EXHIBIT 4-u
[FORM OF FACE OF SECURITY]
PERMANENT GLOBAL FLOATING RATE SENIOR BEARER NOTE
BEARER BEARER
No. PGFL _________
[COMMERCIAL PAPER ISSUED IN ACCORDANCE WITH REGULATIONS MADE
UNDER SECTION 4 OF THE UNITED KINGDOM BANKING ACT 1987.](1)
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(1) Applies only if this Note is denominated in pounds sterling and matures
not more than one year from and including the Original Issue Date.
[A [SHORTER TERM/LONGER TERM] DEBT SECURITY ISSUED IN
ACCORDANCE WITH REGULATIONS MADE UNDER SECTION 4 OF THE UNITED KINGDOM
BANKING ACT 1987.](2)
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(2) Applies only if this Note is denominated in pounds sterling and matures
more than one year from and including the Original Issue Date.
ANY UNITED STATES PERSON WHO HOLDS THIS OBLIGATION WILL BE
SUBJECT TO LIMITATIONS UNDER THE UNITED STATES INCOME TAX LAWS, INCLUDING THE
LIMITATIONS PROVIDED IN SECTIONS 165(j) AND 1287(a) OF THE UNITED STATES
INTERNAL REVENUE CODE.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE FOR DEFINITIVE BEARER
NOTES OR IN WHOLE OR IN PART FOR REGISTERED NOTES, THIS GLOBAL NOTE MAY NOT BE
TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY
OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE
DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY
OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY.
IF APPLICABLE, THE "TOTAL AMOUNT OF OID," "ORIGINAL YIELD TO
MATURITY" AND "INITIAL ACCRUAL PERIOD OID" (COMPUTED UNDER THE APPROXIMATE
METHOD) SET FORTH BELOW HAVE BEEN COMPLETED SOLELY FOR THE PURPOSES OF
APPLYING THE FEDERAL INCOME TAX ORIGINAL ISSUE DISCOUNT ("OID") RULES.
THIS NOTE HAS NOT BEEN, AND WILL NOT BE, REGISTERED UNDER THE
SECURITIES AND EXCHANGE LAW OF JAPAN. THIS NOTE MAY NOT BE OFFERED OR SOLD,
DIRECTLY OR INDIRECTLY, IN JAPAN OR TO, OR FOR THE BENEFIT OF, ANY RESIDENT OF
JAPAN (WHICH TERM AS USED HEREIN MEANS ANY PERSON RESIDENT IN JAPAN INCLUDING
ANY CORPORATION OR OTHER ENTITY ORGANIZED UNDER THE LAWS OF JAPAN) OR TO
OTHERS FOR THE RE-OFFERING OR RE-SALE, DIRECTLY OR INDIRECTLY, IN JAPAN OR TO
A RESIDENT OF JAPAN EXCEPT PURSUANT TO AN EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF, AND OTHERWISE IN COMPLIANCE WITH, THE SECURITIES AND EXCHANGE
LAW OF JAPAN AND OTHER RELEVANT LAWS AND REGULATIONS OF JAPAN.
IF THIS NOTE IS DENOMINATED IN JAPANESE YEN, IT SHALL HAVE A
MATURITY OF NOT LESS THAN ONE YEAR AND IT MAY NOT BE OFFERED OR SOLD, DIRECTLY
OR INDIRECTLY, IN JAPAN OR TO, OR FOR THE BENEFIT OF, ANY RESIDENT IN JAPAN
PRIOR TO THE DATE WHICH IS 90 DAYS AFTER THE SETTLEMENT DATE WITH RESPECT TO
THIS NOTE. IF (i) INTEREST PAYMENTS ON THIS NOTE ARE DENOMINATED IN JAPANESE
YEN AND PRINCIPAL PAYMENTS ARE DENOMINATED IN A CURRENCY OR CURRENCY UNIT
OTHER THAN JAPANESE YEN OR (ii) PRINCIPAL PAYMENTS ON THIS NOTE ARE
DENOMINATED IN JAPANESE YEN AND INTEREST PAYMENTS ARE DENOMINATED IN A
CURRENCY OR CURRENCY UNIT OTHER THAN JAPANESE YEN, THIS NOTE MAY NOT BE
OFFERED OR SOLD, DIRECTLY OR INDIRECTLY, IN JAPAN OR TO, OR FOR THE BENEFIT
OF, ANY RESIDENT OF JAPAN PRIOR TO THE DATE WHICH IS 180 DAYS AFTER THE
SETTLEMENT DATE WITH RESPECT TO THIS NOTE.
MORGAN STANLEY, DEAN WITTER, DISCOVER & CO.
SENIOR GLOBAL MEDIUM-TERM NOTE, SERIES [D/E]
(Floating Rate)
Morgan Stanley, Dean Witter, Discover & Co., a Delaware
corporation (together with its successors and assigns, the "Issuer"), for
value received, hereby promises to pay to bearer, upon surrender hereof,
the principal amount specified in [Schedule A hereto](3) [Schedule A-1
hereto](4), on the Maturity Date specified above (except to the extent
previously redeemed or repaid) and to pay interest thereon, from and
including the Interest Accrual Date specified above at a rate per annum
equal to the Initial Interest Rate specified above until the Initial
Interest Reset Date specified above, and on and after at a rate per annum
determined in accordance with the provisions specified on the reverse
hereof until but excluding the date such principal amount is paid or duly
made available for payment. The Issuer will pay interest in arrears
monthly, quarterly, semiannually or annually as specified above as the
Interest Payment Period on each Interest Payment Date (as specified above),
commencing with the first Interest Payment Date next succeeding the
Interest Accrual Date specified above, and on the Maturity Date specified
above (or any redemption or repayment date); provided, however, that if the
Interest Accrual Date occurs fifteen days or less prior to the first
Interest Payment Date occurring after the Interest Accrual Date, interest
payments will commence on the second Interest Payment Date succeeding the
Interest Accrual Date; and provided, further, that if an Interest Payment
Date (other than the Maturity Date or redemption or repayment date) would
fall on a day that is not a Business Day, as defined on the reverse hereof,
such Interest Payment Date shall be the following day that is a Business
Day, except that if the Base Rate specified above is LIBOR and such next
Business Day falls in the next calendar month, such Interest Payment Date
shall be the immediately preceding day that is a Business Day; and
provided, further, that if the Maturity Date or redemption or repayment
date would fall on a day that is not a Business Day, the payment of
principal, premium, if any, and interest shall be made on the next
succeeding Business Day and no interest shall accrue for the period from
and after such Maturity Date or redemption or repayment date.
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(3) Applies if this Note is not issued as part of, or in relation to, a
Unit.
(4) Applies if this Note is issued as part of, or in relation to, a Unit.
Interest on this Note will accrue from and including the
most recent Interest Payment Date to which interest has been paid or duly
provided for, or, if no interest has been paid or duly provided for, from
and including the Interest Accrual Date, until but excluding the date the
principal hereof has been paid or duly made available for payment (except
as provided below). The interest so payable, and punctually paid or duly
provided for, on any Interest Payment Date will, subject to certain
exceptions described herein, be paid to the holder of this Note at the
office or agency of the Principal Paying Agent (this and certain other
capitalized terms used herein are defined on the reverse of this Note) or
at the office or agency of such other paying agents outside the United
States as the Issuer may determine for that purpose (each, a "Paying
Agent," which term shall include the Principal Paying Agent).
Payment of the principal of this Note, any premium and the
interest due at maturity (or on any redemption or repayment date) will be
made upon presentation and surrender of this Note at the office or agency
of the Principal Paying Agent or at the office of any Paying Agent.
Payment of the principal of and premium, if any, and
interest on this Note will be made in the Specified Currency indicated
above, except as provided on the reverse hereof. If this Note is
denominated in U.S. dollars, any payment of the principal of, premium, if
any, and interest on this Note will be made in such coin or currency of the
United States of America as at the time of payment is legal tender for
payment of public and private debts. Such payments on this Note will be
made either by a check mailed to an address outside the United States
furnished by the payee or, at the option of the payee and subject to
applicable laws and regulations and the procedures of the Paying Agent, by
wire transfer of immediately available funds to an account maintained by
the payee with a bank located outside the United States if appropriate wire
transfer instructions have been received by the Paying Agent not less than
15 calendar days prior to the applicable payment date. Notwithstanding the
foregoing, in the event that payment in U.S. dollars of the full amount
payable on this Note at the offices of all Paying Agents would be illegal
or effectively precluded as a result of exchange controls or similar
restrictions, payment on this Note will be made by a paying agency in the
United States, if such paying agency, under applicable law and regulations,
would be able to make such payment. If this Note is denominated in a
Specified Currency other than U.S. dollars, then, except as provided on the
reverse hereof, payment of the principal of and premium, if any, and
interest on this Note will be made in such Specified Currency either by a
check drawn on a bank outside the United States or, at the option of the
payee and subject to applicable laws and regulations and the procedures of
the Paying Agent, by wire transfer of immediately available funds to an
account maintained by the payee with a bank located outside the United
States.
Reference is hereby made to the further provisions of this
Note set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been
executed by the Trustee referred to on the reverse hereof by manual
signature, this Note shall not be entitled to any benefit under the Senior
Indenture, as defined on the reverse hereof, or be valid or obligatory for
any purpose.
IN WITNESS WHEREOF, the Issuer has caused this Note to be
duly executed.
DATED: MORGAN STANLEY, DEAN WITTER,
DISCOVER & CO.
By:_____________________________
Name:
Title:
TRUSTEE'S CERTIFICATE
OF AUTHENTICATION
This is one of the Notes referred
to in the within-mentioned
Senior Indenture.
THE CHASE MANHATTAN BANK,
as Trustee
By:_____________________________
Authorized Officer
[REVERSE OF SECURITY]
This Note is one of a duly authorized issue of Senior Global
Medium-Term Notes, Series [D/E], having maturities more than nine months
from the date of issue (the "Notes") of the Issuer. The Notes are issuable
under a Senior Indenture, dated as of April 15, 1989, as supplemented by a
First Supplemental Senior Indenture dated as of May 15, 1991 and a Second
Supplemental Senior Indenture dated as of April 15, 1996 between Morgan
Stanley Group Inc. (as predecessor of the Issuer) and The Chase Manhattan
Bank (formerly known as Chemical Bank), as Trustee (the "Trustee," which
term includes any successor trustee under the Senior Indenture) as further
supplemented by a Third Supplemental Senior Indenture dated as of June 1,
1997 between the Issuer and the Trustee (as so supplemented, the "Senior
Indenture"), to which Senior Indenture and all indentures supplemental
thereto reference is hereby made for a statement of the respective rights,
limitations of rights, duties and immunities of the Issuer, the Trustee and
holders of the Notes and the terms upon which the Notes are, and are to be,
authenticated and delivered. The Issuer has appointed The Chase Manhattan
Bank (formerly known as Chemical Bank), London Branch, as its principal
paying agent for the Notes (the "Principal Paying Agent," which term
includes any additional or successor Principal Paying Agent appointed by
the Issuer). The terms of individual Notes may vary with respect to
interest rates, interest rate formulas, issue dates, maturity dates, or
otherwise, all as provided in the Senior Indenture. To the extent not
inconsistent herewith, the terms of the Senior Indenture are hereby
incorporated by reference herein.
If this Note is denominated in pounds sterling, the Issuer
represents that it is not an authorized institution (for purposes of the
United Kingdom Banking Act 1987) nor a European authorized institution as
defined by Regulation 3 of the Banking Co-ordination (Second Council
Directive) Regulations 1992 and repayment of the principal of, and payment
of any interest or premium on, this Note has not been guaranteed, that it
has complied with its obligations under the listing rules of the London
Stock Exchange Limited (the "Rules") and that, since the last publication
in compliance with the Rules of information about it, it, having made all
reasonable inquiries, has not become aware of any change in circumstances
which could reasonably be regarded as significantly and adversely affecting
its ability to meet its obligations in respect of the Notes as they fall
due.
Unless otherwise provided on the face hereof, this Note will
not be subject to any sinking fund and, unless otherwise provided on the
face hereof in accordance with the provisions of the following two
paragraphs and except as set forth below, will not be redeemable or subject
to repayment at the option of the holder prior to maturity.
If so indicated on the face of this Note, this Note may be
redeemed in whole or in part at the option of the Issuer on or after the
Initial Redemption Date specified on the face hereof on the terms set forth
on the face hereof, together with interest accrued and unpaid hereon to the
date of redemption (except as provided below). If this Note is subject to
"Annual Redemption Percentage Reduction," the Initial Redemption Percentage
indicated on the face hereof will be reduced on each anniversary of the
Initial Redemption Date by the Annual Redemption Percentage Reduction
specified on the face hereof until the redemption price of this Note is
100% of the principal amount hereof, together with interest accrued and
unpaid hereon to the date of redemption (except as provided below). Notice
of redemption shall be mailed to the holders of the Notes designated for
redemption who have filed their names and addresses with the Principal
Paying Agent, not less than 30 nor more than 60 days prior to the date
fixed for redemption, subject to all the conditions and provisions of the
Senior Indenture. Notice of redemption to all other holders of Notes shall
be published in the manner set forth in "Notices" as defined below, once in
each of the three successive calendar weeks, the first publication to be
not less than 30 nor more than 60 days prior to the date set for
redemption. In the event of redemption of this Note in part only, the
Principal Paying Agent shall cause Schedule A of this Note to be endorsed
to reflect the reduction of its principal amount by an amount equal to the
aggregate principal amount of this Note so redeemed, whereupon the
principal amount hereof shall be reduced for all purposes by the amount so
redeemed and noted.
If so indicated on the face of this Note, this Note will be
subject to repayment at the option of the holder on the Optional Repayment
Date or Dates specified on the face hereof on the terms set forth herein.
On any Optional Repayment Date, this Note will be repayable in whole or in
part in increments of $1,000 or, if this Note is denominated in a Specified
Currency other than U.S. dollars, in increments of 1,000 units of such
Specified Currency (provided that any remaining principal amount hereof
shall not be less than the minimum authorized denomination hereof) at the
option of the holder hereof at a price equal to 100% of the principal
amount to be repaid, together with interest accrued and unpaid hereon to
the date of repayment (except as provided below). For this Note to be
repaid at the option of the holder hereof, the Principal Paying Agent must
receive at its office in London, at least 15 but not more than 30 days
prior to the date of repayment, this Note with the form entitled "Option to
Elect Repayment" below duly completed. Exercise of such repayment option
by the holder hereof shall be irrevocable. In the event of repayment of
this Note in part only, the Principal Paying Agent shall cause Schedule A
of this Note to be endorsed to reflect the reduction of its principal
amount by an amount equal to the aggregate principal amount of this Note so
repaid, whereupon the principal amount hereof shall be reduced for all
purposes by the amount so repaid and noted.
This Note will bear interest at the rate determined in
accordance with the applicable provisions below by reference to the Base
Rate shown on the face hereof based on the Index Maturity, if any, shown on
the face hereof (i) plus or minus the Spread, if any, or (ii) multiplied by
the Spread Multiplier, if any, specified on the face hereof. Commencing
with the Initial Interest Reset Date specified on the face hereof, the rate
at which interest on this Note is payable shall be reset as of each
Interest Reset Date (as used herein, the term "Interest Reset Date" shall
include the Initial Interest Reset Date). The determination of the rate of
interest at which this Note will be reset on any Interest Reset Date shall
be made on the Interest Determination Date (as defined below) pertaining to
such Interest Reset Date. The Interest Reset Dates will be the Interest
Reset Dates specified on the face hereof; provided, however, that the
interest rate in effect for the period from the Interest Accrual Date to
the Initial Interest Reset Date will be the Initial Interest Rate. 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 day that
is a Business Day, except that if the Base Rate specified on the face
hereof is LIBOR and such Business Day is in the next succeeding calendar
month, such Interest Reset Date shall be the next preceding Business Day.
The Interest Determination Date pertaining to an Interest
Reset Date for Notes bearing interest calculated by reference to the CD
Rate, Commercial Paper Rate, Federal Funds Rate, Prime Rate and CMT Rate
will be the second Business Day next preceding such Interest Reset Date.
The Interest Determination Date pertaining to an Interest Reset Date for
Notes bearing interest calculated by reference to LIBOR shall be the second
London Banking Day preceding such Interest Reset Date except that the
Interest Determination Date pertaining to an Interest Reset Date for a
LIBOR Note for which the Index Currency is pounds sterling will be such
Interest Reset Date. As used herein, "London Banking Day" means any day on
which dealings in deposits in the Index Currency (as defined herein) are
transacted in the London interbank market. The Interest Determination Date
pertaining to an Interest Reset Date for Notes bearing interest calculated
by reference to the Treasury Rate shall be the day of the week in which
such Interest Reset Date falls on which Treasury bills normally would be
auctioned; provided, however, that if as a result of a legal holiday an
auction is held on the Friday of the week preceding such Interest Reset
Date, the related Interest Determination Date shall be such preceding
Friday; and provided, further, that if an auction shall fall on any
Interest Reset Date, then the Interest Reset Date shall instead be the
first Business Day following the date of such auction.
Unless otherwise specified on the face hereof, the
"Calculation Date" pertaining to an Interest Determination Date will be the
earlier of (i) the tenth calendar day after such Interest Determination
Date or, if such day is not a Business Day, the next succeeding Business
Day, or (ii) the Business Day preceding the applicable Interest Payment
Date or Maturity Date (or, with respect to any principal amount to be
redeemed or repaid, any redemption or repayment date), as the case may be.
Determination of CD Rate. If the Base Rate specified on the
face hereof is the CD Rate, the CD Rate with respect to this Note shall be
determined on each Interest Determination Date and shall be the rate on
such date for negotiable certificates of deposit having the Index Maturity
specified on the face hereof as published by the Board of Governors of the
Federal Reserve System in "Statistical Release H.15(519), Selected Interest
Rates," or any successor publication of the Board of Governors of the
Federal Reserve System ("H.15(519)"), under the heading "CDs (Secondary
Market)," or, if not so published by 9:00 a.m., New York City time, on the
Calculation Date pertaining to such Interest Determination Date, the CD
Rate will be the rate on such Interest Determination Date for negotiable
certificates of deposit of the Index Maturity specified on the face hereof
as published by the Federal Reserve Bank of New York in its daily
statistical release "Composite 3:30 p.m. Quotations for U.S. Government
Securities" (the "Composite Quotations") under the heading "Certificates of
Deposit." If such rate is not yet published in either H.15(519) or the
Composite Quotations by 3:00 p.m., New York City time, on such Calculation
Date, then the CD Rate on such Interest Determination Date will be
calculated by the Calculation Agent referred to on the face hereof and will
be the arithmetic mean of the secondary market offered rates as of 10:00
a.m., New York City time, on such Interest Determination Date for
certificates of deposit in an amount that is representative for a single
transaction at that time with a remaining maturity closest to the Index
Maturity specified on the face hereof of three leading nonbank dealers in
negotiable U.S. dollar certificates of deposit in The City of New York
selected by the Calculation Agent for negotiable certificates of deposit of
major United States money center banks; provided, however, that if the
dealers selected as aforesaid by the Calculation Agent are not quoting as
set forth above, the "CD Rate" in effect for the applicable period will be
the same as the CD Rate for the immediately preceding Interest Reset Period
(or, if there was no such Interest Reset Period, the rate of interest
payable hereon shall be the Initial Interest Rate).
Determination of Commercial Paper Rate. If the Base Rate
specified on the face hereof is the Commercial Paper Rate, the Commercial
Paper Rate with respect to this Note shall be determined on each Interest
Determination Date and shall be the Money Market Yield (as defined herein)
of the rate on such date for commercial paper having the Index Maturity
specified on the face hereof, as such rate shall be published in H.15(519)
under the heading "Commercial Paper." In the event that such rate is not
published by 9:00 a.m., New York City time, on the Calculation Date
pertaining to such Interest Determination Date, then the Commercial Paper
Rate shall be the Money Market Yield of the rate on such Interest
Determination Date for commercial paper of the Index Maturity specified on
the face hereof as published in Composite Quotations under the heading
"Commercial Paper." If by 3:00 p.m., New York City time, on such
Calculation Date, such rate is not yet available in either H.15(519) or
Composite Quotations, then the Commercial Paper Rate shall be the Money
Market Yield of the arithmetic mean 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 for commercial paper of the Index Maturity specified on
the face hereof, placed for an industrial issuer whose bond rating is "AA,"
or the equivalent, from a nationally recognized rating agency; provided,
however, that if the dealers selected as aforesaid by the Calculation Agent
are not quoting offered rates as mentioned in this sentence, the
"Commercial Paper Rate" in effect for the applicable period will be the
same as the Commercial Paper Rate for the immediately preceding Interest
Reset Period (or, if there was no such Interest Reset Period, the rate of
interest payable hereon shall be the Initial Interest Rate).
"Money Market Yield" shall be the yield calculated in
accordance with the following formula:
D x 360
Money Market Yield = ------------- 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 Index Maturity specified on the face
hereof.
Determination of Federal Funds Rate. If the Base Rate
specified on the face hereof is the Federal Funds Rate, the Federal Funds Rate
with respect to this Note shall be determined on each Interest Determination
Date and shall be the rate on such date for Federal Funds as published in
H.15(519) under the heading "Federal Funds (Effective)," or, if not so
published by 9:00 a.m., New York City time, on the Calculation Date pertaining
to such Interest Determination Date, the Federal Funds Rate will be the rate
on such Interest Determination Date as published in Composite Quotations under
the heading "Federal Funds/Effective Rate." If such rate is not yet published
in either H.15(519) or the Composite Quotations by 3:00 p.m., New York City
time, on the Calculation Date pertaining to such Interest Determination Date,
the Federal Funds Rate for such Interest Determination Date will be calculated
by the Calculation Agent and will be the arithmetic mean of the rates for the
last transaction in overnight Federal funds as of 11:00 a.m., New York City
time, on such Interest Determination Date, arranged by three leading brokers
in Federal funds transactions in The City of New York selected by the
Calculation Agent; provided, however, that if the brokers selected as
aforesaid by the Calculation Agent are not quoting as set forth above, the
"Federal Funds Rate" in effect for the applicable period will be the same as
the Federal Funds Rate for the immediately preceding Interest Reset Period
(or, if there was no such Interest Reset Period, the rate of interest payable
hereon shall be the Initial Interest Rate).
Determination of LIBOR. If the Base Rate specified on the face
hereof is LIBOR, LIBOR with respect to this Note shall be determined on each
Interest Determination Date as follows:
(i) As of the Interest Determination Date, the Calculation
Agent will determine (a) if "LIBOR Reuters" is specified as the
Reporting Service on the face hereof, the arithmetic mean of the offered
rates (unless the specified Designated LIBOR Page (as defined below) by
its terms provides only for a single rate, in which case such single
rate shall be used) for deposits in the London Interbank Market in the
Index Currency for the period of the Index Maturity specified on the
face hereof, commencing on the second London Banking Day immediately
following such Interest Determination Date, which appear on the
Designated LIBOR Page at approximately 11:00 a.m., London time, on such
Interest Determination Date, if at least two such offered rates appear
(unless, as aforesaid, only a single rate is required) on such
Designated LIBOR Page, or (b) if "LIBOR Telerate" is specified as the
Reporting Service on the face hereof, the rate for deposits in the Index
Currency for the period of the Index Maturity, each as designated on the
face hereof, commencing on the second London Banking Day following such
Interest Determination Date (or, if pounds sterling is the Index
Currency, commencing on such Interest Determination Date), that appears
on the Designated LIBOR Page at approximately 11:00 a.m., London time,
on such Interest Determination Date. If fewer than two offered rates
appear (if "LIBOR Reuters" is specified as the Reporting Service on the
face hereof and calculation of LIBOR is based on the arithmetic mean of
the offered rates) or if no rate appears (if the Reporting Service on
the face hereof specifies either (x) "LIBOR Reuters" and the Designated
LIBOR Page by its terms provides only for a single rate or (y) "LIBOR
Telerate"), LIBOR in respect of that Interest Determination Date will be
determined as if the parties had specified the rate described in (ii)
below.
(ii) With respect to an Interest Determination Date on which
fewer than two offered rates appear (if "LIBOR Reuters" is specified as
the Reporting Service on the face hereof and calculation of LIBOR is
based on the arithmetic mean of the offered rates) or no rate appears
(if the Reporting Service on the face hereof specifies either (x) "LIBOR
Reuters" and the Designated LIBOR Page by its terms provides only for a
single rate or (y) "LIBOR Telerate"), the Calculation Agent will request
the principal London offices of each of four major reference banks in
the London interbank market, as selected by the Calculation Agent (after
consultation with the Issuer), to provide the Calculation Agent with its
offered quotations for deposits in the Index Currency for the period of
the Index Maturity specified on the face hereof, commencing on the
second London Banking Day immediately following such Interest
Determination Date (or, if pounds sterling is the Index Currency,
commencing on such Interest Determination Date), to prime banks in the
London interbank market at approximately 11:00 a.m., London time, on
such Interest Determination Date and in a principal amount equal to an
amount of not less than U.S.$1 million (or the equivalent in the Index
Currency if the Index Currency is not the U.S. dollar) that is
representative of a single transaction in such Index Currency in such
market at such time. If at least two such quotations are provided,
LIBOR determined on such Interest Determination Date will be the
arithmetic mean of such quotations. If fewer than two quotations are
provided, LIBOR determined on such Interest Determination Date will be
the arithmetic mean of rates quoted at approximately 11:00 a.m. (or
such other time specified on the face hereof), in the applicable
principal financial center for the country of the Index Currency on such
Interest Determination Date, by three major banks in such principal
financial center selected by the Calculation Agent (after consultation
with the Issuer) on such Interest Determination Date for loans in the
Index Currency to leading European banks, for the period of the Index
Maturity specified on the face hereof commencing on the second London
Banking Day immediately following such Interest Determination Date (or,
if pounds sterling is the Index Currency, commencing on such Interest
Determination Date) and in a principal amount of not less than U.S.$1
million (or the equivalent in the Index Currency if the Index Currency
is not the U.S. dollar) that is representative of a single transaction
in such Index Currency in such market at such time; provided, however,
that if the banks selected as aforesaid by the Calculation Agent are not
quoting rates as mentioned in this sentence, "LIBOR" for such Interest
Reset Period will be the same as LIBOR for the immediately preceding
Interest Reset Period (or, if there was no such Interest Reset Period,
the rate of interest payable on the LIBOR Notes for which LIBOR is being
determined shall be the Initial Interest Rate). "Index Currency" means
the currency (including composite currencies) specified as Index
Currency on the face hereof. If no such currency is specified as Index
Currency on the face hereof, the Index Currency shall be U.S. dollars.
"Designated LIBOR Page" means either (a) if "LIBOR Reuters" is
designated as the Reporting Service on the face hereof, the display on
the Reuters Monitor Money Rates Service for the purpose of displaying
the London interbank rates of major banks for the applicable Index
Currency, or (b) if "LIBOR Telerate" is designated as the Reporting
Service on the face hereof, the display on the Dow Jones Telerate
Service for the purpose of displaying the London interbank rates of
major banks for the applicable Index Currency. If neither LIBOR Reuters
nor LIBOR Telerate is specified as the Reporting Service on the face
hereof, LIBOR for the applicable Index Currency will be determined as if
LIBOR Telerate (and, if the U.S. dollar is the Index Currency, Page
3750) had been specified.
Determination of Prime Rate. If the Base Rate specified on
the face hereof is the Prime Rate, the Prime Rate with respect to this Note
shall be determined on each Interest Determination Date and shall be the
rate set forth in H.15(519) for such date opposite the caption "Bank Prime
Loan." If such rate is not yet published by 9:00 a.m., New York City time,
on the Calculation Date pertaining to such Interest Determination Date, the
Prime Rate for such Interest Determination Date will be the arithmetic mean
of the rates of interest publicly announced by each bank named on the
Reuters Screen USPRIME1 Page (as defined below) as such bank's prime rate
or base lending rate as in effect for such Interest Determination Date as
quoted on the Reuters Screen USPRIME1 Page on such Interest Determination
Date, or, if fewer than four such rates appear on the Reuters Screen
USPRIME1 Page for such Interest Determination Date, the rate shall be the
arithmetic mean of the prime rates quoted on the basis of the actual number
of days in the year divided by 360 as of the close of business on such
Interest Determination Date by at least two of the three major money center
banks in The City of New York selected by the Calculation Agent from which
quotations are requested. If fewer than two quotations are provided, the
Prime Rate shall be calculated by the Calculation Agent and shall be
determined as the arithmetic mean on the basis of the prime rates in The
City of New York by the appropriate number of substitute banks or trust
companies organized and doing business under the laws of the United States,
or any State thereof, in each case having total equity capital of at least
U.S. $500 million and being subject to supervision or examination by
federal or state authority, selected by the Calculation Agent to quote such
rate or rates; provided, however, that if the banks or trust companies
selected as aforesaid by the Calculation Agent are not quoting rates as set
forth above, the "Prime Rate" in effect for such Interest Reset Period will
be the same as the Prime Rate for the immediately preceding Interest Reset
Period (or, if there was no such Interest Reset Period, the rate of
interest payable hereon shall be the Initial Interest Rate).
"Reuters Screen USPRIME1 Page" means the display designated
as Page "USPRIME1" on the Reuters Monitor Money Rates Service (or such
other page as may replace the USPRIME1 page on that service for the purpose
of displaying prime rates or base lending rates of major United States
banks).
Determination of Treasury Rate. If the Base Rate specified
on the face hereof is the Treasury Rate, the Treasury Rate with respect to
this Note shall be determined on each Interest Determination Date and shall
be the rate for the auction held on such date of direct obligations of the
United States ("Treasury Bills") having the Index Maturity specified on the
face hereof, as published in H.15(519) under the heading "Treasury Bills--
auction average (investment)," or if not so published by 9:00 a.m., New
York City time, on the Calculation Date pertaining to such Interest
Determination Date, the auction average rate on such Interest Determination
Date (expressed as a bond equivalent, on the basis of a year of 365 or 366
days, as applicable, and applied on a daily basis) as otherwise announced
by the United States Department of the Treasury. In the event that the
results of the auction of Treasury Bills having the Index Maturity
specified on the face hereof are not published or reported as provided
above by 3:00 p.m., New York City time, on such Calculation Date or if no
such auction is held on such Interest Determination Date, then the Treasury
Rate shall be calculated by the Calculation Agent and shall be a yield to
maturity (expressed as a bond equivalent, on the basis of a year of 365 or
366 days, as applicable, and applied on a daily basis) calculated using the
arithmetic mean of the secondary market bid rates, as of approximately 3:30
p.m., New York City time, on such Interest Determination Date, of three
leading primary United States government securities dealers selected by the
Calculation Agent for the issue of Treasury Bills with a remaining maturity
closest to the Index Maturity specified on the face hereof; provided,
however, that if the dealers selected as aforesaid by the Calculation Agent
are not quoting bid rates as mentioned in this sentence, the "Treasury
Rate" for such Interest Reset Date will be the same as the Treasury Rate
for the immediately preceding Interest Reset Period (or, if there was no
such Interest Reset Period, the rate of interest payable hereon shall be
the Initial Interest Rate).
Determination of CMT Rate. If the Base Rate specified on
the face hereof is the CMT Rate, the CMT Rate with respect to this Note
shall be determined on each Interest Determination Date and shall be the
rate displayed for the Index Maturity specified on the face hereof on the
Designated CMT Telerate Page (as defined below) under the caption ". .
.Treasury Constant Maturities. . . Federal Reserve Board Release H.15 "
under the column for the Designated CMT Maturity Index (as defined below)
for (i) if the Designated CMT Telerate Page is 7055, the rate on such
Interest Determination Date and (ii) if the Designated CMT Telerate Page is
7052, the week or the month, 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 related Calculation Date, then the CMT
Rate for such Interest Determination Date will be such Treasury Constant
Maturity rate for the Designated CMT Maturity Index as published in the
relevant 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 related Calculation
Date, then the CMT Rate for such Interest Determination Date will be such
Treasury Constant Maturity rate for the Designated CMT Maturity Index (or
other United States Treasury rate for the Designated CMT Maturity Index)
for the Interest Determination Date with respect to the related Interest
Reset Date 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 to be comparable to the rate formerly
displayed on the Designated CMT Telerate Page and published in the relevant
H.15(519). If such information is not provided by 3:00 p.m., New York City
time, on the related Calculation Date, then the CMT Rate for the Interest
Determination Date will be calculated by the Calculation Agent and will be
a yield to maturity, based on the arithmetic mean of the secondary market
closing 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 leading primary United States government
securities dealers (each a "Reference Dealer") in The City of New York
(which may include affiliates of the Issuer or their affiliates) selected
by the Calculation Agent (from five such Reference Dealers selected by the
Calculation Agent, after consultation with the Issuer), and eliminating the
highest quotation (or, in the event of equality, one of the highest) and
the lowest quotation(or, in the event of equality, one of the lowest)), for
the most recently issued direct noncallable fixed rate obligations of the
United States ("Treasury Notes") with an original maturity of approximately
the Designated CMT Maturity Index and remaining term to maturity of not
less than such Designated CMT Maturity Index minus one year. If the
Calculation Agent cannot obtain three such Treasury Notes quotations, the
CMT Rate for such Interest Determination Date will be calculated by the
Calculation Agent and will be a yield to maturity based on the arithmetic
mean of the secondary market offer side prices as of approximately 3:30
p.m., New York City time, on the Interest Determination Date of three
Reference Dealers in The City of New York (from five such Reference Dealers
selected by the Calculation Agent, after consultation with the Issuer, and
eliminating the highest quotation (or, in the event of equality, one of the
highest) and the lowest quotation (or, in the event of equality, one of the
lowest)), for 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 $100,000,000. If three or four (and not five) of
such Reference Dealers are quoting as described above, then the CMT Rate
will be based on the arithmetic mean of the offer prices obtained and
neither the highest not the lowest of such quotes will be eliminated;
provided, however, that if fewer than three Reference Dealers selected by
the Calculation Agent are quoting as described herein, the CMT Rate for
such Interest Reset Date will be the same as the CMT Rate for the
immediately preceding Interest Reset Period (or, if there was no such
Interest Reset Period, the rate of interest payable hereon shall be the
Initial Interest Rate). If two Treasury Notes with an original maturity as
described in the second preceding sentence have remaining terms to maturity
equally close to the Designated CMT Maturity Index, the quotes for the
Treasury Note with the shorter remaining term to maturity will be used.
"Designated CMT Telerate Page" means the display on the Dow
Jones Telerate Service specified 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)), for the purpose of
displaying Treasury Constant Maturities as reported in H.15(519). If no
such page is specified on the face hereof, the Designated CMT Telerate Page
shall be 7052, for the most recent week.
"Designated CMT Maturity Index" shall be 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 specified on the face
hereof, the designated CMT Maturity Index shall be two years.
Notwithstanding the foregoing, the interest rate hereon
shall not be greater than the Maximum Interest Rate, if any, or less than
the Minimum Interest Rate, if any, specified on the face hereof. The
Calculation Agent shall calculate the interest rate hereon in accordance
with the foregoing on or before each Calculation Date. The interest rate
on this Note will in no event be higher than the maximum rate permitted by
New York law, as the same may be modified by United States Federal law of
general application.
At the request of the holder hereof, the Calculation Agent
will provide to the holder hereof the interest rate hereon then in effect
and, if determined, the interest rate that will become effective as of the
next Interest Reset Date.
Interest payments on this Note will include interest accrued
to but excluding the Interest Payment Dates or the Maturity Date (or any
earlier redemption or repayment date), as the case may be. Accrued
interest hereon shall be an amount calculated by multiplying the principal
amount hereof shown on Schedule A hereto by an accrued interest factor.
Such accrued interest factor shall be computed by adding the interest
factor calculated for each day in the period for which interest is being
paid. Unless otherwise specified on the face hereof, the interest factor
for each such date shall be computed by dividing the interest rate
applicable to such day by 360 if the Base Rate is CD Rate, Commercial Paper
Rate, Federal Funds Rate, Prime Rate or LIBOR, as specified on the face
hereof, or by the actual number of days in the year if the Base Rate is the
Treasury Rate or the CMT Rate, as specified on the face hereof. All
percentages resulting from any calculation of the rate of interest on this
Note will be rounded, if necessary, to the nearest one hundred-thousandth
of a percentage point (.0000001), with five one-millionths of a percentage
point rounded upward, and all dollar amounts used in or resulting from such
calculation on this Note will be rounded to the nearest cent (with one-half
cent rounded upward). The interest rate in effect on any Interest Reset
Date will be the applicable rate as reset on such date. The interest rate
applicable to any other day is the interest rate from the immediately
preceding Interest Reset Date (or, if none, the Initial Interest Rate).
This Note and all the obligations of the Issuer hereunder
are direct, unsecured obligations of the Issuer and rank without preference
or priority among themselves and pari passu with all other existing and
future unsecured and unsubordinated indebtedness of the Issuer, subject to
certain statutory exceptions in the event of liquidation upon insolvency.
This Note is issued in permanent global bearer form without
interest coupons attached (a "Global Bearer Note"). The beneficial owner
of all or a portion of this Note may exchange its interest in this Note
upon not less than 30 days' written notice to the Principal Paying Agent
through the relevant clearing system, in whole, for Notes in bearer form
with interest coupons, if any, attached (the "Definitive Bearer Notes,"
and, together with the Global Bearer Notes, the "Bearer Notes") or, if so
indicated on the face of this Note, at the beneficial owner's option, in
whole or from time to time in part, for Notes in fully registered form
without coupons (the "Registered Notes"), in each case, in the minimum
denominations set forth on the face hereof or any amount in excess thereof
which is an integral multiple of 1,000 units of the Specified Currency set
forth on the face hereof. Interests in this Note shall also be exchanged
by the Issuer in whole, but not in part, for Definitive Bearer Notes, which
shall be serially numbered, with coupons, if any, attached or, if indicated
on the face of this Note, at the beneficial owner's option, for Registered
Notes, of any authorized denominations if (i) this Note is accelerated
following an Event of Default or (ii) either Euroclear or Cedel Bank or any
other relevant clearing system is closed for business for a continuous
period of fourteen days (other than by reason of public holidays) or
announces an intention to cease business permanently or in fact does so.
The Issuer shall give notice to the Principal Paying Agent promptly
following any such acceleration or upon learning of any such closure. Any
exchanges referred to above shall be made at the office of the Principal
Paying Agent, or, in the case of Registered Notes, at the office of the
transfer agent for the Registered Notes in London, which transfer agent
will initially be The Chase Manhattan Bank (formerly known as Chemical
Bank), London Branch, upon compliance with any procedures set forth in, or
established pursuant to, the Senior Indenture; provided, however, that the
Issuer shall not be required (i) to exchange this Note for a period of
fifteen calendar days preceding the first publication of a notice of
redemption of all or any portion hereof or (ii) to exchange any portion of
this Note selected for redemption or surrendered for optional repayment,
except that such portion of this Note may be exchanged for a Registered
Note of like tenor; provided that such Registered Note shall be
simultaneously surrendered for redemption or repayment, as the case may be;
and provided, further, that if a Registered Note is issued in exchange for
any portion of this Note after the close of business at the office of the
Principal Paying Agent on any record date (whether or not a Business Day)
for the payment of interest on such Registered Note and before the opening
of business at such office on the relevant Interest Payment Date, any
interest will not be payable on such Interest Payment Date in respect of
such Registered Note, but will be payable on such Interest Payment Date
only to the holder of this Note. Upon exchange of this Note in whole for a
Definitive Bearer Note or Definitive Bearer Notes, or in whole or in part
for a Registered Note or Registered Notes, the Principal Paying Agent shall
cause Schedule A of this Note to be endorsed to reflect the reduction of
the principal amount hereof by an amount equal to the aggregate principal
amount of such Definitive Bearer Note or Definitive Bearer Notes, or such
Registered Note or Registered Notes, whereupon the principal amount hereof
shall be reduced for all purposes by the amount so exchanged and noted.
All such exchanges of Notes will be free of service charge, but the Issuer
may require payment of a sum sufficient to cover any tax or other
governmental charge payable in connection therewith. The date of any Note
delivered upon any exchange of this Note shall be such that no gain or loss
of interest results from such exchange.
All (and not less than all) interests in this Note will be
exchanged for Definitive Bearer Notes in accordance with the procedures set
forth in the following two sentences as soon as practicable after (i) the
first beneficial owner of an interest in this Note exchanges its interest
for a Definitive Bearer Note or (ii) the Issuer gives notice to the
Principal Paying Agent of an acceleration of the Note or the closure of a
relevant clearing system as described above; provided that a common
depositary located outside the United States (the "common depositary")
holding this Note for Morgan Guaranty Trust Company of New York, Brussels
office, as operator of the Euroclear System (the "Euroclear Operator"),
Cedel Bank, societe anonyme ("Cedel") and/or any other relevant clearing
system (including Societe Interprofessionelle pour la Compensation des
Valeurs Mobilieres ("SICOVAM")) instructs the Principal Paying Agent
regarding the aggregate principal amount of Definitive Bearer Notes and the
denominations of such Definitive Bearer Notes that must be authenticated
and delivered to each relevant clearing system in exchange for this Note.
Thereafter, the Principal Paying Agent, acting solely in reliance on such
instructions, shall, upon surrender to it of this Note and subject to the
conditions in the preceding paragraph, authenticate and deliver Definitive
Bearer Notes in exchange for this Note in accordance with such instructions
and shall cause Schedule A of this Note to be endorsed to reflect the
reduction of its principal amount by an amount equal to the aggregate
principal amount of this Note. Nothing in this paragraph shall prevent the
further exchange of Definitive Bearer Notes into Registered Notes.
This Note may be transferred by delivery; provided, however,
that this Note may be transferred only to a common depositary outside the
United States for the Euroclear Operator, Cedel and/or any other relevant
clearing system or to a nominee of such a depositary.
In case this Note shall at any time become mutilated,
defaced or be destroyed, lost or stolen and this Note or evidence of the
loss, theft or destruction thereof (together with the indemnity hereinafter
referred to and such other documents or proof as may be required in the
premises) shall be delivered to the Trustee, a new Note of like tenor will
be issued by the Issuer in exchange for this Note, but, in the case of any
destroyed, lost or stolen Note, only upon receipt of evidence satisfactory
to the Trustee and the Issuer that this Note was destroyed, lost or stolen
and, if required, upon receipt also of indemnity satisfactory to each of
them. All expenses and reasonable charges associated with procuring such
indemnity and with the preparation, authentication and delivery of a new
Note shall be borne by the owner of the Note mutilated, defaced, destroyed,
lost or stolen.
The Senior Indenture provides that, (a) if an Event of
Default (as defined in the Senior Indenture) due to the default in payment
of principal of, premium, if any, or interest on, any series of debt
securities issued under the Senior Indenture, including the series of
Senior Global Medium-Term Notes of which this Note forms a part, or due to
the default in the performance or breach of any other covenant or warranty
of the Issuer applicable to the debt securities of such series but not
applicable to all outstanding debt securities issued under the Senior
Indenture shall have occurred and be continuing, either the Trustee or the
holders of not less than 25% in principal amount of the debt securities of
each affected series (voting as a single class) may then declare the
principal of all debt securities of all such series and interest accrued
thereon to be due and payable immediately and (b) if an Event of Default
due to a default in the performance of any other of the covenants or
agreements in the Senior Indenture applicable to all outstanding debt
securities issued thereunder, including this Note, or due to certain events
of bankruptcy, insolvency and reorganization of the Issuer, shall have
occurred and be continuing, either the Trustee or the holders of not less
than 25% in principal amount of all debt securities issued under the Senior
Indenture then outstanding (treated as one class) may declare the principal
of all such debt securities and interest accrued thereon to be due and
payable immediately, but upon certain conditions such declarations may be
annulled and past defaults may be waived (except a continuing default in
payment of principal (or premium, if any) or interest on such debt
securities) by the holders of a majority in principal amount of the debt
securities of all affected series then outstanding.
This Note may be redeemed, as a whole, at the option of the
Issuer at any time prior to maturity, upon the giving of a notice of
redemption as described below, at a redemption price equal to 100% of the
principal amount hereof, together with accrued interest to the date fixed
for redemption, if the Issuer determines that, as a result of any change in
or amendment to the laws (or any regulations or rulings promulgated
thereunder) of the United States or of any political subdivision or taxing
authority thereof or therein affecting taxation, or any change in official
position regarding the application or interpretation of such laws,
regulations or rulings, which change or amendment becomes effective on or
after the Original Issue Date hereof, the Issuer has or will become
obligated to pay Additional Amounts (as defined below) with respect to this
Note as described below. Prior to the giving of any Notice of redemption
pursuant to this paragraph, the Issuer shall deliver to the Trustee (i) a
certificate stating that the Issuer is entitled to effect such redemption
and setting forth a statement of facts showing that the conditions
precedent to the right of the Issuer to so redeem have occurred, and (ii)
an opinion of independent counsel satisfactory to the Trustee to such
effect based on such statement of facts; provided that no such notice of
redemption shall be given earlier than 60 days prior to the earliest date
on which the Issuer would be obligated to pay such Additional Amounts if a
payment in respect of this Note were then due.
Notice of redemption will be given not less than 30 nor more
than 60 days prior to the date fixed for redemption, which date and the
applicable redemption price will be specified in the Notice.
If the Issuer shall determine that any payment made outside
the United States by the Issuer or any Paying Agent of principal, premium
or interest due in respect of this Note would, under any present or future
laws or regulations of the United States, be subject to any certification,
identification or other information reporting requirement of any kind, the
effect of which is the disclosure to the Issuer, any Paying Agent or any
governmental authority of the nationality, residence or identity of a
beneficial owner of this Note who is a United States Alien (as defined
below) (other than such a requirement (a) that would not be applicable to
a payment made by the Issuer or any Paying Agent (i) directly to the
beneficial owner or (ii) to a custodian, nominee or other agent of the
beneficial owner, or (b) that can be satisfied by such custodian, nominee
or other agent certifying to the effect that such beneficial owner is a
United States Alien; provided that in each case referred to in clauses
(a)(ii) and (b) payment by such custodian, nominee or agent to such
beneficial owner is not otherwise subject to any such requirement), the
Issuer shall redeem this Note, as a whole, at a redemption price equal to
100% of the principal amount thereof, together with accrued interest to the
date fixed for redemption, or, at the election of the Issuer if the
conditions of the next succeeding paragraph are satisfied, pay the
additional amounts specified in such paragraph. The Issuer shall make such
determination and election as soon as practicable, shall promptly notify
the Trustee thereof and shall publish prompt notice thereof (the
"Determination Notice") stating the effective date of such certification,
identification or other information reporting requirements, whether the
Issuer will redeem this Note or has elected to pay the additional amounts
specified in the next succeeding paragraph, and (if applicable) the last
date by which the redemption of this Note must take place, as provided in
the next succeeding sentence. If the Issuer redeems this Note, such
redemption shall take place on such date, not later than one year after the
publication of the Determination Notice, as the Issuer shall elect by
notice to the Trustee at least 60 days prior to the date fixed for
redemption. Notice of such redemption of this Note will be given to the
holder of this Note not more than 60 nor less than 30 days prior to the
date fixed for redemption. Such redemption notice shall include a
statement as to the last date by which this Note to be redeemed may be
exchanged for Registered Notes. Notwithstanding the foregoing, the Issuer
shall not so redeem this Note if the Issuer shall subsequently determine,
not less than 30 days prior to the date fixed for redemption, that
subsequent payments would not be subject to any such certification,
identification or other information reporting requirement, in which case
the Issuer shall publish prompt notice of such determination and any
earlier redemption notice shall be revoked and of no further effect. The
right of the holder of this Note to exchange this Note for Registered Notes
pursuant to the provisions of this paragraph will terminate at the close of
business of the Principal Paying Agent on the fifteenth day prior to the
date fixed for redemption, and no further exchanges of this Note for
Registered Notes shall be permitted.
If and so long as the certification, identification or other
information reporting requirements referred to in the preceding paragraph
would be fully satisfied by payment of a backup withholding tax or similar
charge, the Issuer may elect by notice to the Trustee to pay as additional
amounts such amounts as may be necessary so that every net payment made
outside the United States following the effective date of such requirements
by the Issuer or any Paying Agent of principal, premium or interest due in
respect of this Note of which the beneficial owner is a United States Alien
(but without any requirement that the nationality, residence or identity of
such beneficial owner be disclosed to the Issuer, any Paying Agent or any
governmental authority, with respect to the payment of such additional
amounts), after deduction or withholding for or on account of such backup
withholding tax or similar charge (other than a backup withholding tax or
similar charge that (i) would not be applicable in the circumstances
referred to in the second parenthetical clause of the first sentence of the
preceding paragraph, or (ii) is imposed as a result of presentation of this
Note for payment more than 15 days after the date on which such payment
becomes due and payable or on which payment thereof is duly provided for,
whichever occurs later), will not be less than the amount provided for in
this Note to be then due and payable. In the event the Issuer elects to
pay any additional amounts pursuant to this paragraph, the Issuer shall
have the right to redeem this Note as a whole at any time pursuant to the
applicable provisions of the immediately preceding paragraph and the
redemption price of this Note will not be reduced for applicable
withholding taxes. If the Issuer elects to pay additional amounts pursuant
to this paragraph and the condition specified in the first sentence of this
paragraph should no longer be satisfied, then the Issuer will redeem this
Note as a whole, pursuant to the applicable provisions of the immediately
preceding paragraph.
The Issuer will, subject to certain exceptions and
limitations set forth below, pay such additional amounts (the "Additional
Amounts") to the holder of this Note who is a United States Alien as may be
necessary in order that every net payment of the principal of and interest
on this Note and any other amounts payable on this Note, after withholding
for or on account of any present or future tax, assessment or governmental
charge imposed upon or as a result of such payment by the United States (or
any political subdivision or taxing authority thereof or therein), will not
be less than the amount provided for in this Note to be then due and
payable. The Issuer will not, however, be required to make any payment of
Additional Amounts to any such holder for or on account of:
(a) any such tax, assessment or other governmental charge
that would not have been so imposed but for (i) the existence of any
present or former connection between such holder (or between a
fiduciary, settlor, beneficiary, member or shareholder of such holder,
if such holder is an estate, a trust, a partnership or a corporation)
and the United States, including, without limitation, such holder (or
such fiduciary, settlor, beneficiary, member or shareholder) being or
having been a citizen or resident thereof or being or having been
engaged in a trade or business or present therein or having, or having
had, a permanent establishment therein or (ii) the presentation by the
holder of this Note for payment on a date more than 15 days after the
date on which such payment became due and payable or the date on which
payment thereof is duly provided for, whichever occurs later;
(b) any estate, inheritance, gift, sales, transfer or personal
property tax or any similar tax, assessment or governmental charge;
(c) any tax, assessment or other governmental charge imposed
by reason of such holder's past or present status as a personal holding
company or foreign personal holding company or controlled foreign
corporation or passive foreign investment company with respect to the
United States or as a corporation which accumulates earnings to avoid
United States federal income tax or as a private foundation or other
tax-exempt organization;
(d) any tax, assessment or other governmental charge that is
payable otherwise than by withholding from payments on or in respect of
this Note;
(e) any tax, assessment or other governmental charge
required to be withheld by any Paying Agent from any payment of
principal of, or interest on, this Note, if such payment can be made
without such withholding by any other Paying Agent in a city in Western
Europe;
(f) any tax, assessment or other governmental charge that
would not have been imposed but for the failure to comply with
certification, information or other reporting requirements concerning
the nationality, residence or identity of the holder or beneficial owner
of this Note, if such compliance is required by statute or by regulation
of the United States or of any political subdivision or taxing authority
thereof or therein as a precondition to relief or exemption from such
tax, assessment or other governmental charge;
(g) any tax, assessment or other governmental charge imposed
by reason of such holder's past or present status as the actual or
constructive owner of 10% or more of the total combined voting power of
all classes of stock entitled to vote of the Issuer or as a direct or
indirect subsidiary of the Issuer; or
(h) any combination of items (a), (b), (c), (d), (e), (f) or
(g);
nor shall Additional Amounts be paid with respect to any payment on this
Note to a United States Alien who is a fiduciary or partnership or other
than the sole beneficial owner of such payment to the extent such payment
would be required by the laws of the United States (or any political
subdivision thereof) to be included in the income, for tax purposes, of a
beneficiary or settlor with respect to such fiduciary or a member of such
partnership or a beneficial owner who would not have been entitled to the
Additional Amounts had such beneficiary, settlor, member or beneficial
owner been the holder of this Note.
The Senior Indenture permits the Issuer and the Trustee,
with the consent of the holders of not less than a majority in aggregate
principal amount of the debt securities of all series issued under the
Senior Indenture then outstanding and affected (voting as one class), to
execute supplemental indentures adding any provisions to or changing in any
manner the rights of the holders of each series so affected; provided that
the Issuer and the Trustee may not, without the consent of the holder of
each outstanding debt security affected thereby, (a) extend the final
maturity of any such debt security, or reduce the principal amount thereof,
or reduce the rate or extend the time of payment of interest thereon, or
reduce any amount payable on redemption or repayment thereof, or change the
currency of payment thereof, or impair or affect the rights of any holder
to institute suit for the payment thereof without the consent of the holder
of each debt security so affected; or (b) reduce the aforesaid percentage
in principal amount of debt securities the consent of the holders of which
is required for any such supplemental indenture.
Except as set forth below, if the principal of, premium, if
any, or interest on, this Note is payable in a Specified Currency other
than U.S. dollars and such Specified Currency is not available to the
Issuer for making payments hereon due to the imposition of exchange
controls or other circumstances beyond the control of the Issuer or is no
longer used by the government of the country issuing such currency or for
the settlement of transactions by public institutions within the
international banking community, then the Issuer will be entitled to
satisfy its obligations to the holder of this Note by making such payments
in U.S. dollars on the basis of the Market Exchange Rate (as defined below)
on the date of such payment or, if the Market Exchange Rate is not
available on such date, as of the most recent practicable date; provided,
however, that if such Specified Currency is replaced by a single European
currency (expected to be named the Euro), the payment of principal of,
premium, if any, or interest on any Note denominated in such currency shall
be effected in the new single European currency in conformity with legally
applicable measures taken pursuant to, or by virtue of, the treaty
establishing the European Community (the "EC"), as amended by the treaty on
European Union (as so amended, the "Treaty"). Any payment made under such
circumstances in U.S. dollars (or, if applicable, such new single European
currency) where the required payment is in a Specified Currency other than
U.S. dollars will not constitute an Event of Default.
If the principal of, premium, if any, or interest on, this Note
is payable in ECUs, then with respect to each due date for any such payment on
or after the first business day in Brussels on which the ECU ceases to be used
as the unit of account of the EC and has not become a currency in its own
right, replacing all or some of the currencies of the member states of the EC,
the Issuer shall choose a substitute currency (the "Chosen Currency") which
may be any currency which was, on the last day on which the ECU was used as
the unit of account of the EC, a component currency of the ECU basket or U.S.
dollars, in which all such payments due on or after that date with respect to
this Note shall be made. Notice of the Chosen Currency so selected shall,
where practicable, be published in the manner described in "Notices" below.
The amount of each payment in such Chosen Currency shall be computed on the
basis of the equivalent of the ECU in that currency, determined as described
below, as of the fourth business day in Brussels prior to the date on which
such payment is due.
If the principal of, premium, if any, or interest on, this Note
is payable in ECUs, then on the first business day in Brussels on which the
ECU ceases to be used as the unit of account of the EC, and has not become a
currency in its own right, replacing all or some of the currencies of the
member states of the EC, the Issuer shall choose a Chosen Currency in which
all such payments with respect to this Note having a due date prior thereto
but not yet presented for payment are to be made. The amount of each payment
in such Chosen Currency shall be computed on the basis of the equivalent of
the ECU in that currency, determined as described below, as of such first
business day.
The equivalent of the ECU in the relevant Chosen Currency as of
any date (the "Day of Valuation") shall be determined on the following basis
by, or on behalf of, an Exchange Rate Agent appointed by the Issuer. The
amounts and components composing the ECU for this purpose (the "Components")
shall be the amounts and components composing the ECU as of the last date on
which the ECU was used as the unit of account of the EC. The equivalent of
the ECU in the Chosen Currency shall be calculated by, first, aggregating the
U.S. dollar equivalents of the Components; and then, in the case of a Chosen
Currency other than U.S. dollars, using the rate used for determining the U.S.
dollar equivalent of the Components in the Chosen Currency as set forth below,
calculating the equivalent in the Chosen Currency of such aggregate amount in
U.S. dollars.
The U.S. dollar equivalent of each of the Components shall be
determined by, or on behalf of, the Exchange Rate Agent on the basis of the
middle spot delivery quotations prevailing at 2:30 p.m., Brussels time, on the
Day of Valuation, as obtained by, or on behalf of, the Exchange Rate Agent
from one or more major banks, as selected by the Issuer, in the country of
issue of the component currency in question.
If for any reason no direct quotations are available for a
Component as of a Day of Valuation from any of the banks selected for this
purpose, in computing the U.S. dollar equivalent of such Component, the
Exchange Rate Agent shall (except as provided below) use the most recent
direct quotations for such Component obtained by it or on its behalf;
provided that such quotations were prevailing in the country of issue not
more than two Business Days before such Day of Valuation. If such most
recent quotations were so prevailing in the country of issue more than two
Business Days before such Day of Valuation, the Exchange Rate Agent shall
determine the U.S. dollar equivalent of such Component on the basis of
cross rates derived from the middle spot delivery quotations for such
component currency and for the U.S. dollar prevailing at 2:30 p.m.,
Brussels time, on such Day of Valuation, as obtained by, or on behalf of,
the Exchange Rate Agent from one or more major banks, as selected by the
Issuer, in a country other than the country of issue of such component
currency. Notwithstanding the foregoing, the Exchange Rate Agent shall
determine the U.S. dollar equivalent of such Component on the basis of such
cross rates if the Issuer or such agent judges that the equivalent so
calculated is more representative than the U.S. dollar equivalent
calculated as provided in the first sentence of this paragraph. Unless
otherwise specified by the Issuer, if there is more than one market for
dealing in any component currency by reason of foreign exchange regulations
or for any other reason, the market to be referred to in respect of such
currency shall be that upon which a non-resident issuer of notes
denominated in such currency would purchase such currency in order to make
payments in respect of such securities.
Payments in the Chosen Currency will be made at the specified
office of a paying agent in the country of the Chosen Currency, or, if none,
or at the option of the holder, at the specified office of any Paying Agent
either by a check drawn on, or by transfer to an account maintained by the
holder with, a bank in the principal financial center of the country of the
Chosen Currency; provided that if U.S. dollars is the Chose Currency payments
shall be made in accordance with the provisions for payments in U.S. dollars
on the face hereof.
All determinations referred to above made by, or on behalf of,
the Issuer or by, or on behalf of, the Exchange Rate Agent shall be at such
entity's sole discretion and shall, in the absence of manifest error, be
conclusive for all purposes and binding on holders of this Note.
So long as this Note shall be outstanding, the Issuer will
cause to be maintained an office or agency for the payment of the principal of
and premium, if any, and interest on this Note as herein provided. If this
Note is listed on the London Stock Exchange Limited and such Exchange so
requires, the Issuer shall maintain a Paying Agent in London. The Issuer may
designate other agencies for the payment of said principal, premium and
interest at such place or places outside the United States (subject to
applicable laws and regulations) as the Issuer may decide. So long as there
shall be such an agency, the Issuer shall keep the Trustee advised of the
names and locations of such agencies, if any are so designated.
With respect to moneys paid by the Issuer and held by the
Trustee or any Paying Agent for payment of the principal of or interest or
premium, if any, on any Notes that remain unclaimed at the end of two years
after such principal, interest or premium shall have become due and payable
(whether at maturity or upon call for redemption or otherwise), (i) the
Trustee or such Paying Agent shall notify the holders of such Notes that such
moneys shall be repaid to the Issuer and any person claiming such moneys shall
thereafter look only to the Issuer for payment thereof and (ii) such moneys
shall be so repaid to the Issuer. Upon such repayment all liability of the
Trustee or such Paying Agent with respect to such moneys shall thereupon
cease, without, however, limiting in any way any obligation that the Issuer
may have to pay the principal of or interest or premium, if any, on this Note
as the same shall become due.
No provision of this Note or of the Senior Indenture shall
alter or impair the obligation of the Issuer, which is absolute and
unconditional, to pay the principal of, premium, if any, and interest on this
Note at the time, place, and rate, and in the coin or currency, herein
prescribed unless otherwise agreed between the Issuer and the holder of this
Note.
The Issuer, the Trustee and any agent of the Issuer or the
Trustee may treat the holder of this Note as the owner hereof for all
purposes, whether or not this Note be overdue, and none of the Issuer, the
Trustee or any such agent shall be affected by notice to the contrary.
No recourse shall be had for the payment of the principal of,
premium, if any, or the interest on this Note for any claim based hereon, or
otherwise in respect hereof, or based on or in respect of the Senior Indenture
or any indenture supplemental thereto, against any incorporator, shareholder,
officer or director, as such, past, present or future, of the Issuer or of any
successor corporation, either directly or through the Issuer or any successor
corporation, whether by virtue of any constitution, statute or rule of law or
by the enforcement of any assessment or penalty or otherwise, all such
liability being, by the acceptance hereof and as part of the consideration for
the issue hereof, expressly waived and released.
This Note shall for all purposes be governed by, and construed
in accordance with, the laws of the State of New York.
As used herein:
(a) the term "Business Day" means any day, other than a
Saturday or Sunday, that is neither a legal holiday nor a day on which
banking institutions are authorized or required by law or regulation to
close in The City of New York or in the City of London and (i) if this
Note bears interest calculated by reference to LIBOR, that is also a
London Banking Day, (ii) if this Note is denominated in a Specified
Currency other than U.S. dollars, Australian dollars or ECUs, in the
principal financial center of the country of the Specified Currency,
(iii) if this Note is denominated in Australian dollars, in Sydney and
(iv) if this Note is denominated in ECUs, that is not a non-ECU clearing
day, as determined by the ECU Banking Association in Paris.
(b) the term "Market Exchange Rate" means the noon U.S.
dollar buying rate in The City of New York for wire transfers of the
Specified Currency indicated on the face hereof as certified for customs
purposes by the Federal Reserve Bank of New York;
(c) the term "Notices" refers to notices to the holders of
the Notes to be given by publication in an authorized newspaper in the
English language and of general circulation in the Borough of Manhattan,
The City of New York, and London or, if publication in London is not
practical, in an English language newspaper with general circulation in
Western Europe. Such publication is expected to be made in The Wall
Street Journal and the Financial Times. Such Notices will be deemed to
have been given on the date of such publication, or if published in such
newspapers on different dates, on the date of the first such
publication;
(d) the term "United States" means the United States of America
(including the States and the District of Columbia), its territories, its
possessions and other areas subject to its jurisdiction; and
(e) the term "United States Alien" means any person who, for
United States federal income tax purposes, is a foreign corporation, a
non-resident alien individual, a non-resident alien fiduciary of a
foreign estate or trust, or a foreign partnership, one or more of the
members of which is a foreign corporation, a non-resident alien
individual or a non-resident alien fiduciary of a foreign estate or
trust.
All other terms used in this Note which are defined in the
Senior Indenture and not otherwise defined herein shall have the meanings
assigned to them in the Senior Indenture.
OPTION TO ELECT REPAYMENT
The undersigned hereby irrevocably requests and instructs the
Issuer to repay the within Note (or portion thereof specified below) pursuant
to its terms at a price equal to the principal amount thereof, together with
interest to the Optional Repayment Date, to the undersigned at
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
(Please print or typewrite name and address of the undersigned)
If less than the entire principal amount of the within Note
is to be repaid, specify the portion thereof which the holder elects to
have repaid: _______________________________; and specify the denomination
or denominations (which shall not be less than the minimum authorized
denomination) of the Notes to be issued to the holder for the portion of
the within Note not being repaid (in the absence of any such specification,
one such Note will be issued for the portion not being repaid): ___________.
Dated:___________________________ ___________________________
[SCHEDULE A(5)]
EXCHANGES FOR DEFINITIVE BEARER NOTES, DEFINITIVE
REGISTERED NOTES AND FROM TEMPORARY GLOBAL BEARER NOTE,
REDEMPTIONS AND REPAYMENTS
The initial principal amount of this Note is ______________.
The following (A) exchanges of (i) portions of this Note for Definitive
Bearer Notes or Registered Notes and (ii) portions of a Temporary Global
Bearer Note for an interest in this Note or (B) (x) redemptions at the
option of the Issuer or (y) repayments at the option of the holder have
been made:
[SCHEDULE A-1](6)
PERMANENT GLOBAL BEARER NOTE
SCHEDULE OF EXCHANGES
The initial principal amount of this Note is $__________. The
following (A) exchanges of the principal amount of Notes indicated below for
the same principal amount of Notes to be represented by (i) Definitive Bearer
Notes or (ii) Definitive Registered Notes or [(iii) a Global Bearer Note that
has been separated from a Unit (a "Separated Note")](7), (B) exchanges of the
principal amount of Notes that had been represented by (i) a Temporary Global
Bearer Note [or (ii) a Global Bearer Note that is part of a Unit (an "Attached
Unit Note")](8) for an interest in this Note and (C) reductions of the
principal amount of this Note as a result of (i) cancellation upon the
application of such amount to the settlement of Purchase Contracts or the
exercise of Universal Warrants (ii) redemption at the option of the Issuer or
(iii) repayments at the option of the Holder have been made:
[FORM OF FACE OF SECURITY]
PERMANENT GLOBAL FLOATING RATE SENIOR BEARER NOTE
BEARER BEARER
No. PGFL _________
[COMMERCIAL PAPER ISSUED IN ACCORDANCE WITH REGULATIONS MADE
UNDER SECTION 4 OF THE UNITED KINGDOM BANKING ACT 1987.](1)
------------
(1) Applies only if this Note is denominated in pounds sterling and matures
not more than one year from and including the Original Issue Date.
[A [SHORTER TERM/LONGER TERM] DEBT SECURITY ISSUED IN
ACCORDANCE WITH REGULATIONS MADE UNDER SECTION 4 OF THE UNITED KINGDOM
BANKING ACT 1987.](2)
------------
(2) Applies only if this Note is denominated in pounds sterling and matures
more than one year from and including the Original Issue Date.
ANY UNITED STATES PERSON WHO HOLDS THIS OBLIGATION WILL BE
SUBJECT TO LIMITATIONS UNDER THE UNITED STATES INCOME TAX LAWS, INCLUDING THE
LIMITATIONS PROVIDED IN SECTIONS 165(j) AND 1287(a) OF THE UNITED STATES
INTERNAL REVENUE CODE.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE FOR DEFINITIVE BEARER
NOTES OR IN WHOLE OR IN PART FOR REGISTERED NOTES, THIS GLOBAL NOTE MAY NOT BE
TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY
OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE
DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY
OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY.
IF APPLICABLE, THE "TOTAL AMOUNT OF OID," "ORIGINAL YIELD TO
MATURITY" AND "INITIAL ACCRUAL PERIOD OID" (COMPUTED UNDER THE APPROXIMATE
METHOD) SET FORTH BELOW HAVE BEEN COMPLETED SOLELY FOR THE PURPOSES OF
APPLYING THE FEDERAL INCOME TAX ORIGINAL ISSUE DISCOUNT ("OID") RULES.
THIS NOTE HAS NOT BEEN, AND WILL NOT BE, REGISTERED UNDER THE
SECURITIES AND EXCHANGE LAW OF JAPAN. THIS NOTE MAY NOT BE OFFERED OR SOLD,
DIRECTLY OR INDIRECTLY, IN JAPAN OR TO, OR FOR THE BENEFIT OF, ANY RESIDENT OF
JAPAN (WHICH TERM AS USED HEREIN MEANS ANY PERSON RESIDENT IN JAPAN INCLUDING
ANY CORPORATION OR OTHER ENTITY ORGANIZED UNDER THE LAWS OF JAPAN) OR TO
OTHERS FOR THE RE-OFFERING OR RE-SALE, DIRECTLY OR INDIRECTLY, IN JAPAN OR TO
A RESIDENT OF JAPAN EXCEPT PURSUANT TO AN EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF, AND OTHERWISE IN COMPLIANCE WITH, THE SECURITIES AND EXCHANGE
LAW OF JAPAN AND OTHER RELEVANT LAWS AND REGULATIONS OF JAPAN.
IF THIS NOTE IS DENOMINATED IN JAPANESE YEN, IT SHALL HAVE A
MATURITY OF NOT LESS THAN ONE YEAR AND IT MAY NOT BE OFFERED OR SOLD, DIRECTLY
OR INDIRECTLY, IN JAPAN OR TO, OR FOR THE BENEFIT OF, ANY RESIDENT IN JAPAN
PRIOR TO THE DATE WHICH IS 90 DAYS AFTER THE SETTLEMENT DATE WITH RESPECT TO
THIS NOTE. IF (i) INTEREST PAYMENTS ON THIS NOTE ARE DENOMINATED IN JAPANESE
YEN AND PRINCIPAL PAYMENTS ARE DENOMINATED IN A CURRENCY OR CURRENCY UNIT
OTHER THAN JAPANESE YEN OR (ii) PRINCIPAL PAYMENTS ON THIS NOTE ARE
DENOMINATED IN JAPANESE YEN AND INTEREST PAYMENTS ARE DENOMINATED IN A
CURRENCY OR CURRENCY UNIT OTHER THAN JAPANESE YEN, THIS NOTE MAY NOT BE
OFFERED OR SOLD, DIRECTLY OR INDIRECTLY, IN JAPAN OR TO, OR FOR THE BENEFIT
OF, ANY RESIDENT OF JAPAN PRIOR TO THE DATE WHICH IS 180 DAYS AFTER THE
SETTLEMENT DATE WITH RESPECT TO THIS NOTE.
MORGAN STANLEY, DEAN WITTER, DISCOVER & CO.
SENIOR GLOBAL MEDIUM-TERM NOTE, SERIES [D/E]
(Floating Rate)
Morgan Stanley, Dean Witter, Discover & Co., a Delaware
corporation (together with its successors and assigns, the "Issuer"), for
value received, hereby promises to pay to bearer, upon surrender hereof,
the principal amount specified in [Schedule A hereto](3) [Schedule A-1
hereto](4), on the Maturity Date specified above (except to the extent
previously redeemed or repaid) and to pay interest thereon, from and
including the Interest Accrual Date specified above at a rate per annum
equal to the Initial Interest Rate specified above until the Initial
Interest Reset Date specified above, and on and after at a rate per annum
determined in accordance with the provisions specified on the reverse
hereof until but excluding the date such principal amount is paid or duly
made available for payment. The Issuer will pay interest in arrears
monthly, quarterly, semiannually or annually as specified above as the
Interest Payment Period on each Interest Payment Date (as specified above),
commencing with the first Interest Payment Date next succeeding the
Interest Accrual Date specified above, and on the Maturity Date specified
above (or any redemption or repayment date); provided, however, that if the
Interest Accrual Date occurs fifteen days or less prior to the first
Interest Payment Date occurring after the Interest Accrual Date, interest
payments will commence on the second Interest Payment Date succeeding the
Interest Accrual Date; and provided, further, that if an Interest Payment
Date (other than the Maturity Date or redemption or repayment date) would
fall on a day that is not a Business Day, as defined on the reverse hereof,
such Interest Payment Date shall be the following day that is a Business
Day, except that if the Base Rate specified above is LIBOR and such next
Business Day falls in the next calendar month, such Interest Payment Date
shall be the immediately preceding day that is a Business Day; and
provided, further, that if the Maturity Date or redemption or repayment
date would fall on a day that is not a Business Day, the payment of
principal, premium, if any, and interest shall be made on the next
succeeding Business Day and no interest shall accrue for the period from
and after such Maturity Date or redemption or repayment date.
------------
(3) Applies if this Note is not issued as part of, or in relation to, a
Unit.
(4) Applies if this Note is issued as part of, or in relation to, a Unit.
Interest on this Note will accrue from and including the
most recent Interest Payment Date to which interest has been paid or duly
provided for, or, if no interest has been paid or duly provided for, from
and including the Interest Accrual Date, until but excluding the date the
principal hereof has been paid or duly made available for payment (except
as provided below). The interest so payable, and punctually paid or duly
provided for, on any Interest Payment Date will, subject to certain
exceptions described herein, be paid to the holder of this Note at the
office or agency of the Principal Paying Agent (this and certain other
capitalized terms used herein are defined on the reverse of this Note) or
at the office or agency of such other paying agents outside the United
States as the Issuer may determine for that purpose (each, a "Paying
Agent," which term shall include the Principal Paying Agent).
Payment of the principal of this Note, any premium and the
interest due at maturity (or on any redemption or repayment date) will be
made upon presentation and surrender of this Note at the office or agency
of the Principal Paying Agent or at the office of any Paying Agent.
Payment of the principal of and premium, if any, and
interest on this Note will be made in the Specified Currency indicated
above, except as provided on the reverse hereof. If this Note is
denominated in U.S. dollars, any payment of the principal of, premium, if
any, and interest on this Note will be made in such coin or currency of the
United States of America as at the time of payment is legal tender for
payment of public and private debts. Such payments on this Note will be
made either by a check mailed to an address outside the United States
furnished by the payee or, at the option of the payee and subject to
applicable laws and regulations and the procedures of the Paying Agent, by
wire transfer of immediately available funds to an account maintained by
the payee with a bank located outside the United States if appropriate wire
transfer instructions have been received by the Paying Agent not less than
15 calendar days prior to the applicable payment date. Notwithstanding the
foregoing, in the event that payment in U.S. dollars of the full amount
payable on this Note at the offices of all Paying Agents would be illegal
or effectively precluded as a result of exchange controls or similar
restrictions, payment on this Note will be made by a paying agency in the
United States, if such paying agency, under applicable law and regulations,
would be able to make such payment. If this Note is denominated in a
Specified Currency other than U.S. dollars, then, except as provided on the
reverse hereof, payment of the principal of and premium, if any, and
interest on this Note will be made in such Specified Currency either by a
check drawn on a bank outside the United States or, at the option of the
payee and subject to applicable laws and regulations and the procedures of
the Paying Agent, by wire transfer of immediately available funds to an
account maintained by the payee with a bank located outside the United
States.
Reference is hereby made to the further provisions of this
Note set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been
executed by the Trustee referred to on the reverse hereof by manual
signature, this Note shall not be entitled to any benefit under the Senior
Indenture, as defined on the reverse hereof, or be valid or obligatory for
any purpose.
IN WITNESS WHEREOF, the Issuer has caused this Note to be
duly executed.
DATED: MORGAN STANLEY, DEAN WITTER,
DISCOVER & CO.
By:_____________________________
Name:
Title:
TRUSTEE'S CERTIFICATE
OF AUTHENTICATION
This is one of the Notes referred
to in the within-mentioned
Senior Indenture.
THE CHASE MANHATTAN BANK,
as Trustee
By:_____________________________
Authorized Officer
[REVERSE OF SECURITY]
This Note is one of a duly authorized issue of Senior Global
Medium-Term Notes, Series [D/E], having maturities more than nine months
from the date of issue (the "Notes") of the Issuer. The Notes are issuable
under a Senior Indenture, dated as of April 15, 1989, as supplemented by a
First Supplemental Senior Indenture dated as of May 15, 1991 and a Second
Supplemental Senior Indenture dated as of April 15, 1996 between Morgan
Stanley Group Inc. (as predecessor of the Issuer) and The Chase Manhattan
Bank (formerly known as Chemical Bank), as Trustee (the "Trustee," which
term includes any successor trustee under the Senior Indenture) as further
supplemented by a Third Supplemental Senior Indenture dated as of June 1,
1997 between the Issuer and the Trustee (as so supplemented, the "Senior
Indenture"), to which Senior Indenture and all indentures supplemental
thereto reference is hereby made for a statement of the respective rights,
limitations of rights, duties and immunities of the Issuer, the Trustee and
holders of the Notes and the terms upon which the Notes are, and are to be,
authenticated and delivered. The Issuer has appointed The Chase Manhattan
Bank (formerly known as Chemical Bank), London Branch, as its principal
paying agent for the Notes (the "Principal Paying Agent," which term
includes any additional or successor Principal Paying Agent appointed by
the Issuer). The terms of individual Notes may vary with respect to
interest rates, interest rate formulas, issue dates, maturity dates, or
otherwise, all as provided in the Senior Indenture. To the extent not
inconsistent herewith, the terms of the Senior Indenture are hereby
incorporated by reference herein.
If this Note is denominated in pounds sterling, the Issuer
represents that it is not an authorized institution (for purposes of the
United Kingdom Banking Act 1987) nor a European authorized institution as
defined by Regulation 3 of the Banking Co-ordination (Second Council
Directive) Regulations 1992 and repayment of the principal of, and payment
of any interest or premium on, this Note has not been guaranteed, that it
has complied with its obligations under the listing rules of the London
Stock Exchange Limited (the "Rules") and that, since the last publication
in compliance with the Rules of information about it, it, having made all
reasonable inquiries, has not become aware of any change in circumstances
which could reasonably be regarded as significantly and adversely affecting
its ability to meet its obligations in respect of the Notes as they fall
due.
Unless otherwise provided on the face hereof, this Note will
not be subject to any sinking fund and, unless otherwise provided on the
face hereof in accordance with the provisions of the following two
paragraphs and except as set forth below, will not be redeemable or subject
to repayment at the option of the holder prior to maturity.
If so indicated on the face of this Note, this Note may be
redeemed in whole or in part at the option of the Issuer on or after the
Initial Redemption Date specified on the face hereof on the terms set forth
on the face hereof, together with interest accrued and unpaid hereon to the
date of redemption (except as provided below). If this Note is subject to
"Annual Redemption Percentage Reduction," the Initial Redemption Percentage
indicated on the face hereof will be reduced on each anniversary of the
Initial Redemption Date by the Annual Redemption Percentage Reduction
specified on the face hereof until the redemption price of this Note is
100% of the principal amount hereof, together with interest accrued and
unpaid hereon to the date of redemption (except as provided below). Notice
of redemption shall be mailed to the holders of the Notes designated for
redemption who have filed their names and addresses with the Principal
Paying Agent, not less than 30 nor more than 60 days prior to the date
fixed for redemption, subject to all the conditions and provisions of the
Senior Indenture. Notice of redemption to all other holders of Notes shall
be published in the manner set forth in "Notices" as defined below, once in
each of the three successive calendar weeks, the first publication to be
not less than 30 nor more than 60 days prior to the date set for
redemption. In the event of redemption of this Note in part only, the
Principal Paying Agent shall cause Schedule A of this Note to be endorsed
to reflect the reduction of its principal amount by an amount equal to the
aggregate principal amount of this Note so redeemed, whereupon the
principal amount hereof shall be reduced for all purposes by the amount so
redeemed and noted.
If so indicated on the face of this Note, this Note will be
subject to repayment at the option of the holder on the Optional Repayment
Date or Dates specified on the face hereof on the terms set forth herein.
On any Optional Repayment Date, this Note will be repayable in whole or in
part in increments of $1,000 or, if this Note is denominated in a Specified
Currency other than U.S. dollars, in increments of 1,000 units of such
Specified Currency (provided that any remaining principal amount hereof
shall not be less than the minimum authorized denomination hereof) at the
option of the holder hereof at a price equal to 100% of the principal
amount to be repaid, together with interest accrued and unpaid hereon to
the date of repayment (except as provided below). For this Note to be
repaid at the option of the holder hereof, the Principal Paying Agent must
receive at its office in London, at least 15 but not more than 30 days
prior to the date of repayment, this Note with the form entitled "Option to
Elect Repayment" below duly completed. Exercise of such repayment option
by the holder hereof shall be irrevocable. In the event of repayment of
this Note in part only, the Principal Paying Agent shall cause Schedule A
of this Note to be endorsed to reflect the reduction of its principal
amount by an amount equal to the aggregate principal amount of this Note so
repaid, whereupon the principal amount hereof shall be reduced for all
purposes by the amount so repaid and noted.
This Note will bear interest at the rate determined in
accordance with the applicable provisions below by reference to the Base
Rate shown on the face hereof based on the Index Maturity, if any, shown on
the face hereof (i) plus or minus the Spread, if any, or (ii) multiplied by
the Spread Multiplier, if any, specified on the face hereof. Commencing
with the Initial Interest Reset Date specified on the face hereof, the rate
at which interest on this Note is payable shall be reset as of each
Interest Reset Date (as used herein, the term "Interest Reset Date" shall
include the Initial Interest Reset Date). The determination of the rate of
interest at which this Note will be reset on any Interest Reset Date shall
be made on the Interest Determination Date (as defined below) pertaining to
such Interest Reset Date. The Interest Reset Dates will be the Interest
Reset Dates specified on the face hereof; provided, however, that the
interest rate in effect for the period from the Interest Accrual Date to
the Initial Interest Reset Date will be the Initial Interest Rate. 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 day that
is a Business Day, except that if the Base Rate specified on the face
hereof is LIBOR and such Business Day is in the next succeeding calendar
month, such Interest Reset Date shall be the next preceding Business Day.
The Interest Determination Date pertaining to an Interest
Reset Date for Notes bearing interest calculated by reference to the CD
Rate, Commercial Paper Rate, Federal Funds Rate, Prime Rate and CMT Rate
will be the second Business Day next preceding such Interest Reset Date.
The Interest Determination Date pertaining to an Interest Reset Date for
Notes bearing interest calculated by reference to LIBOR shall be the second
London Banking Day preceding such Interest Reset Date except that the
Interest Determination Date pertaining to an Interest Reset Date for a
LIBOR Note for which the Index Currency is pounds sterling will be such
Interest Reset Date. As used herein, "London Banking Day" means any day on
which dealings in deposits in the Index Currency (as defined herein) are
transacted in the London interbank market. The Interest Determination Date
pertaining to an Interest Reset Date for Notes bearing interest calculated
by reference to the Treasury Rate shall be the day of the week in which
such Interest Reset Date falls on which Treasury bills normally would be
auctioned; provided, however, that if as a result of a legal holiday an
auction is held on the Friday of the week preceding such Interest Reset
Date, the related Interest Determination Date shall be such preceding
Friday; and provided, further, that if an auction shall fall on any
Interest Reset Date, then the Interest Reset Date shall instead be the
first Business Day following the date of such auction.
Unless otherwise specified on the face hereof, the
"Calculation Date" pertaining to an Interest Determination Date will be the
earlier of (i) the tenth calendar day after such Interest Determination
Date or, if such day is not a Business Day, the next succeeding Business
Day, or (ii) the Business Day preceding the applicable Interest Payment
Date or Maturity Date (or, with respect to any principal amount to be
redeemed or repaid, any redemption or repayment date), as the case may be.
Determination of CD Rate. If the Base Rate specified on the
face hereof is the CD Rate, the CD Rate with respect to this Note shall be
determined on each Interest Determination Date and shall be the rate on
such date for negotiable certificates of deposit having the Index Maturity
specified on the face hereof as published by the Board of Governors of the
Federal Reserve System in "Statistical Release H.15(519), Selected Interest
Rates," or any successor publication of the Board of Governors of the
Federal Reserve System ("H.15(519)"), under the heading "CDs (Secondary
Market)," or, if not so published by 9:00 a.m., New York City time, on the
Calculation Date pertaining to such Interest Determination Date, the CD
Rate will be the rate on such Interest Determination Date for negotiable
certificates of deposit of the Index Maturity specified on the face hereof
as published by the Federal Reserve Bank of New York in its daily
statistical release "Composite 3:30 p.m. Quotations for U.S. Government
Securities" (the "Composite Quotations") under the heading "Certificates of
Deposit." If such rate is not yet published in either H.15(519) or the
Composite Quotations by 3:00 p.m., New York City time, on such Calculation
Date, then the CD Rate on such Interest Determination Date will be
calculated by the Calculation Agent referred to on the face hereof and will
be the arithmetic mean of the secondary market offered rates as of 10:00
a.m., New York City time, on such Interest Determination Date for
certificates of deposit in an amount that is representative for a single
transaction at that time with a remaining maturity closest to the Index
Maturity specified on the face hereof of three leading nonbank dealers in
negotiable U.S. dollar certificates of deposit in The City of New York
selected by the Calculation Agent for negotiable certificates of deposit of
major United States money center banks; provided, however, that if the
dealers selected as aforesaid by the Calculation Agent are not quoting as
set forth above, the "CD Rate" in effect for the applicable period will be
the same as the CD Rate for the immediately preceding Interest Reset Period
(or, if there was no such Interest Reset Period, the rate of interest
payable hereon shall be the Initial Interest Rate).
Determination of Commercial Paper Rate. If the Base Rate
specified on the face hereof is the Commercial Paper Rate, the Commercial
Paper Rate with respect to this Note shall be determined on each Interest
Determination Date and shall be the Money Market Yield (as defined herein)
of the rate on such date for commercial paper having the Index Maturity
specified on the face hereof, as such rate shall be published in H.15(519)
under the heading "Commercial Paper." In the event that such rate is not
published by 9:00 a.m., New York City time, on the Calculation Date
pertaining to such Interest Determination Date, then the Commercial Paper
Rate shall be the Money Market Yield of the rate on such Interest
Determination Date for commercial paper of the Index Maturity specified on
the face hereof as published in Composite Quotations under the heading
"Commercial Paper." If by 3:00 p.m., New York City time, on such
Calculation Date, such rate is not yet available in either H.15(519) or
Composite Quotations, then the Commercial Paper Rate shall be the Money
Market Yield of the arithmetic mean 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 for commercial paper of the Index Maturity specified on
the face hereof, placed for an industrial issuer whose bond rating is "AA,"
or the equivalent, from a nationally recognized rating agency; provided,
however, that if the dealers selected as aforesaid by the Calculation Agent
are not quoting offered rates as mentioned in this sentence, the
"Commercial Paper Rate" in effect for the applicable period will be the
same as the Commercial Paper Rate for the immediately preceding Interest
Reset Period (or, if there was no such Interest Reset Period, the rate of
interest payable hereon shall be the Initial Interest Rate).
"Money Market Yield" shall be the yield calculated in
accordance with the following formula:
D x 360
Money Market Yield = ------------- 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 Index Maturity specified on the face
hereof.
Determination of Federal Funds Rate. If the Base Rate
specified on the face hereof is the Federal Funds Rate, the Federal Funds Rate
with respect to this Note shall be determined on each Interest Determination
Date and shall be the rate on such date for Federal Funds as published in
H.15(519) under the heading "Federal Funds (Effective)," or, if not so
published by 9:00 a.m., New York City time, on the Calculation Date pertaining
to such Interest Determination Date, the Federal Funds Rate will be the rate
on such Interest Determination Date as published in Composite Quotations under
the heading "Federal Funds/Effective Rate." If such rate is not yet published
in either H.15(519) or the Composite Quotations by 3:00 p.m., New York City
time, on the Calculation Date pertaining to such Interest Determination Date,
the Federal Funds Rate for such Interest Determination Date will be calculated
by the Calculation Agent and will be the arithmetic mean of the rates for the
last transaction in overnight Federal funds as of 11:00 a.m., New York City
time, on such Interest Determination Date, arranged by three leading brokers
in Federal funds transactions in The City of New York selected by the
Calculation Agent; provided, however, that if the brokers selected as
aforesaid by the Calculation Agent are not quoting as set forth above, the
"Federal Funds Rate" in effect for the applicable period will be the same as
the Federal Funds Rate for the immediately preceding Interest Reset Period
(or, if there was no such Interest Reset Period, the rate of interest payable
hereon shall be the Initial Interest Rate).
Determination of LIBOR. If the Base Rate specified on the face
hereof is LIBOR, LIBOR with respect to this Note shall be determined on each
Interest Determination Date as follows:
(i) As of the Interest Determination Date, the Calculation
Agent will determine (a) if "LIBOR Reuters" is specified as the
Reporting Service on the face hereof, the arithmetic mean of the offered
rates (unless the specified Designated LIBOR Page (as defined below) by
its terms provides only for a single rate, in which case such single
rate shall be used) for deposits in the London Interbank Market in the
Index Currency for the period of the Index Maturity specified on the
face hereof, commencing on the second London Banking Day immediately
following such Interest Determination Date, which appear on the
Designated LIBOR Page at approximately 11:00 a.m., London time, on such
Interest Determination Date, if at least two such offered rates appear
(unless, as aforesaid, only a single rate is required) on such
Designated LIBOR Page, or (b) if "LIBOR Telerate" is specified as the
Reporting Service on the face hereof, the rate for deposits in the Index
Currency for the period of the Index Maturity, each as designated on the
face hereof, commencing on the second London Banking Day following such
Interest Determination Date (or, if pounds sterling is the Index
Currency, commencing on such Interest Determination Date), that appears
on the Designated LIBOR Page at approximately 11:00 a.m., London time,
on such Interest Determination Date. If fewer than two offered rates
appear (if "LIBOR Reuters" is specified as the Reporting Service on the
face hereof and calculation of LIBOR is based on the arithmetic mean of
the offered rates) or if no rate appears (if the Reporting Service on
the face hereof specifies either (x) "LIBOR Reuters" and the Designated
LIBOR Page by its terms provides only for a single rate or (y) "LIBOR
Telerate"), LIBOR in respect of that Interest Determination Date will be
determined as if the parties had specified the rate described in (ii)
below.
(ii) With respect to an Interest Determination Date on which
fewer than two offered rates appear (if "LIBOR Reuters" is specified as
the Reporting Service on the face hereof and calculation of LIBOR is
based on the arithmetic mean of the offered rates) or no rate appears
(if the Reporting Service on the face hereof specifies either (x) "LIBOR
Reuters" and the Designated LIBOR Page by its terms provides only for a
single rate or (y) "LIBOR Telerate"), the Calculation Agent will request
the principal London offices of each of four major reference banks in
the London interbank market, as selected by the Calculation Agent (after
consultation with the Issuer), to provide the Calculation Agent with its
offered quotations for deposits in the Index Currency for the period of
the Index Maturity specified on the face hereof, commencing on the
second London Banking Day immediately following such Interest
Determination Date (or, if pounds sterling is the Index Currency,
commencing on such Interest Determination Date), to prime banks in the
London interbank market at approximately 11:00 a.m., London time, on
such Interest Determination Date and in a principal amount equal to an
amount of not less than U.S.$1 million (or the equivalent in the Index
Currency if the Index Currency is not the U.S. dollar) that is
representative of a single transaction in such Index Currency in such
market at such time. If at least two such quotations are provided,
LIBOR determined on such Interest Determination Date will be the
arithmetic mean of such quotations. If fewer than two quotations are
provided, LIBOR determined on such Interest Determination Date will be
the arithmetic mean of rates quoted at approximately 11:00 a.m. (or
such other time specified on the face hereof), in the applicable
principal financial center for the country of the Index Currency on such
Interest Determination Date, by three major banks in such principal
financial center selected by the Calculation Agent (after consultation
with the Issuer) on such Interest Determination Date for loans in the
Index Currency to leading European banks, for the period of the Index
Maturity specified on the face hereof commencing on the second London
Banking Day immediately following such Interest Determination Date (or,
if pounds sterling is the Index Currency, commencing on such Interest
Determination Date) and in a principal amount of not less than U.S.$1
million (or the equivalent in the Index Currency if the Index Currency
is not the U.S. dollar) that is representative of a single transaction
in such Index Currency in such market at such time; provided, however,
that if the banks selected as aforesaid by the Calculation Agent are not
quoting rates as mentioned in this sentence, "LIBOR" for such Interest
Reset Period will be the same as LIBOR for the immediately preceding
Interest Reset Period (or, if there was no such Interest Reset Period,
the rate of interest payable on the LIBOR Notes for which LIBOR is being
determined shall be the Initial Interest Rate). "Index Currency" means
the currency (including composite currencies) specified as Index
Currency on the face hereof. If no such currency is specified as Index
Currency on the face hereof, the Index Currency shall be U.S. dollars.
"Designated LIBOR Page" means either (a) if "LIBOR Reuters" is
designated as the Reporting Service on the face hereof, the display on
the Reuters Monitor Money Rates Service for the purpose of displaying
the London interbank rates of major banks for the applicable Index
Currency, or (b) if "LIBOR Telerate" is designated as the Reporting
Service on the face hereof, the display on the Dow Jones Telerate
Service for the purpose of displaying the London interbank rates of
major banks for the applicable Index Currency. If neither LIBOR Reuters
nor LIBOR Telerate is specified as the Reporting Service on the face
hereof, LIBOR for the applicable Index Currency will be determined as if
LIBOR Telerate (and, if the U.S. dollar is the Index Currency, Page
3750) had been specified.
Determination of Prime Rate. If the Base Rate specified on
the face hereof is the Prime Rate, the Prime Rate with respect to this Note
shall be determined on each Interest Determination Date and shall be the
rate set forth in H.15(519) for such date opposite the caption "Bank Prime
Loan." If such rate is not yet published by 9:00 a.m., New York City time,
on the Calculation Date pertaining to such Interest Determination Date, the
Prime Rate for such Interest Determination Date will be the arithmetic mean
of the rates of interest publicly announced by each bank named on the
Reuters Screen USPRIME1 Page (as defined below) as such bank's prime rate
or base lending rate as in effect for such Interest Determination Date as
quoted on the Reuters Screen USPRIME1 Page on such Interest Determination
Date, or, if fewer than four such rates appear on the Reuters Screen
USPRIME1 Page for such Interest Determination Date, the rate shall be the
arithmetic mean of the prime rates quoted on the basis of the actual number
of days in the year divided by 360 as of the close of business on such
Interest Determination Date by at least two of the three major money center
banks in The City of New York selected by the Calculation Agent from which
quotations are requested. If fewer than two quotations are provided, the
Prime Rate shall be calculated by the Calculation Agent and shall be
determined as the arithmetic mean on the basis of the prime rates in The
City of New York by the appropriate number of substitute banks or trust
companies organized and doing business under the laws of the United States,
or any State thereof, in each case having total equity capital of at least
U.S. $500 million and being subject to supervision or examination by
federal or state authority, selected by the Calculation Agent to quote such
rate or rates; provided, however, that if the banks or trust companies
selected as aforesaid by the Calculation Agent are not quoting rates as set
forth above, the "Prime Rate" in effect for such Interest Reset Period will
be the same as the Prime Rate for the immediately preceding Interest Reset
Period (or, if there was no such Interest Reset Period, the rate of
interest payable hereon shall be the Initial Interest Rate).
"Reuters Screen USPRIME1 Page" means the display designated
as Page "USPRIME1" on the Reuters Monitor Money Rates Service (or such
other page as may replace the USPRIME1 page on that service for the purpose
of displaying prime rates or base lending rates of major United States
banks).
Determination of Treasury Rate. If the Base Rate specified
on the face hereof is the Treasury Rate, the Treasury Rate with respect to
this Note shall be determined on each Interest Determination Date and shall
be the rate for the auction held on such date of direct obligations of the
United States ("Treasury Bills") having the Index Maturity specified on the
face hereof, as published in H.15(519) under the heading "Treasury Bills--
auction average (investment)," or if not so published by 9:00 a.m., New
York City time, on the Calculation Date pertaining to such Interest
Determination Date, the auction average rate on such Interest Determination
Date (expressed as a bond equivalent, on the basis of a year of 365 or 366
days, as applicable, and applied on a daily basis) as otherwise announced
by the United States Department of the Treasury. In the event that the
results of the auction of Treasury Bills having the Index Maturity
specified on the face hereof are not published or reported as provided
above by 3:00 p.m., New York City time, on such Calculation Date or if no
such auction is held on such Interest Determination Date, then the Treasury
Rate shall be calculated by the Calculation Agent and shall be a yield to
maturity (expressed as a bond equivalent, on the basis of a year of 365 or
366 days, as applicable, and applied on a daily basis) calculated using the
arithmetic mean of the secondary market bid rates, as of approximately 3:30
p.m., New York City time, on such Interest Determination Date, of three
leading primary United States government securities dealers selected by the
Calculation Agent for the issue of Treasury Bills with a remaining maturity
closest to the Index Maturity specified on the face hereof; provided,
however, that if the dealers selected as aforesaid by the Calculation Agent
are not quoting bid rates as mentioned in this sentence, the "Treasury
Rate" for such Interest Reset Date will be the same as the Treasury Rate
for the immediately preceding Interest Reset Period (or, if there was no
such Interest Reset Period, the rate of interest payable hereon shall be
the Initial Interest Rate).
Determination of CMT Rate. If the Base Rate specified on
the face hereof is the CMT Rate, the CMT Rate with respect to this Note
shall be determined on each Interest Determination Date and shall be the
rate displayed for the Index Maturity specified on the face hereof on the
Designated CMT Telerate Page (as defined below) under the caption ". .
.Treasury Constant Maturities. . . Federal Reserve Board Release H.15 "
under the column for the Designated CMT Maturity Index (as defined below)
for (i) if the Designated CMT Telerate Page is 7055, the rate on such
Interest Determination Date and (ii) if the Designated CMT Telerate Page is
7052, the week or the month, 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 related Calculation Date, then the CMT
Rate for such Interest Determination Date will be such Treasury Constant
Maturity rate for the Designated CMT Maturity Index as published in the
relevant 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 related Calculation
Date, then the CMT Rate for such Interest Determination Date will be such
Treasury Constant Maturity rate for the Designated CMT Maturity Index (or
other United States Treasury rate for the Designated CMT Maturity Index)
for the Interest Determination Date with respect to the related Interest
Reset Date 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 to be comparable to the rate formerly
displayed on the Designated CMT Telerate Page and published in the relevant
H.15(519). If such information is not provided by 3:00 p.m., New York City
time, on the related Calculation Date, then the CMT Rate for the Interest
Determination Date will be calculated by the Calculation Agent and will be
a yield to maturity, based on the arithmetic mean of the secondary market
closing 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 leading primary United States government
securities dealers (each a "Reference Dealer") in The City of New York
(which may include affiliates of the Issuer or their affiliates) selected
by the Calculation Agent (from five such Reference Dealers selected by the
Calculation Agent, after consultation with the Issuer), and eliminating the
highest quotation (or, in the event of equality, one of the highest) and
the lowest quotation(or, in the event of equality, one of the lowest)), for
the most recently issued direct noncallable fixed rate obligations of the
United States ("Treasury Notes") with an original maturity of approximately
the Designated CMT Maturity Index and remaining term to maturity of not
less than such Designated CMT Maturity Index minus one year. If the
Calculation Agent cannot obtain three such Treasury Notes quotations, the
CMT Rate for such Interest Determination Date will be calculated by the
Calculation Agent and will be a yield to maturity based on the arithmetic
mean of the secondary market offer side prices as of approximately 3:30
p.m., New York City time, on the Interest Determination Date of three
Reference Dealers in The City of New York (from five such Reference Dealers
selected by the Calculation Agent, after consultation with the Issuer, and
eliminating the highest quotation (or, in the event of equality, one of the
highest) and the lowest quotation (or, in the event of equality, one of the
lowest)), for 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 $100,000,000. If three or four (and not five) of
such Reference Dealers are quoting as described above, then the CMT Rate
will be based on the arithmetic mean of the offer prices obtained and
neither the highest not the lowest of such quotes will be eliminated;
provided, however, that if fewer than three Reference Dealers selected by
the Calculation Agent are quoting as described herein, the CMT Rate for
such Interest Reset Date will be the same as the CMT Rate for the
immediately preceding Interest Reset Period (or, if there was no such
Interest Reset Period, the rate of interest payable hereon shall be the
Initial Interest Rate). If two Treasury Notes with an original maturity as
described in the second preceding sentence have remaining terms to maturity
equally close to the Designated CMT Maturity Index, the quotes for the
Treasury Note with the shorter remaining term to maturity will be used.
"Designated CMT Telerate Page" means the display on the Dow
Jones Telerate Service specified 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)), for the purpose of
displaying Treasury Constant Maturities as reported in H.15(519). If no
such page is specified on the face hereof, the Designated CMT Telerate Page
shall be 7052, for the most recent week.
"Designated CMT Maturity Index" shall be 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 specified on the face
hereof, the designated CMT Maturity Index shall be two years.
Notwithstanding the foregoing, the interest rate hereon
shall not be greater than the Maximum Interest Rate, if any, or less than
the Minimum Interest Rate, if any, specified on the face hereof. The
Calculation Agent shall calculate the interest rate hereon in accordance
with the foregoing on or before each Calculation Date. The interest rate
on this Note will in no event be higher than the maximum rate permitted by
New York law, as the same may be modified by United States Federal law of
general application.
At the request of the holder hereof, the Calculation Agent
will provide to the holder hereof the interest rate hereon then in effect
and, if determined, the interest rate that will become effective as of the
next Interest Reset Date.
Interest payments on this Note will include interest accrued
to but excluding the Interest Payment Dates or the Maturity Date (or any
earlier redemption or repayment date), as the case may be. Accrued
interest hereon shall be an amount calculated by multiplying the principal
amount hereof shown on Schedule A hereto by an accrued interest factor.
Such accrued interest factor shall be computed by adding the interest
factor calculated for each day in the period for which interest is being
paid. Unless otherwise specified on the face hereof, the interest factor
for each such date shall be computed by dividing the interest rate
applicable to such day by 360 if the Base Rate is CD Rate, Commercial Paper
Rate, Federal Funds Rate, Prime Rate or LIBOR, as specified on the face
hereof, or by the actual number of days in the year if the Base Rate is the
Treasury Rate or the CMT Rate, as specified on the face hereof. All
percentages resulting from any calculation of the rate of interest on this
Note will be rounded, if necessary, to the nearest one hundred-thousandth
of a percentage point (.0000001), with five one-millionths of a percentage
point rounded upward, and all dollar amounts used in or resulting from such
calculation on this Note will be rounded to the nearest cent (with one-half
cent rounded upward). The interest rate in effect on any Interest Reset
Date will be the applicable rate as reset on such date. The interest rate
applicable to any other day is the interest rate from the immediately
preceding Interest Reset Date (or, if none, the Initial Interest Rate).
This Note and all the obligations of the Issuer hereunder
are direct, unsecured obligations of the Issuer and rank without preference
or priority among themselves and pari passu with all other existing and
future unsecured and unsubordinated indebtedness of the Issuer, subject to
certain statutory exceptions in the event of liquidation upon insolvency.
This Note is issued in permanent global bearer form without
interest coupons attached (a "Global Bearer Note"). The beneficial owner
of all or a portion of this Note may exchange its interest in this Note
upon not less than 30 days' written notice to the Principal Paying Agent
through the relevant clearing system, in whole, for Notes in bearer form
with interest coupons, if any, attached (the "Definitive Bearer Notes,"
and, together with the Global Bearer Notes, the "Bearer Notes") or, if so
indicated on the face of this Note, at the beneficial owner's option, in
whole or from time to time in part, for Notes in fully registered form
without coupons (the "Registered Notes"), in each case, in the minimum
denominations set forth on the face hereof or any amount in excess thereof
which is an integral multiple of 1,000 units of the Specified Currency set
forth on the face hereof. Interests in this Note shall also be exchanged
by the Issuer in whole, but not in part, for Definitive Bearer Notes, which
shall be serially numbered, with coupons, if any, attached or, if indicated
on the face of this Note, at the beneficial owner's option, for Registered
Notes, of any authorized denominations if (i) this Note is accelerated
following an Event of Default or (ii) either Euroclear or Cedel Bank or any
other relevant clearing system is closed for business for a continuous
period of fourteen days (other than by reason of public holidays) or
announces an intention to cease business permanently or in fact does so.
The Issuer shall give notice to the Principal Paying Agent promptly
following any such acceleration or upon learning of any such closure. Any
exchanges referred to above shall be made at the office of the Principal
Paying Agent, or, in the case of Registered Notes, at the office of the
transfer agent for the Registered Notes in London, which transfer agent
will initially be The Chase Manhattan Bank (formerly known as Chemical
Bank), London Branch, upon compliance with any procedures set forth in, or
established pursuant to, the Senior Indenture; provided, however, that the
Issuer shall not be required (i) to exchange this Note for a period of
fifteen calendar days preceding the first publication of a notice of
redemption of all or any portion hereof or (ii) to exchange any portion of
this Note selected for redemption or surrendered for optional repayment,
except that such portion of this Note may be exchanged for a Registered
Note of like tenor; provided that such Registered Note shall be
simultaneously surrendered for redemption or repayment, as the case may be;
and provided, further, that if a Registered Note is issued in exchange for
any portion of this Note after the close of business at the office of the
Principal Paying Agent on any record date (whether or not a Business Day)
for the payment of interest on such Registered Note and before the opening
of business at such office on the relevant Interest Payment Date, any
interest will not be payable on such Interest Payment Date in respect of
such Registered Note, but will be payable on such Interest Payment Date
only to the holder of this Note. Upon exchange of this Note in whole for a
Definitive Bearer Note or Definitive Bearer Notes, or in whole or in part
for a Registered Note or Registered Notes, the Principal Paying Agent shall
cause Schedule A of this Note to be endorsed to reflect the reduction of
the principal amount hereof by an amount equal to the aggregate principal
amount of such Definitive Bearer Note or Definitive Bearer Notes, or such
Registered Note or Registered Notes, whereupon the principal amount hereof
shall be reduced for all purposes by the amount so exchanged and noted.
All such exchanges of Notes will be free of service charge, but the Issuer
may require payment of a sum sufficient to cover any tax or other
governmental charge payable in connection therewith. The date of any Note
delivered upon any exchange of this Note shall be such that no gain or loss
of interest results from such exchange.
All (and not less than all) interests in this Note will be
exchanged for Definitive Bearer Notes in accordance with the procedures set
forth in the following two sentences as soon as practicable after (i) the
first beneficial owner of an interest in this Note exchanges its interest
for a Definitive Bearer Note or (ii) the Issuer gives notice to the
Principal Paying Agent of an acceleration of the Note or the closure of a
relevant clearing system as described above; provided that a common
depositary located outside the United States (the "common depositary")
holding this Note for Morgan Guaranty Trust Company of New York, Brussels
office, as operator of the Euroclear System (the "Euroclear Operator"),
Cedel Bank, societe anonyme ("Cedel") and/or any other relevant clearing
system (including Societe Interprofessionelle pour la Compensation des
Valeurs Mobilieres ("SICOVAM")) instructs the Principal Paying Agent
regarding the aggregate principal amount of Definitive Bearer Notes and the
denominations of such Definitive Bearer Notes that must be authenticated
and delivered to each relevant clearing system in exchange for this Note.
Thereafter, the Principal Paying Agent, acting solely in reliance on such
instructions, shall, upon surrender to it of this Note and subject to the
conditions in the preceding paragraph, authenticate and deliver Definitive
Bearer Notes in exchange for this Note in accordance with such instructions
and shall cause Schedule A of this Note to be endorsed to reflect the
reduction of its principal amount by an amount equal to the aggregate
principal amount of this Note. Nothing in this paragraph shall prevent the
further exchange of Definitive Bearer Notes into Registered Notes.
This Note may be transferred by delivery; provided, however,
that this Note may be transferred only to a common depositary outside the
United States for the Euroclear Operator, Cedel and/or any other relevant
clearing system or to a nominee of such a depositary.
In case this Note shall at any time become mutilated,
defaced or be destroyed, lost or stolen and this Note or evidence of the
loss, theft or destruction thereof (together with the indemnity hereinafter
referred to and such other documents or proof as may be required in the
premises) shall be delivered to the Trustee, a new Note of like tenor will
be issued by the Issuer in exchange for this Note, but, in the case of any
destroyed, lost or stolen Note, only upon receipt of evidence satisfactory
to the Trustee and the Issuer that this Note was destroyed, lost or stolen
and, if required, upon receipt also of indemnity satisfactory to each of
them. All expenses and reasonable charges associated with procuring such
indemnity and with the preparation, authentication and delivery of a new
Note shall be borne by the owner of the Note mutilated, defaced, destroyed,
lost or stolen.
The Senior Indenture provides that, (a) if an Event of
Default (as defined in the Senior Indenture) due to the default in payment
of principal of, premium, if any, or interest on, any series of debt
securities issued under the Senior Indenture, including the series of
Senior Global Medium-Term Notes of which this Note forms a part, or due to
the default in the performance or breach of any other covenant or warranty
of the Issuer applicable to the debt securities of such series but not
applicable to all outstanding debt securities issued under the Senior
Indenture shall have occurred and be continuing, either the Trustee or the
holders of not less than 25% in principal amount of the debt securities of
each affected series (voting as a single class) may then declare the
principal of all debt securities of all such series and interest accrued
thereon to be due and payable immediately and (b) if an Event of Default
due to a default in the performance of any other of the covenants or
agreements in the Senior Indenture applicable to all outstanding debt
securities issued thereunder, including this Note, or due to certain events
of bankruptcy, insolvency and reorganization of the Issuer, shall have
occurred and be continuing, either the Trustee or the holders of not less
than 25% in principal amount of all debt securities issued under the Senior
Indenture then outstanding (treated as one class) may declare the principal
of all such debt securities and interest accrued thereon to be due and
payable immediately, but upon certain conditions such declarations may be
annulled and past defaults may be waived (except a continuing default in
payment of principal (or premium, if any) or interest on such debt
securities) by the holders of a majority in principal amount of the debt
securities of all affected series then outstanding.
This Note may be redeemed, as a whole, at the option of the
Issuer at any time prior to maturity, upon the giving of a notice of
redemption as described below, at a redemption price equal to 100% of the
principal amount hereof, together with accrued interest to the date fixed
for redemption, if the Issuer determines that, as a result of any change in
or amendment to the laws (or any regulations or rulings promulgated
thereunder) of the United States or of any political subdivision or taxing
authority thereof or therein affecting taxation, or any change in official
position regarding the application or interpretation of such laws,
regulations or rulings, which change or amendment becomes effective on or
after the Original Issue Date hereof, the Issuer has or will become
obligated to pay Additional Amounts (as defined below) with respect to this
Note as described below. Prior to the giving of any Notice of redemption
pursuant to this paragraph, the Issuer shall deliver to the Trustee (i) a
certificate stating that the Issuer is entitled to effect such redemption
and setting forth a statement of facts showing that the conditions
precedent to the right of the Issuer to so redeem have occurred, and (ii)
an opinion of independent counsel satisfactory to the Trustee to such
effect based on such statement of facts; provided that no such notice of
redemption shall be given earlier than 60 days prior to the earliest date
on which the Issuer would be obligated to pay such Additional Amounts if a
payment in respect of this Note were then due.
Notice of redemption will be given not less than 30 nor more
than 60 days prior to the date fixed for redemption, which date and the
applicable redemption price will be specified in the Notice.
If the Issuer shall determine that any payment made outside
the United States by the Issuer or any Paying Agent of principal, premium
or interest due in respect of this Note would, under any present or future
laws or regulations of the United States, be subject to any certification,
identification or other information reporting requirement of any kind, the
effect of which is the disclosure to the Issuer, any Paying Agent or any
governmental authority of the nationality, residence or identity of a
beneficial owner of this Note who is a United States Alien (as defined
below) (other than such a requirement (a) that would not be applicable to
a payment made by the Issuer or any Paying Agent (i) directly to the
beneficial owner or (ii) to a custodian, nominee or other agent of the
beneficial owner, or (b) that can be satisfied by such custodian, nominee
or other agent certifying to the effect that such beneficial owner is a
United States Alien; provided that in each case referred to in clauses
(a)(ii) and (b) payment by such custodian, nominee or agent to such
beneficial owner is not otherwise subject to any such requirement), the
Issuer shall redeem this Note, as a whole, at a redemption price equal to
100% of the principal amount thereof, together with accrued interest to the
date fixed for redemption, or, at the election of the Issuer if the
conditions of the next succeeding paragraph are satisfied, pay the
additional amounts specified in such paragraph. The Issuer shall make such
determination and election as soon as practicable, shall promptly notify
the Trustee thereof and shall publish prompt notice thereof (the
"Determination Notice") stating the effective date of such certification,
identification or other information reporting requirements, whether the
Issuer will redeem this Note or has elected to pay the additional amounts
specified in the next succeeding paragraph, and (if applicable) the last
date by which the redemption of this Note must take place, as provided in
the next succeeding sentence. If the Issuer redeems this Note, such
redemption shall take place on such date, not later than one year after the
publication of the Determination Notice, as the Issuer shall elect by
notice to the Trustee at least 60 days prior to the date fixed for
redemption. Notice of such redemption of this Note will be given to the
holder of this Note not more than 60 nor less than 30 days prior to the
date fixed for redemption. Such redemption notice shall include a
statement as to the last date by which this Note to be redeemed may be
exchanged for Registered Notes. Notwithstanding the foregoing, the Issuer
shall not so redeem this Note if the Issuer shall subsequently determine,
not less than 30 days prior to the date fixed for redemption, that
subsequent payments would not be subject to any such certification,
identification or other information reporting requirement, in which case
the Issuer shall publish prompt notice of such determination and any
earlier redemption notice shall be revoked and of no further effect. The
right of the holder of this Note to exchange this Note for Registered Notes
pursuant to the provisions of this paragraph will terminate at the close of
business of the Principal Paying Agent on the fifteenth day prior to the
date fixed for redemption, and no further exchanges of this Note for
Registered Notes shall be permitted.
If and so long as the certification, identification or other
information reporting requirements referred to in the preceding paragraph
would be fully satisfied by payment of a backup withholding tax or similar
charge, the Issuer may elect by notice to the Trustee to pay as additional
amounts such amounts as may be necessary so that every net payment made
outside the United States following the effective date of such requirements
by the Issuer or any Paying Agent of principal, premium or interest due in
respect of this Note of which the beneficial owner is a United States Alien
(but without any requirement that the nationality, residence or identity of
such beneficial owner be disclosed to the Issuer, any Paying Agent or any
governmental authority, with respect to the payment of such additional
amounts), after deduction or withholding for or on account of such backup
withholding tax or similar charge (other than a backup withholding tax or
similar charge that (i) would not be applicable in the circumstances
referred to in the second parenthetical clause of the first sentence of the
preceding paragraph, or (ii) is imposed as a result of presentation of this
Note for payment more than 15 days after the date on which such payment
becomes due and payable or on which payment thereof is duly provided for,
whichever occurs later), will not be less than the amount provided for in
this Note to be then due and payable. In the event the Issuer elects to
pay any additional amounts pursuant to this paragraph, the Issuer shall
have the right to redeem this Note as a whole at any time pursuant to the
applicable provisions of the immediately preceding paragraph and the
redemption price of this Note will not be reduced for applicable
withholding taxes. If the Issuer elects to pay additional amounts pursuant
to this paragraph and the condition specified in the first sentence of this
paragraph should no longer be satisfied, then the Issuer will redeem this
Note as a whole, pursuant to the applicable provisions of the immediately
preceding paragraph.
The Issuer will, subject to certain exceptions and
limitations set forth below, pay such additional amounts (the "Additional
Amounts") to the holder of this Note who is a United States Alien as may be
necessary in order that every net payment of the principal of and interest
on this Note and any other amounts payable on this Note, after withholding
for or on account of any present or future tax, assessment or governmental
charge imposed upon or as a result of such payment by the United States (or
any political subdivision or taxing authority thereof or therein), will not
be less than the amount provided for in this Note to be then due and
payable. The Issuer will not, however, be required to make any payment of
Additional Amounts to any such holder for or on account of:
(a) any such tax, assessment or other governmental charge
that would not have been so imposed but for (i) the existence of any
present or former connection between such holder (or between a
fiduciary, settlor, beneficiary, member or shareholder of such holder,
if such holder is an estate, a trust, a partnership or a corporation)
and the United States, including, without limitation, such holder (or
such fiduciary, settlor, beneficiary, member or shareholder) being or
having been a citizen or resident thereof or being or having been
engaged in a trade or business or present therein or having, or having
had, a permanent establishment therein or (ii) the presentation by the
holder of this Note for payment on a date more than 15 days after the
date on which such payment became due and payable or the date on which
payment thereof is duly provided for, whichever occurs later;
(b) any estate, inheritance, gift, sales, transfer or personal
property tax or any similar tax, assessment or governmental charge;
(c) any tax, assessment or other governmental charge imposed
by reason of such holder's past or present status as a personal holding
company or foreign personal holding company or controlled foreign
corporation or passive foreign investment company with respect to the
United States or as a corporation which accumulates earnings to avoid
United States federal income tax or as a private foundation or other
tax-exempt organization;
(d) any tax, assessment or other governmental charge that is
payable otherwise than by withholding from payments on or in respect of
this Note;
(e) any tax, assessment or other governmental charge
required to be withheld by any Paying Agent from any payment of
principal of, or interest on, this Note, if such payment can be made
without such withholding by any other Paying Agent in a city in Western
Europe;
(f) any tax, assessment or other governmental charge that
would not have been imposed but for the failure to comply with
certification, information or other reporting requirements concerning
the nationality, residence or identity of the holder or beneficial owner
of this Note, if such compliance is required by statute or by regulation
of the United States or of any political subdivision or taxing authority
thereof or therein as a precondition to relief or exemption from such
tax, assessment or other governmental charge;
(g) any tax, assessment or other governmental charge imposed
by reason of such holder's past or present status as the actual or
constructive owner of 10% or more of the total combined voting power of
all classes of stock entitled to vote of the Issuer or as a direct or
indirect subsidiary of the Issuer; or
(h) any combination of items (a), (b), (c), (d), (e), (f) or
(g);
nor shall Additional Amounts be paid with respect to any payment on this
Note to a United States Alien who is a fiduciary or partnership or other
than the sole beneficial owner of such payment to the extent such payment
would be required by the laws of the United States (or any political
subdivision thereof) to be included in the income, for tax purposes, of a
beneficiary or settlor with respect to such fiduciary or a member of such
partnership or a beneficial owner who would not have been entitled to the
Additional Amounts had such beneficiary, settlor, member or beneficial
owner been the holder of this Note.
The Senior Indenture permits the Issuer and the Trustee,
with the consent of the holders of not less than a majority in aggregate
principal amount of the debt securities of all series issued under the
Senior Indenture then outstanding and affected (voting as one class), to
execute supplemental indentures adding any provisions to or changing in any
manner the rights of the holders of each series so affected; provided that
the Issuer and the Trustee may not, without the consent of the holder of
each outstanding debt security affected thereby, (a) extend the final
maturity of any such debt security, or reduce the principal amount thereof,
or reduce the rate or extend the time of payment of interest thereon, or
reduce any amount payable on redemption or repayment thereof, or change the
currency of payment thereof, or impair or affect the rights of any holder
to institute suit for the payment thereof without the consent of the holder
of each debt security so affected; or (b) reduce the aforesaid percentage
in principal amount of debt securities the consent of the holders of which
is required for any such supplemental indenture.
Except as set forth below, if the principal of, premium, if
any, or interest on, this Note is payable in a Specified Currency other
than U.S. dollars and such Specified Currency is not available to the
Issuer for making payments hereon due to the imposition of exchange
controls or other circumstances beyond the control of the Issuer or is no
longer used by the government of the country issuing such currency or for
the settlement of transactions by public institutions within the
international banking community, then the Issuer will be entitled to
satisfy its obligations to the holder of this Note by making such payments
in U.S. dollars on the basis of the Market Exchange Rate (as defined below)
on the date of such payment or, if the Market Exchange Rate is not
available on such date, as of the most recent practicable date; provided,
however, that if such Specified Currency is replaced by a single European
currency (expected to be named the Euro), the payment of principal of,
premium, if any, or interest on any Note denominated in such currency shall
be effected in the new single European currency in conformity with legally
applicable measures taken pursuant to, or by virtue of, the treaty
establishing the European Community (the "EC"), as amended by the treaty on
European Union (as so amended, the "Treaty"). Any payment made under such
circumstances in U.S. dollars (or, if applicable, such new single European
currency) where the required payment is in a Specified Currency other than
U.S. dollars will not constitute an Event of Default.
If the principal of, premium, if any, or interest on, this Note
is payable in ECUs, then with respect to each due date for any such payment on
or after the first business day in Brussels on which the ECU ceases to be used
as the unit of account of the EC and has not become a currency in its own
right, replacing all or some of the currencies of the member states of the EC,
the Issuer shall choose a substitute currency (the "Chosen Currency") which
may be any currency which was, on the last day on which the ECU was used as
the unit of account of the EC, a component currency of the ECU basket or U.S.
dollars, in which all such payments due on or after that date with respect to
this Note shall be made. Notice of the Chosen Currency so selected shall,
where practicable, be published in the manner described in "Notices" below.
The amount of each payment in such Chosen Currency shall be computed on the
basis of the equivalent of the ECU in that currency, determined as described
below, as of the fourth business day in Brussels prior to the date on which
such payment is due.
If the principal of, premium, if any, or interest on, this Note
is payable in ECUs, then on the first business day in Brussels on which the
ECU ceases to be used as the unit of account of the EC, and has not become a
currency in its own right, replacing all or some of the currencies of the
member states of the EC, the Issuer shall choose a Chosen Currency in which
all such payments with respect to this Note having a due date prior thereto
but not yet presented for payment are to be made. The amount of each payment
in such Chosen Currency shall be computed on the basis of the equivalent of
the ECU in that currency, determined as described below, as of such first
business day.
The equivalent of the ECU in the relevant Chosen Currency as of
any date (the "Day of Valuation") shall be determined on the following basis
by, or on behalf of, an Exchange Rate Agent appointed by the Issuer. The
amounts and components composing the ECU for this purpose (the "Components")
shall be the amounts and components composing the ECU as of the last date on
which the ECU was used as the unit of account of the EC. The equivalent of
the ECU in the Chosen Currency shall be calculated by, first, aggregating the
U.S. dollar equivalents of the Components; and then, in the case of a Chosen
Currency other than U.S. dollars, using the rate used for determining the U.S.
dollar equivalent of the Components in the Chosen Currency as set forth below,
calculating the equivalent in the Chosen Currency of such aggregate amount in
U.S. dollars.
The U.S. dollar equivalent of each of the Components shall be
determined by, or on behalf of, the Exchange Rate Agent on the basis of the
middle spot delivery quotations prevailing at 2:30 p.m., Brussels time, on the
Day of Valuation, as obtained by, or on behalf of, the Exchange Rate Agent
from one or more major banks, as selected by the Issuer, in the country of
issue of the component currency in question.
If for any reason no direct quotations are available for a
Component as of a Day of Valuation from any of the banks selected for this
purpose, in computing the U.S. dollar equivalent of such Component, the
Exchange Rate Agent shall (except as provided below) use the most recent
direct quotations for such Component obtained by it or on its behalf;
provided that such quotations were prevailing in the country of issue not
more than two Business Days before such Day of Valuation. If such most
recent quotations were so prevailing in the country of issue more than two
Business Days before such Day of Valuation, the Exchange Rate Agent shall
determine the U.S. dollar equivalent of such Component on the basis of
cross rates derived from the middle spot delivery quotations for such
component currency and for the U.S. dollar prevailing at 2:30 p.m.,
Brussels time, on such Day of Valuation, as obtained by, or on behalf of,
the Exchange Rate Agent from one or more major banks, as selected by the
Issuer, in a country other than the country of issue of such component
currency. Notwithstanding the foregoing, the Exchange Rate Agent shall
determine the U.S. dollar equivalent of such Component on the basis of such
cross rates if the Issuer or such agent judges that the equivalent so
calculated is more representative than the U.S. dollar equivalent
calculated as provided in the first sentence of this paragraph. Unless
otherwise specified by the Issuer, if there is more than one market for
dealing in any component currency by reason of foreign exchange regulations
or for any other reason, the market to be referred to in respect of such
currency shall be that upon which a non-resident issuer of notes
denominated in such currency would purchase such currency in order to make
payments in respect of such securities.
Payments in the Chosen Currency will be made at the specified
office of a paying agent in the country of the Chosen Currency, or, if none,
or at the option of the holder, at the specified office of any Paying Agent
either by a check drawn on, or by transfer to an account maintained by the
holder with, a bank in the principal financial center of the country of the
Chosen Currency; provided that if U.S. dollars is the Chose Currency payments
shall be made in accordance with the provisions for payments in U.S. dollars
on the face hereof.
All determinations referred to above made by, or on behalf of,
the Issuer or by, or on behalf of, the Exchange Rate Agent shall be at such
entity's sole discretion and shall, in the absence of manifest error, be
conclusive for all purposes and binding on holders of this Note.
So long as this Note shall be outstanding, the Issuer will
cause to be maintained an office or agency for the payment of the principal of
and premium, if any, and interest on this Note as herein provided. If this
Note is listed on the London Stock Exchange Limited and such Exchange so
requires, the Issuer shall maintain a Paying Agent in London. The Issuer may
designate other agencies for the payment of said principal, premium and
interest at such place or places outside the United States (subject to
applicable laws and regulations) as the Issuer may decide. So long as there
shall be such an agency, the Issuer shall keep the Trustee advised of the
names and locations of such agencies, if any are so designated.
With respect to moneys paid by the Issuer and held by the
Trustee or any Paying Agent for payment of the principal of or interest or
premium, if any, on any Notes that remain unclaimed at the end of two years
after such principal, interest or premium shall have become due and payable
(whether at maturity or upon call for redemption or otherwise), (i) the
Trustee or such Paying Agent shall notify the holders of such Notes that such
moneys shall be repaid to the Issuer and any person claiming such moneys shall
thereafter look only to the Issuer for payment thereof and (ii) such moneys
shall be so repaid to the Issuer. Upon such repayment all liability of the
Trustee or such Paying Agent with respect to such moneys shall thereupon
cease, without, however, limiting in any way any obligation that the Issuer
may have to pay the principal of or interest or premium, if any, on this Note
as the same shall become due.
No provision of this Note or of the Senior Indenture shall
alter or impair the obligation of the Issuer, which is absolute and
unconditional, to pay the principal of, premium, if any, and interest on this
Note at the time, place, and rate, and in the coin or currency, herein
prescribed unless otherwise agreed between the Issuer and the holder of this
Note.
The Issuer, the Trustee and any agent of the Issuer or the
Trustee may treat the holder of this Note as the owner hereof for all
purposes, whether or not this Note be overdue, and none of the Issuer, the
Trustee or any such agent shall be affected by notice to the contrary.
No recourse shall be had for the payment of the principal of,
premium, if any, or the interest on this Note for any claim based hereon, or
otherwise in respect hereof, or based on or in respect of the Senior Indenture
or any indenture supplemental thereto, against any incorporator, shareholder,
officer or director, as such, past, present or future, of the Issuer or of any
successor corporation, either directly or through the Issuer or any successor
corporation, whether by virtue of any constitution, statute or rule of law or
by the enforcement of any assessment or penalty or otherwise, all such
liability being, by the acceptance hereof and as part of the consideration for
the issue hereof, expressly waived and released.
This Note shall for all purposes be governed by, and construed
in accordance with, the laws of the State of New York.
As used herein:
(a) the term "Business Day" means any day, other than a
Saturday or Sunday, that is neither a legal holiday nor a day on which
banking institutions are authorized or required by law or regulation to
close in The City of New York or in the City of London and (i) if this
Note bears interest calculated by reference to LIBOR, that is also a
London Banking Day, (ii) if this Note is denominated in a Specified
Currency other than U.S. dollars, Australian dollars or ECUs, in the
principal financial center of the country of the Specified Currency,
(iii) if this Note is denominated in Australian dollars, in Sydney and
(iv) if this Note is denominated in ECUs, that is not a non-ECU clearing
day, as determined by the ECU Banking Association in Paris.
(b) the term "Market Exchange Rate" means the noon U.S.
dollar buying rate in The City of New York for wire transfers of the
Specified Currency indicated on the face hereof as certified for customs
purposes by the Federal Reserve Bank of New York;
(c) the term "Notices" refers to notices to the holders of
the Notes to be given by publication in an authorized newspaper in the
English language and of general circulation in the Borough of Manhattan,
The City of New York, and London or, if publication in London is not
practical, in an English language newspaper with general circulation in
Western Europe. Such publication is expected to be made in The Wall
Street Journal and the Financial Times. Such Notices will be deemed to
have been given on the date of such publication, or if published in such
newspapers on different dates, on the date of the first such
publication;
(d) the term "United States" means the United States of America
(including the States and the District of Columbia), its territories, its
possessions and other areas subject to its jurisdiction; and
(e) the term "United States Alien" means any person who, for
United States federal income tax purposes, is a foreign corporation, a
non-resident alien individual, a non-resident alien fiduciary of a
foreign estate or trust, or a foreign partnership, one or more of the
members of which is a foreign corporation, a non-resident alien
individual or a non-resident alien fiduciary of a foreign estate or
trust.
All other terms used in this Note which are defined in the
Senior Indenture and not otherwise defined herein shall have the meanings
assigned to them in the Senior Indenture.
OPTION TO ELECT REPAYMENT
The undersigned hereby irrevocably requests and instructs the
Issuer to repay the within Note (or portion thereof specified below) pursuant
to its terms at a price equal to the principal amount thereof, together with
interest to the Optional Repayment Date, to the undersigned at
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
(Please print or typewrite name and address of the undersigned)
If less than the entire principal amount of the within Note
is to be repaid, specify the portion thereof which the holder elects to
have repaid: _______________________________; and specify the denomination
or denominations (which shall not be less than the minimum authorized
denomination) of the Notes to be issued to the holder for the portion of
the within Note not being repaid (in the absence of any such specification,
one such Note will be issued for the portion not being repaid): ___________.
Dated:___________________________ ___________________________
[SCHEDULE A(5)]
EXCHANGES FOR DEFINITIVE BEARER NOTES, DEFINITIVE
REGISTERED NOTES AND FROM TEMPORARY GLOBAL BEARER NOTE,
REDEMPTIONS AND REPAYMENTS
The initial principal amount of this Note is ______________.
The following (A) exchanges of (i) portions of this Note for Definitive
Bearer Notes or Registered Notes and (ii) portions of a Temporary Global
Bearer Note for an interest in this Note or (B) (x) redemptions at the
option of the Issuer or (y) repayments at the option of the holder have
been made:
[SCHEDULE A-1](6)
PERMANENT GLOBAL BEARER NOTE
SCHEDULE OF EXCHANGES
The initial principal amount of this Note is $__________. The
following (A) exchanges of the principal amount of Notes indicated below for
the same principal amount of Notes to be represented by (i) Definitive Bearer
Notes or (ii) Definitive Registered Notes or [(iii) a Global Bearer Note that
has been separated from a Unit (a "Separated Note")](7), (B) exchanges of the
principal amount of Notes that had been represented by (i) a Temporary Global
Bearer Note [or (ii) a Global Bearer Note that is part of a Unit (an "Attached
Unit Note")](8) for an interest in this Note and (C) reductions of the
principal amount of this Note as a result of (i) cancellation upon the
application of such amount to the settlement of Purchase Contracts or the
exercise of Universal Warrants (ii) redemption at the option of the Issuer or
(iii) repayments at the option of the Holder have been made: