Exhibit 1.1
$250,000,000
EASTMAN CHEMICAL COMPANY
5.500% Notes due 2019
Underwriting Agreement
October 28, 2009
Citigroup Global Markets Inc.
J.P. Morgan Securities Inc.
As Representatives of the
several Underwriters listed
in Schedule 1 hereto
c/o J.P. Morgan Securities Inc.
270 Park Avenue
New York, New York 10017
Ladies and Gentlemen:
Eastman Chemical Company, a Delaware corporation (the Company), proposes to issue and sell
to the several Underwriters listed in Schedule 1 hereto (the Underwriters), for whom you are
acting as representatives (the Representatives), $250,000,000 principal amount of its 5.500%
Notes due 2019 (the Securities). The Securities will be issued pursuant to an Indenture dated as
of January 10, 1994 (the Indenture) between the Company and the Bank of New York Mellon Trust
Company, N.A., as trustee (the Trustee).
The Company hereby confirms its agreement with the several Underwriters concerning the
purchase and sale of the Securities, as follows:
1.
Registration Statement
. The Company has prepared and filed with the Securities and
Exchange Commission (the Commission) under the Securities Act of 1933 and the rules and
regulations of the Commission thereunder (collectively, the Securities Act), a registration
statement on Form S-3 (File No. 333-159259), including a prospectus, relating to the Securities.
Such registration statement, as amended at the time it becomes effective, including the
information, if any, deemed pursuant to Rule 430A or 430B under the Securities Act to be part of
the registration statement at the time of its effectiveness (Rule 430 Information), is referred
to herein as the Registration Statement; and as used herein, the term Preliminary Prospectus
means any prospectus filed with the Commission pursuant to Rule 424(a) under the Securities Act and
the prospectus included in the Registration Statement at the time of its effectiveness that omits
Rule 430 Information, and the term Prospectus means the prospectus in the form first used (or
made available upon request of purchasers pursuant to Rule 173 under the Securities Act) in
connection with a confirmation of sales of the Securities. Any reference in this Agreement to the
Registration Statement, any Preliminary Prospectus or the Prospectus shall be deemed to refer to
and include the documents incorporated by reference therein pursuant to Item 12 of Form S-3 under
the Securities Act, as of the effective date of the Registration Statement or
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the date of such Preliminary Prospectus or the Prospectus, as the case may be, and any
reference to amend, amendment or supplement with respect to the Registration Statement, any
Preliminary Prospectus or the Prospectus shall be deemed to refer to and include any documents
filed after such date under the Securities Exchange Act of 1934 and the rules and regulations of
the Commission thereunder (collectively, the Exchange Act) that are deemed to be incorporated by
reference therein. Capitalized terms used but not defined herein shall have the meanings given to
such terms in the Registration Statement and the Prospectus.
At or prior to the time when sales of the Securities were first made (the Time of Sale), the
Company had prepared the following information (collectively, the Time of Sale Information): a
Preliminary Prospectus dated October 28, 2009, and each free-writing prospectus (as defined
pursuant to Rule 405 under the Securities Act) listed on Annex B hereto as constituting part of the
Time of Sale Information.
2.
Purchase of the Securities by the Underwriters
. (a) The Company agrees to issue
and sell the Securities to the several Underwriters as
provided
in this Agreement, and each
Underwriter, on the basis of the representations, warranties and agreements set forth herein and
subject to the conditions set forth herein, agrees, severally and not jointly, to purchase from the
Company the respective principal amount of Securities set forth opposite such Underwriters name in
Schedule 1 hereto at a price equal to 99.248% of the principal amount thereof plus accrued
interest, if any, from November 2, 2009 to the Closing Date (as defined below). The Company will
not be obligated to deliver any of the Securities except upon payment for all the Securities to be
purchased as
provided
herein.
(b) The Company understands that the Underwriters intend to make a public offering of the
Securities as soon after the effectiveness of this Agreement as in the judgment of the
Representatives is advisable, and initially to offer the Securities on the terms set forth in the
Prospectus. The Company acknowledges and agrees that the Underwriters may offer and sell
Securities to or through any affiliate of an Underwriter and that any such affiliate may offer and
sell Securities purchased by it to or through any Underwriter.
(c) Payment for and delivery of the Securities will be made at the offices of Davis Polk &
Wardwell LLP, 450 Lexington Avenue, New York, New York 10017, at 10:00 A.M., New York City time, on
November 2, 2009, or at such other time or place on the same or such other date, not later than the
fifth business day thereafter, as the Representatives and the Company may agree upon in writing.
The time and date of such payment and delivery is referred to herein as the Closing Date.
(d) Payment for the Securities shall be made by wire transfer in immediately available funds
to the account(s) specified by the Company to the Representatives against delivery to the nominee
of The Depository Trust Company, for the account of the Underwriters, of one or more global notes
representing the Securities (collectively, the Global Note), with any transfer taxes payable in
connection with the sale of the Securities duly paid by the Company. The Global Note will be made
available for inspection by the Representatives not later than 1:00 P.M., New York City time, on
the business day prior to the Closing Date.
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(e) The Company acknowledges and agrees that the Underwriters are acting solely in the
capacity of an arms length contractual counterparty to the Company with respect to the offering of
Securities contemplated hereby (including in connection with determining the terms of the offering)
and not as a financial advisor or a fiduciary to, or an agent of, the Company or any other person.
Additionally, neither the Representatives nor any other Underwriter is advising the Company or any
other person as to any legal, tax, investment, accounting or regulatory matters in any
jurisdiction. The Company shall consult with its own advisors concerning such matters and shall be
responsible for making its own independent investigation and appraisal of the transactions
contemplated hereby, and the Underwriters shall have no responsibility or liability to the Company
with respect thereto. Any review by the Underwriters of the Company, the transactions contemplated
hereby or other matters relating to such transactions will be performed solely for the benefit of
the Underwriters and shall not be on behalf of the Company.
3.
Representations and Warranties of the Company
. The Company represents and warrants
to each Underwriter that:
(a)
Preliminary Prospectus
. No order preventing or suspending the use of any Preliminary
Prospectus has been issued by the Commission, and each Preliminary Prospectus, at the time of
filing thereof, complied in all material respects with the Securities Act and did not contain any
untrue statement of a material fact or omit to state a material fact required to be stated therein
or necessary in order to make the statements therein, in the light of the circumstances under which
they were made, not misleading;
provided
that the Company makes no representation or warranty with
respect to any statements or omissions made in reliance upon and in conformity with information
relating to any Underwriter furnished to the Company in writing by such Underwriter through the
Representatives expressly for use in any Preliminary Prospectus.
(b)
Time of Sale Information
. The Time of Sale Information, at the Time of Sale did not, and
at the Closing Date will not, contain any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in the light of the circumstances
under which they were made, not misleading;
provided
that the Company makes no representation or
warranty with respect to any statements or omissions made in reliance upon and in conformity with
information relating to any Underwriter furnished to the Company in writing by such Underwriter
through the Representatives expressly for use in such Time of Sale Information. No statement of
material fact included in the Prospectus has been omitted from the Time of Sale Information and no
statement of material fact included in the Time of Sale Information that is required to be included
in the Prospectus has been omitted therefrom.
(c)
Issuer Free Writing Prospectus
. The Company (including its agents and representatives,
other than the Underwriters in their capacity as such) has not prepared, made, used, authorized,
approved or referred to, and will not prepare, make, use, authorize, approve or refer to, any
written communication (as defined in Rule 405 under the Securities Act) that constitutes an offer
to sell or solicitation of an offer to buy the Securities (each such communication by the Company
or its agents and representatives (other than a communication referred to in clauses (i) (ii) and
(iii) below) an Issuer Free Writing Prospectus) other than (i) any document not constituting a
prospectus pursuant to
Section 2(a)(10)(a)
of the Securities
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Act or Rule 134 under the Securities Act, (ii) the Preliminary Prospectus, (iii) the Prospectus,
(iv) the documents listed on Annex B hereto as constituting the Time of Sale Information and (v)
any electronic road show or other written communications, in each case approved in writing in
advance by the Representatives (such approval not to be unreasonably withheld). Each such Issuer
Free Writing Prospectus complied in all material respects with the Securities Act, has been or will
be (within the time period specified in Rule 433) filed in accordance with the Securities Act (to
the extent required thereby) and, when taken together with the Preliminary Prospectus accompanying,
or delivered prior to delivery of, or filed prior to the first use of, such Issuer Free Writing
Prospectus, did not, and at the Closing Date will not, contain any untrue statement of a material
fact or omit to state a material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
provided
that the Company
makes no representation or warranty with respect to any statements or omissions made in each such
Issuer Free Writing Prospectus in reliance upon and in conformity with information relating to any
Underwriter furnished to the Company in writing by such Underwriter through the Representatives
expressly for use in any Issuer Free Writing Prospectus.
(d)
Registration Statement and Prospectus
. The Registration Statement is an automatic shelf
registration statement as defined under Rule 405 of the Securities Act that has been filed with
the Commission not earlier than three years prior to the date hereof; and no notice of objection of
the Commission to the use of such registration statement or any post-effective amendment thereto
pursuant to Rule 401(g)(2) under the Securities Act has been received by the Company. No order
suspending the effectiveness of the Registration Statement has been issued by the Commission and no
proceeding for that purpose or pursuant to Section 8A of the Securities Act against the Company or
related to the offering has been initiated or, to the knowledge of the Company, threatened by the
Commission; as of the applicable effective date of the Registration Statement and any amendment
thereto, the Registration Statement complied and will comply in all material respects with the
Securities Act and the Trust Indenture Act of 1939 and the rules and regulations of the Commission
thereunder (collectively, the Trust Indenture Act), and did not and will not contain any untrue
statement of a material fact or omit to state a material fact required to be stated therein or
necessary in order to make the statements therein not misleading; and as of the date of the
Prospectus and any amendment or supplement thereto and as of the Closing Date, the Prospectus did
not and will not contain any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading;
provided
that the Company makes no
representation or warranty with respect to (i) that part of the Registration Statement that
constitutes the Statement of Eligibility and Qualification (Form T-1) of the Trustee under the
Trust Indenture Act or (ii) any statements or omissions made in reliance upon and in conformity
with information relating to any Underwriter furnished to the Company in writing by such
Underwriter through the Representatives expressly for use in the Registration Statement and the
Prospectus and any amendment or supplement thereto.
(e)
Incorporated Documents
. The documents incorporated by reference in the Registration
Statement, the Prospectus and the Time of Sale Information, when they became effective or were
filed with the Commission, as the case may be, conformed in all material respects to the
requirements of the Exchange Act, and none of such documents contained any untrue statement of a
material fact or omitted to state a material fact required to be stated therein,
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or necessary to make the statements therein, in the light of the circumstances under which
they were made, not misleading; and any further documents so filed and incorporated by reference in
the Registration Statement, the Prospectus and the Time of Sale Information, or any further
amendment or supplement thereto, when such documents become effective or are filed with the
Commission, as the case may be, will conform in all material respects to the requirements of the
Securities Act or the Exchange Act, as applicable, and will not contain any untrue statement of a
material fact or omit to state a material fact required to be stated therein or necessary to make
the statements therein, in the light of the circumstances under which they were made, not
misleading; provided, however, that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity with information furnished in
writing to the Company by an Underwriter through the Representatives expressly for use therein.
(f)
Financial Statements
. The financial statements and the related notes thereto included or
incorporated by reference in the Registration Statement, the Time of Sale Information and the
Prospectus comply in all material respects with the applicable requirements of the Securities Act
and the Exchange Act, as applicable, and present fairly, in all material respects, the financial
position of the Company and its consolidated subsidiaries as of the dates indicated and the
statements of earnings, comprehensive earnings and retained earnings, and statements of cash flows
for the periods specified; such financial statements have been prepared in conformity with
generally accepted accounting principles applied on a consistent basis throughout the periods
covered thereby, and the summary consolidated historical financial data included in the
Registration Statement, the Time of Sale Information and the Prospectus presents fairly, in all
material respects, the information shown therein and have been compiled on a basis consistent with
that of the related financial statements incorporated by reference in the Registration Statement,
the Time of Sale Information and the Prospectus.
(g)
No Material Adverse Change
. Neither the Company nor any of its subsidiaries has sustained
since the date of the latest audited financial statements included or incorporated by reference in
the Registration Statement, the Time of Sale Information and the Prospectus any material loss or
interference with its business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or governmental action, order or decree
which would be reasonably likely to have a material adverse effect on the financial position,
stockholders equity, results of operations or business prospects of the Company and its
subsidiaries taken as a whole (a Material Adverse Effect), otherwise than as set forth or
contemplated in the Registration Statement, the Time of Sale Information and the Prospectus; and,
since the respective dates as of which information is given in the Registration Statement, the Time
of Sale Information and the Prospectus, there has not been any change in the capital stock (other
than pursuant to options, stock purchase and other employee benefit plans and the Companys stock
buy-back program) or long-term debt of the Company and its subsidiaries taken as a whole or any
material adverse change, or any development involving a prospective material adverse change, in or
affecting the general affairs, management, financial position, stockholders equity or results of
operations of the Company and its subsidiaries taken as a whole, otherwise than as set forth or
contemplated in the Registration Statement, the Time of Sale Information and the Prospectus.
(h)
Organization and Good Standing
. The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State of Delaware, with
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corporate power and authority to own its properties and conduct its business as described in
the Registration Statement, the Time of Sale Information and the Prospectus, and has been duly
qualified as a foreign corporation for the transaction of business and is in good standing under
the laws of each other jurisdiction in which it owns or leases properties, or conducts any
business, so as to require such qualification, or is subject to no material liability or disability
by reason of the failure to be so qualified in any such jurisdiction; and each subsidiary of the
Company listed on Exhibit 21.01 to the Companys Annual Report on Form 10-K for the fiscal year
ended December 31, 2008 has been duly incorporated or otherwise organized and is validly existing
as a corporation or other entity in good standing under the laws of its jurisdiction of
incorporation or organization, with power and authority (corporate and other) to own and conduct
its properties and conduct its business as currently conducted, and has been duly qualified as a
foreign corporation or other entity for the transaction of business and is in good standing under
the laws of each other jurisdiction in which it owns or leases properties, or conducts any
business, so as to require such qualification, or is subject to no liability or disability by
reason of the failure to be so qualified in any such jurisdiction, except where the failure to be
would not, individually or in the aggregate, result in a Material Adverse Effect, and none of the
subsidiaries of the Company is a significant subsidiary.
(i)
Capitalization
. The Company has an authorized capitalization as set forth in the
Registration Statement, the Time of Sale Information and the Prospectus, and all of the issued
shares of capital stock of the Company have been duly and validly authorized and issued and are
fully paid and non-assessable; and all of the issued shares of capital stock of each subsidiary of
the Company that are owned by the Company are owned directly or indirectly by the Company, free and
clear of all liens, encumbrances, equities or claims and all of the issued shares of capital stock
of each subsidiary of the Company that is a significant subsidiary have been duly and validly
authorized and issued and are fully paid and non-assessable (except for directors qualifying
shares).
(j)
Due Authorization
. The Company has full right, power and authority to execute and deliver
this Agreement, the Securities and the Indenture (collectively, the Transaction Documents) and to
perform its obligations hereunder and thereunder; and all action required to be taken for the due
and proper authorization, execution and delivery of each of the Transaction Documents and the
consummation of the transactions contemplated thereby has been duly and validly taken.
(k)
The Securities and the Indenture
. The Securities have been duly authorized and, when
issued and delivered pursuant to this Agreement and the Indenture, will have been duly executed,
authenticated, issued and delivered and will constitute valid and legally binding obligations of
the Company entitled to the benefits provided by the Indenture; the Indenture has been duly
authorized, executed and delivered by the Company and duly qualified under the Trust Indenture Act
and constitutes a valid and legally binding instrument, enforceable in accordance with its terms,
subject, as to enforcement, to bankruptcy, insolvency, reorganization and other laws of general
applicability relating to or affecting creditors rights and to general equity principles; and the
Indenture conforms, and the Securities will conform, to the descriptions thereof in the
Registration Statement, the Time of Sale Information and the Prospectus as amended or supplemented.
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(l)
Underwriting Agreement
. This Agreement has been duly authorized, executed and delivered
by the Company.
(m)
No Conflict; No Consent Required
. The issue and sale of the Securities and the compliance
by the Company with all of the provisions of each of the Transaction Documents and the consummation
of the transactions contemplated by the Transaction Documents will not conflict with or result in a
breach or violation of any of the terms or provisions of, or constitute a default under, any
indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which the
Company or any of its subsidiaries is a party or by which the Company or any of its subsidiaries is
bound or to which any of the property or assets of the Company or any of its subsidiaries is
subject except, in each case, for such breaches, violations and defaults that would not,
individually or in the aggregate, be reasonably likely to have a Material Adverse Effect, nor will
such action result in any violation of (i) the provisions of the Certificate of Incorporation or
Bylaws of the Company or (ii) any statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the Company or any of its subsidiaries or any
of their properties, except, in the case of clause (ii) above, for such violations that would not,
individually or in the aggregate, result in a Material Adverse Effect; and no consent, approval,
authorization, order, registration or qualification of or with any court or governmental agency or
body is required for the issue and sale of the Securities or the consummation by the Company of the
transactions contemplated by the Transaction Documents, except the registration under the
Securities Act of the Securities, such as have been obtained under the Trust Indenture Act and such
consents, approvals, authorizations, registrations or qualifications as may be required under state
securities laws or Blue Sky laws in connection with the purchase and distribution of the Securities
by the Underwriters.
(n)
Legal Proceedings
. Other than as set forth in the Registration Statement, the Time of
Sale Information and the Prospectus, there are no legal or governmental proceedings pending to
which the Company or any of its subsidiaries is a party or of which any property of the Company or
any of its subsidiaries is the subject which would, individually or in the aggregate, be reasonably
likely to have a Material Adverse Effect; and, to the best of the Companys knowledge, no such
proceedings are threatened or contemplated by governmental authorities or threatened by others.
(o)
Independent Accountants
. PricewaterhouseCoopers LLP, which has certified certain
financial statements of the Company and its subsidiaries is, to our knowledge, an independent
registered public accounting firm with respect to the Company and its subsidiaries within the
applicable rules and regulations adopted by the Commission and the Public Company Accounting
Oversight Board (United States) and as required by the Securities Act.
(p)
Title to Real and Personal Property
. The Company and its subsidiaries have good and
marketable title in fee simple to all real property and good and marketable title to all personal
property owned by them, in each case free and clear of all liens, encumbrances and defects except
such as are described in the Registration Statement, the Time of Sale Information and the
Prospectus or such as are not material and do not interfere with the use made and proposed to be
made of such property by the Company and its subsidiaries; and any real property and buildings held
under lease by the Company and its subsidiaries are held by them under valid, subsisting and
enforceable leases with such exceptions as are not material and do not interfere
7
with the use made and proposed to be made of such property and buildings by the Company and
its subsidiaries.
(q)
Title to Intellectual Property
. The Company and its subsidiaries own or possess the
patents, patent rights, licenses, inventions, copyrights, know-how (including trade secrets and
other unpatented and/or unpatentable proprietary or confidential information, systems or
procedures), trademarks, service marks and trade names (collectively, patent and proprietary
rights) presently employed by them in connection with the business now operated by them, and the
patent and proprietary rights necessary in connection with the business proposed to be operated by
them, as described in the Registration Statement, the Time of Sale Information and the Prospectus,
and neither the Company nor any of its subsidiaries has received any notice or is otherwise aware
of any infringement of or conflict with asserted rights of others with respect to any patent or
proprietary rights referred to above, or of any facts which would render any such patent and
proprietary rights invalid or inadequate to protect the interest of the Company or any of its
subsidiaries therein, and which infringement or conflict (if the subject of any unfavorable
decision, ruling or finding) or invalidity or inadequacy, would, individually or in the aggregate,
be reasonably likely to have a Material Adverse Effect.
(r)
Investment Company Act
. The Company is not and, upon the issuance and sale of the
Securities and the application of the proceeds thereof as described in the Registration Statement,
the Time of Sale Information and the Prospectus, will not be required to register as an investment
company or an entity controlled by an investment company (as such terms are defined in the
Investment Company Act of 1940) and the rules and regulations of the Commission thereunder
(collectively, Investment Company Act).
(s)
Licenses and Permits
. Except as would not, individually or in the aggregate, result in a
Material Adverse Effect, each of the Company and its subsidiaries owns or possesses all licenses,
certificates, permits and other authorizations issued by the appropriate federal, state, local or
foreign governmental or regulatory authorities that are necessary for the ownership or lease of
their respective properties or the conduct of their respective businesses as described in the
Registration Statement, the Time of Sale Information and the Prospectus; and except as described in
the Registration Statement, the Time of Sale Information and the Prospectus, neither the Company
nor any of its subsidiaries has received notice of any revocation or modification of any such
license, certificate, permit or authorization or has any reason to believe that any such license,
certificate, permit or authorization could not be renewed in the ordinary course.
(t)
Compliance With Environmental Laws
. Neither the Company nor any of its subsidiaries (i)
has received notice or has actual knowledge of any claim, demand, obligation, cause of action,
accusation, allegation, order, violation, damage, injury, judgment, penalty or fine which would,
individually or in the aggregate, be reasonably likely to have a Material Adverse Effect resulting
from (A) the violation or alleged violation of any laws relating to air pollution, water pollution,
noise control and/or handling discharge, disposal or recovery of on-site or off-site hazardous
substances or materials, (B) any noncompliance with or violation of the requirements of any
environmental law, (C) the release or threatened release of any toxic or hazardous waste, substance
or constituent or (D) any other Environmental Matter (as hereinafter defined), or (ii) is liable,
or has any contingent liability known to the Company, in connection with the release or threatened
release of any toxic or hazardous waste, substance or constituent,
8
which liability would, individually or in the aggregate, be reasonably likely to have a
Material Adverse Effect, or (iii) has received notice or has actual knowledge of any governmental
investigation seeking remedial action in connection with a release or threatened release of any
toxic or hazardous waste, substance or constituent for which the Company or any of its subsidiaries
may be liable and which (if the Company or any of its subsidiaries were so liable) would be
reasonably likely to have a Material Adverse Effect. Environmental Matter means (I) the release
of any amount of toxic or hazardous waste or substances, pollutant or contaminant into the
environment, (II) the management, including the generation, handling, treatment, storage,
transport, discharge or disposal or recovery, whether on-site or off-site, of any solid wastes,
toxic or hazardous wastes, hazardous substances, pollutants or contaminants, (III) the past and
present use of surface waters or groundwater and (IV) the construction or maintenance of any dams
or levees.
(u)
Disclosure Controls
. The Company and its subsidiaries maintain an effective system of
disclosure controls and procedures (as defined in Rule 13a-15(e) of the Exchange Act) that is
designed to ensure that information required to be disclosed by the Company in reports that it
files or submits under the Exchange Act is recorded, processed, summarized and reported within the
time periods specified in the Commissions rules and forms, including controls and procedures
designed to ensure that such information is accumulated and communicated to the Companys
management as appropriate to allow timely decisions regarding required disclosure. The Company and
its subsidiaries have carried out evaluations of the effectiveness of their disclosure controls and
procedures as required by Rule 13a-15 of the Exchange Act.
(v)
Accounting Controls
. The Company maintains a system of internal control over financial
reporting (as defined in Rule 13a-15(f) of the Exchange Act) that complies with the requirements
of the Exchange Act. Except as may be disclosed in the Registration Statement, the Time of Sale
Information and the Prospectus, there are no material weaknesses in the Companys internal control
over financial reporting.
(w)
No Unlawful Payments
. Neither the Company nor any of its subsidiaries nor, to the
knowledge of the Company, any director, officer, agent, employee or other person associated with or
acting on behalf of the Company or any of its subsidiaries has (i) used any corporate funds for any
unlawful contribution, gift, entertainment or other unlawful expense relating to political
activity; (ii) made any direct or indirect unlawful payment to any foreign or domestic government
official or employee from corporate funds; (iii) violated or is in violation of any provision of
the Foreign Corrupt Practices Act of 1977; or (iv) made any bribe, rebate, payoff, influence
payment, kickback or other unlawful payment.
(x)
Compliance with Money Laundering Laws
. The operations of the Company and its subsidiaries
are and have been conducted at all times in compliance with applicable financial recordkeeping and
reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended,
the money laundering statutes of all jurisdictions, the rules and regulations thereunder and any
related or similar rules, regulations or guidelines, issued, administered or enforced by any
governmental agency (collectively, the Money Laundering Laws) and no action, suit or proceeding
by or before any court or governmental agency,
9
authority or body or any arbitrator involving the Company or any of its subsidiaries with
respect to the Money Laundering Laws is pending or, to the knowledge of the Company, threatened.
(y)
Compliance with OFAC
. None of the Company, any of its subsidiaries or, to the knowledge
of the Company, any director, officer, agent, employee or affiliate of the Company or any of its
subsidiaries is currently subject to any U.S. sanctions administered by the Office of Foreign
Assets Control of the U.S. Department of the Treasury (OFAC); and the Company will not directly
or indirectly use the proceeds of the offering of the Securities hereunder, or lend, contribute or
otherwise make available such proceeds to any subsidiary, joint venture partner or other person or
entity, for the purpose of financing the activities of any person currently subject to any U.S.
sanctions administered by OFAC.
(z)
Sarbanes-Oxley Act
. There is and has been no failure on the part of the Company or any of
the Companys directors or officers, in their capacities as such, to comply in all material
respects with any provision of the Sarbanes-Oxley Act of 2002 and the rules and regulations
promulgated in connection therewith, including Section 402 related to loans and Sections 302 and
906 related to certifications.
(aa)
No Stabilization
. The Company has not taken, directly or indirectly, any action designed
to or that could reasonably be expected to cause or result in any stabilization or manipulation of
the price of the Securities.
(bb)
Margin Rules
. Neither the issuance, sale and delivery of the Securities nor the
application of the proceeds thereof by the Company as described in the Registration Statement, the
Time of Sale Information and the Prospectus will violate Regulation T, U or X of the Board of
Governors of the Federal Reserve System or any other regulation of such Board of Governors.
(cc)
Status under the Securities Act
. The Company is not an ineligible issuer and is a
well-known seasoned issuer, in each case as defined under the Securities Act, in each case at the
times specified in the Securities Act in connection with the offering of the Securities.
4.
Further Agreements of the Company
. The Company covenants and agrees with each
Underwriter that:
(a)
Required Filings
. The Company will file the final Prospectus with the Commission within
the time periods specified by Rule 424(b) and Rule 430A or 430B under the Securities Act, will file
any Issuer Free Writing Prospectus (including the Term Sheet in the form of Annex C hereto) to the
extent required by Rule 433 under the Securities Act; and will file promptly all reports and any
definitive proxy or information statements required to be filed by the Company with the Commission
pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date of the
Prospectus and for so long as the delivery of a prospectus is required in connection with the
offering or sale of the Securities; and the Company will furnish copies of the Prospectus and each
Issuer Free Writing Prospectus (to the extent not previously delivered) to the Underwriters in New
York City prior to 10:00 A.M., New York City time, on the business day next succeeding the date of
this Agreement in such quantities as the Representatives may reasonably request. The Company will
pay the registration fees for this
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offering within the time period required by Rule 456(b)(1)(i) under the Securities Act
(without giving effect to the proviso therein) and in any event prior to the Closing Date.
(b)
Delivery of Copies
. The Company will deliver, without charge, (i) to the Representatives,
conformed copies of the Registration Statement as originally filed and each amendment thereto, in
each case including all exhibits and consents filed therewith and documents incorporated by
reference therein; and (ii) to each Underwriter (A) a conformed copy of the Registration Statement
as originally filed and each amendment thereto, in each case including all exhibits and consents
filed therewith and (B) during the Prospectus Delivery Period (as defined below), as many copies of
the Prospectus (including all amendments and supplements thereto and documents incorporated by
reference therein) and each Issuer Free Writing Prospectus as the Representatives may reasonably
request. As used herein, the term Prospectus Delivery Period means such period of time after the
first date of the public offering of the Securities as in the opinion of counsel for the
Underwriters a prospectus relating to the Securities is required by law to be delivered (or
required to be delivered but for Rule 172 under the Securities Act) in connection with sales of the
Securities by any Underwriter or dealer.
(c)
Amendments or Supplements; Issuer Free Writing Prospectuses
. Before making, preparing,
using, authorizing, approving, referring to or filing any Issuer Free Writing Prospectus, and
before filing any amendment or supplement to the Registration Statement or the Prospectus, the
Company will furnish to the Representatives and counsel for the Underwriters a copy of the proposed
Issuer Free Writing Prospectus, amendment or supplement for review and will not make, prepare, use,
authorize, approve, refer to or file any such Issuer Free Writing Prospectus or file any such
proposed amendment or supplement to which the Representatives reasonably objects, provided,
however, following the Closing Date, the foregoing requirements shall not apply to any of the
Companys reports filed with the Commission required to be filed pursuant to Section 13(a) or 15(d)
of the Exchange Act, copies of which filings the Company will cause to be delivered to the
Representatives promptly after being transmitted for filing with the Commission unless such filings
are available electronically through the Commissions EDGAR system.
(d)
Notice to the Representatives
. The Company will advise the Representatives promptly, and
confirm such advice in writing, (i) when any amendment to the Registration Statement has been filed
or becomes effective; (ii) when any supplement to the Prospectus or any amendment to the Prospectus
or any Issuer Free Writing Prospectus has been filed during the Prospectus Delivery Period; (iii)
of any request by the Commission for any amendment to the Registration Statement or any amendment
or supplement to the Prospectus or the receipt of any comments from the Commission relating to the
Registration Statement or any other request by the Commission for any additional information; (iv)
of the issuance by the Commission of any order suspending the effectiveness of the Registration
Statement or preventing or suspending the use of any Preliminary Prospectus or the Prospectus or
the initiation or threatening of any proceeding for that purpose or pursuant to Section 8A of the
Securities Act; (v) of the occurrence of any event within the Prospectus Delivery Period as a
result of which the Prospectus, the Time of Sale Information or any Issuer Free Writing Prospectus
as then amended or supplemented would include any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary in order to make the statements
therein, in the light of the circumstances existing when the Prospectus, the Time of Sale
Information or any such Issuer
11
Free Writing Prospectus is delivered to a purchaser, not misleading; (vi) of the receipt by
the Company of any notice of objection of the Commission to the use of the Registration Statement
or any post-effective amendment thereto pursuant to Rule 401(g)(2) under the Securities Act; and
(vii) of the receipt by the Company of any notice with respect to any suspension of the
qualification of the Securities for offer and sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose; and the Company will use its reasonable best
efforts to prevent the issuance of any such order suspending the effectiveness of the Registration
Statement, preventing or suspending the use of any Preliminary Prospectus or the Prospectus or
suspending any such qualification of the Securities and, if any such order is issued, will obtain
as soon as possible the withdrawal thereof.
(e)
Time of Sale Information
. If at any time prior to the Closing Date (i) any event shall
occur or condition shall exist as a result of which the Time of Sale Information as then amended or
supplemented would include any untrue statement of a material fact or omit to state any material
fact necessary in order to make the statements therein, in the light of the circumstances, not
misleading or (ii) it is necessary to amend or supplement the Time of Sale Information to comply
with law, the Company will immediately notify the Underwriters thereof and forthwith prepare and,
subject to paragraph (c) above, file with the Commission (to the extent required) and furnish to
the Underwriters and to such dealers as the Representatives may designate, such amendments or
supplements to the Time of Sale Information as may be necessary so that the statements in the Time
of Sale Information as so amended or supplemented will not, in the light of the circumstances, be
misleading or so that the Time of Sale Information will comply with law.
(f)
Ongoing Compliance
. If during the Prospectus Delivery Period (i) any event shall occur or
condition shall exist as a result of which the Prospectus as then amended or supplemented would
include any untrue statement of a material fact or omit to state any material fact required to be
stated therein or necessary in order to make the statements therein, in the light of the
circumstances existing when the Prospectus is delivered to a purchaser, not misleading or (ii) it
is necessary to amend or supplement the Prospectus to comply with law, the Company will immediately
notify the Underwriters thereof and forthwith prepare and, subject to paragraph (c) above, file
with the Commission and furnish to the Underwriters and to such dealers as the Representatives may
designate, such amendments or supplements to the Prospectus as may be necessary so that the
statements in the Prospectus as so amended or supplemented will not, in the light of the
circumstances existing when the Prospectus is delivered to a purchaser, be misleading or so that
the Prospectus will comply with law.
(g)
Blue Sky Compliance
. The Company will qualify the Securities for offer and sale under the
securities or Blue Sky laws of such jurisdictions as the Representatives shall reasonably request
and will continue such qualifications in effect so long as required for distribution of the
Securities;
provided
that the Company shall not be required to (i) qualify as a foreign corporation
or other entity or as a dealer in securities in any such jurisdiction where it would not otherwise
be required to so qualify, (ii) file any general consent to service of process in any such
jurisdiction or (iii) subject itself to taxation in any such jurisdiction if it is not otherwise so
subject.
12
(h)
Earning Statement
. The Company will make generally available to its security holders and
the Representatives as soon as practicable an earning statement that satisfies the provisions of
Section 11(a) of the Securities Act and Rule 158 of the Commission promulgated thereunder covering
a period of at least twelve months beginning with the first fiscal quarter of the Company occurring
after the effective date (as defined in Rule 158) of the Registration Statement.
(i)
Clear Market
. During the period from the date hereof through and including the business
day following the Closing Date, the Company will not, without the prior written consent of the
Representatives, offer, sell, contract to sell or otherwise dispose of any debt securities issued
or guaranteed by the Company and having a tenor of more than one year.
(j)
Use of Proceeds
. The Company will apply the net proceeds from the sale of the Securities
as described in the Registration Statement, the Time of Sale Information and the Prospectus under
the heading Use of proceeds.
(k)
No Stabilization
. The Company will not take, directly or indirectly, any action designed
to or that could reasonably be expected to cause or result in any stabilization or manipulation of
the price of the Securities.
(l)
Record Retention
. The Company will, pursuant to reasonable procedures developed in good
faith, retain copies of each Issuer Free Writing Prospectus that is not filed with the Commission
in accordance with Rule 433 under the Securities Act.
5.
Certain Agreements of the Underwriters
. Each Underwriter hereby represents and
agrees that
(a) It has not and will not use, authorize use of, refer to, or participate in the planning
for use of, any free writing prospectus, as defined in Rule 405 under the Securities Act (which
term includes use of any written information furnished to the Commission by the Company and not
incorporated by reference into the Registration Statement and any press release issued by the
Company) other than (i) a free writing prospectus that, solely as a result of use by such
underwriter, would not trigger an obligation to file such free writing prospectus with the
Commission pursuant to Rule 433, (ii) any Issuer Free Writing Prospectus listed on Annex B or
prepared pursuant to Section 3(c) or Section 4(c) above (including any electronic road show), or
(iii) any free writing prospectus prepared by such underwriter and approved by the Company in
advance in writing (each such free writing prospectus referred to in clauses (i) or (iii), an
Underwriter Free Writing Prospectus). Notwithstanding the foregoing, the Underwriters may use a
term sheet substantially in the form of Annex C hereto without the consent of the Company.
(b) It is not subject to any pending proceeding under Section 8A of the Securities Act with
respect to the offering (and will promptly notify the Company if any such proceeding against it is
initiated during the Prospectus Delivery Period).
6.
Conditions of Underwriters Obligations
. The obligation of each Underwriter to
purchase Securities on the Closing Date as provided herein is subject to the performance by the
13
Company of its covenants and other obligations hereunder and to the following additional
conditions:
(a)
Registration Compliance; No Stop Order
. No order suspending the effectiveness of the
Registration Statement shall be in effect, and no proceeding for such purpose, pursuant to Rule
401(g)(2) or pursuant to Section 8A under the Securities Act shall be pending before or threatened
by the Commission; the Prospectus and each Issuer Free Writing Prospectus shall have been timely
filed with the Commission under the Securities Act (in the case of an Issuer Free Writing
Prospectus, to the extent required by Rule 433 under the Securities Act) and in accordance with
Section 4(a) hereof; and all requests by the Commission for additional information shall have been
complied with to the reasonable satisfaction of the Representatives.
(b)
Representations and Warranties
. The representations and warranties of the Company
contained herein shall be true and correct on the date hereof and on and as of the Closing Date;
and the statements of the Company and its officers made in any certificates delivered pursuant to
this Agreement shall be true and correct on and as of the Closing Date.
(c)
No Downgrade
. Subsequent to the earlier of (A) the Time of Sale and (B) the execution and
delivery of this Agreement, (i) no downgrading shall have occurred in the rating accorded the
Securities or any other debt securities or preferred stock of or guaranteed by the Company or any
of its subsidiaries by any nationally recognized statistical rating organization, as such term is
defined by the Commission for purposes of Rule 436(g)(2) under the Securities Act and (ii) no such
organization shall have publicly announced that it has under surveillance or review, or has changed
its outlook with respect to, its rating of the Securities or of any other debt securities or
preferred stock of or guaranteed by the Company or any of its subsidiaries (other than an
announcement with positive implications of a possible upgrading).
(d)
No Material Adverse Change
. No event or condition of a type described in Section 3(g)
hereof shall have occurred or shall exist, which event or condition is not described in the Time of
Sale Information (excluding any amendment or supplement thereto) and the Prospectus (excluding any
amendment or supplement thereto) and the effect of which in the judgment of the Representatives
makes it impracticable or inadvisable to proceed with the offering, sale or delivery of the
Securities on the terms and in the manner contemplated by this Agreement, the Time of Sale
Information and the Prospectus.
(e)
Officers Certificate
. The Representatives shall have received on and as of the Closing
Date a certificate of an executive officer of the Company who has specific knowledge of the
Companys financial matters and is satisfactory to the Representatives (i) confirming that such
officer has carefully reviewed the Registration Statement, the Time of Sale Information and the
Prospectus and, to the best knowledge of such officer, the representations set forth in Sections
3(b) or 3(d) hereof are true and correct, (ii) confirming that the other representations and
warranties of the Company in this Agreement are true and correct and that the Company has complied
with all agreements and satisfied all conditions on its part to be performed or satisfied hereunder
at or prior to the Closing Date and (iii) to the effect set forth in paragraphs (a), (c) and (d)
above.
14
(f)
Comfort Letters
. On the date of this Agreement and on the Closing Date,
PricewaterhouseCoopers LLP shall have furnished to the Representatives, at the request of the
Company, letters, dated the respective dates of delivery thereof and addressed to the Underwriters,
in form and substance reasonably satisfactory to the Representatives, containing statements and
information of the type customarily included in accountants comfort letters to underwriters with
respect to the financial statements and certain financial information contained or incorporated by
reference in the Registration Statement, the Time of Sale Information and the Prospectus;
provided
that the letter delivered on the Closing Date shall use a cut-off date no more than three
business days prior to the Closing Date.
(g)
Opinion and 10b-5 Statement of Chief Legal Officer for the Company
. Theresa K. Lee,
Senior Vice President, Chief Legal Officer and Corporate Secretary for the Company, shall have
furnished to the Representatives, at the request of the Company, her written opinion and 10b-5
Statement, dated the Closing Date and addressed to the Underwriters, in form and substance
reasonably satisfactory to the Representatives, to the effect set forth in Annex A hereto.
(h)
Opinion and 10b-5 Statement of Counsel for the Underwriters
. The Representatives shall
have received on and as of the Closing Date an opinion and 10b-5 Statement of Davis Polk & Wardwell
LLP, counsel for the Underwriters, with respect to such matters as the Representatives may
reasonably request, and such counsel shall have received such documents and information as they may
reasonably request to enable them to pass upon such matters.
(i)
No Legal Impediment to Issuance
. No action shall have been taken and no statute, rule,
regulation or order shall have been enacted, adopted or issued by any federal, state or foreign
governmental or regulatory authority that would, as of the Closing Date, prevent the issuance or
sale of the Securities; and no injunction or order of any federal, state or foreign court shall
have been issued that would, as of the Closing Date, prevent the issuance or sale of the
Securities.
(j)
Good Standing
. The Representatives shall have received on and as of the Closing Date
satisfactory evidence of the good standing of the Company in its jurisdiction of incorporation and
its good standing in such other jurisdictions as the Representatives may reasonably request, in
each case in writing or any standard form of telecommunication from the appropriate governmental
authorities of such jurisdictions.
(k)
Additional Documents
. On or prior to the Closing Date, the Company shall have furnished
to the Representatives such further certificates and documents as the Representatives may
reasonably request.
All opinions, letters, certificates and evidence mentioned above or elsewhere in this
Agreement shall be deemed to be in compliance with the provisions hereof only if they are in form
and substance reasonably satisfactory to counsel for the Underwriters.
15
7.
Indemnification and Contribution
.
(a)
Indemnification of the Underwriters
. The Company agrees to indemnify and hold harmless
each Underwriter, its affiliates, directors and officers and each person, if any, who controls such
Underwriter within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange
Act, from and against any and all losses, claims, damages and liabilities (including, without
limitation, legal fees and other expenses incurred in connection with any suit, action or
proceeding or any claim asserted, as such fees and expenses are incurred), joint or several, that
arise out of, or are based upon, (i) any untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement or caused by any omission or alleged omission to state
therein a material fact required to be stated therein or necessary in order to make the statements
therein, not misleading, (ii) or any untrue statement or alleged untrue statement of a material
fact contained in the Prospectus (or any amendment or supplement thereto), any Issuer Free Writing
Prospectus or any Time of Sale Information, or caused by any omission or alleged omission to state
therein a material fact necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading, in each case except insofar as such
losses, claims, damages or liabilities arise out of, or are based upon, any untrue statement or
omission or alleged untrue statement or omission made in reliance upon and in conformity with any
information relating to any Underwriter furnished to the Company in writing by such Underwriter
through the Representatives expressly for use therein.
(b)
Indemnification of the Company
. Each Underwriter agrees, severally and not jointly, to
indemnify and hold harmless the Company, its directors, its officers who signed the Registration
Statement and each person, if any, who controls the Company within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act to the same extent as the indemnity set forth in
paragraph (a) above, but only with respect to any losses, claims, damages or liabilities
(including, without limitation, legal fees and other expenses incurred in connection with any suit,
action or proceeding or any claim asserted, as such fees and expenses are incurred) that arise out
of, or are based upon, any untrue statement or omission or alleged untrue statement or omission
made in reliance upon and in conformity with any information relating to such Underwriter furnished
to the Company in writing by such Underwriter through the Representatives expressly for use in the
Registration Statement, the Prospectus (or any amendment or supplement thereto), any Issuer Free
Writing Prospectus or any Time of Sale Information, it being understood and agreed that the only
such information consists of the following: The third paragraph of text under the caption
Underwriting in the Preliminary Prospectus Supplement and the Prospectus Supplement concerning
the terms of offering, including the concession and reallowance to certain dealers, by the
Underwriters; the third and fourth sentences of the seventh paragraph of text under the caption
Underwriting in the Preliminary Prospectus Supplement and the Prospectus Supplement relating to
market making by the Underwriters; and the eighth paragraph of text under the caption
Underwriting in the Preliminary Prospectus Supplement and the Prospectus Supplement relating to
over-allotment, stabilization and syndicate covering transactions by the Underwriters.
(c)
Notice and Procedures
. If any suit, action, proceeding (including any governmental or
regulatory investigation), claim or demand shall be brought or asserted against any person in
respect of which indemnification may be sought pursuant to either paragraph (a) or (b) above, such
person (the Indemnified Person) shall promptly notify the person against
16
whom such indemnification may be sought (the Indemnifying Person) in writing;
provided
that
the failure to notify the Indemnifying Person shall not relieve it from any liability that it may
have under this Section 7 except to the extent that it has been materially prejudiced (through the
forfeiture of substantive rights or defenses) by such failure; and
provided
,
further
, that the failure to notify the Indemnifying Person shall not relieve it from any
liability that it may have to an Indemnified Person otherwise than under this Section 7. If any
such proceeding shall be brought or asserted against an Indemnified Person and it shall have
notified the Indemnifying Person thereof, the Indemnifying Person shall retain counsel reasonably
satisfactory to the Indemnified Person (who shall not, without the consent of the Indemnified
Person, be counsel to the Indemnifying Person) to represent the Indemnified Person and any others
entitled to indemnification pursuant to Section 7 that the Indemnifying Party may designate in such
proceeding and shall pay the reasonable fees and expenses of such proceeding and shall pay the fees
and expenses of counsel related to such proceeding, as incurred. In any such proceeding, any
Indemnified Person shall have the right to retain its own counsel, but the fees and expenses of
such counsel shall be at the expense of such Indemnified Person unless (i) the Indemnifying Person
and the Indemnified Person shall have mutually agreed to the contrary; (ii) the Indemnifying Person
has failed within a reasonable time to retain counsel reasonably satisfactory to the Indemnified
Person; (iii) the Indemnified Person shall have reasonably concluded that there may be legal
defenses available to it that are different from or in addition to those available to the
Indemnifying Person; or (iv) the named parties in any such proceeding (including any impleaded
parties) include both the Indemnifying Person and the Indemnified Person and representation of both
parties by the same counsel would be inappropriate due to actual or potential differing interests
between them. It is understood and agreed that the Indemnifying Person shall not, in connection
with any proceeding or related proceeding in the same jurisdiction, be liable for the fees and
expenses of more than one separate firm (in addition to any local counsel) for all Indemnified
Persons, and that all such fees and expenses shall be reimbursed as they are incurred. Any such
separate firm for any Underwriter, its affiliates, directors and officers and any control persons
of such Underwriter shall be designated in writing by the Representatives and any such separate
firm for the Company, its directors, its officers who signed the Registration Statement and any
control persons of the Company shall be designated in writing by the Company. The Indemnifying
Person shall not be liable for any settlement of any proceeding effected without its written
consent, but if settled with such consent or if there be a final judgment for the plaintiff, the
Indemnifying Person agrees to indemnify each Indemnified Person from and against any loss or
liability by reason of such settlement or judgment. Notwithstanding the foregoing sentence, if at
any time an Indemnified Person shall have requested that an Indemnifying Person reimburse the
Indemnified Person for fees and expenses of counsel as contemplated by this paragraph, the
Indemnifying Person shall be liable for any settlement of any proceeding effected without its
written consent if (i) such settlement is entered into more than 30 days after receipt by the
Indemnifying Person of such request and (ii) the Indemnifying Person shall not have reimbursed the
Indemnified Person in accordance with such request prior to the date of such settlement. No
Indemnifying Person shall, without the written consent of the Indemnified Person, effect any
settlement of any pending or threatened proceeding in respect of which any Indemnified Person is or
could have been a party and indemnification could have been sought hereunder by such Indemnified
Person, unless such settlement (x) includes an unconditional release of such Indemnified Person, in
form and substance reasonably satisfactory to such Indemnified Person, from all liability on claims
that are the
17
subject matter of such proceeding and (y) does not include any statement as to or any admission of fault,
culpability or a failure to act by or on behalf of any Indemnified Person.
(d)
Contribution
. If the indemnification provided for in paragraphs (a) and (b) above is
unavailable to an Indemnified Person or insufficient in respect of any losses, claims, damages or
liabilities referred to therein, then each Indemnifying Person under such paragraph, in lieu of
indemnifying such Indemnified Person thereunder, shall contribute to the amount paid or payable by
such Indemnified Person as a result of such losses, claims, damages or liabilities (i) in such
proportion as is appropriate to reflect the relative benefits received by the Company on the one
hand and the Underwriters on the other from the offering of the Securities or (ii) if the
allocation provided by clause (i) is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i) but also the
relative fault of the Company on the one hand and the Underwriters on the other in connection with
the statements or omissions that resulted in such losses, claims, damages or liabilities, as well
as any other relevant equitable considerations. The relative benefits received by the Company on
the one hand and the Underwriters on the other shall be deemed to be in the same respective
proportions as the net proceeds (before deducting expenses) received by the Company from the sale
of the Securities and the total underwriting discounts and commissions received by the Underwriters
in connection therewith, in each case as set forth in the table on the cover of the Prospectus,
bear to the aggregate offering price of the Securities. The relative fault of the Company on the
one hand and the Underwriters on the other shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the Company or by the
Underwriters and the parties relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission.
(e)
Limitation on Liability
. The Company and the Underwriters agree that it would not be just
and equitable if contribution pursuant to this Section 7 were determined by
pro
rata
allocation
(even if the Underwriters were treated as one entity for such purpose) or by any other method of
allocation that does not take account of the equitable considerations referred to in paragraph (d)
above. The amount paid or payable by an Indemnified Person as a result of the losses, claims,
damages and liabilities referred to in paragraph (d) above shall be deemed to include, subject to
the limitations set forth above, any legal or other expenses incurred by such Indemnified Person in
connection with any such action or claim. Notwithstanding the provisions of this Section 7, in no
event shall an Underwriter be required to contribute any amount in excess of the amount by which
the total underwriting discounts and commissions received by such Underwriter with respect to the
offering of the Securities exceeds the amount of any damages that such Underwriter has otherwise
been required to pay by reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Underwriters obligations to contribute pursuant to this Section
7 are several in proportion to their respective purchase obligations hereunder and not joint.
(f)
Non-Exclusive Remedies
. The remedies provided for in this Section 7 are not exclusive and
shall not limit any rights or remedies which may otherwise be available to any Indemnified Person
at law or in equity.
18
8.
Effectiveness of Agreement
. This Agreement shall become effective upon the
execution and delivery hereof by the parties hereto.
9.
Termination
. This Agreement may be terminated in the absolute discretion of the
Representatives, by notice to the Company, if after the execution and delivery of this Agreement
and prior to the Closing Date (i) trading generally shall have been suspended or materially limited
on the New York Stock Exchange or the over-the-counter market; (ii) trading of any securities
issued or guaranteed by the Company shall have been suspended on any exchange or in any
over-the-counter market; (iii) a general moratorium on commercial banking activities shall have
been declared by federal or New York State authorities; or (iv) there shall have occurred any
outbreak or escalation of hostilities or any change in financial markets or any calamity or crisis,
either within or outside the United States, that, in the judgment of the Representatives, is
material and adverse and makes it impracticable or inadvisable to proceed with the offering, sale
or delivery of the Securities on the terms and in the manner contemplated by this Agreement, the
Time of Sale Information and the Prospectus.
10.
Defaulting Underwriter
. (a) If, on the Closing Date, any Underwriter defaults on
its obligation to purchase the Securities that it has agreed to purchase hereunder, the
non-defaulting Underwriters may in their discretion arrange for the purchase of such Securities by
other persons satisfactory to the Company on the terms contained in this Agreement. If, within 36
hours after any such default by any Underwriter, the non-defaulting Underwriters do not arrange for
the purchase of such Securities, then the Company shall be entitled to a further period of 36 hours
within which to procure other persons satisfactory to the non-defaulting Underwriters to purchase
such Securities on such terms. If other persons become obligated or agree to purchase the
Securities of a defaulting Underwriter, either the non defaulting Underwriters or the Company may
postpone the Closing Date for up to five full business days in order to effect any changes that in
the opinion of counsel for the Company or counsel for the Underwriters may be necessary in the
Registration Statement and the Prospectus or in any other document or arrangement, and the Company
agrees to promptly prepare any amendment or supplement to the Registration Statement and the
Prospectus that effects any such changes. As used in this Agreement, the term Underwriter
includes, for all purposes of this Agreement unless the context otherwise requires, any person not
listed in Schedule 1 hereto that, pursuant to this Section 10, purchases Securities that a
defaulting Underwriter agreed but failed to purchase.
(b) If, after giving effect to any arrangements for the purchase of the Securities of a
defaulting Underwriter or Underwriters by the non-defaulting Underwriters and the Company as
provided
in paragraph (a) above, the aggregate principal amount of such Securities that remains
unpurchased does not exceed one-eleventh of the aggregate principal amount of all the Securities,
then the Company shall have the right to require each non-defaulting Underwriter to purchase the
principal amount of Securities that such Underwriter agreed to purchase hereunder plus such
Underwriters pro rata share (based on the principal amount of Securities that such Underwriter
agreed to purchase hereunder) of the Securities of such defaulting Underwriter or Underwriters for
which such arrangements have not been made.
(c) If, after giving effect to any arrangements for the purchase of the Securities of a
defaulting Underwriter or Underwriters by the non-defaulting Underwriters and the Company as
provided in paragraph (a) above, the aggregate principal amount of such Securities that remains
19
unpurchased exceeds one-eleventh of the aggregate principal amount of all the Securities, or
if the Company shall not exercise the right described in paragraph (b) above, then this Agreement
shall terminate without liability on the part of the non-defaulting Underwriters. Any termination
of this Agreement pursuant to this Section 10 shall be without liability on the part of the
Company, except that the Company will continue to be liable for the payment of expenses as set
forth in Section 11 hereof and except that the provisions of Section 7 hereof shall not terminate
and shall remain in effect.
(d) Nothing contained herein shall relieve a defaulting Underwriter of any liability it may
have to the Company or any non-defaulting Underwriter for damages caused by its default.
11.
Payment of Expenses
. (a) Whether or not the transactions contemplated by this
Agreement are consummated or this Agreement is terminated, the Company will pay or cause to be paid
all costs and expenses incident to the performance of its obligations hereunder, including without
limitation, (i) the costs incident to the authorization, issuance, sale, preparation and delivery
of the Securities and any taxes payable in that connection; (ii) the costs incident to the
preparation, printing and filing under the Securities Act of the Registration Statement, the
Preliminary Prospectus, any Issuer Free Writing Prospectus, any Time of Sale Information and the
Prospectus (including all exhibits, amendments and supplements thereto) and the distribution
thereof; (iii) the costs of reproducing and distributing each of the Transaction Documents; (iv)
the fees and expenses of the Companys counsel and independent accountants; (v) the fees and
expenses incurred in connection with the registration or qualification and determination of
eligibility for investment of the Securities under the laws of such jurisdictions as the
Representatives may designate and the preparation, printing and distribution of a Blue Sky
Memorandum (including the related fees and expenses of counsel for the Underwriters); (vi) any fees
charged by rating agencies for rating the Securities; (vii) the fees and expenses of the Trustee
and any paying agent (including related fees and expenses of any counsel to such parties); (viii)
all expenses and application fees incurred in connection with any filing with, and clearance of the
offering by, Financial Industry Regulatory Authority, Inc.; and (ix) all expenses incurred by the
Company in connection with any road show presentation to potential investors.
(b) If (i) this Agreement is terminated pursuant to Section 9, (ii) the Company for any reason
fails to tender the Securities for delivery to the Underwriters or (iii) the Underwriters decline
to purchase the Securities for any reason permitted under this Agreement, the Company agrees to
reimburse the Underwriters for all out-of-pocket costs and expenses (including the reasonable fees
and expenses of their counsel) reasonably incurred by the Underwriters in connection with this
Agreement and the offering contemplated hereby.
12.
Persons Entitled to Benefit of Agreement
. This Agreement shall inure to the
benefit of and be binding upon the parties hereto and their respective successors and the officers
and directors and any controlling persons referred to herein, and the affiliates of each
Underwriter referred to in Section 7 hereof. Nothing in this Agreement is intended or shall be
construed to give any other person any legal or equitable right, remedy or claim under or in
respect of this Agreement or any provision contained herein. No purchaser of Securities from any
Underwriter shall be deemed to be a successor merely by reason of such purchase.
20
13.
Survival
. The respective indemnities, rights of contribution, representations,
warranties and agreements of the Company and the Underwriters contained in this Agreement or made
by or on behalf of the Company or the Underwriters pursuant to this Agreement or any certificate
delivered pursuant hereto shall survive the delivery of and payment for the Securities and shall
remain in full force and effect, regardless of any termination of this Agreement or any
investigation made by or on behalf of the Company or the Underwriters.
14.
Certain Defined Terms
. For purposes of this Agreement, (a) except where otherwise
expressly provided, the term affiliate has the meaning set forth in Rule 405 under the Securities
Act; (b) the term business day means any day other than a day on which banks are permitted or
required to be closed in New York City; (c) the term subsidiary has the meaning set forth in Rule
405 under the Securities Act; and (d) the term significant subsidiary has the meaning set forth
in Rule 1-02 of Regulation S-X under the Exchange Act.
15.
Miscellaneous
. (a)
Authority of the Representatives
. Any action by the
Underwriters hereunder may be taken by the Representatives on behalf of the Underwriters, and any
such action taken by the Representatives shall be binding upon the Underwriters.
(b)
Notices
. All notices and other communications hereunder shall be in writing and shall be
deemed to have been duly given if mailed or transmitted and confirmed by any standard form of
telecommunication. Notices to the Underwriters shall be given to the Representatives c/o Citigroup
Global Markets Inc., 388 Greenwich Street, New York, New York 10013 (fax: 212-816-7912); Attention:
General Counsel; and J.P. Morgan Securities Inc., 270 Park Avenue, New York, New York 10017 (fax:
212-834-6081); Attention: High Grade Syndicate Desk. Notices to the Company shall be given to it
at Eastman Chemical Company, 100 North Eastman Road, Kingsport, Tennessee 37660, (fax:
423-224-0165); Attention: Treasurer.
(c)
Governing Law
. This Agreement shall be governed by and construed in accordance with the
laws of the State of New York.
(d)
Counterparts
. This Agreement may be signed in counterparts (which may include
counterparts delivered by any standard form of telecommunication), each of which shall be an
original and all of which together shall constitute one and the same instrument.
(e)
Amendments or Waivers
. No amendment or waiver of any provision of this Agreement, nor any
consent or approval to any departure therefrom, shall in any event be effective unless the same
shall be in writing and signed by the parties hereto.
(f)
Headings
. The headings herein are included for convenience of reference only and are not
intended to be part of, or to affect the meaning or interpretation of, this Agreement.
21
If the foregoing is in accordance with your understanding, please indicate your acceptance of
this Agreement by signing in the space
provided
below.
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Very truly yours,
EASTMAN CHEMICAL COMPANY
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By
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/s/ Curtis E. Espeland
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Curtis E. Espeland
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Senior Vice President and Chief Financial Officer
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Accepted: October 28, 2009
CITIGROUP GLOBAL MARKETS INC.
J.P. MORGAN SECURITIES INC.
For themselves and on behalf of the
several Underwriters listed
in Schedule 1 hereto.
CITIGROUP GLOBAL MARKETS INC.
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By:
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/s/
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Authorized Signatory
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J.P. Morgan Securities Inc.
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By:
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/s/
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Authorized Signatory
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22
Exhibit 4.1
[Face of Security]
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO
AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE THEREOF. THIS SECURITY MAY NOT BE
EXCHANGED IN WHOLE OR IN PART FOR A SECURITY REGISTERED, AND NO TRANSFER OF THIS SECURITY IN WHOLE
OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH DEPOSITARY OR A NOMINEE
THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY, A NEW YORK CORPORATION (DTC), TO EASTMAN CHEMICAL COMPANY OR ITS AGENT FOR REGISTRATION
OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE &
CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT
IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
CUSIP No. 277432AH3
EASTMAN CHEMICAL COMPANY
5.500% Notes due 2019
EASTMAN CHEMICAL COMPANY, a corporation duly organized and existing under the laws of the
State of Delaware (herein called the Company, which term includes any successor Person under the
Indenture hereinafter referred to), for value received, hereby promises to pay to CEDE & CO., or
registered assigns, the principal sum of Two Hundred Fifty Million Dollars ($250,000,000) on
November 15, 2019, and to pay interest thereon from November 2, 2009 or from the most recent
Interest Payment Date to which interest has been paid or duly provided for, semi-annually on May 15
and November 15 in each year, commencing May 15, 2010, at the rate of 5.500% per annum, until the
principal hereof is paid or made available for payment. The interest so payable, and punctually
paid or duly provided for, on any Interest Payment Date will, as provided in such Indenture, be
paid to the Person in whose name this Security (or one or more Predecessor Securities) is
registered at the close of business on the Regular Record Date for such interest, which shall be
the May 1 or November 1 (whether or not a Business Day), as the case may be, next preceding such
Interest Payment Date. Any such interest not so punctually paid or duly provided for will
forthwith cease to be payable to the Holder on such Regular Record Date and may either be paid to
the Person in whose name this Security (or one or more Predecessor Securities) is registered at the
close of business on a
Special Record Date for the payment of such Defaulted Interest to be fixed by the Trustee,
notice whereof shall be given to Holders of Securities of this series not less than 10 days prior
to such Special Record Date, or be paid at any time in any other lawful manner not inconsistent
with the requirements of any securities exchange on which the Securities of this series may be
listed, and upon such notice as may be required by such exchange, all as more fully provided in
said Indenture. Interest on the Securities of this series shall be computed on the basis of a
360-day year consisting of twelve 30-day months.
Payment of the principal of (and premium, if any) and any such interest on this Security will
be made at the office or agency of the Company maintained for that purpose in The City of New York,
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;
provided
,
however
, that at the option of the Company
payment of interest may be made by check mailed to the address of the Person entitled thereto as
such address shall appear in the Security Register.
Reference is hereby made to the further provisions of this Security set forth on the reverse
hereof, which further provisions shall for all purposes have the same effect as if set forth at
this place.
Unless the certificate of authentication hereon has been executed by the Trustee referred to
on the reverse hereof by manual signature, this Security shall not be entitled to any benefit under
the Indenture or be valid or obligatory for any purpose.
2
In Witness Whereof
, the Company has caused this instrument to be duly executed under
its corporate seal.
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EASTMAN CHEMICAL COMPANY
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By:
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Mary D. Hall
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Vice President and Treasurer
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Attest:
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Brian L. Henry
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Assistant Secretary
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CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated therein referred to in the
within-mentioned Indenture.
Dated: November 2, 2009
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THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.
As Trustee
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By:
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Authorized Signatory
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3
[Reverse of Security]
This Security is one of a duly authorized issue of securities of the Company (herein called
the Securities), issued and to be issued in one or more series under an Indenture, dated as of
January 10, 1994 (herein called the Indenture, which term shall have the meaning assigned to it
in such instrument), between the Company and The Bank of New York Mellon Trust Company, N.A., as
Trustee (herein called the Trustee, which term includes any successor Trustee under the
Indenture), and reference is hereby made to the Indenture for a statement of the respective rights,
limitations of rights, duties and immunities thereunder of the Company, the Trustee and the Holders
of the Securities and of the terms upon which the Securities are, and are to be, authenticated and
delivered. This Security is one of the series designated on the face hereof, initially limited in
aggregate principal amount to $250,000,000;
provided
that the Company may from time to time,
without notice to or the consent of the Holders of Securities, create and issue further Securities
of this series (the Additional Securities) having the same terms and ranking equally and ratably
with the Securities of this series in all respects and with the same CUSIP number as the Securities
of this series, or in all respects except for the payment of interest accruing prior to the Issue
Date or except for the first payment of interest following the issue date of such Additional
Securities. Any Additional Securities will be consolidated and form a single series with the
Securities and shall have the same terms as to status, redemption and otherwise as the Securities.
Any Additional Securities may be issued pursuant to authorization provided by a resolution of the
Board of Directors of the Company, a supplement to the Indenture, or under an Officers Certificate
pursuant to the Indenture. No Additional Securities may be issued if an Event of Default has
occurred with respect to the Securities of this series.
The Indenture contains provisions for defeasance at any time of the entire indebtedness of
this Security or certain restrictive covenants and Events of Default with respect to this Security,
in each case upon compliance with certain conditions set forth in the Indenture.
If an Event of Default with respect to Securities of this series shall occur and be
continuing, the principal of the Securities of this series may be declared due and payable in the
manner and with the effect provided in the Indenture.
The Indenture permits, with certain exceptions as therein provided, the amendment thereof and
the modification of the rights and obligations of the Company and the rights of the Holders of the
Securities of each series to be affected under the Indenture at any time by the Company and the
Trustee with the consent of the Holders of a majority in principal amount of the Securities at the
time Outstanding of each series to be affected. The Indenture also contains provisions permitting
the Holders of specified percentages in principal amount of the Securities of each series at the
time Outstanding, on behalf of the Holders of all Securities of such series, to waive compliance by
the Company with certain provisions of the Indenture and certain past defaults under the Indenture
and their consequences. Any such consent or waiver by the Holder of this Security shall be
conclusive and binding upon such Holder and upon all future Holders of this Security and of any
Security issued upon the registration of transfer hereof or in exchange herefor or in lieu hereof,
whether or not notation of such consent or waiver is made upon this Security.
4
As provided in and subject to the provisions of the Indenture, the Holder of this Security
shall not have the right to institute any proceeding with respect to the Indenture or for the
appointment of a receiver or Trustee or for any other remedy thereunder, unless such Holder shall
have previously given the Trustee written notice of a continuing Event of Default with respect to
the Securities of this series, the Holders of not less than 25% in principal amount of the
Securities of this series at the time Outstanding shall have made written request to the Trustee to
institute proceedings in respect of such Event of Default as Trustee and offered the Trustee
reasonable indemnity, and the Trustee shall not have received from the Holders of a majority in
principal amount of Securities of this series at the time Outstanding a direction inconsistent with
such request, and shall have failed to institute any such proceeding, for 60 days after receipt of
such notice, request and offer of indemnity. The foregoing shall not apply to any suit instituted
by the Holder of this Security for the enforcement of any payment of principal hereof or any
premium or interest hereon on or after the respective due dates expressed herein.
No reference herein to the Indenture and no provision of this Security or of the Indenture
shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay
the principal of and any premium and interest on this Security at the times, place and rate, and in
the coin or currency, herein prescribed.
As provided in the Indenture and subject to certain limitations therein set forth, the
transfer of this Security is registrable in the Security Register, upon surrender of this Security
for registration of transfer at the office or agency of the Company in any place where the
principal of and any premium and interest on this Security are payable, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the Company and the
Security Registrar duly executed by, the Holder hereof or his attorney duly authorized in writing,
and thereupon one or more new Securities of this series and of like tenor, of authorized
denominations and for the same aggregate principal amount, will be issued to the designated
transferee or transferees.
The Company may redeem the Securities, in whole or in part, at the Companys option, at any
time at a Redemption Price equal to the greater of:
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100% of the principal amount of the Securities to be redeemed; or
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as determined by a Quotation Agent (as defined below), the sum of the
present values of the remaining scheduled payments of principal and interest
thereon (not including any portion of such payments of interest accrued to the
date of redemption) discounted to the Redemption Date on a semiannual basis
(assuming a 360-day year consisting of twelve 30-day months) at the Adjusted
Treasury Rate (as defined below) plus 30 basis points
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plus, in each case, accrued and unpaid interest on the Securities to the Redemption Date provided
that the principal amount of a note remaining outstanding after redemption in part shall be $2,000
or an integral multiple of $1,000 in excess thereof.
Adjusted Treasury Rate means, with respect to any Redemption Date, the rate per annum equal
to the semiannual equivalent yield to maturity of the Comparable Treasury
Issue, assuming a price for the Comparable Treasury Issue (expressed as a percentage of its
principal amount) equal to the Comparable Treasury Price for such Redemption Date.
5
Comparable Treasury Issue means the United States Treasury security selected by a Quotation
Agent as having a maturity comparable to the remaining term of the Securities to be redeemed that
would be utilized, at the time of selection and in accordance with customary financial practice, in
pricing new issues of corporate debt securities of comparable maturity to the remaining term of
such Securities.
Quotation Agent means the Reference Treasury Dealer appointed by the Trustee after
consultation with the Company.
Comparable Treasury Price means, with respect to any Redemption Date, (1) the average of the
Reference Treasury Dealer Quotations for such Redemption Date, after excluding the highest and
lowest such Reference Treasury Dealer Quotations, or (2) if the Trustee obtains fewer than three
such Reference Treasury Dealer Quotations, the average of all such quotations.
Reference Treasury Dealer means (1) Citigroup Global Markets Inc., J.P. Morgan Securities
Inc. and their respective successors; provided, however, that if either of the foregoing shall
cease to be a primary U.S. Government securities dealer in New York City (a Primary Treasury
Dealer), the Company shall substitute therefor another Primary Treasury Dealer; and (2) any other
Primary Treasury Dealer selected by the Trustee after consultation with the Company.
Reference Treasury Dealer Quotations means, with respect to each Reference Treasury Dealer
and any Redemption Date, the average, as determined by the Trustee, of the bid and asked prices for
the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount)
quoted in writing to the Trustee by such Reference Treasury Dealer at 5:00 p.m., New York City
time, on the third business day preceding such Redemption Date.
The Company will give notice to the Trustee of any redemption the Company proposes to make at
least 30 days, but not more than 60 days, before the Redemption Date.
Unless the Company defaults in payment of the Redemption Price, on and after the Redemption
Date, interest will cease to accrue on the Securities or portions of the Securities called for
redemption.
Upon the occurrence of a Change of Control Triggering Event with respect to the Securities,
unless the Company has exercised its right to redeem the Securities as described above, each holder
of Securities will have the right to require the Company to purchase all or a portion of such
holders Securities pursuant to the offer described below (the Change of Control Offer), at a
purchase price equal to 101% of the principal amount thereof plus accrued and unpaid interest, if
any, to the date of purchase (the Change of Control Payment), subject to the rights of holders of
Securities on the relevant record date to receive interest due on the relevant interest payment
date.
6
Within 30 days following the date upon which the Change of Control Triggering Event occurred
with respect to the Securities, or at the Companys option, prior to any Change of Control but
after the public announcement of the pending Change of Control, the Company will be required to
send, by first class mail, a notice to each holder of Securities, with a copy to the Trustee, which
notice will govern the terms of the Change of Control Offer. Such notice will state, among other
things, the purchase date, which must be no earlier than 30 days nor later than 60 days from the
date such notice is mailed, other than as may be required by law (the Change of Control Payment
Date). The notice, if mailed prior to the date of consummation of the Change of Control, will
state that the Change of Control Offer is conditioned on the Change of Control being consummated on
or prior to the Change of Control Payment Date.
On the Change of Control Payment Date, the Company will, to the extent lawful:
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accept or cause a third party to accept for payment all Securities or
portions of Securities properly tendered pursuant to the Change of Control
Offer;
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deposit or cause a third party to deposit with the paying agent an amount
equal to the Change of Control Payment in respect of all Securities or portions
of Securities properly tendered; and
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deliver or cause to be delivered to the Trustee the Securities properly
accepted together with an Officers Certificate stating the aggregate principal
amount of Securities or portions of Securities being repurchased and that all
conditions precedent to the Change of Control Offer and to the repurchase by
the Company of Securities pursuant to the Change of Control Offer have been
complied with.
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The Company will not be required to make a Change of Control Offer with respect to the
Securities if a third party makes such an offer in the manner, at the times and otherwise in
compliance with the requirements for such an offer otherwise required to be made by the Company and
such third party purchases all the Securities properly tendered and not withdrawn under its offer.
The Company will comply in all material respects with the requirements of Rule 14e-1 under the
Securities Exchange Act of 1934 (the Exchange Act), and any other securities laws and regulations
thereunder to the extent those laws and regulations are applicable in connection with the
repurchase of the Securities as a result of a Change of Control Triggering Event. To the extent
that the provisions of any such securities laws or regulations conflict with the Change of Control
Offer provisions of the Securities, the Company will comply with those securities laws and
regulations and will not be deemed to have breached its obligations under the Change of Control
Offer provisions of the Securities by virtue of any such conflict.
7
For purposes of the foregoing discussion of a Change of Control Offer, the following
definitions are applicable:
Below Investment Grade Rating Event means the Securities cease to be rated Investment Grade
by each of the Rating Agencies on any date during the period (the Trigger
Period) commencing on the earlier of (a) the occurrence of a Change of Control and (b) the
first public announcement by the Company of any Change of Control (or pending Change of Control)
and ending 60 days following the consummation of such Change of Control (which Trigger Period will
be extended if the rating of the Securities is under publicly announced consideration for possible
downgrade by any Rating Agency on such 60th day, such extension to last with respect to each Rating
Agency until the date on which such Rating Agency considering such possible downgrade either (x)
rates the Securities below Investment Grade or (y) publicly announces that it is no longer
considering the Securities for possible downgrade;
provided
, that no such extension will occur if
on such 60th day the Securities are rated Investment Grade not subject to review for possible
downgrade by any Rating Agency);
provided
, that a rating event will not be deemed to have occurred
in respect of a particular Change of Control (and thus will not be deemed a Below Investment Grade
Rating Event for purposes of the definition of Change of Control Triggering Event) if each Rating
Agency making the reduction in rating does not publicly announce or confirm or inform the Trustee
in writing at the Companys request that the reduction was the result, in whole or in part, of any
event or circumstance comprised of or arising as a result of, or in respect of, the Change of
Control (whether or not the applicable Change of Control has occurred at the time of the Below
Investment Grade Rating Event).
Change of Control means the occurrence of any of the following after the date of issuance of
the Securities:
(1) the direct or indirect sale, lease, transfer, conveyance or other disposition (other than
by way of merger or consolidation), in one or a series of related transactions, of all or
substantially all of the assets of the Company and its subsidiaries taken as a whole to any
person or group (as those terms are used in Section 13(d)(3) of the Exchange Act) other than to
the Company or one of its subsidiaries;
(2) the consummation of any transaction (including, without limitation, any merger or
consolidation) the result of which is that any person or group (as those terms are used in
Section 13(d)(3) of the Exchange Act, it being agreed that an employee of the Company or any of its
subsidiaries for whom shares are held under an employee stock ownership, employee retirement,
employee savings or similar plan and whose shares are voted in accordance with the instructions of
such employee shall not be a member of a group (as that term is used in Section 13(d)(3) of the
Exchange Act) solely because such employees shares are held by a Trustee under said plan) becomes
the beneficial owner (as defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or
indirectly, of the Companys Voting Stock representing more than 50% of the voting power of the
Companys outstanding Voting Stock;
(3) the Company consolidates with, or merges with or into, any Person, or any Person
consolidates with, or merges with or into, the Company, in any such event pursuant to a transaction
in which any of the Companys outstanding Voting Stock or Voting Stock of such other Person is
converted into or exchanged for cash, securities or other property, other than any such transaction
where the Companys Voting Stock outstanding immediately prior to such transaction constitutes, or
is converted into or exchanged for, Voting Stock representing more than 50% of the voting power of
the Voting Stock of the surviving Person immediately after giving effect to such transaction; or
8
(4) during any period of 24 consecutive calendar months, the majority of the members of the
Companys Board of Directors shall no longer be composed of individuals (a) who were members of the
Companys Board of Directors on the first day of such period or (b) whose election or nomination to
the Companys Board of Directors was approved by individuals referred to in clause (a) above
constituting, at the time of such election or nomination, at least a majority of the Companys
Board of Directors or, if directors are nominated by a committee of the Companys Board of
Directors, constituting at the time of such nomination, at least a majority of such committee.
Notwithstanding the foregoing, a transaction will not be deemed to involve a Change of Control
if (i) the Company becomes a direct or indirect wholly-owned subsidiary of a holding company and
(ii) the direct or indirect holders of the Voting Stock of such holding company immediately
following that transaction are substantially the same as the holders of the Companys Voting Stock
immediately prior to that transaction.
Change of Control Triggering Event means the occurrence of both a Change of Control and a
Below Investment Grade Rating Event. Notwithstanding the foregoing, no Change of Control Triggering
Event will be deemed to have occurred in connection with any particular Change of Control unless
and until such Change of Control has actually been consummated.
Investment Grade means a rating of Baa3 or better by Moodys (or its equivalent under any
successor rating category of Moodys) and a rating of BBB- or better by S&P (or its equivalent
under any successor rating category of S&P), and the equivalent investment grade credit rating from
any replacement rating agency or rating agencies selected by the Company under the circumstances
permitting the Company to select a replacement agency and in the manner for selecting a replacement
agency, in each case as set forth in the definition of Rating Agency.
Moodys means Moodys Investors Service, Inc., a subsidiary of Moodys Corporation, and its
successors.
Rating Agency means each of Moodys and S&P; provided, that if any of Moodys or S&P ceases
to provide rating services to issuers or investors, the Company may appoint another nationally
recognized statistical rating organization within the meaning of Rule 15c3-1(c)(2)(vi)(F) under
the Exchange Act as a replacement for such Rating Agency; provided, that the Company shall give
notice of such appointment to the Trustee.
S&P means Standard & Poors Ratings Services, a division of The McGraw-Hill Companies, Inc.,
and its successors.
Voting Stock of any specified Person as of any date means the capital stock of such Person
that is at the time entitled to vote generally in the election of the board of directors of such
Person.
9
For purposes of the Securities, the following definition is applicable:
Person means any individual, corporation, partnership, limited liability company, business
trust, association, joint-stock company, joint venture, trust, incorporated or unincorporated
organization or government or any agency or political subdivision thereof.
The Securities of this series are issuable only in registered form without coupons in
denominations of $2,000 and integral multiples of $1,000 in excess thereof. As provided in the
Indenture and subject to certain limitations therein set forth, Securities of this series are
exchangeable for a like aggregate principal amount of Securities of this series and of like tenor
of a different authorized denomination, as requested by the Holder surrendering the same.
No service charge shall be made for any such registration of transfer or exchange, but the
Company may require payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith.
Prior to due presentment of this Security for registration of transfer, the Company, the
Trustee and any agent of the Company or the Trustee may treat the Person in whose name this
Security is registered as the owner hereof for all purposes, whether or not this Security be
overdue, and neither the Company, the Trustee nor any such agent shall be affected by notice to the
contrary.
All terms used in this Security which are defined in the Indenture shall have the meanings
assigned to them in the Indenture.
This Security shall be governed by and construed in accordance with the law of the State of
New York.
10