except as may be otherwise provided in such supplement to the
Prospectus, the Notes will be issued in denominations of U.S. $1,000 or any
amount in excess thereof which is an integral multiple of U.S. $1,000. All
Notes sold through an Agent as agent will be sold at 100% of their principal
amount unless otherwise agreed to by the Company and such Agent.
(b) PURCHASES AS PRINCIPAL. Each sale of Notes to an Agent as
principal shall be made in accordance with the terms contained herein and
pursuant to a separate agreement which will provide for the sale of such
Notes to, and the purchase and reoffering thereof by, such Agent. Each such
separate agreement (which may be an oral agreement and confirmed in writing
as described below between the applicable Agent and the Company) is herein
referred to as a "Terms Agreement". Unless the context otherwise requires,
each reference contained herein to "this Agreement" shall be deemed to
include any applicable Terms Agreement between the Company and the applicable
Agent. Each such Terms Agreement, whether oral (and confirmed in writing,
which may be by facsimile transmission) or in writing, shall be with respect
to such information (as applicable) as is specified in Exhibit B hereto. An
Agent's commitment to purchase Notes as principal pursuant to any Terms
Agreement shall be deemed to have been made on the basis of the
representations and warranties of the Company herein contained and
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shall be subject to the terms and conditions herein set forth. Each Terms
Agreement shall specify the principal amount of Notes to be purchased by the
applicable Agent pursuant thereto, the price to be paid to the Company for
such Notes, the time and place of delivery of and payment for such Notes and
such other provisions (including further terms of the Notes) as may be
mutually agreed upon. Such Terms Agreement shall also specify the
requirements for the officer's certificate, opinions of counsel, comfort
letter and stand-off agreement pursuant to Sections 7(b), 7(c), 7(d) and
4(j), respectively, hereof. In addition, the applicable Agent is authorized
to engage the services of any broker or dealer in connection with the offer
or sale of Notes which such Agent has purchased as principal. The applicable
Agent may sell such Notes to any broker or dealer at a price that includes
all or any portion of the discount to be received by such Agent from the
Company.
(c) ADMINISTRATIVE PROCEDURES. Administrative procedures with
respect to the sale of Notes shall be agreed upon from time to time by the
Agents and the Company (the "Procedures"). The Agents and the Company agree
to perform the respective duties and obligations specifically provided to be
performed by them in the Procedures.
SECTION 4. COVENANTS OF THE COMPANY.
The Company covenants with the Agents as follows:
(a) NOTICE OF CERTAIN EVENTS. The Company will notify the Agents
immediately of (i) the effectiveness of any amendment to the Registration
Statement, (ii) the receipt of any comments from the SEC with respect to the
Registration Statement or the Prospectus, (iii) any request by the SEC for
any amendment to the Registration Statement or any amendment or supplement to
the Prospectus or for additional information, and (iv) the issuance by the
SEC 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.
(b) NOTICE OF CERTAIN PROPOSED FILINGS. Except as otherwise provided
in this subsection or subsection (k) of this Section, the Company will (i)
give the Agents notice of its intention to file (a) any additional
registration statement with respect to the registration of additional Notes
to be distributed pursuant to this Agreement or (b) any amendment to the
Registration Statement or any amendment or supplement to the Prospectus,
whether by the filing of documents pursuant to the 1933 Act, the 1934 Act or
otherwise; (ii) furnish the Agents with copies of any document referred to in
clause (i) above proposed to be filed a reasonable time in advance of filing;
and (iii) make available to the Agents copies of documents so filed promptly
upon the filing thereof. Notwithstanding the foregoing, except as set forth
below, the Company shall not be required to give any Agent notice of its
intention to file, to furnish any Agent a copy of in advance of filing, or to
make available to any Agent, (i) Quarterly Reports on Form 10-Q, any Current
Report on Form 8-K that includes solely the financial and other information
referred to in subsection (e) or (f) of this Section (including a press
release containing such information) or any filings pursuant to Section 14 of
the 1934 Act, provided that the Company shall make available to each Agent
copies of such documents promptly after the filing thereof, and provided,
further, that if any such document is to be filed in order that the
Prospectus does not include an
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untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein not misleading in light of
the circumstances then existing, then the Company shall give immediate notice
(prior to the filing of any such document) to each Agent to cease
solicitations of offers to purchase the Notes in its capacity as agent and to
cease sales of any Notes an Agent may then own as principal pursuant to a
Terms Agreement, (ii) any pricing supplement to the Prospectus in connection
with a sale of Notes (except that a pricing upplement shall be provided to
the Agent who solicits the Notes to which such pricing supplement relates),
(iii) any amendment or supplement to the Prospectus that relates exclusively
to an offering of debt securities other than Notes or (iv) any Current Report
on Form 8-K filed solely for the purpose of incorporating an exhibit by
reference into a registration statement except that the Company shall make
available to each Agent any such Current Report on Form 8-K promptly after
the filing thereof.
(c) COPIES OF THE REGISTRATION STATEMENT AND THE PROSPECTUS. The
Company will deliver to each Agent 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 such
Agent may reasonably request. The Company will furnish to each Agent as many
copies of the Prospectus (as amended or supplemented) as such Agent shall
reasonably request so long as an Agent is required to deliver a Prospectus in
connection with sales or solicitations of offers to purchase the Notes.
(d) REVISIONS OF PROSPECTUS -- MATERIAL CHANGES. Except as otherwise
provided in subsection (k) of this Section, if at any time during the term of
this Agreement any event shall occur or condition exist as a result of which
it is necessary, in the opinion of the Company or in the reasonable opinion
of counsel for the Agents 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 in order to make the statements therein not misleading in the light
of the circumstances existing at the time the Prospectus is delivered to a
purchaser, or if it shall be necessary, in the opinion of the Company or in
the reasonable opinion of either such counsel, to amend or supplement the
Registration Statement or the Prospectus in order to comply with the
requirements of the 1933 Act or the 1933 Act Regulations, the Company shall
give immediate notice to each Agent to cease the solicitation of offers to
purchase the Notes in its capacity as agent and to cease sales of any Notes
it may then own as principal pursuant to a Terms Agreement, and the Company
will promptly prepare and file with the SEC such amendment or supplement,
whether by filing documents pursuant to the 1934 Act, the 1933 Act or
otherwise, as may be necessary to correct such untrue statement or omission
or to make the Registration Statement and Prospectus comply with such
requirements.
(e) PROSPECTUS REVISIONS -- PERIODIC FINANCIAL INFORMATION. Except
as otherwise provided in subsection (k) of this Section, promptly after there
shall be released to the general public, interim financial statement
information related to the Company with respect to each of the first three
quarters of any fiscal year or preliminary financial statement information
with respect to any fiscal year, the Company shall cause the Registration
Statement and the Prospectus to be amended or supplemented to include or
incorporate by reference capsule financial information with respect thereto
and corresponding information for the comparable period of the preceding
fiscal year, as well as such other information and explanations as shall be
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necessary for an understanding thereof or as shall be required by the 1933
Act or the 1933 Act Regulations.
(f) PROSPECTUS REVISIONS -- AUDITED FINANCIAL INFORMATION. Except as
otherwise provided in subsection (k) of this Section, promptly after there
shall be released to the general public, financial information included in or
derived from the audited financial statements of the Company for the
preceding fiscal year, the Company shall cause the Registration Statement and
the Prospectus to be amended, whether by the filing of documents pursuant to
the 1934 Act, the 1933 Act or otherwise, to include or incorporate by
reference such audited financial statements and the report or reports, and
consent or consents to such inclusion or incorporation by reference, of the
independent accountants with respect thereto, as well as such other
information and explanations as shall be necessary for an understanding of
such financial statements or as shall be required by the 1933 Act or the 1933
Act Regulations.
(g) EARNINGS STATEMENTS. The Company will make generally available
to its security holders as soon as practicable, but not later than 90 days
after the close of the period covered thereby, an earnings statement (in form
complying with the provisions of Rule 158 under the 1933 Act) covering each
twelve month period beginning, in each case, not later than the first day of
the Company's fiscal quarter next following the "effective date" (as defined
in such Rule 158) of the Registration Statement with respect to each sale of
Notes.
(h) BLUE SKY QUALIFICATIONS. The Company will endeavor, in
cooperation with the Agents, to qualify the Notes for offering and sale under
the applicable securities laws of such states and other jurisdictions of the
United States as the Agents may designate, and will maintain such
qualifications in effect for as long as may be required for the distribution
of the Notes; provided, however, that the Company shall not be obligated to
file any general consent to service of process or to qualify as a foreign
corporation in any jurisdiction in which it is not so qualified. The Company
will file such statements and reports as may be required by the laws of each
jurisdiction in which the Notes have been qualified as above provided. The
Company will promptly advise the Agents of the receipt by the Company of any
notification with respect to the suspension of the qualification of the Notes
for sale in any such state or jurisdiction or the initiating or threatening
of any proceeding for such purpose.
(i) 1934 ACT FILINGS. 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 SEC pursuant to Sections 13(a) or
14 of the 1934 Act.
(j) STAND-OFF AGREEMENT. If required pursuant to the terms of a
Terms Agreement, between the date of any Terms Agreement and the Settlement
Date with respect to such Terms Agreement, the Company will not, without the
applicable Agent's prior consent, offer or sell in the United States, or
enter into any agreement to so sell, any debt securities of the Company
(other than the Notes that are to be sold pursuant to such Terms Agreement
and debt securities with maturities of less than nine months in the ordinary
course of business).
(k) SUSPENSION OF CERTAIN OBLIGATIONS. The Company shall not be
required to comply with the provisions of subsections (b), (d), (e) or (f) of
this Section during any period from the time (i) the Agents shall have
suspended solicitation of purchases of the Notes in its capacity as
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agent pursuant to a request from the Company and (ii) neither Agent shall
hold any Notes as principal purchased pursuant to a Terms Agreement, to the
time the Company shall determine that solicitation of purchases of the Notes
should be resumed or shall subsequently enter into a new Terms Agreement with
an Agent.
SECTION 5. CONDITIONS OF OBLIGATIONS.
The obligations of the Agents as agents of the Company to solicit offers
to purchase the Notes, the obligations of any purchasers of the Notes sold
through an Agent as agent, and any obligation of an Agent as principal to
purchase Notes pursuant to a Terms Agreement will be subject to the accuracy of
the representations and warranties on the part of the Company herein and to the
accuracy of the statements of the Company's officers made in any certificate
furnished pursuant to the provisions hereof, to the performance and observance
by the Company of all its covenants and agreements herein contained and to the
following additional conditions precedent:
(a) LEGAL OPINIONS. On the date hereof, the Agents shall have received
the following legal opinions, dated as of the date hereof and in form and
substance satisfactory to the Agents:
(1) OPINION OF COMPANY COUNSEL. The opinion of Shearman &
Sterling, counsel to the Company, to the effect that:
(i) The Company is a corporation duly incorporated and
validly existing in good standing under the laws of the State of
Delaware.
(ii) This Agreement has been duly authorized, executed and
delivered by the Company.
(iii) Each Indenture has been duly authorized, executed and
delivered by the Company and, assuming due authorization, execution
and delivery by the applicable Trustee, constitutes a valid and
binding obligation of the Company, enforceable in accordance with
its terms, except as enforcement thereof may be limited by
bankruptcy, insolvency (including, without limitation, all laws
relating to fraudulent transfers), reorganization or other similar
laws affecting enforcement of creditors' rights generally and except
as enforcement thereof is subject to general principles of equity
(regardless of whether enforcement is considered in a proceeding in
equity or at law) and to provisions of law that require that a
judgment for money damages rendered by a court in the United States
be expressed only in United States dollars.
(iv) The Notes have been duly authorized by the Company and,
when duly executed by the Company and completed and authenticated by
the applicable Trustee in accordance with the applicable Indenture
and delivered against payment pursuant to this Agreement, the Notes,
in the forms certified by an authorized officer of the Company, will
be valid and binding obligations of the Company entitled to the
benefits of such Indenture and enforceable in accordance with their
terms, except as enforcement thereof may be limited by bankruptcy,
insolvency (including, without limitation, all laws relating to
fraudulent transfers), reorganization or other similar laws
affecting enforcement of creditors' rights
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generally and except as enforcement thereof is subject to general
principles of equity (regardless of whether enforcement is
considered in a proceeding in equity or at law) and to provisions
of law that require that a judgment for money damages rendered by
a court in the United States be expressed only in United States
dollars.
(v) The statements in the Prospectus under the captions
"Description of Notes", "Description of Debt Securities" and
"Special Provisions Relating to Foreign Currency Notes", insofar as
they purport to summarize certain provisions of documents
specifically referred to therein, are accurate summaries of such
provisions.
(vi) Each Indenture has been duly qualified under the 1939
Act.
(vii) The Registration Statement is effective under the 1933
Act and, to the best of their knowledge and information, no stop
order suspending the effectiveness of the Registration Statement has
been issued under 1933 Act or proceedings therefor initiated or
threatened by the SEC.
(viii) The Registration Statement and the Prospectus (except
for the financial statements and other financial data included
therein or omitted therefrom and the Statements of Eligibility of
the respective Trustees on Form T-1, as to which such counsel need
express no opinion), excluding the documents incorporated by
reference therein, as of their respective effective or issue dates,
appear on their face to have been appropriately responsive in all
material respects to the requirements of the 1933 Act, the 1939 Act
and the 1933 Act Regulations.
(ix) Each document incorporated by reference in the
Prospectus (except for the financial statements and other financial
data included therein or omitted therefrom, as to which such counsel
need express no opinion), as of the date it was filed with the SEC,
appears on its face to have been appropriately responsive in all
material respects to the requirements of the 1934 Act and the rules
and regulations of the SEC thereunder.
(x) The execution and delivery of this Agreement, the
fulfillment of the terms herein set forth and the consummation of
the transactions herein contemplated will not conflict with the
charter or by-laws of the Company.
(xi) The information contained in the Prospectus under the
caption "United States Taxation", to the extent that it constitutes
matters of law or legal conclusions, has been reviewed by such
counsel and is correct.
(2) OPINION OF GENERAL COUNSEL TO THE COMPANY. The opinion of
Frank S. Cottrell (or his successor), General Counsel of the Company, or
Michael A. Harring, Assistant General Counsel of the Company, to the
effect that (i) the Company is duly qualified to transact business and is
in good standing in the states of Illinois and Iowa, (ii) the execution
and delivery of this Agreement and each Indenture, the fulfillment of the
terms herein and therein set forth and the consummation of the
transactions herein and
11
therein contemplated will not conflict with or constitute a breach of,
or default under, the charter or by-laws of the Company or any agreement,
indenture or other instrument known to such counsel of which the Company
or any of its subsidiaries is a party or by which any of them is bound,
or any law, administrative regulation or administrative or court order
known to him applicable to the Company or any of its subsidiaries.
(3) OPINION OF COUNSEL TO THE AGENTS. The opinion of Brown & Wood
LLP, counsel to the Agents, covering the matters referred to in subsection
(a)(1) of this Section under the subheadings (i) to (viii), inclusive.
(4) DISCLOSURE OPINION. In giving their opinions required by
subsections (a)(1) and (a)(3) of this Section, Shearman & Sterling and
Brown & Wood LLP shall each additionally state that such counsel has not
verified, and is not passing upon and does not assume any responsibility
for, the accuracy, completeness or fairness of the statements contained in
the Registration Statement or the Prospectus, other than those mentioned
in Section 5(a)(1)(v) and Section 5(a)(1)(xi) (in the case of Shearman &
Sterling only). Such counsel has, however, generally reviewed and
discussed such statements with certain officers and employees of the
Company and with its auditors. In the course of such review and
discussion, no facts have come to the attention of such counsel to lead
them to believe that (A) the Registration Statement (except for the
financial statements and other financial data included therein or omitted
therefrom and the Statements of Eligibility of the respective Trustees on
Form T-1, as to which such counsel has not been requested to comment), at
the time the Registration Statement or any such amendment became effective
or at the time an Annual Report on Form 10-K was filed by the Company
(whichever is later), or at the date of any Terms Agreement, contained an
untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements therein
not misleading or (B) the Prospectus (except for the financial statements
and other financial data included therein or omitted therefrom, as to
which such counsel has not been requested to comment), at the time the
Prospectus was issued, at the time any amendment or supplement to the
Prospectus was issued or at the date hereof, included or includes an
untrue statement of a material fact or omitted or omits 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.
(b) OFFICER'S CERTIFICATE. At the date hereof and at each Settlement
Date with respect to any Terms Agreement, there shall not have been, since the
respective dates as of which information is given in the Prospectus or since the
date of such Terms Agreement, any material adverse change in the financial
condition of the Company and its subsidiaries considered as one enterprise or in
the results of operations or business prospects of the Company and its
subsidiaries considered as one enterprise, not reflected in or contemplated by
the Prospectus, whether or not arising in the ordinary course of business; and
on the date hereof, the Agents shall have received a certificate of the
President, any Executive Vice President, any Senior Vice President or any Vice
President and the principal financial or principal accounting officer of the
Company to the effect that (i) there has been no such material adverse change,
(ii) the representations and warranties of the Company contained in Section 2
hereof are true and correct with the same force and effect as though expressly
made at and as of the date of such certificate, (iii) the Company has performed
or complied with all agreements and satisfied all conditions on
12
its part to be performed or satisfied at or prior to the date of such
certificate, and (iv) no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that purpose
have been initiated or threatened by the SEC. For purposes of this Section
5(b) only, the term "Prospectus" shall mean the Prospectus in the form first
provided by the Company to the Agents for delivery with confirmations of
sales of Notes to or through such Agents.
(c) COMFORT LETTER. On the date hereof, the Agents shall have
received a letter from Deloitte & Touche LLP, dated as of the date hereof and
in form and substance satisfactory to the Agents, to the effect that:
(i) they are independent public accountants with respect to the
Company and its subsidiaries within the meaning of the 1933 Act and the
1933 Act Regulations;
(ii) in their opinion, the consolidated financial statements and
supporting schedule(s) of the Company and its subsidiaries examined by
them and included or incorporated by reference in the Registration
Statement comply as to form in all material respects with the applicable
accounting requirements of the 1933 Act and the 1933 Act Regulations with
respect to registration statements on Form S-3 and the 1934 Act and the
1934 Act Regulations;
(iii) they have performed specified procedures, not constituting an
audit, including a reading of the latest available interim financial
statements of the Company and its indicated subsidiaries, a reading of the
minute books of the Company and such subsidiaries since the end of the
most recent fiscal year with respect to which an audit report has been
issued, inquiries of and discussions with certain officials of the Company
and such subsidiaries responsible for financial and accounting matters
with respect to the unaudited consolidated financial statements included
in the Registration Statement and Prospectus and the latest available
interim unaudited financial statements of the Company and its
subsidiaries, and such other inquiries and procedures as may be specified
in such letter, and on the basis of such inquiries and procedures nothing
came to their attention that caused them to believe that: (A) the
unaudited consolidated financial statements of the Company and its
subsidiaries included in the Registration Statement and Prospectus do not
comply as to form in all material respects with the applicable accounting
requirements of the 1934 Act and the 1934 Act Regulations or were not
fairly presented in conformity with generally accepted accounting
principles in the United States applied on a basis substantially
consistent with that of the audited financial statements included therein,
or (B) at a specified date not more than five days prior to the date of
such letter, there was any change in the consolidated capital stock or any
increase in consolidated long-term debt of the Company and its
subsidiaries or any decrease in the consolidated net assets of the Company
and its subsidiaries, in each case as compared with the amounts shown on
the most recent consolidated balance sheet of the Company and its
subsidiaries included in the Registration Statement and Prospectus or,
during the period from the date of such balance sheet to a specified date
not more than five days prior to the date of such letter, there were any
dereases, as compared with the corresponding period in the preceding year,
in consolidated revenues or net income of the Company and its
subsidiaries, except in each such case as set forth in or contemplated by
the Registration
13
Statement and Prospectus or except for such exceptions enumerated in such
letter as shall have been agreed to by the Agents and the Company; and
(iv) in addition to the examination referred to in their report
included or incorporated by reference in the Registration Statement and
the Prospectus, and the limited procedures referred to in clause (iii)
above, they have carried out certain other specified procedures, not
constituting an audit, with respect to certain amounts, percentages and
financial information which are included or incorporated by reference in
the Registration Statement and Prospectus and which are specified by the
Agents, and have found such amounts, percentages and financial information
to be in agreement with the relevant accounting, financial and other
records of the Company and its subsidiaries identified in such letter.
(d) OTHER DOCUMENTS. On the date hereof and on each Settlement Date
with respect to any applicable Terms Agreement, counsel to the Agents shall have
been furnished with such documents and opinions as such counsel may reasonably
require for the purpose of enabling such counsel to pass upon the issuance and
sale of Notes 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
Notes as herein contemplated shall be satisfactory in form and substance to the
Agents and to counsel to the Agents.
If any condition specified in this Section 5 shall not have been fulfilled
when and as required to be fulfilled, this Agreement (or, at the option of the
applicable Agent, any applicable Terms Agreement) may be terminated by any Agent
as to itself, and any Terms Agreement may be terminated by the Agent party
thereto, by notice to the Company at any time and any such termination shall be
without liability of any party to any other party, except that the covenant
regarding provision of an earnings statement set forth in Section 4(g) hereof,
the provisions concerning payment of expenses under Section 10 hereof, the
indemnity and contribution agreement set forth in Sections 8 and 9 hereof, the
provisions concerning the representations, warranties and agreements to survive
delivery of Section 11 hereof and the provisions set forth under "Parties" of
Section 15 hereof shall remain in effect.
SECTION 6. DELIVERY OF AND PAYMENT FOR NOTES SOLD THROUGH THE AGENTS.
Delivery of Notes sold through an Agent as agent shall be made by the
Company to such Agent for the account of any purchaser only against payment
therefor in immediately available funds. In the event that a purchaser shall
fail either to accept delivery of or to make payment for a Note on the date
fixed for settlement, the applicable Agent shall promptly notify the Company and
deliver the Note to the Company, and, if such Agent has theretofore paid the
Company for such Note, the Company will promptly return such funds to such
Agent. If such failure occurred for any reason other than default by the
applicable Agent in the performance of its obligations hereunder, the Company
will reimburse such Agent on an equitable basis for its loss of the use of the
funds for the period such funds were credited to the Company's account.
14
SECTION 7. ADDITIONAL COVENANTS OF THE COMPANY.
The Company covenants and agrees with the Agents that:
(a) REAFFIRMATION OF REPRESENTATIONS AND WARRANTIES. Each acceptance by
it of an offer for the purchase of Notes, and each delivery of Notes to an Agent
pursuant to a Terms Agreement, shall be deemed to be an affirmation that the
representations and warranties of the Company contained in this Agreement and,
to the extent therein provided, in any certificate theretofore delivered to the
Agents pursuant hereto are true and correct at the time of such acceptance or
sale, as the case may be, and an undertaking that such representations and
warranties will be true and correct at the time of delivery to the purchaser or
his agent, or to the Agents, of the Note or Notes relating to such acceptance or
sale, as the case may be, as though made at and as of each such time (and it is
understood that such representations and warranties shall relate to the
Registration Statement and Prospectus as amended and supplemented to each such
time).
(b) SUBSEQUENT DELIVERY OF CERTIFICATES. Each time that (1) the
Registration Statement or the Prospectus shall be amended or supplemented or
there is filed with the SEC any document incorporated by reference into the
Prospectus (other than (i) any amendment, supplement or document that is not
required to be made available by the Company to any Agent pursuant to Section
4(b), (ii) any Current Report on Form 8-K filed solely for the purpose of
incorporating an exhibit by reference into another document, and (iii) any
Quarterly Report on Form 10-Q relating exclusively to a presentation of
periodic financial information (including management's discussion and
analysis), a true and accurate summary of which has been previously filed in
a Current Report on Form 8-K, if a certificate described below was delivered
in connection with the filing on such Form 8-K) or (2) (if required pursuant
to the terms of a Terms Agreement) the Company sells Notes to an Agent
pursuant to a Terms Agreement then the Company shall furnish or cause to be
furnished to the Agents forthwith a certificate dated the date of
effectiveness of such amendment, the date of filing with the SEC of such
supplement or document, or the date of such sale, as the case may be, in form
and substance satisfactory to the Agents to the effect that the statements
contained in the certificate referred to in Section 5(b) hereof which were
last furnished to the Agents are true and correct at the time of such
amendment, supplement, filing or sale, as the case may be, as though made at
and as of such time (except that such statements shall be deemed to relate to
the Registration Statement and the Prospectus as amended and supplemented to
such time) or, in lieu of such certificate, a certificate of the same tenor
as the certificate referred to in said Section 5(b), modified as necessary to
relate to the Registration Statement and the Prospectus as amended and
supplemented to the time of delivery of such certificate; provided, however,
that in the event that the sale of Notes whose principal, premium, if any,
and/or interest payments are determined by reference to any index, formula or
other method ("Indexed Notes") shall be authorized by the Company, such
certificate shall also include as an exhibit thereto a true and correct
specimen of the form of Indexed Notes being issued and shall cover such other
matters as the Agents may reasonably request.
(c) SUBSEQUENT DELIVERY OF LEGAL OPINIONS. Each time that (1) the
Registration Statement or the Prospectus shall be amended or supplemented (other
than (i) by an amendment or supplement relating solely to the interest rates,
interest payment dates or maturity dates of the Notes or similar information,
(ii) solely for the inclusion of additional financial information
15
(including any management's discussion and analysis), (iii) by an amendment
made by the filing of a Quarterly Report on Form 10-Q and any Current Report
on Form 8-K (except in the circumstances hereinafter described) and (iv) by
an amendment or supplement which is not required to be made available by the
Company to any Agent pursuant to Section 4(b)) or (2) there is filed with the
SEC the Company's Annual Report on Form 10-K and such Annual Report is
incorporated by reference into the Prospectus or (3) (if required pursuant to
the terms of a Terms Agreement) the Company sells Notes to an Agent pursuant
to a Terms Agreement, the Company shall furnish or cause to be furnished
forthwith to the Agents and to counsel to the Agents the written opinions of
Shearman & Sterling, counsel to the Company, and the General Counsel for the
Company, or other counsel satisfactory to the Agents, dated the date of
effectiveness of such amendment, the date of filing with the SEC of such
supplement or document, or the date of such sale, as the case may be, in form
and substance satisfactory to the Agents, of the same tenor as the opinions
referred to in Section 5(a)(1) and Section 5(a)(2), respectively, hereof, but
modified, as necessary, to relate to the Registration Statement and the
Prospectus as amended and supplemented to the time of delivery of such
opinions or, in lieu of such opinions, counsel last furnishing such opinions
to the Agents shall each furnish the Agents with a letter to the effect that
the Agents may rely on such last opinion to the same extent as though it was
dated the date of such letter authorizing reliance (except that statements in
such last opinion shall be deemed to relate to the Reistration Statement and
the Prospectus as amended and supplemented to the time of delivery of such
letter authorizing reliance); provided, however, that in the event that the
sale of Indexed Notes shall be authorized by the Company, Shearman &
Sterling, counsel for the Company, and Brown & Wood LLP, counsel for the
Agents, or other counsel satisfactory to the Company and the Agents, shall
deliver their written opinions, dated the date of such sale, confirming the
exclusion or exemption of such Indexed Notes from the Commodity Exchange Act
and covering such other matters as the Company and/or the Agents may
reasonably request. If one or more of the Agents reasonably determine that
the information included in a filing by the Company in a Quarterly Report
filed on Form 10-Q or a Current Report filed on Form 8-K is of such
importance that a legal opinion should be delivered to the Agents in
conjunction therewith, such Agent or Agents shall notify the Company promptly
upon such determination. The Company will thereupon deliver to the Agents an
opinion of the General Counsel for the Company as to matters set forth in
Section 5(a)(2) and such portions of Section 5(a)(1) as the Agents may
reasonably designate and to the further effect of the opinions delivered
pursuant to Section 5(a)(4), modified, as necessary, to relate to the
Registration Statement and Prospectus as amended or supplemented to the time
of delivery of such opinion.
(d) SUBSEQUENT DELIVERY OF COMFORT LETTERS. Each time that (1) the
Registration Statement or the Prospectus shall be amended or supplemented to
include additional financial information or (2) there is filed with the SEC any
document incorporated by reference into the Prospectus which contains additional
financial information or (3) (if required pursuant to the terms of a Terms
Agreement) the Company sells Notes to an Agent pursuant to a Terms Agreement,
the Company shall cause Deloitte & Touche LLP, or their successors, forthwith to
furnish the Agents a letter, dated the date of effectiveness of such amendment,
supplement or document with the SEC , or the date of such sale, as the case may
be, in form satisfactory to the Agents, of the same tenor as the portions of the
letter referred to in clauses (i) and (ii) of Section 5(c) hereof but modified
to relate to the Registration Statement and Prospectus, as amended and
supplemented to the date of such letter, and of the same general tenor as the
portions of the letter
16
referred to in clauses (iii) and (iv) of said Section 5(c) with such changes
as may be necessary to reflect changes in the financial statements and other
information derived from the accounting records of the Company; provided,
however, that if the Registration Statement or the Prospectus is amended or
supplemented solely to include financial information as of and for a fiscal
quarter, Deloitte & Touche LLP, or their successors, may limit the scope of
such letter to the unaudited financial statements included in such amendment
or supplement unless any other information included therein of an accounting,
financial or statistical nature is of such a nature that, in the reasonable
judgment of the Agents, such letter should cover such other information. For
purposes of this Section 7(d), the filing of a Current Report on Form 8-K for
the exclusive purpose of presenting interim periodic financial information
pursuant to Section 4(e) will not, in and of itself, give rise to an
obligation to deliver a letter from Deloitte & Touche LLP or their successors
pursuant to this Section 7(d).
SECTION 8. INDEMNIFICATION.
(a) INDEMNIFICATION OF THE AGENTS. The Company agrees to indemnify and
hold harmless the Agents and each person, if any, who controls an Agent within
the meaning of Section 15 of the 1933 Act as follows:
(i) against any and all loss, liability, claim, damage and expense
whatsoever arising out of any untrue statement or alleged untrue statement
of a material fact contained in the Registration Statement, or any
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 a preliminary prospectus or the Prospectus 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 untrue statement
or omission or such alleged untrue statement or omission was made in
reliance upon and in conformity with written information furnished to the
Company by or on behalf of any Agent expressly for use in the Registration
Statement or any such preliminary prospectus or the Prospectus, or was
made in reliance upon the Statements of Eligibility under the 1939 Act on
Form T-1 of each Trustee under the applicable Indenture;
(ii) against any and all loss, liability, claim, damage and expense
whatsoever to the extent of the aggregate amount paid in settlement of any
litigation, or any investigation or proceeding by any governmental agency
or body, commenced or threatened, or of any claim whatsoever based upon
any such untrue statement or omission, or any such alleged untrue
statement or omission, if such settlement is effected with the written
consent of the Company; and
(iii) against any and all expense whatsoever reasonably incurred in
investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced
or threatened, or any claim whatsoever based upon any such untrue
statement or omission, or any such alleged untrue statement or omission,
to the extent that any such expense is not paid under (i) or (ii) above.
17
This indemnity agreement is subject to the condition that, insofar as
it relates to any preliminary prospectus, it shall not inure to the benefit
of any Agent from whom the person asserting any loss, liability, claim or
damage purchased the Notes which are the subject thereof (or to the benefit
of any person who controls such Agent) if such Agent failed to send or give a
copy of the Prospectus (excluding documents incorporated by reference) to
such person prior to or together with the written confirmation of the sale of
such Notes to such person. In no case shall the Company be liable under this
indemnity agreement with respect to any claim made against any Agent or any
such controlling person unless the Company shall be notified in writing of
the nature of the claim within a reasonable time after the assertion thereof,
but failure so to notify the Company shall not relieve it from any liability
which it may have otherwise than on account of this indemnity agreement. The
Company shall be entitled to participate at its own expense in the defense,
or if it so elects within a reasonable time after receipt of such notice, to
assume the defense for any suit brought to enforce any such claim, but if the
Company elects to assume the defense, such defense shall be conducted by
counsel chosen by it and satisfactory to the Agent or Agents or controlling
person or persons, defendant or defendants in any suit so brought. In the
event that the Company elects to assume the defense of any such suit and
retains such counsel, the Agent or Agents or controlling person or persons,
defendant or defendants in the suit, shall bear the fees and expenses of any
additional counsel thereafter retained by them. In the event that the
parties of any such action (including impleaded parties) include both the
Company and one or more Agents and any such Agent shall have been advised by
counsel chosen by it and satisfactory to the Company that there may be one or
more legal defenses available to it which are different from or additional to
tose available to the Company, the Company shall not have the right to assume
the defense of such action on behalf of such Agent and will reimburse such
Agent and any person controlling such Agent as aforesaid for the reasonable
fees and expenses of any counsel retained by them, it being understood that
the Company shall not, in connection with any one action or separate but
similar or related actions in the same jurisdiction arising out of the same
general allegations or circumstances, be liable for the reasonable fees and
expenses of more than one separate firm of attorneys for all such Agents and
controlling persons, which firm shall be designated in writing by the Agents.
The Company agrees to notify the Agents within a reasonable time of the
assertion of any claim against it, any of its officers or directors or any
person, if any, who controls the Company within the meaning of Section 15 of
the 1933 Act, in connection with the sale of the Notes.
(b) Each Agent severally agrees that it will indemnify and hold
harmless the Company and each of its officers who signs the Registration
Statement and each of its directors and each person, if any, who controls the
Company within the meaning of Section 15 of the 1933 Act to the same extent
as the foregoing indemnity from the Company, but free of the condition set
forth in the first sentence of the second paragraph of Section 8(a) and only
with respect to statements or omissions made in a preliminary prospectus, the
Prospectus or the Registration Statement in reliance upon and in conformity
with written information furnished to the Company by or on behalf of such
Agent expressly for use in the Registration Statement or in any such
preliminary prospectus or the Prospectus. In case any action shall be
brought against the Company or any person so indemnified based on the
Registration Statement or such preliminary prospectus or the Prospectus and
in respect of which indemnity may be sought against any Agent, such Agent
shall have the rights and duties given to the Company, and the Company and
each person so indemnified shall have the rights and duties given to the
Agents, by the provisions of subsection (a) of this Section.
18
SECTION 9. CONTRIBUTION.
If the indemnification provisions provided in Section 8 above should
under applicable law be unenforceable in respect of any losses, liabilities,
claims, damages or expenses (or actions in respect thereof) referred to
therein, then each indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, liabilities,
claims, damages or expenses (or actions in respect thereof) in such
proportion as is appropriate to reflect the relative benefits received by the
Company and each of the Agents from the offering of the Notes which are the
subject of the action and also the relative fault of the Company and each of
such Agents in connection with the statements or omissions which resulted in
such losses, liabilities, claims, damages or expenses (or actions in respect
thereof), as well as any other relevant equitable considerations. The
relative benefits received by the Company and each of the applicable Agents
shall be deemed to be in the same proportion as (A) in the case of Notes to
be resold on a fixed public offering price basis, the total net proceeds from
the offering (before deducting expenses) received by the Company and the
total underwriting discounts and commissions received by each of such Agents,
in each case as set forth in the Prospectus, bear to the aggregate public
offering price of the Notes which are the subject of the action or (B) in the
case of Notes to be resold on a varying price basis, the total net proceeds
from the offering (before deducting expenses) received by the Company and the
total net proceeds received by each of such Agents from the distribution of
such Notes in excess of the purchase price paid by such Agents to the Company
bear to the public offering price paid to such Agents for such Notes. The
relative fault shall be determined by reference to, among other things,
whether the indemnified party failed to give the notice required under
Section 8 above including the consequences of such failure, and whether the
untrue or alleged utrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by
the Company or an Agent and the parties' relative intent, knowledge, access
to information and opportunity to correct or prevent such statement or
omission of the Company and such Agents. With respect to any Agent, such
relative fault shall also be determined by reference to the extent (if any)
to which such losses, liabilities, claims, damages or expenses (or actions in
respect thereof) with respect to any preliminary prospectus supplement result
from the fact that such Agent sold Notes to a person to whom there was not
sent or given, at or prior to the written confirmation of such sale, a copy
of the Prospectus (excluding documents incorporated by reference) if the
Company has previously furnished copies thereof to such Agent. The Company
and the Agents agree that it would not be just and equitable if contribution
pursuant to this Section 9 were determined by per capita allocation (even if
the Agents 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 in this Section 9. The amount paid or
payable by an indemnified party as a result of the losses, liabilities,
claims, damages or expenses (or actions in respect thereof) referred to above
in this Section 9 shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 9, no Agent shall be required to contribute any
amount in excess of the amount by which the total price at which the Notes
sold by the Company as a result of a solicitation made by such Agent or
purchased by such Agent pursuant to a Terms Agreement and distributed to the
public were offered to the public exceeds the amount of any damages which
such Agent has otherwise been required to pay by reason of such unrue or
alleged untrue statement or omission or alleged omission. No person guilty
of fraudulent misrepresentation (within the meaning of Section 11 of
19
the 1933 Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. Each Agent's obligation in this
Section 9 to contribute is several in proportion to the amount of gross
proceeds received by the Company from the sale of the Notes which are the
subject of the action as a result of a solicitation made by such Agent or
purchased by such Agent pursuant to a Terms Agreement and not joint.
The obligations of the Company under this Section 9 shall be in
addition to any liability which the Company may otherwise have and shall
extend, upon the same terms and conditions, to each person, if any, who
controls any Agent within the meaning of the 1933 Act; and the obligations of
the Agents under this Section 9 shall be in addition to any liability which
the respective Agents may otherwise have and shall extend, upon the same
terms and conditions, to each officer who signs the Registration Statement,
to each director of the Company and to each person, if any, who controls the
Company within the meaning of the 1933 Act.
SECTION 10. PAYMENT OF EXPENSES.
The Company will pay all expenses incident to the performance of its
obligations under this Agreement, including:
(i) The preparation and filing of the Registration Statement and
all amendments thereto and the Prospectus and any amendments or
supplements thereto;
(ii) The preparation, filing and reproduction of this Agreement;
(iii) The preparation, printing, issuance and delivery of the Notes,
including any fees and expenses relating to the use of Notes issued in
book-entry form;
(iv) The fees and disbursements of the Company's accountants and
counsel, of the Trustees and their respective counsel, and of any
calculation agent or exchange rate agent;
(v) The reasonable fees and disbursements of counsel to the Agents
incurred from time to time in connection with the transactions
contemplated hereby;
(vi) The qualification of the Notes under state securities laws in
accordance with the provisions of Section 4(h) hereof, including filing
fees and the reasonable fees and disbursements of counsel for the Agents
in connection therewith and in connection with the preparation of any Blue
Sky Survey and any Legal Investment Survey;
(vii) The printing and delivery to the Agents 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, and the delivery by the Agents of the Prospectus and
any amendments or supplements thereto in connection with solicitations or
confirmations of sales of the Notes;
(viii) The preparation, printing and delivery to the Agents of copies
of each Indenture and all supplements and amendments thereto;
20
(ix) Any fees charged by rating agencies for the rating of the
Notes;
(x) The fees and expenses, if any, incurred with respect to any
filing with the National Association of Securities Dealers, Inc.; and
(xi) Any advertising and other out-of-pocket expenses of the Agents
incurred with the express consent of the Company.
SECTION 11. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE
DELIVERY.
All representations, warranties and agreements contained in this Agreement
or in certificates of officers of the Company submitted pursuant hereto or
thereto, shall remain operative and in full force and effect, regardless of any
investigation made by or on behalf of an Agent or any controlling person of an
Agent, or by or on behalf of the Company, and shall survive each delivery of and
payment for any of the Notes.
SECTION 12. TERMINATION.
(a) TERMINATION OF THIS AGREEMENT. This Agreement (excluding any Terms
Agreement) may be terminated for any reason at any time by either the Company,
as to any Agent, or by an Agent, as to itself, upon the giving of 30 days'
written notice of such termination to the other parties hereto.
(b) TERMINATION OF A TERMS AGREEMENT. The Agent party to a Terms
Agreement may terminate such Terms Agreement, immediately upon notice to the
Company, at any time prior to the Settlement Date relating thereto (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 Prospectus, any material adverse change
in the financial condition of the Company and its subsidiaries considered as
one enterprise, or in the results of operations 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 shall have
occurred any outbreak or escalation of hostilities or other calamity or crisis
the effect of which on the financial markets of the United States or in the
country or countries of origin of any foreign currency or currencies in which
the Notes are denominated, indexed or payable is such as to make it, in the
judgment of such Agent, impracticable to market the Notes or enforce contracts
for the sale of the Notes, or (iii) if trading in any securities of the Company
has been suspended by the SEC or a national securities exchange, or if trading
generally on either the American Stock Exchange or the New York Stock Exchange
shall have 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 SEC or any other governmental authority, or
if a banking moratorium shall have been declared by either Federal or New York
authorities or if a banking moratorium shall have been declared by the relevant
authorities in the country or countries of origin of any foreign currency or
currencies in which the Notes are denominated, indexed or payable, or (iv) if
the rating assigned by any nationally recognized securities rating agency to any
debt securities of the Company as of the date of any applicable Terms Agreement
shall have been lowered since that date or if any such ating agency shall have
publicly announced that it has placed any debt securities of the Company on what
is commonly termed a "watch list" for
21
possible downgrading, or (v) if there shall have come to such Agent's
attention any facts that would cause it to believe that the Prospectus, at
the time it was required to be delivered to a purchaser of Notes, included an
untrue statement of a material fact or omitted to state a material fact
necessary in order to make the statements therein, in light of the
circumstances existing at the time of such delivery, not misleading. For the
purposes of this Section 12(b) only, the term "Prospectus" shall mean the
Prospectus in the form first provided by the Company to such Agent for
delivery with confirmations of sales of Notes purchased by such Agent as
principal.
(c) GENERAL. In the event of any such termination, neither party
will have any liability to the other party hereto, except that (i) each Agent
shall be entitled to any commission with respect to Notes sold by the Company
as a result of a solicitation made by such Agent and earned in accordance
with the third paragraph of Section 3(a) hereof, (ii) if at the time of
termination (a) an Agent shall own any Notes purchased pursuant to a Terms
Agreement with the intention of reselling them or (b) an offer to purchase
any of the Notes has been accepted by the Company but the time of delivery to
the purchaser or his agent of the Note or Notes relating thereto has not
occurred, the covenants set forth in Sections 4 and 7 hereof shall remain in
effect until such Notes are so resold or delivered, as the case may be, and
(iii) the covenant set forth in Section 4(g) hereof, the provisions of
Section 5 hereof, the indemnity and contribution agreements set forth in
Sections 8 and 9 hereof, and the provisions of Sections 11 and 15 hereof
shall remain in effect.
SECTION 13. NOTICES.
Unless otherwise provided herein, all notices required under the terms and
provisions hereof shall be in writing, either delivered by hand, by registered
mail or by telex, telecopier or telegram, and any such notice shall be effective
when received at the address specified below.
If to the Company:
Deere & Company
One John Deere Place
Moline, Illinois 61265
Attention: Treasurer
Telecopier: (309) 765-5021
22
If to Merrill Lynch, Pierce, Fenner & Smith
Incorporated:
Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
World Financial Center
North Tower - 10th Floor
New York, New York 10281-1310
Attention: MTN Product Management
Telecopier: (212) 449-2234
If to Goldman, Sachs & Co.:
Goldman, Sachs & Co.
85 Broad Street
New York, New York 10004
Attention: Credit Department
Telecopier: (212) 358-8680
or at such other address as such party may designate from time to time by notice
duly given in accordance with the terms of this Section 13.
SECTION 14. GOVERNING LAW.
THIS AGREEMENT AND ALL THE RIGHTS AND OBLIGATIONS OF THE PARTIES SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK
APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN SUCH STATE. ANY SUIT,
ACTION OR PROCEEDING BROUGHT BY THE COMPANY AGAINST AN AGENT IN CONNECTION WITH
OR ARISING UNDER THIS AGREEMENT SHALL BE BROUGHT SOLELY IN THE STATE OR FEDERAL
COURT OF APPROPRIATE JURISDICTION LOCATED IN THE BOROUGH OF MANHATTAN, THE CITY
OF NEW YORK.
SECTION 15. PARTIES.
This Agreement shall inure to the benefit of and be binding upon the
Agents and the Company and their respective successors. Nothing expressed or
mentioned in this Agreement is intended or shall be construed to give any
person, firm or corporation, other than the parties hereto and their respective
successors and the controlling persons and officers and directors referred to in
Sections 8 and 9 and their heirs and legal representatives, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision herein contained. This Agreement and all conditions and provisions
hereof are intended to be for the sole and exclusive benefit of the parties
hereto and 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 Notes shall be deemed to be
a successor by reason merely of such purchase.
23
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company a counterpart hereof,
whereupon this instrument along with all counterparts will become a binding
agreement between the Agents and the Company in accordance with its terms.
Very truly yours,
DEERE & COMPANY
By:______________________________________
Name:
Title:
CONFIRMED AND ACCEPTED, as of the
date first above written:
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
By: _________________________________
_______________________________________
(Goldman, Sachs & Co.)
24
EXHIBIT A
As compensation for the services of an Agent hereunder, the Company shall
pay such Agent (on a discount basis or by other means agreed to by the Company
and such Agent) a commission for the sale by such Agent as agent of a Senior
Note equal to the price to the public of such Note multiplied by the appropriate
percentage set forth below:
The above Schedule shall also apply to commissions paid in connection with
sales of Subordinated Notes unless otherwise agreed to by the Company and all of
the Agents.
Unless otherwise specified in the applicable Terms Agreement, the discount
payable to an Agent shall be determined on the basis of the commission schedule
set forth above.
A-1
EXHIBIT B
The following terms, if applicable, shall be agreed to by an Agent and the
Company pursuant to each Terms Agreement:
Principal Amount: $_______ (or principal amount of foreign currency)
Interest Rate:
If Fixed Rate Note, Interest Rate:
If Floating Rate Note:
Interest Rate Basis:
Initial Interest Rate:
Initial Interest Reset Date:
Spread, Spread Multiplier or Other Formula, if any:
Index Maturity:
Interest Reset Date(s):
Interest Payment Date(s):
Maximum Interest Rate, if any:
Minimum Interest Rate, if any:
Interest Reset Period:
Interest Payment Period:
Calculation Agent:
Redemption provisions, if any:
Initial Redemption Date:
Initial Redemption Percentage:
Annual Redemption Percentage Reduction:
Repayment provisions if any:
Optional Repayment Date(s):
Date of Maturity:
Purchase Price: ___%
Settlement Date and Time:
Currency of Denomination:
Denominations (if currency is other than U.S. dollars):
Currency of Payment:
Additional Terms:
Also, agreement as to whether the following will be required:
Officer's Certificate pursuant to Section 7(b) of the Distribution
Agreement.
Legal Opinion pursuant to Section 7(c) of the Distribution Agreement.
Comfort Letter pursuant to Section 7(d) of the Distribution Agreement.
Stand-off Agreement pursuant to Section 4(j) of the Distribution
Agreement.
B-1