[FACE OF NOTE]
CUSIP NO.
REGISTERED
PRINCIPAL AMOUNT
No. FL -
DEERE & COMPANY
SUBORDINATED MEDIUM-TERM NOTE, SERIES C,
Due from 9 Months to 30 Years from Date of Issue
(FLOATING RATE)
If the registered owner of this Security (as indicated below) is The
Depository Trust Company (the "DEPOSITORY") or a nominee of the Depository, this
Security is a Global Security and the following two legends apply:
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY (55 WATER STREET, NEW YORK, NEW YORK) TO THE ISSUER OR
ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND SUCH
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO., OR SUCH OTHER NAME
AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY, ANY TRANSFER,
PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL, SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
UNLESS AND UNTIL THIS CERTIFICATE IS EXCHANGED IN WHOLE OR IN PART FOR
SECURITIES IN CERTIFICATED FORM, THIS CERTIFICATE MAY NOT BE TRANSFERRED EXCEPT
AS A WHOLE BY THE DEPOSITORY TO A NOMINEE THEREOF OR BY A NOMINEE THEREOF TO THE
DEPOSITORY OR ANOTHER NOMINEE OF THE DEPOSITORY OR BY THE DEPOSITORY OR ANY SUCH
NOMINEE TO A SUCCESSOR OF THE DEPOSITORY OR A NOMINEE OF SUCH SUCCESSOR.
IF APPLICABLE, THE "TOTAL AMOUNT OF OID", "YIELD TO MATURITY" AND "INITIAL
ACCRUAL PERIOD OID" (COMPUTED UNDER THE APPROXIMATE METHOD) BELOW WILL BE
COMPLETED SOLELY FOR THE PURPOSES OF APPLYING THE FEDERAL INCOME TAX ORIGINAL
ISSUE DISCOUNT ("OID") RULES.
2
ISSUE PRICE: YIELD TO MATURITY:
ORIGINAL ISSUE DATE: OTHER/DIFFERENT PROVISIONS:
STATED MATURITY DATE: OPTION TO ELECT REPAYMENT:
[ ] YES [ ] NO
BASE RATE: OPTIONAL REPAYMENT DATE[S]:
If LIBOR: [ ] LIBOR Telerate
[ ] LIBOR Reuters
[ ] Other:
Designated LIBOR Page: OPTIONAL REDEMPTION: [ ] YES [ ] NO
Designated LIBOR Currency:
INITIAL REDEMPTION DATE:
If CMT Rate,
Designated CMT Telerate Page:
Designated CMT Maturity Index: INITIAL REDEMPTION PERCENTAGE:
INITIAL INTEREST RATE:
RENEWABLE: [ ] YES [ ] NO
RENEWAL DATE:
ANNUAL REDEMPTION PERCENTAGE REDUCTION:
EXTENDIBLE: [ ] YES [ ] NO
FINAL MATURITY DATE:
MINIMUM DENOMINATION:
INDEX MATURITY: [ ] $1,000
[ ] Other:
SPREAD (PLUS OR MINUS):
SPREAD MULTIPLIER:
SPECIFIED CURRENCY:
CALCULATION AGENT: United States Dollars:
[ ] YES [ ] NO
Foreign Currency:
CALCULATION DATE:
OPTION TO RECEIVE PAYMENTS
IN SPECIFIED CURRENCY
SINKING FUND: OTHER THAN U.S. DOLLARS:
[ ] YES [ ] NO
MAXIMUM INTEREST RATE: EXCHANGE RATE AGENT:
MINIMUM INTEREST RATE:
REFERENCE BANKS:
INTEREST DETERMINATION DATE:
ADDITIONAL AMOUNTS:
INTEREST RESET PERIOD:
DEFEASANCE: [ ] YES [ ] NO
INTEREST RESET DATES:
COVENANT DEFEASANCE: [ ] YES [ ] NO
INTEREST PAYMENT PERIOD: OPTIONAL INTEREST RATE RESET:
[ ] YES [ ] NO
INTEREST PAYMENT DATES:
OPTIONAL INTEREST RATE RESET DATES:
TOTAL AMOUNT OF OID:
INITIAL ACCRUAL PERIOD OID:
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DEERE & COMPANY, a Delaware corporation (herein referred to as the
"COMPANY", which term includes any successor corporation under the Indenture
hereinafter referred to), for value received, hereby promises to pay to
___________________, or registered assigns, the principal sum of _____________
__________ on the Stated Maturity Date shown above (except to the extent
redeemed or repaid prior to the Stated Maturity Date) and to pay interest
thereon at the Initial Interest Rate shown above from the Original Issue Date
shown above until the first Interest Reset Date shown above following the
Original Issue Date (if the first Interest Reset Date is later than the Original
Issue Date) and thereafter at the interest rate determined by reference to the
Base Rate shown above, plus or minus the Spread, if any, or multiplied by the
Spread Multiplier, if any, shown above, or determined by reference to such other
formula or adjusted in such other manner, in each case calculated in accordance
with the provisions on the reverse hereof, until the principal hereof is paid or
duly made available for payment. The Company will pay interest on each Interest
Payment Date, if any, specified above, commencing with the first Interest
Payment Date next succeeding the Original Issue Date, and on the Stated Maturity
Date, any Redemption Date or Repayment Date (each such day being hereinafter
referred to as a "MATURITY DATE" with respect to the principal repayable on such
date); PROVIDED, HOWEVER, that any payment of principal (or premium, if any) or
interest, if any, to be made on any Interest Payment Date or on the Maturity
Date that is not a Business Day (as defined below) shall be made on the next
succeeding Business Day (except that if the Base Rate specified above is LIBOR,
and such day falls in the next succeeding calendar month, such payment will be
made on the next preceding Business Day) as described on the reverse hereof.
For purposes of this Security, unless otherwise specified on the face hereof,
"BUSINESS DAY" means any day that is not a Saturday or Sunday and that is
neither a legal holiday nor a day on which commercial banks are authorized or
required by law, regulation or executive order to close in The City of New York;
PROVIDED, HOWEVER, that, if the Specified Currency shown above is a Foreign
Currency, such day is also not a day on which commercial banks are authorized or
required by law, regulation or executive order to close in the Principal
Financial Center (as defined) of the country issuing the Specified Currency (or,
if the Specified Currency is the euro, such day is also a day on which the
Trans-European Automated Real-Time Gross Settlement Express Transfer (TARGET)
System is open); PROVIDED, FURTHER, that, with respect to Securities as to which
LIBOR is an applicable Base Rate, such day is also a London Business Day.
"LONDON BUSINESS DAY" means a day on which commercial banks are open for
business (including dealings in the LIBOR Currency (as defined below)) in
London. "PRINCIPAL FINANCIAL CENTER" means (i) the capital city of the country
issuing the Specified Currency or (ii) the capital city of the country to which
the LIBOR Currency relates, as applicable, except, in the case of (i) or (ii)
above, that with respect to United States dollars, Australian dollars, Canadian
dollars, Deutsche marks, Dutch guilders, Portuguese escudos, South African rand
and Swiss francs, the "Principal Financial Center" shall be The City of New
York, Sydney and (solely in the case of the Specified
4
Currency) Melbourne, Toronto, Frankfurt, Amsterdam, London (solely in the case
of the LIBOR Currency), Johannesburg and Zurich, respectively.
Interest on this Security will accrue from, and including, the
immediately preceding Interest Payment Date to which interest has been paid or
duly provided for (or from, and including, the Original Issue Date if no
interest has been paid or duly provided for) to, but excluding, the applicable
Interest Payment Date or the Maturity Date, as the case may be (each, an
"Interest Period"). The interest, if any, so payable, and punctually paid or
duly provided for, on any Interest Payment Date will, as provided in the
Indenture and subject to certain exceptions described herein (referred to on the
reverse hereof), be paid to the person (the "HOLDER") in whose name this
Security (or one or more Predecessor Securities) is registered at the close of
business on the fifteenth day (whether or not a Business Day) next preceding
such Interest Payment Date (a "REGULAR RECORD DATE"); PROVIDED, HOWEVER, that,
if this Security was issued between a Regular Record Date and the initial
Interest Payment Date relating to such Regular Record Date, interest, if any,
for the period beginning on the Original Issue Date and ending on such initial
Interest Payment Date shall be paid on the Interest Payment Date following the
next succeeding Regular Record Date to the Holder on such Regular Record Date;
and PROVIDED FURTHER that interest, if any, payable on the Maturity Date will be
payable to the person to whom the principal hereof shall be payable. Any such
interest not so punctually paid or duly provided for on any Interest Payment
Date other than the Maturity Date ("DEFAULTED INTEREST") will forthwith cease to
be payable to the Holder on such Regular Record Date and may either be paid to
the person in whose name this Security (or one or more Predecessor Securities)
is registered at the close of business on a special record date (the "SPECIAL
RECORD DATE") for the payment of such Defaulted Interest to be fixed by the
Trustee (referred to on the reverse hereof), notice whereof shall be given to
the Holder of this Security not less than ten days prior to such Special Record
Date, or may be paid at any time in any other lawful manner, all as more fully
provided in the Indenture.
Unless otherwise specified above, all payments in respect of this
Security will be made in U.S. dollars regardless of the Specified Currency
shown above unless the Holder hereof makes the election described below. If
the Specified Currency shown above is other than U.S. dollars, the Exchange
Rate Agent (referred to on the reverse hereof) will arrange to convert any
such amounts so payable in respect hereof into U.S. dollars in the manner
described on the reverse hereof; PROVIDED, HOWEVER, that the Holder hereof
may, if so indicated above, elect to receive all or a specified portion of
any payment of principal, premium, if any, and/or interest in respect of this
Security in such Specified Currency by delivery of a written request to the
corporate trust office of the Trustee in The City of New York, on or prior to
the applicable Regular Record Date or at least fifteen days prior to the
Maturity Date, as the case may be. Such request may be in writing (mailed or
hand delivered) or by cable, telex or other form of facsimile transmission.
The Holder hereof may elect to receive payment in such Specified Currency for
all principal and interest payments and need not file a separate election for
each payment. Such election will remain in effect until revoked by written
notice to the Trustee, but written notice of any such revocation must be
received by the
5
Trustee on or prior to the Regular Record Date or at least fifteen days prior to
the Maturity Date, as the case may be.
In the event of an official redenomination of the Specified Currency,
the obligations of the Company with respect to payments on this Security shall,
in all cases, be deemed immediately following such redenomination to provide for
payment of that amount of redenominated currency representing the amount of such
obligations immediately before such redenomination. In no event shall any
adjustment be made to any amount payable hereunder as a result of any change in
the value of the Specified Currency shown above relative to any other currency
due solely to fluctuations in exchange rates.
Until the Securities are paid in full or payment therefor in full is
duly provided for, the Company will at all times maintain a Paying Agent (which
Paying Agent may be the Trustee) in The City of New York (which, unless
otherwise specified above, shall be the "PLACE OF PAYMENT"). The Company has
initially appointed The Bank of New York at its corporate trust office in The
City of New York as paying agent.
Unless otherwise shown above, payment of interest on this Security
(other than on the Maturity Date) will be made by check mailed to the
registered address of the Holder hereof; PROVIDED, HOWEVER, that, if (i) the
Specified Currency is U.S. dollars and this is a Global Security or (ii) the
Specified Currency is a Foreign Currency, and the Holder has elected to
receive payments in such Specified Currency as provided for above, such
interest payments will be made by transfer of immediately available funds,
but only if appropriate instructions have been received in writing by the
Trustee on or prior to the applicable Regular Record Date. Simultaneously
with any election by the Holder hereof to receive payments in respect hereof
in the Specified Currency (if other than U.S. dollars), such Holder may
provide appropriate instructions to the Trustee, and all such payments will
be made in immediately available funds to an account maintained by the payee
with a bank, but only if such bank has appropriate facilities therefor.
Unless otherwise specified above, the principal hereof (and premium, if any)
and interest hereon payable on the Maturity Date will be paid in immediately
available funds upon surrender of this Security at the office of the Trustee
maintained for that purpose in the Borough of Manhattan, The City and State
of New York (or at such other location as may be specified above). The
Company will pay any administrative costs imposed by banks in making payments
in immediately available funds, but, except as otherwise provided under
Additional Amounts above, any tax, assessment or governmental charge imposed
upon payments will be borne by the Holders of the Securities in respect of
which such payments are made.
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, INCLUDING, WITHOUT
LIMITATION, THE PROVISIONS RELATING TO THE SUBORDINATION OF THIS SECURITY TO THE
COMPANY'S SENIOR INDEBTEDNESS.
Unless the certificate of authentication hereon has been executed by
the Trustee by manual signature, this Security shall not be entitled to any
benefit under the Indenture or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its facsimile corporate seal.
DEERE & COMPANY
By:
--------------------------------------
Authorized Officer
Attest:
---------------------------------
Secretary
Dated: TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series
designated therein referred to in the
within-mentioned Indenture
THE BANK OF NEW YORK,
as Trustee
By:
--------------------------------------
Authorized Signatory
[REVERSE OF NOTE]
DEERE & COMPANY
SUBORDINATED MEDIUM-TERM NOTE, SERIES C
Section 1. GENERAL. This Security is one of a duly authorized
issue of securities (herein called the "SECURITIES") of the Company, issued
and to be issued in one or more series under an indenture, dated as of
March 15, 1999, as it may be supplemented from time to time (herein called
the "INDENTURE"), between the Company and The Bank of New York, Trustee
(herein called the "TRUSTEE", which term includes any successor trustee under
the Indenture with respect to a series of which this Security is a part), to
which Indenture and all indentures supplemental thereto, reference is hereby
made for a statement of the respective rights, limitations of rights, duties
and immunities thereunder of the Company, the Trustee and the Holders of the
Securities, and of the terms upon which the Securities are, and are to be,
authenticated and delivered. This Security is one of the series designated
on the face hereof which is unlimited in aggregate principal amount.
Section 2. PAYMENTS. If the Specified Currency is other than U.S.
dollars and the Holder hereof fails to elect payment in such Specified Currency,
the amount of U.S. dollar payments to be made in respect hereof will be
determined by the Exchange Rate Agent specified on the face hereof or a
successor thereto (the "EXCHANGE RATE AGENT") based on the highest bid quotation
in The City of New York at approximately 11:00 A.M., New York City time, on the
second Business Day preceding the applicable payment date by the Exchange Rate
Agent for the purchase by the Exchange Rate Agent of the Specified Currency for
U.S. dollars from three recognized foreign exchange dealers (one of whom may be
the Exchange Rate Agent) selected by the Exchange Rate Agent and approved by the
Company for the purchase by the quoting dealer of the Specified Currency for
U.S. dollars for settlement on such payment date in the aggregate amount of the
Specified Currency payable to all Holders of Securities scheduled to receive
U.S. dollar payments and at which the applicable dealer commits to execute a
contract. If three such bid quotations are not available, payments will be made
in the Specified Currency. All currency exchange costs will be borne by the
Holder of the Securities by deductions from such payments.
Except as set forth below, if the Specified Currency is other than
U.S. dollars and the Specified Currency is not available due to the imposition
of exchange controls or to other circumstances beyond the Company's control, the
Company will be entitled to satisfy its obligations to the Holder of this
Security by making such payment in U.S. dollars on the basis of the noon buying
rate in The City of New York for cable transfers of such Specified Currency as
certified for customs purposes (or, if not so specified, as otherwise
determined) by the Federal Reserve Bank of New York (the "MARKET EXCHANGE RATE")
for such Specified Currency as computed by the Exchange Rate Agent on the second
Business Day prior to the
2
applicable payment date or, if the Market Exchange Rate is then not available,
on the basis of the most recently available Market Exchange Rate or as otherwise
indicated above.
All determinations referred to above made by the Exchange Rate Agent
shall be at its sole discretion (except to the extent expressly provided that
any determination is subject to approval by the Company) and, in the absence of
manifest error, shall be conclusive for all purposes and binding on the Holder
of this Security and the Exchange Rate Agent shall have no liability therefor.
All currency exchange costs will be borne by the Company unless the
Holder of this Security has made the election to receive payments in the
Specified Currency. In that case, the Holder shall bear its pro rata portion of
currency exchange costs, if any, by deductions from payments otherwise due to
such Holder.
Section 3. INTEREST RATE CALCULATIONS. Unless otherwise set forth on
the face hereof, the following provisions of this Section 3 shall apply to the
calculation of interest on this Security. If the first Interest Reset Date is
later than the Original Issue Date, this Security will bear interest from its
Original Issue Date to the first Interest Reset Date at the Initial Interest
Rate set forth on the face hereof. Thereafter, the interest rate hereon for
each Interest Reset Period (as defined below) will be determined by reference to
the Base Rate set forth on the face hereof, as adjusted by the Spread, the
Spread Multiplier or other formula, if any, set forth on the face hereof.
As set forth on the face hereof, this Security may also have either or
both of the following: (i) a maximum limitation, or ceiling, on the rate at
which interest may accrue during any Interest Period (as defined below)
("MAXIMUM INTEREST RATE"); and (ii) a minimum limitation, or floor, on the rate
at which interest may accrue during any Interest Period ("MINIMUM INTEREST
RATE"). In addition to any Maximum Interest Rate that may be set forth on the
face hereof, the interest rate on this Security will in no event be higher than
the maximum rate permitted by New York law, as the same may be modified by
United States law of general application.
The rate of interest hereon will be reset daily, weekly, monthly,
quarterly, semi-annually or annually or at another interval (each, an "INTEREST
RESET PERIOD"), as set forth on the face hereof. The date or dates on which
interest will be reset (each, an "INTEREST RESET DATE") will be, if this
Security resets (i) daily, each Business Day; (ii) weekly, the Wednesday of each
week (unless the Base Rate set forth on the face hereof is the Treasury Rate),
in which case, the Tuesday of each week (except as provided below); (iii)
monthly, the third Wednesday of each month; (iv) quarterly, the third Wednesday
of March, June, September and December of each year; (v) semi-annually, the
third Wednesday of each of the two months set forth on the face hereof; and (vi)
annually, the third Wednesday of the month of each year set forth on the face
hereof; PROVIDED, HOWEVER, that if the first Interest Reset Date is later than
the
3
Original Issue Date, the interest rate in effect from the Original Issue Date to
the first Interest Reset Date will be the Initial Interest Rate as set forth on
the face hereof. If the Base Rate set forth on the face hereof is the Treasury
Rate and a Treasury auction shall fall on the Interest Reset Date for this
Security, then such Interest Reset Date shall instead be the first Business Day
immediately following such Treasury auction. If any Interest Reset Date would
otherwise be a day that is not a Business Day, such Interest Reset Date shall be
postponed to the next succeeding Business Day, except that, if the Base Rate set
forth on the face hereof is LIBOR, if such Business Day is in the next
succeeding calendar month, such Interest Reset Date shall be the immediately
preceding Business Day.
The interest payable hereon on each Interest Payment Date and on the
Maturity Date shall be the amount of interest accrued from, and including, the
Original Issue Date or the next preceding Interest Payment Date in respect of
which interest, if any, has been paid or duly provided for, as the case may be,
to, but excluding, the next succeeding Interest Payment Date or the Maturity
Date, as the case may be; PROVIDED, HOWEVER, that, if the interest rate is reset
daily or weekly, interest payable on any Interest Payment Date will be the
amount of interest accrued from and including the Original Issue Date or from
but excluding the last Regular Record Date through which interest has been paid
to and including the Regular Record Date immediately preceding such Interest
Payment Date, except that interest payable on the Maturity Date will include
interest accrued to, but excluding, the Maturity Date (each such period, an
"INTEREST PERIOD"). If the Maturity Date falls on a day which is not a Business
Day, the payment of principal, premium, if any, and interest, if any, with
respect to the Maturity Date will be paid on the next succeeding Business Day
with the same force and effect as if made on the Maturity Date, and no interest
shall accrue on the amount so payable as a result of such delayed payment. If
an Interest Payment Date other than the Maturity Date falls on a day that is not
a Business Day, such Interest Payment Date will be postponed to the next day
that is a Business Day and interest will accrue for the period of such
postponement (except if the Base Rate specified above is LIBOR, and such day
falls in the next succeeding calendar month, such Interest Payment Date will be
the immediately preceding Business Day), it being understood that, to the extent
this sentence is inconsistent with Section 112 of the Indenture, the provisions
of this sentence shall apply in lieu of such Section.
Accrued interest will be calculated by multiplying the principal
amount hereof by an accrued interest factor. Such accrued interest factor will
be computed by adding the interest factor calculated for each day in the
Interest Period or from the last date from which accrued interest is being
calculated. The interest factor for each such day is computed by dividing the
interest rate applicable on such day by 360, if the Base Rate set forth on the
face hereof is the CD Rate, Commercial Paper Rate, Eleventh District Cost Funds
Rate, Federal Funds Rate, Prime Rate or LIBOR (as described below), or by the
actual number of days in the year, if the Base Rate set forth on the face hereof
is the Treasury Rate or the CMT Rate (each as described below). The interest
rate applicable to any day that is an Interest Reset Date is the interest rate
as determined, in accordance with the procedures hereinafter set forth, with
4
respect to the Interest Determination Date (as defined below) pertaining to such
Interest Reset Date. The interest rate applicable to any other day is the
interest rate for the immediately preceding Interest Reset Date (or, if none,
the Initial Interest Rate, as set forth on the face hereof).
All percentages resulting from any calculation with respect hereto
will be rounded, if necessary, to the nearest one hundred-thousandth of a
percentage point, with five one-millionths of a percentage point rounded upward
(E.G., 7.123455% (or 0.07123455) being rounded to 7.12346% (or 0.0712346) and
7.123454% (or 0.07123454) being rounded to 7.12345% (or 0.0712345)), and all
currency amounts used in or resulting from such calculation will be rounded to
the nearest one-hundredth of a unit (with five one-thousandths of a unit being
rounded upwards).
Interest will be payable on, if this Security resets (i) daily, weekly
or monthly, the third Wednesday of each month; (ii) quarterly, the third
Wednesday of March, June, September and December of each year; (iii)
semi-annually, the third Wednesday of the two months set forth on the face
hereof; and (iv) annually, the third Wednesday of the month set forth on the
face hereof (each, an "INTEREST PAYMENT DATE"), and in each case, on the
Maturity Date.
If the Base Rate set forth on the face hereof is the CD Rate, the
CMT Rate, the Commercial Paper Rate, the Federal Funds Rate or the Prime
Rate, the "INTEREST DETERMINATION DATE" pertaining to an Interest Reset Date
for this Security will be the second Business Day immediately preceding such
Interest Reset Date; if the Base Rate set forth on the face hereof is LIBOR,
the "INTEREST DETERMINATION DATE" pertaining to an Interest Reset Date for
this Security will be the second London Banking Day immediately preceding
such Interest Reset Date, unless the Designated LIBOR Currency is British
pounds sterling, in which case the "Interest Determination Date" will be such
Interest Reset Date; and if the Base Rate set forth on the face hereof is the
Treasury Rate, the "INTEREST DETERMINATION DATE" pertaining to an Interest
Reset Date for this Security will be the day of the week in which such
Interest Reset Date falls on which Treasury bills (as defined below) would
normally be auctioned. Treasury bills are usually sold at auction on Monday
of each week, unless that day is a legal holiday, in which case the auction
is usually held on the following Tuesday, except that sometimes such auction
may be held on the preceding Friday. If, as the result of a legal holiday,
an auction is so held on the preceding Friday, such Friday will be the
Interest Determination Date pertaining to the Interest Reset Date occurring
in the next succeeding week.
If the Base Rate set forth on the face hereof is the Eleventh District
Cost of Funds Rate, the "INTEREST DETERMINATION DATE" pertaining to an Interest
Reset Date for this Security is the last Business Day of the month immediately
preceding the applicable Interest Reset Date in which the Federal Home Loan Bank
of San Francisco published the index.
5
Unless otherwise set forth on the face hereof, the "CALCULATION DATE",
where applicable, pertaining to an Interest Determination Date is the earlier of
(i) the tenth calendar day after such Interest Determination Date, or if any
such day is not a Business Day, the next succeeding Business Day and (ii) the
Business Day immediately preceding the applicable Interest Payment Date or the
Maturity Date, as the case may be.
The Company will appoint and enter into an agreement with an agent
(a "CALCULATION AGENT") to calculate the rate of interest on the Securities
of this series which bear interest at a floating rate. Unless otherwise set
forth on the face hereof. The Bank of New York will be the Calculation Agent.
At the request of the Holder hereof, the Calculation Agent will provide the
interest rate then in effect and, if determined, the interest rate that will
become effective on the next Interest Reset Date.
Subject to applicable provisions of law and except as specified
herein, with respect to each Interest Determination Date, the rate of interest
shall be the rate determined by the Calculation Agent in accordance with the
provisions of the applicable heading below.
DETERMINATION OF CD RATE. If the Base Rate set forth on the face
hereof is the CD Rate, this Security will bear interest for each Interest
Reset Period at the interest rate calculated with reference to the CD Rate
and the Spread, Spread Multiplier or other formula, if any, set forth on the
face hereof. Unless otherwise set forth on the face hereof, the "CD RATE"
means, with respect to any Interest Determination Date pertaining thereto,
the rate on such date for negotiable certificates of deposit having the Index
Maturity set forth on the face hereof as published in H.15(519) (as defined
below) under the heading "CDS (SECONDARY MARKET)" or, if not yet published by
3:00 P.M., New York City time, on the Calculation Date pertaining to such
Interest Determination Date, the CD Rate will be the rate on such Interest
Determination Date for negotiable certificates of deposit having the Index
Maturity set forth on the face hereof as published in H.15 Daily Update under
the caption "CDS (Secondary Market)." If by 3:00 P.M., New York City time, on
the Calculation Date pertaining to such Interest Determination Date such rate
is not yet published in either H.15(519) or H.15 Daily Update, the CD Rate on
such Interest Determination Date will be calculated by the Calculation Agent
and will be the average of the secondary market offered rates as of 10:00 A.M.,
New York City time, on such Interest Determination Date, of three leading
non-bank dealers in negotiable U.S. dollar certificates of deposit in The
City of New York selected by the Calculation Agent (after consultation with
the Company) for negotiable certificates of deposit of major United States
money market banks of the highest credit standing (in the market for
negotiable certificates of deposit) having a remaining maturity closest to
the Index Maturity set forth on the face hereof in a denomination of U.S.
$5,000,000; PROVIDED, HOWEVER, that, if the dealers selected as aforesaid by
the Calculation Agent are not quoting as mentioned in this sentence, the
interest rate for the period commencing on the Interest Reset Date following
such Interest Determination Date will be the interest rate in effect on such
Interest Determination Date. "H.15(519)" means the weekly statistical
release designated as such, or any successor
6
publication, published by the Board of Governors of the Federal Reserve System.
"H.15 DAILY UPDATE" means the daily update of H.15(519), available through the
world-wide-web site of the Board of Governors of the Federal Reserve System at
http://www.bog.frb.fed.us/releases/h15/update, or any successor site or
publication.
DETERMINATION OF COMMERCIAL PAPER RATE. If the Base Rate set forth
on the face hereof is the Commercial Paper Rate, this Security will bear
interest for each Interest Reset Period at the interest rate calculated with
reference to the Commercial Paper Rate and the Spread, Spread Multiplier or
other formula, if any, set forth on the face hereof. Unless otherwise set
forth on the face hereof, the "COMMERCIAL PAPER RATE" means, with respect to
any Interest Determination Date pertaining thereto, the Money Market Yield
(calculated as described below) of the rate on such date for commercial paper
having the Index Maturity set forth on the face hereof, as such rate shall be
published in H.15(519) under the caption "COMMERCIAL PAPER - NONFINANCIAL"
or, if not yet published by 3:00 P.M., New York City time, on the Calculation
Date pertaining to such Interest Determination Date, the Commercial Paper
Rate shall be the Money Market Yield of the rate on such Interest
Determination Date for commercial paper having the Index Maturity set forth
on the face hereof as published in H.15 Daily Update under the caption
"COMMERCIAL PAPER -NONFINANCIAL". If by 3:00 P.M., New York City time, on
the Calculation Date pertaining to such Interest Determination Date such rate
is not yet published in either H.15(519) or H.15 Daily Update, the Commercial
Paper Rate on such Interest Determination Date shall be calculated by the
Calculation Agent and shall be the Money Market Yield of the average of the
offered rates as of 11:00 A.M., New York City time, on such Interest
Determination Date of three leading dealers in commercial paper in The City
of New York selected by the Calculation Agent (after consultation with the
Company) for commercial paper having the Index Maturity set forth on the face
hereof placed for an industrial issuer whose bond rating is "Aa", or the
equivalent, from a nationally recognized securities rating agency; PROVIDED,
HOWEVER, that, if the dealers selected as aforesaid by the Calculation Agent
are not quoting as mentioned in this sentence, the interest rate for the
period commencing on the Interest Reset Date following such Interest
Determination Date will be the interest rate in effect on such Interest
Determination Date.
"MONEY MARKET YIELD" shall be a yield (expressed as a percentage)
calculated in accordance with the following formula:
MONEY MARKET YIELD = D X 360 x 100
---------------
360 - (D x M)
where "D" refers to the applicable per annum rate for commercial paper quoted on
a bank discount basis and expressed as a decimal; and "M" refers to the actual
number of days in the Interest Period for which interest is being calculated.
7
DETERMINATION OF FEDERAL FUNDS RATE. If the Base Rate set forth on
the face hereof is the Federal Funds Rate, this Security will bear interest
for each Interest Reset Period at the interest rate calculated with reference
to the Federal Funds Rate and the Spread, Spread Multiplier or other formula,
if any, set forth on the face hereof. Unless otherwise set forth on the face
hereof, the "FEDERAL FUNDS RATE" means, with respect to any Interest
Determination Date pertaining thereto, the rate on such date for federal
funds as published in H.15(519) under the caption "FEDERAL FUNDS (EFFECTIVE)"
or, if not yet published by 3:00 P.M., New York City time, on the Calculation
Date pertaining to such Interest Determination Date, the Federal Funds Rate
will be the rate on such Interest Determination Date as published in H.15
Daily Update under the caption "FEDERAL FUNDS/EFFECTIVE RATE". If by 3:00
P.M., New York City time, on the Calculation Date pertaining to such Interest
Determination Date such rate is not yet published in either H.15(519), or
H.15 Daily Update, the Federal Funds Rate for such Interest Determination
Date will be calculated by the Calculation Agent and will be the average of
the rates for the last transaction in overnight federal funds arranged by
three leading dealers of federal funds transactions in The City of New York,
which dealers have been selected by the Calculation Agent (after consultation
with the Company), as of 9:00 A.M., New York City time, on such Interest
Determination Date; PROVIDED, HOWEVER, that, if the dealers selected as
aforesaid by the Calculation Agent are not quoting as mentioned in this
sentence, the interest rate for the period commencing on the Interest Reset
Date following such Interest Determination Date will remain the interest rate
in effect on such Interest Determination Date.
DETERMINATION OF LIBOR. If the Base Rate set forth on the face hereof
is LIBOR, this Security will bear interest for each Interest Reset Period at the
interest rate calculated with reference to LIBOR and the Spread, Spread
Multiplier or other formula, if any, set forth on the face hereof. Unless
otherwise set forth on the face hereof, "LIBOR" means the rate determined by the
Calculation Agent in accordance with the following provisions:
(i) If "LIBOR Reuters" is specified on the face hereof, LIBOR will
be the average of the offered rates for deposits in the LIBOR Currency
having the Index Maturity set forth on the face hereof on the applicable
Interest Reset Date, as such rates appear on the Designated LIBOR Page as
of 11:00 A.M., London time, on that Interest Determination Date, if at
least two such offered rates appear on the Designated LIBOR Page.
(ii) If "LIBOR Telerate" is specified on the face hereof, LIBOR
will be the rate for deposits in the LIBOR Currency having the Index
Maturity set forth on the face hereof on the applicable Interest Reset
Date, as such rates appears on the Designated LIBOR Page as of 11:00 A.M.,
London time, on that Interest Determination Date. If such rate does not
appear, LIBOR for such Interest Determination Date will be determined as
described in (iii) below.
8
(iii) If the Designated LIBOR Page by its terms provides only for a
single rate, that single rate will be used regardless of the foregoing
provisions require more than one rate. With respect to an Interest
Determination Date, if LIBOR-Reuters is the applicable method for
determining LIBOR and fewer than two offered rates appear on the Designated
LIBOR Page as specified in (i) above or if LIBOR-Telerate is the applicable
method for determining LIBOR and no rate appears on the Designated LIBOR
Page as specified in (ii) above, then LIBOR will be determined on the basis
of the offered rates at which deposits in the LIBOR Currency having the
Index Maturity set forth on the face hereof on the Interest Determination
Date and in a principal amount that is representative of a single
transaction in that market at that time are offered by four major banks in
the London interbank market at approximately 11:00 AM., London time, on the
Interest Determination Date to prime banks in the London interbank market.
The Calculation Agent will select the four banks and request the principal
London office of each of those banks to provide a quotation of its rate for
deposits in the LIBOR Currency. If at least two quotations are provided,
LIBOR for that Interest Determination Date will be the average of those
quotations. If fewer than two quotations are provided as mentioned above,
LIBOR will be the average of the rates quoted by three major banks in the
Principal Financial Center selected by the Calculation Agent at
approximately 11:00 A.M. in the Principal Financial Center, on the Interest
Determination Date for loans to leading Europeans banks in the LIBOR
Currency having the Index Maturity set forth on the face hereof and in a
principal amount that is representative for a single transaction in the
LIBOR Currency in that market at that time. The Calculation Agent will
select the three banks referred to above. If fewer than three banks
selected by the Calculation Agent are quoting as mentioned above, LIBOR
will remain LIBOR then in effect on the Interest Determination Date.
"LIBOR CURRENCY" means the Designated LIBOR Currency specified on the
face hereof as to which LIBOR shall be calculated or, if no such currency
is specified on the face hereof, United States dollars.
"DESIGNATED LIBOR PAGE" means if "LIBOR Reuters" is specified on the
face hereof, the display on the Reuter Monitor Money Rates Service (or any
successor service) on the page specified on the face hereof (or any other
page as may replace such page on such service) for the purpose of
displaying the London interbank rates of major banks for the LIBOR
Currency; or if "LIBOR Telerate" is specified in the applicable pricing
supplement or neither "LIBOR Reuters" nor "LIBOR Telerate" is specified on
the face hereof as the method of calculating LIBOR, the display on Bridge
Telerate, Inc. (or any successor service, "TELERATE") on the page specified
on the face hereof (or
9
any other page as may replace such page on such service) for the purpose of
displaying the London interbank rates of major banks for the LIBOR
Currency.
DETERMINATION OF PRIME RATE. If the Base Rate set forth on the face
hereof is the Prime Rate, this Security will bear interest for each Interest
Reset Period at the interest rate calculated with reference to the Prime Rate
and the Spread, Spread Multiplier or other formula, if any, set forth on the
face hereof. Unless otherwise set forth on the face hereof, the "PRIME RATE"
means, with respect to any Interest Determination Date pertaining thereto, the
rate on such date as published in H.15(519) under the caption "BANK PRIME LOAN"
or, if not yet published by 3:00 A.M., New York City time, on the Calculation
Date pertaining to such Interest Determination Date, the rate on such Interest
Determination Date as published in H.15 Daily Update, or such other recognized
electronic source used for the purpose of displaying such rate, under the
caption "Bank Prime Loan."
If the rate is not published in H.15 (519), H.15 Daily Update or
another recognized electronic source by 3:00 P.M., New York City time, on the
Calculation Date, then the Calculation Agent will determine the Prime Rate to be
the average of the of the rates of interest publicly announced by each bank that
appears on the Reuters screen designated as "US Prime 1" as that bank's prime
rate or base lending rate as in effect for that Interest Determination Date. If
at least one rate but fewer than four rates appear on the Reuters screen US
Prime 1 on the Interest Determination Date, then the Prime Rate will be the
average 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 the Interest Determination Date by three major money center banks in
the City of New York selected by the Calculation Agent. If the banks selected
by the Calculation Agent are not quoting as mentioned above, the Prime Rate will
remain the Prime Rate then in effect on the Interest Determination Date.
DETERMINATION OF TREASURY RATE. If the Base Rate set forth on the
face hereof is the Treasury Rate, this Security will bear interest for each
Interest Reset Period at the interest rate calculated with reference to the
Treasury Rate and the Spread, Spread Multiplier or other formula, if any, set
forth on the face hereof. Unless otherwise set forth on the face hereof, the
"TREASURY RATE" means, with respect to any Interest Determination Date
pertaining thereto the rate for the auction of direct obligations of the
United States ("TREASURY BILLS") held on such Interest Determination Date
having the Index Maturity set forth on the cover page hereof under the
caption "INVESTMENT RATE" on the display on Telerate on page 56 (or any other
page as may replace such page on such service) ("TELERATE PAGE 56") or page
57 (or any other page as may replace such page on such service) ("TELERATE
PAGE 57") by 3:00 P.M., New York City time, on the Calculation date for that
Interest Determination Date.
The following procedures will be followed if the Treasury Rate cannot
be determined as described above:
10
If the rate is not published by 3:00 P.M., New York City time, on
the Calculation Date, the Treasury Rate will be the Bond Equivalent Yield of
the auction rate of such Treasury bills as published in H.15 Daily Update or
such recognized electronic source used for the purpose of displaying such
rate under the caption "U.S. Government Securities Treasury Bills/Auction
High."
If the rate is not published by 3:00 P.M., New York City time, on the
Calculation Date and cannot be determined as described in the immediately
preceding paragraph, the Treasury Rate will be the Bond Equivalent Yield of
the auction rate of such Treasury bills as otherwise announced by the United
States Department of Treasury.
If the results of the most recent auction of Treasury bills having
the Index Maturity set forth on the face hereof are not published or
announced as described above by 3:00 P.M., New York City time, on the
Calculation Date, or if no auction is held on the Interest Determination
Date, then the Treasury Rate will be the Bond Yield Equivalent on such
Interest Determination Date of Treasury bills having the Index Maturity set
forth on the face hereof as published in H.15(519) under the caption "U.S.
Government securities/Treasury bills/Secondary market" or, if not yet
published by 3:00 p.m., New York City time, on the related Calculation Date,
the rate on such Interest Determination Date of such Treasury Bills as
published in H.15 Daily Update, or such other recognized electronic source
used for the purpose of displaying such rate, under the caption "U.S.
Government securities/Treasury bills/Secondary market."
If such rate is not published in H.15 (519), H.15 Daily Update or
another recognized electronic source, then the Calculation Agent will
determine the Treasury Rate to be the Bond Yield Equivalent of the average of
the secondary market bid rates, as of approximately 3:30 P.M., New York City
time, on the Interest Determination Date of three leading primary United
States government securities dealers (which may include Agents or their
affiliates) for the issue of Treasury bills with a remaining maturity closest
to the Index Maturity set forth on the face hereof. The Calculation Agent
will select the three dealers referred to above.
If fewer than three dealers selected by the Calculation Agent are
quoting as mentioned above, the Treasury Rate will remain the Treasury Rate then
in effect on that Interest Determination Date.
"Bond Equivalent Yield" means a yield (expressed as a percentage)
calculated in accordance with the following formula:
D x N
Bond Equivalent Yield = --------------- x 100
360 - (D x M)
where "D" refers to the applicable per annum rate for Treasury bills quoted
on a bank discount basis, "N" refers to 365 or 366, as the case may be, and
"M" refers to the actual number of days in the applicable Interest Reset
Period.
DETERMINATION OF CMT RATE. If the Base Rate set forth on the face
hereof is the CMT Rate, this Security will bear interest for each Interest Reset
Period at the interest rate calculated with reference to the CMT Rate and the
Spread, Spread Multiplier, or other formula, if any, set forth on the face
hereof. Unless otherwise set forth on the face hereof, the "CMT RATE" means,
with respect to any Interest Determination Date pertaining thereto, the rate
displayed on the Designated CMT Telerate Page (as defined below) under the
caption "... Treasury Constant Maturities ... Federal Reserve Board Release H.15
... Mondays Approximately 3:45 P.M.", under the column for the Designated CMT
Maturity Index (as defined below) for (i) if the Designated CMT Telerate Page is
7051 or any successor page, the
11
rate on such Interest Determination Date and (ii) if the Designated CMT Telerate
Page is 7052 or any successor page, the rate for the week or the monthly
average, as applicable, ended immediately preceding the week in which the
related Interest Determination Date occurs. If such rate is no longer displayed
on the relevant page, or if not displayed by 3:00 P.M., New York City time, on
the Calculation Date pertaining to such Interest Determination Date, then the
interest rate for such Interest Determination Date shall be the rate for the
Designated CMT Maturity Index as published in H.15(519). If such rate is no
longer published, or if not published by 3:00 P.M., New York City time, on the
Calculation Date pertaining to such Interest Determination Date, then the
interest rate for such Interest Determination Date shall be the rate for the
Designated CMT Maturity Index (or other United States Treasury rate for the
Designated CMT Maturity Index) as may then be published by either the Board of
Governors of the Federal Reserve System or the United States Department of the
Treasury that the Calculation Agent determines (with the concurrence of the
Company) to be comparable to the rate formerly displayed on the Designated CMT
Telerate Page and published in H.15(519). If such information is not provided
by 3:00 P.M., New York City time, on the Calculation Date pertaining to such
Interest Determination Date, then the interest rate for such Interest
Determination Date shall be calculated by the Calculation Agent and shall be a
yield to maturity, based on the arithmetic average of the secondary market
closing offer side prices as of approximately 3:30 P.M., New York City time, on
such Interest Determination Date, reported by three leading primary United
States government securities dealers (each, a "REFERENCE DEALER") in The City of
New York, for the most recently issued direct noncallable fixed rate obligations
of the United States ("U.S. TREASURY NOTES") with an original maturity of
approximately the Designated CMT Maturity Index and a remaining term to maturity
of not less than such Designated CMT Maturity Index minus one year. The three
Reference Dealers shall be determined by (i) the selection of five Reference
Dealers by the Calculation Agent (after consultation with the Company) and (ii)
the elimination of the Reference Dealers providing the highest (or, in the event
of equality, one of the highest) and the lowest (or, in the event of equality,
one of the lowest) quotations for such Interest Determination Date. If the
Calculation Agent cannot obtain three such U.S. Treasury Note quotations, the
interest rate for such Interest Determination Date shall be calculated by the
Calculation Agent and shall be a yield to maturity based on the arithmetic
average of the secondary market offer side prices as of approximately 3:30 P.M.,
New York City time, on the Interest Determination Date reported, according to
their written records, by three Reference Dealers in The City of New York,
selected in the manner described above, for U.S. Treasury Notes with an original
maturity of the number of years that is the next highest to the Designated CMT
Maturity Index and a remaining term to maturity closest to the Designated CMT
Maturity Index and in an amount of at least $100 million. If only three or four
of such Reference Dealers are quoting as described above, then the interest rate
shall be based on the arithmetic average of the offer side prices so obtained
from all such Reference Dealers, without eliminating the Reference Dealers
providing the highest and the lowest of such quotes. If fewer than three such
Reference Dealers are quoting as described above, then the interest rate shall
be the CMT Rate in effect on such Interest Determination Date. If two such U.S.
Treasury Notes have remaining terms
12
to maturity equally close to the Designated CMT Maturity Index, the quotes for
the U.S. Treasury Note with the shorter remaining term to maturity shall be
used.
"DESIGNATED CMT TELERATE PAGE" means the display on the Dow Jones
Telerate Service on the page set forth on the face hereof (or any other
page as may replace such page on that service for the purpose of displaying
treasury constant maturities as reported in H.15(519)). If no such page is
so specified, the Designated CMT Telerate Page shall be 7052.
"DESIGNATED CMT MATURITY INDEX" means the original period to maturity
of the U.S. Treasury securities (either 1, 2, 3, 5, 7, 10, 20 or 30
years) specified on the face hereof with respect to which the CMT Rate will
be calculated. If no such maturity is so specified, the Designated CMT
Maturity Index shall be two years.
DETERMINATION OF THE ELEVENTH DISTRICT COST OF FUNDS RATE. If the
Base Rate set forth on the face hereof is the Eleventh District Cost of Funds
Rate this security will bear interest for each Interest Reset Period at the
interest rate calculated with reference to the Eleventh District Cost of Funds
Rate and Spread, Spread Multiple or other formula, if any, set forth on the face
hereof. Unless otherwise set forth on the face hereof, the "ELEVENTH DISTRICT
COST OF FUNDS RATE" means with respect to any Interest Determination Date the
rate equal to the monthly weighted average cost of funds for the month preceding
the Interest Determination Date as displayed on the Telerate Page 7058 by 11:00
A.M., San Francisco time, on the Calculation Date for that Interest
Determination Date under the caption "11th District."
The following procedures will be used if the Eleventh District Cost of
Funds Rate cannot be determined as described above: (i) if the rate is not
displayed on the relevant page by 11:00 A.M., San Francisco time, on the
Calculation Date, then the Eleventh District Cost of Funds Rate will be the
monthly weighted average cost of funds paid by member institutions of the
Eleventh Federal Home Loan Bank District, as announced by the Federal Home Loan
Bank of San Francisco, for the month preceding the date of announcement and
(ii) if no announcement was made relating to the month preceding the Interest
Determination Date, the Eleventh District Cost of Funds Rate will remain the
Eleventh District Cost of Funds Rate then in effect on the Interest
Determination Date.
References herein to "U.S. DOLLARS" or "U.S. $" or "$" are to the
currency of the United States of America.
Section 4. REDEMPTION. If so specified on the face hereof, the
Company may at its option redeem this Security in whole or from time to time in
part in increments of $1,000 (provided that any remaining principal amount of
this Security shall not be less than the Minimum Denomination specified on the
face hereof) on or after the date designated as the Initial Redemption Date on
the face hereof at 100% of the unpaid principal amount hereof or
13
the portion thereof redeemed (or, if this Security is a Discount Security,
such lesser amount as is provided for below) multiplied by the Initial
Redemption Percentage specified on the face hereof, together with accrued
interest to the Redemption Date. Such Initial Redemption Percentage shall
decline at each anniversary of the Initial Redemption Date by an amount equal to
the Annual Redemption Percentage Reduction, if any, specified on the face hereof
until the redemption price is 100% of the unpaid principal amount hereof. The
Company may exercise such option by causing the Trustee to mail a notice of such
redemption at least 30 but not more than 60 days prior to the Redemption Date.
In the event of redemption of this Security in part only, a new Security or
Securities for the unredeemed portion hereof shall be issued in the name of the
Holder hereof upon the cancellation hereof. If less than all of the Securities
with like tenor and terms to this Security are to be redeemed, the Securities to
be redeemed shall be selected by the Trustee by such method as the Trustee shall
deem fair and appropriate. However, if less than all the Securities of the
series, of which this Security is a part, with differing issue dates, interest
rates or formula and stated maturities are to be redeemed, the Company in its
sole discretion shall select the particular Securities to be redeemed and shall
notify the Trustee in writing thereof at least 45 days prior to the relevant
Redemption Date.
Section 5. REPAYMENT. If so specified on the face hereof, this
Security shall be repayable prior to the Stated Maturity Date at the option of
the Holder on each applicable Optional Repayment Date shown on the face hereof
at a repayment price equal to 100% of the principal amount to be repaid,
together with accrued interest to the Repayment Date. In order for this
Security to be repaid, the Trustee must receive at least 30 but not more than 60
days prior to an Optional Repayment Date, this Security with the form attached
hereto entitled "OPTION TO ELECT REPAYMENT" duly completed. Any tender of this
Security for repayment shall be irrevocable. The repayment option may be
exercised by the Holder of this Security in whole or in part in increments of
$1,000 (provided that any remaining principal amount of this Security shall not
be less than the Minimum Denomination specified on the face hereof). Upon any
partial repayment, this Security shall be cancelled and a new Security or
Securities for the remaining principal amount hereof shall be issued in the name
of the Holder of this Security.
Section 6. SINKING FUND. Unless otherwise specified on the face
hereof, this Security will not be subject to any sinking fund.
Section 7. DISCOUNT SECURITIES. If this Security (such Security being
referred to as a "DISCOUNT SECURITY") (a) has been issued at an Issue Price
lower, by more than a DE MINIMIS amount (as determined under United States
federal income tax rules applicable to original issue discount instruments),
than the principal amount hereof and (b) would be considered an original issue
discount security for United States federal income tax purposes, then the amount
payable on this Security in the event of redemption by the Company, repayment at
the option of the Holder or acceleration of the maturity hereof, in lieu of the
principal amount due at the Stated Maturity Date hereof, shall be the Amortized
Face Amount (as defined below) of this Security as of the date of such
redemption, repayment or
14
acceleration. The "AMORTIZED FACE AMOUNT" of this Security shall be the amount
equal to the sum of (a) the Issue Price (as set forth on the face hereof) plus
(b) the aggregate of the portions of the original issue discount (the excess of
the amounts considered as part of the "stated redemption price at maturity" of
this Security within the meaning of Section 1273(a)(2) of the Internal Revenue
Code of 1986, as amended (the "CODE"), whether denominated as principal or
interest, over the Issue Price of this Security) which shall theretofore have
accrued pursuant to Section 1272 of the Code (without regard to
Section 1272(a)(7) of the Code) from the date of issue of this Security to the
date of determination, minus (c) any amount considered as part of the "stated
redemption price at maturity" of this Security which has been paid on this
Security from the date of issue to the date of determination.
Section 8. MODIFICATION AND WAIVERS; SUBORDINATION; OBLIGATION OF THE
COMPANY ABSOLUTE. The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Company and the rights of the Holders of the Securities of
each series. Such amendment may be effected under the Indenture at any time by
the Company and the Trustee with the consent of the Holders of not less than a
majority in principal amount of all Outstanding Securities affected thereby.
The Indenture also contains provisions permitting the Holders of not less than a
majority in principal amount of the Outstanding Securities, on behalf of the
Holders of all Outstanding Securities, to waive compliance by the Company with
certain provisions of the Indenture. Provisions in the Indenture also permit
the Holders of not less than a majority in principal amount of all Outstanding
Securities of any series to waive on behalf of all of the Holders of Securities
of such series certain past defaults under the Indenture and their consequences.
Any such consent or waiver shall be conclusive and binding upon the Holder of
this Security and upon all future Holders of this Security and of any Security
issued upon the registration of transfer hereof or in exchange herefor or in
lieu hereof, whether or not notation of such consent or waiver is made upon this
Security.
The indebtedness evidenced by the Securities is, to the extent and in
the manner set forth in the Indenture, expressly subordinated and subject in
right of payment to the prior payment in full of all Senior Indebtedness, and
this Security is issued subject to such provisions of the Indenture. Each
Holder of this Security, by accepting the same, agrees to and shall be bound by
such provisions of the Indenture and authorizes and directs the Trustee on his
behalf to take such action as may be necessary or appropriate to effectuate such
subordination as provided in the Indenture and appoints the Trustee his
attorney-in-fact for any and all such purposes.
No reference herein to the Indenture and no provision of this Security
or of the Indenture shall alter or impair the obligation of the Company, which
is absolute and unconditional, to pay the principal of (and premium, if any) and
interest on this Security at the times, place and rate, and in the Currency
herein prescribed.
15
Section 9. DEFEASANCE AND COVENANT DEFEASANCE. The Indenture contains
provisions for defeasance at any time of (a) the entire indebtedness of the
Company on this Security and (b) certain restrictive covenants and the related
defaults and Events of Default, upon compliance by the Company with certain
conditions set forth therein, which provisions apply to this Security, unless
otherwise specified on the face hereof.
Section 10. MINIMUM DENOMINATION. Unless otherwise provided on the
face hereof, this Security is issuable only in registered form without coupons
issued in denominations of $1,000 or any amount in excess thereof which is an
integral multiple of $1,000. If this Security is denominated in a Specified
Currency other than U.S. dollars or is a Discount Security, this Security shall
be issuable in the denominations set forth on the face hereof.
Section 11. REGISTRATION OF TRANSFER. As provided in the Indenture
and subject to certain limitations herein and therein set forth, the transfer of
this Security is registrable in the Security Register upon surrender of this
Security for registration of transfer at a Place of Payment for the series of
Securities of which this Security is a part, duly endorsed by, or accompanied by
a written instrument of transfer in form satisfactory to the Company and the
Security Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Securities of this series,
of authorized denominations and for the same aggregate principal amount, will be
issued to the designated transferee or transferees.
If the registered owner of this Security is the Depository (such a
Security being referred to herein as a "GLOBAL SECURITY") and (i) the Depository
is at any time unwilling or unable to continue as depository and a successor
depository is not appointed by the Company within 90 days following notice to
the Company or (ii) an Event of Default occurs, the Company will issue
Securities in certificated form in exchange for this Global Security. In
addition, the Company may at any time determine not to have Securities
represented by this Global Security and, in such event, will issue Securities in
certificated form in exchange in whole for this Global Security representing
such Security. In any such instance, an owner of a beneficial interest in a
Global Security will be entitled to physical delivery of Securities in
certificated form equal in principal amount to such beneficial interest and to
have such Securities registered in its name. Securities so issued in
certificated form will be issued in denominations of $1,000 (or such other
Minimum Denomination specified on the face hereof) or any amount in excess
thereof which is an integral multiple of $1,000 (or such Minimum Denomination)
and will be issued in registered form only, without coupons.
No service charge shall be made for any such registration of transfer
or exchange, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
16
Prior to due presentment of this Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Holder as the owner hereof for all purposes, whether or not this
Security be overdue, and neither the Company, the Trustee nor any such agent
shall be affected by notice to the contrary.
Section 12. EVENTS OF DEFAULT. If an Event of Default with respect to
the Securities of the series of which this Security forms a part shall have
occurred and be continuing, the principal of this Security may be declared due
and payable in the manner and with the effect provided in the Indenture.
Section 13. DEFINED TERMS. All terms used in this Security which are
defined in the Indenture and are not otherwise defined herein shall have the
meanings assigned to them in the Indenture.
Section 14. GOVERNING LAW. Unless otherwise specified on the face
hereof, this Security shall be governed by and construed in accordance with the
law of the State of New York, without regard to principles of conflicts of laws.
OPTION TO ELECT REPAYMENT
The undersigned hereby irrevocably requests and instructs the Company
to repay this Security (or the portion thereof specified below), pursuant to its
terms, on the "REPAYMENT DATE" first occurring after the date of receipt of the
within Security as specified below, at a Repayment Price equal to 100% of the
principal amount thereof, together with interest thereon accrued to the
Repayment Date, to the undersigned at:
--------------------------------------------------------------------------------
(Please Print or Type Name and Address of the Undersigned.)
FOR THIS OPTION TO ELECT REPAYMENT TO BE EFFECTIVE, THIS SECURITY WITH
THE OPTION TO ELECT REPAYMENT DULY COMPLETED MUST BE RECEIVED AT LEAST 30 BUT
NOT MORE THAN 45 DAYS PRIOR TO THE REPAYMENT DATE (OR, IF SUCH REPAYMENT DATE IS
NOT A BUSINESS DAY, THE NEXT SUCCEEDING BUSINESS DAY) BY THE COMPANY AT ITS
OFFICE OR AGENCY IN THE CITY OF NEW YORK, WHICH WILL BE LOCATED INITIALLY AT THE
OFFICE OF THE TRUSTEE AT C/O THE BANK OF NEW YORK, 101 BARCLAY STREET, NEW YORK,
NEW YORK 10286; ATTENTION: CORPORATE TRUST ADMINISTRATION.
If less than the entire principal amount of this Security is to be
repaid, specify the portion thereof (which shall be $1,000 or an integral
multiple thereof) which is to be repaid: $ ___________.
If less than the entire principal amount of this Security is to be
repaid, specify the denomination(s) of the Security(ies) to be issued for the
unpaid amount ($1,000 or any integral multiple of $1,000; PROVIDED that any
remaining principal amount of this Security shall not be less than the Minimum
Denomination): $ ________.
Dated:
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Note: The signature to this Option to Elect
Repayment must correspond with the name as written
upon the face of this Security in every particular
without alterations or enlargement or any change
whatsoever.
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ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of survivorship and not as
tenants in common
UNIF GIFT MIN ACT - ...............Custodian.............
(Cust.) (Minor)
Under Uniform Gifts to Minors Act
.....................................
(State)
Additional abbreviations may also be used though not in the above list.
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FOR VALUE RECEIVED, the undersigned
hereby sell(s), assign(s) and transfer(s) unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
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Please print or type name and address, including zip code of assignee
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the within Security of DEERE & COMPANY and all rights thereunder and does hereby
irrevocably constitute and appoint
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Attorney to transfer the said Security on the books of the within-named Company,
with full power of substitution in the premises.
Dated
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SIGNATURE GUARANTEED:
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NOTICE: The signature to this assignment
must correspond with the name as it appears
upon the face of the within Security in every
particular, without alteration or enlargement
or any change whatsoever.