-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, fEWjDrH8lf1APPqIJM+N2cyiOawa8Yzdk6S4/8RHrA9XDiIKijevNxyxbG9V1yEv vnStxFTz3NpkQQKLrO5sMg== 0000950131-95-000427.txt : 19950224 0000950131-95-000427.hdr.sgml : 19950224 ACCESSION NUMBER: 0000950131-95-000427 CONFORMED SUBMISSION TYPE: S-3 PUBLIC DOCUMENT COUNT: 9 FILED AS OF DATE: 19950223 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: DONNELLEY R R & SONS CO CENTRAL INDEX KEY: 0000029669 STANDARD INDUSTRIAL CLASSIFICATION: COMMERCIAL PRINTING [2750] IRS NUMBER: 361004130 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-3 SEC ACT: 1933 Act SEC FILE NUMBER: 033-57807 FILM NUMBER: 95514382 BUSINESS ADDRESS: STREET 1: 77 W WACKER DR CITY: CHICAGO STATE: IL ZIP: 60601 BUSINESS PHONE: 3123268000 MAIL ADDRESS: STREET 1: 77 W. WACKER DRIVE CITY: CHICAGO STATE: IL ZIP: 60601 S-3 1 FORM S-3 AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON FEBRUARY 23, 1995 REGISTRATION NO. 33- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ---------------- FORM S-3 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ---------------- R. R. DONNELLEY & SONS COMPANY (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) ---------------- DELAWARE 36-1004130 (STATE OR OTHER JURISDICTION (I.R.S. EMPLOYER OF INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.) 77 WEST WACKER DRIVE CHICAGO, ILLINOIS 60601 (312) 326-8000 (ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES) ---------------- DEBORAH M. REGAN VICE PRESIDENT AND SECRETARY R. R. DONNELLEY & SONS COMPANY 77 WEST WACKER DRIVE CHICAGO, ILLINOIS 60601 (312) 326-8000 (NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF AGENT FOR SERVICE) COPY TO: DENNIS V. OSIMITZ SIDLEY & AUSTIN ONE FIRST NATIONAL PLAZA CHICAGO, ILLINOIS 60603 (312) 853-7000 ---------------- APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time to time after the effective date of this Registration Statement. If the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please check the following box. [_] If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box. [X] CALCULATION OF REGISTRATION FEE - -------------------------------------------------------------------------------- - --------------------------------------------------------------------------------
PROPOSED PROPOSED MAXIMUM AMOUNT MAXIMUM AGGREGATE AMOUNT OF TITLE OF EACH CLASS OF TO BE OFFERING PRICE OFFERING REGISTRATION SECURITIES TO BE REGISTERED REGISTERED PER UNIT(1) PRICE(1) FEE - --------------------------------------------------------------------------------------------- Debt Securities.................. $500,000,000(2) 100% $500,000,000 $172,414
- -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- (1) Estimated solely for the purpose of determining the registration fee. (2) Or, in the case of debt securities issued at an original discount, such greater principal amount as shall result in an aggregate offering price of the amount set forth above or, in the case of debt securities denominated in a currency other than U.S. dollars or in a composite currency, such U.S. dollar amount as shall result from converting the aggregate public offering price of such debt securities into U.S. dollars at the spot exchange rate in effect on the date such debt securities are initially offered to the public. ---------------- THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY DETERMINE. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- ++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++ +INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A + +REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE + +SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY + +OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT + +BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR + +THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE + +SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE + +UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF + +ANY SUCH STATE. + ++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++ SUBJECT TO COMPLETION DATED FEBRUARY 23, 1995 PROSPECTUS LOGO LOGO DEBT SECURITIES ----------- R. R. Donnelley & Sons Company (the "Company") may offer from time to time up to $500,000,000 (or its equivalent, based on the applicable exchange rate at the time of sale, in such foreign currencies or composite currencies, as shall be designated by the Company) aggregate principal amount of its unsecured debt securities (the "Debt Securities"), consisting of debentures, notes and/or other unsecured evidences of indebtedness. The Debt Securities may be offered as separate series in amounts, at prices and on terms to be determined at the time of sale. The accompanying Prospectus Supplement (the "Prospectus Supplement") sets forth with regard to the Debt Securities in respect of which this Prospectus is being delivered (the "Offered Debt Securities") the title, aggregate principal or initial offering amount, currency or currencies in which the principal (and premium, if any) and any interest are payable, denominations, maturity, rate (which may be fixed or variable) and time of payment of any interest, any terms for redemption at the option of the Company or the holder, any terms for sinking fund payments, any listing on a securities exchange and the initial public offering price and other terms in connection with the offering and sale of the Offered Debt Securities. The Company may sell Debt Securities to or through underwriters or dealers, and also may sell Debt Securities directly to other purchasers or through agents. See "Plan of Distribution." The Prospectus Supplement sets forth the names of any underwriters or agents involved in the sale of the Offered Debt Securities and any applicable commissions or discounts. ----------- THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAP- PROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PRO- SPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. ----------- The date of this Prospectus is , 1995 NO DEALER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATION NOT CONTAINED IN THIS PROSPECTUS AND, WITH RESPECT TO PARTICULAR OFFERED DEBT SECURITIES, THE PROSPECTUS SUPPLEMENT RELATING THERETO, AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR ANY AGENT, UNDERWRITER OR DEALER. NEITHER THIS PROSPECTUS NOR ANY PROSPECTUS SUPPLEMENT CONSTITUTES AN OFFER TO SELL OR A SOLICITATION OF ANY OFFER TO BUY ANY OF THE SECURITIES OFFERED HEREBY OR THEREBY IN ANY JURISDICTION TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER IN SUCH JURISDICTION. NEITHER THE DELIVERY OF THIS PROSPECTUS OR ANY PROSPECTUS SUPPLEMENT NOR ANY SALE MADE HEREUNDER OR THEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF OR THEREOF OR THAT THE INFORMATION CONTAINED OR INCORPORATED BY REFERENCE HEREIN OR THEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO ITS DATE. AVAILABLE INFORMATION The Company is subject to the informational requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance therewith files reports and other information with the Securities and Exchange Commission (the "Commission"). Reports, proxy and information statements and other information filed by the Company can be inspected and copied at the public reference facilities maintained by the Commission at 450 5th Street, N.W., Washington, D.C. 20549, and at the following Regional Offices of the Commission: 500 West Madison Street, Suite 1400, Chicago, Illinois 60661; and Seven World Trade Center, New York, New York 10048. Copies of such material can be obtained at prescribed rates from the Public Reference Branch of the Commission, 450 5th Street, N.W., Washington, D.C. 20549. Such reports, proxy and information statements and other information concerning the Company can also be inspected at the offices of the New York Stock Exchange, 20 Broad Street, New York, New York 10005, the Chicago Stock Exchange, 440 South LaSalle Street, Chicago, Illinois 60605, and the Pacific Stock Exchange, 301 Pine Street, San Francisco, California 94104, on which the Company's Common Stock is listed. DOCUMENTS INCORPORATED BY REFERENCE The following documents heretofore filed with the Commission by the Company under the Exchange Act are incorporated herein by reference: (a) the Company's Annual Report on Form 10-K for the year ended December 31, 1993; (b) the Company's Quarterly Reports on Form 10-Q for the fiscal quarters ended March 31, June 30 and September 30, 1994, respectively; and (c) the Company's Current Reports on Form 8-K dated January 5, 1994 and February 21, 1995, respectively. All documents filed by the Company pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this Prospectus and prior to the termination of the offering of the Debt Securities shall be deemed to be incorporated in this Prospectus by reference and to be a part hereof from the date of filing of such documents. Any statement contained in a document incorporated or deemed to be incorporated by reference herein shall be deemed to be modified or superseded for purposes of this Prospectus to the extent that a statement contained herein or in any other subsequently filed document which also is incorporated or deemed to be incorporated by reference herein modifies or supersedes such statement. Any such statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this Prospectus. The Company will provide without charge to each person to whom a copy of this Prospectus has been delivered, on the written or oral request of such person, a copy of any or all of the documents referred to above which have been or may be incorporated in this Prospectus by reference, other than exhibits to such documents, unless such exhibits are specifically incorporated by reference therein. Written requests or requests by telephone for such copies should be directed to Deborah M. Regan, Vice President and Secretary, R. R. Donnelley & Sons Company, 77 West Wacker Drive, Chicago, Illinois 60601 (telephone number 312-326-8000). 2 THE COMPANY R. R. Donnelley & Sons Company, incorporated in the state of Delaware in 1956 as the successor to a business founded in 1864, is a major participant in the information industry, providing a broad range of services in print and digital media. The Company believes it is the largest supplier of commercial print and print-related services in the United States. It is a major supplier in the United Kingdom and also provides services in Latin America, continental Europe and Asia. Services provided to customers include presswork and binding, including on-demand customized publications; conventional and digital pre-press operations, including desktop publishing and filmless color imaging, necessary to create a printing image; software replication, translation and localization; list, list enhancement, data base management and mail production services; design and related creative services; cartographic services; electronic communication networks for simultaneous worldwide product releases; digital services to publishers; and the planning for and fulfillment of truck, rail, mail and air distribution for products of the Company and its customers, as well as third parties. The Company's executive offices are located at 77 West Wacker Drive, Chicago, Illinois 60601, and its telephone number is 312-326-8000. USE OF PROCEEDS Unless otherwise specified in the Prospectus Supplement, the net proceeds to be received by the Company from the sale of the Debt Securities will be used for general corporate purposes, which may include the repayment of indebtedness, working capital, capital expenditures, acquisitions and the repurchase of shares of the Company's common stock. Pending use for these purposes, the Company may invest proceeds from the sale of the Debt Securities in short-term marketable securities. RATIO OF EARNINGS TO FIXED CHARGES(1)
YEAR ENDED DECEMBER 31, -------------------------------------------------------------------------------------------- 1994 1993 1992 1991 1990 ---- ---- ---- ---- ---- 5.7 4.9(2) 7.3 5.7 11.5
- -------- (1) For the purposes of calculating the ratio of earnings to fixed charges, earnings consist of earnings before income taxes and fixed charges to the extent that such charges are included in the determination of earnings. Fixed charges consist of interest (whether expensed or capitalized) and one-third of minimum rental payments under operating leases (estimated by management to be the interest factor of such rentals). (2) 1993 results include a $90 million restructuring charge recorded in the first quarter of 1993 and related primarily to the shutdown of the Company's Chicago manufacturing facility following a customer's decision to discontinue its catalog operations. The ratio of earnings to fixed charges for 1993 would have been 6.2, exclusive of such charge. 3 DESCRIPTION OF DEBT SECURITIES The following description sets forth certain general terms and provisions of the Debt Securities to which any Prospectus Supplement may relate. The particular terms of the Debt Securities offered by any Prospectus Supplement and the extent, if any, to which such general provisions may apply to the Debt Securities so offered will be described in the Prospectus Supplement relating to such Debt Securities. The Offered Debt Securities are to be issued under an Indenture, dated as of November 1, 1990, as supplemented from time to time (the "Indenture"), between the Company and Citibank, N.A., as Trustee (the "Trustee"), a copy of which is an exhibit to the Registration Statement of which this Prospectus is a part. The following summaries of certain provisions of the Debt Securities and the Indenture do not purport to be complete and are subject to, and are qualified in their entirety by express reference to, all the provisions of the Indenture, including the definitions therein of certain terms. Certain terms defined in the Indenture are capitalized herein. Particular section numbers refer to sections in the Indenture. GENERAL The Debt Securities will be unsecured obligations of the Company and will rank on a parity with all other unsecured and unsubordinated indebtedness of the Company. The Indenture does not limit the aggregate principal amount of Debt Securities which may be issued thereunder and provides that Debt Securities may be issued thereunder from time to time in one or more series (Section 301). Reference is made to the Prospectus Supplement relating to the Offered Debt Securities for, among other things, the following terms thereof: (1) the title of the Offered Debt Securities; (2) any limit on the aggregate principal amount of the Offered Debt Securities; (3) the date or dates on which the Offered Debt Securities will mature; (4) the rate or rates (which may be fixed or variable) per annum at which the Offered Debt Securities will bear interest, if any, and the date from which such interest will accrue; (5) the dates on which such interest will be payable and the Regular Record Dates for such Interest Payment Dates; (6) the dates, if any, on which and the price or prices at which the Offered Debt Securities may, pursuant to any mandatory or optional sinking fund provisions, be redeemed by the Company and other detailed terms and provisions of such sinking funds; (7) the date, if any, after which and the price or prices at which the Offered Debt Securities may, pursuant to any optional redemption provisions, be redeemed at the option of the Company or of the Holder thereof and other detailed terms and provisions of such optional redemption; and (8) the currency or composite currencies in which the Offered Debt Securities are denominated and in which principal of, premium, if any, and any interest on the Offered Debt Securities will or may be payable (Section 301). For a description of the terms of the Offered Debt Securities, reference must be made to both the Prospectus Supplement relating thereto and to the description of Debt Securities set forth herein. Unless otherwise indicated in the Prospectus Supplement relating thereto, the principal of, and any premium or interest on, the Offered Debt Securities will be payable, and the Offered Debt Securities will be exchangeable and transfers thereof will be registerable, at the Corporate Trust Office of the Trustee, provided 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 it appears in the Security Register (Sections 202, 301, 305 and 1002). Unless otherwise indicated in the Prospectus Supplement relating thereto, the Offered Debt Securities will be issued in United States dollars in fully registered form, without coupons, in denominations of $1,000 or any integral multiple thereof (Section 302). No service charge will be made for any transfer or exchange of the Offered Debt Securities, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection therewith (Section 305). Debt Securities may be issued under the Indenture as Original Issue Discount Securities to be offered and sold at a substantial discount from the principal amount thereof. Special federal income tax, accounting and other considerations applicable to any such Original Issue Discount Securities will be described in the 4 Prospectus Supplement relating thereto. "Original Issue Discount Security" means any security which provides for an amount less than the principal amount thereof to be due and payable upon the declaration of acceleration of the Maturity thereof upon the occurrence of an Event of Default and during the continuation thereof (Section 101). Unless otherwise indicated in the Prospectus Supplement relating thereto, the Indenture does not afford holders of Debt Securities of any series protection against the Company incurring unsecured indebtedness or (except as described in "Description of Debt Securities--Restrictive Covenants") engaging in corporate transactions or reorganizations which could result in the Company's involvement in a highly leveraged transaction. RESTRICTIVE COVENANTS Restrictions Upon Secured Debt The Company covenants that it will not, and will not permit any Restricted Subsidiary to, create, incur, issue, assume or guarantee any indebtedness for borrowed money (hereafter called "indebtedness") secured by a mortgage, security interest, pledge or lien (hereafter called "mortgage") of or upon any Principal Property or on any shares of capital stock or indebtedness of any Restricted Subsidiary, whether owned at the date of the Indenture or thereafter acquired, without effectively providing that the Debt Securities (together with, if the Company shall so determine, any other indebtedness created, incurred, issued, assumed or guaranteed by the Company or any Restricted Subsidiary and then existing or thereafter created) shall be secured by such mortgage equally and ratably with (or, at the option of the Company, prior to) such indebtedness. The foregoing restrictions, however, shall not apply to any indebtedness secured by any one or more of the following: (a) mortgages of or upon any property acquired, constructed or improved by, or of or upon any shares of capital stock or indebtedness acquired by, the Company or any Restricted Subsidiary after the date of the Indenture to secure indebtedness incurred for the purpose of financing or refinancing all or any part of the purchase price of any property, shares of capital stock or indebtedness or of the cost of any construction or improvements on such property, which indebtedness is incurred prior to or within 180 days after such acquisition, completion of such construction or the commencement of the commercial operation of such property, as the case may be; (b) mortgages of or upon any property, shares of capital stock or indebtedness existing at the time of acquisition thereof by the Company or any Restricted Subsidiary; (c) mortgages of or upon property of a corporation existing at the time such corporation is merged with or into or consolidated with the Company or any Restricted Subsidiary or existing at the time of a sale or transfer of the properties of a corporation as an entirety or substantially as an entirety to the Company or any Restricted Subsidiary; (d) mortgages of or upon any property of, or shares of capital stock or indebtedness of, a corporation existing at the time such corporation becomes a Restricted Subsidiary; (e) mortgages to secure indebtedness of any Restricted Subsidiary to the Company or to another Restricted Subsidiary; (f) mortgages in favor of governmental bodies to secure partial, progress, advance or other payments pursuant to any contract or statute or to secure indebtedness incurred or guaranteed to finance or refinance all or any part of the purchase price of the property, shares of capital stock or indebtedness subject to, or the cost of constructing or improving the property subject to, such mortgages; and (g) extensions, renewals or replacements of any mortgage existing on the date of the Indenture or any mortgage referred to in the foregoing clauses (a) through (f), inclusive (Section 1006). Notwithstanding the restrictions outlined above, the Company or any Restricted Subsidiary may, without equally and ratably securing the Debt Securities, issue, assume or guarantee indebtedness secured by a mortgage not excepted under clauses (a) through (g) above, if the aggregate amount of such indebtedness, together with all other indebtedness of, or indebtedness guaranteed by, the Company and its Restricted 5 Subsidiaries existing at such time and secured by mortgages not so excepted and the Attributable Debt in respect of Sale and Lease-Back Transactions existing at such time (other than Sale and Lease-Back Transactions in respect of which an amount not less than the greater of (x) the net proceeds of the sale of such property or (y) the fair market value (as determined by the Board of Directors) of such property has been applied, within 180 days after the effective date of the arrangement, to either the prepayment or retirement (other than any mandatory prepayment or retirement) of long-term indebtedness or to the acquisition, construction or improvement of a manufacturing plant or facility which is, or upon completion will be, a Principal Property and Sale and Lease- Back Transactions in which the property involved would have been permitted to be mortgaged under clause (a) or (f) above), does not at the time exceed 10% of Consolidated Net Tangible Assets (Section 1006). Restrictions Upon Sale and Lease-Back Transactions Sale and Lease-Back Transactions by the Company or any Restricted Subsidiary of any Principal Property are prohibited unless (i) the Company or such Restricted Subsidiary would (at the time of entering into such arrangement) be entitled pursuant to clause (a) or (f) under the subsection Restrictions Upon Secured Debt above, without equally and ratably securing the Debt Securities, to incur indebtedness secured by a mortgage on the property to be leased, or (ii) the Company or such Restricted Subsidiary would (at the time of entering into such arrangement) be entitled, without equally and ratably securing the Debt Securities, to incur indebtedness secured by a mortgage on such property in an amount at least equal to the Attributable Debt in respect of the Sale and Lease-Back Transaction, or (iii) the Company shall apply, within 180 days of the effective date of the arrangement, an amount not less than the greater of (x) the net proceeds of the sale of such property or (y) the fair market value (as determined by the Board of Directors of the Company) of such property to either the prepayment or retirement (other than any mandatory prepayment or retirement) of long-term indebtedness of the Company or any Restricted Subsidiary or to the acquisition, construction or improvement of a manufacturing plant or manufacturing facility which is, or upon such acquisition, construction or improvement will be, a Principal Property (Section 1007). Certain Definitions The term "Attributable Debt" in respect of a Sale and Lease-Back Transaction means the present value (discounted at the rate of interest implicit in the lease involved in such Sale and Lease-Back Transaction, as determined in good faith by the Company) of the obligation of the lessee thereunder for rental payments (excluding, however, any amounts required to be paid by such lessee, whether or not designated as rent or additional rent, on account of maintenance and repairs, insurance, taxes, assessments, water rates or similar charges or any amounts required to be paid by such lessee thereunder contingent upon the amount of sales, maintenance and repairs, insurance, taxes, assessments, water rates or similar charges) during the remaining term of such lease (including any period for which such lease has been extended or may, at the option of the lessor, be extended) (Section 101). The term "Consolidated Net Tangible Assets" means, as of any particular time, the total amount of assets (less applicable reserves) after deducting therefrom (a) all current liabilities (excluding any thereof which are by their terms extendible or renewable at the option of the obligor thereon to a time more than 12 months after the time as of which the amount thereof is being computed and excluding current maturities of long-term indebtedness), and (b) all goodwill, trade names, trademarks, patents, unamortized debt discount and expense and other like intangible assets, all as shown in the audited consolidated balance sheet of the Company and subsidiaries contained in the Company's then most recent annual report to stockholders, except that assets shall include an amount equal to the Attributable Debt in respect of any Sale and Lease-Back Transaction not capitalized on such balance sheet (Section 101). The term "Principal Property" means any manufacturing plant or manufacturing facility located within the United States of America, having a gross book value in excess of 1% of Consolidated Net Tangible Assets 6 at the time of determination thereof and owned by the Company or any Restricted Subsidiary, in each case other than (1) any such plant or facility which, in the opinion of the Board of Directors of the Company, is not of material importance to the total business conducted by the Company and its Restricted Subsidiaries taken as a whole, or (2) any portion of such a plant or facility similarly found not to be of material importance to the use or operation thereof (Section 101). The term "Restricted Subsidiary" means any Subsidiary (a) substantially all of the property of which is located, or substantially all of the business of which is carried on, within the United States of America (other than its territories or possessions and other than Puerto Rico) and (b) which owns a Principal Property; provided, however, that any Subsidiary which is principally engaged in financing operations outside the United States of America or which is principally engaged in leasing or in financing installment receivables shall not be a Restricted Subsidiary (Section 101). The term "Sale and Lease-Back Transaction" means any arrangement with any Person providing for the leasing by the Company or any Restricted Subsidiary of any Principal Property, whether owned at the date of the Indenture or thereafter acquired (except for temporary leases for a term, including any renewal thereof, of not more than three years and except for leases between the Company and any Restricted Subsidiary, between any Restricted Subsidiary and the Company or between Restricted Subsidiaries), which property has been or is to be sold or transferred by the Company or such Restricted Subsidiary to such Person with the intention of taking back a lease of such property (Section 101). The term "Subsidiary" means any corporation more than 50% of the outstanding voting stock of which is at the time owned, directly or indirectly, by the Company and/or one or more of its other Subsidiaries (Section 101). EVENTS OF DEFAULT The following are Events of Default under the Indenture with respect to Debt Securities of any series: (a) default in the payment of any interest on any Debt Security of that series when due, continued for 30 days; (b) default in the payment of the principal of or premium, if any, on any Debt Security of that series at Maturity; (c) default in the deposit of any sinking fund payment in respect of any Debt Security of that series when due; (d) default in the performance, or breach, of any other covenant or warranty of the Company in the Indenture (other than a covenant or warranty included in the Indenture solely for the benefit of series of Debt Securities other than that series), continued for 90 days after written notice as provided in the Indenture; (e) certain events of bankruptcy, insolvency or reorganization relating to the Company; and (f) any other Event of Default provided with respect to Debt Securities of that series (Section 501). If an Event of Default with respect to Debt Securities of any series at the time Outstanding shall occur and be continuing, either the Trustee or the Holders of not less than 25% in principal amount of the Outstanding Debt Securities of that series may declare the principal amount (or, if the Debt Securities of that series are Original Issue Discount Securities, such portion of the principal amount as may be specified in the terms of that series) of all of the Debt Securities of that series to be due and payable immediately. However, at any time after a declaration of acceleration with respect to Debt Securities of any series has been made, and before a judgment or decree based on such acceleration has been obtained, the Holders of a majority in principal amount of Outstanding Debt Securities of that series may, subject to certain conditions, rescind and annul such acceleration if all Events of Default, other than the nonpayment of accelerated principal, with respect to Debt Securities of that series have been cured or waived as provided in the Indenture (Section 502). For information as to waiver of defaults, see "Modification and Waiver." Reference is made to the Prospectus Supplement relating to any series of Offered Debt Securities which are Original Issue Discount Securities for the particular provisions relating to acceleration of the Maturity of a portion of the principal amount of such Original Issue Discount Securities upon the occurrence of an Event of Default and the continuation thereof. 7 The Indenture provides that, subject to the duties of the Trustee to act with the required standard of care if an Event of Default shall occur and be continuing, the Trustee will be under no obligation to exercise any of its rights or powers under the Indenture at the request or direction of any of the Holders, unless such Holders shall have offered to the Trustee reasonable security or indemnity (Sections 601 and 603). Subject to such provisions for security or indemnification of the Trustee and certain other conditions, the Holders of a majority in principal amount of the Outstanding Debt Securities of any series will have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or exercising any trust or power conferred on the Trustee with respect to the Debt Securities of that series (Section 512). No Holder of any Debt Security of any series will have any right to institute any proceeding with respect to the Indenture or for any remedy thereunder, unless such Holder shall have previously given to the Trustee written notice of a continuing Event of Default with respect to Debt Securities of that series and unless also the Holders of not less than 25% in principal amount of the Outstanding Debt Securities of that series shall have made written request, and offered reasonable security or indemnity, to the Trustee to institute such proceeding as trustee, and the Trustee shall not have received from the Holders of a majority in principal amount of the Outstanding Debt Securities of that series a direction inconsistent with such request and shall have failed to institute such proceeding within 60 days after the Trustee's receipt of such notice (Section 507). However, the Holder of any Debt Security will have an absolute right to receive payment of the principal of (and premium, if any) and any interest on such Debt Security on or after the due dates expressed in such Debt Security and to institute suit for the enforcement of any such payment (Section 508). The Indenture requires the Company to furnish to the Trustee annually a statement as to the absence of certain defaults under the Indenture (Section 1008). The Indenture provides that the Trustee may withhold notice to the Holders of Debt Securities of any series of any default (except defaults in payment of principal or any premium or interest or in sinking fund payments) with respect to Debt Securities of that series if it determines the withholding of such notice is in the interest of the Holders of Debt Securities of that series (Section 602). MODIFICATION AND WAIVER Modification and amendments of the Indenture may be made by the Company and the Trustee with the consent of the Holders of a majority in aggregate principal amount of the Outstanding Debt Securities of each series affected thereby; provided, however, that no such modification or amendment may, without the consent of the Holder of each Outstanding Debt Security affected thereby: (a) change the Stated Maturity of the principal of, or any installment of principal of or interest on, any Debt Security; (b) reduce the principal amount of, or the rate of interest on, or any premium payable upon the redemption of, any Debt Security; (c) reduce the amount of principal of an Original Issue Discount Security payable upon acceleration of the Maturity thereof; (d) change the place or currency of payment of principal of, or premium, if any, or interest on, any Debt Security; (e) impair the right to institute suit for the enforcement of any payment on or with respect to any Debt Security after the Stated Maturity; or (f) reduce the percentage in principal amount of Outstanding Debt Securities of any series, the consent of the Holders of which is required for modification or amendment of the Indenture, for waiver of compliance with certain provisions of the Indenture or for waiver of certain defaults (Section 902). The Holders of a majority in aggregate principal amount of the Outstanding Debt Securities of any series may on behalf of the Holders of all Debt Securities of that series waive, insofar as that series is concerned, compliance by the Company with certain restrictive covenants of the Indenture (Section 1009). The Holders of not less than a majority in principal amount of the Outstanding Debt Securities of any series may on behalf of the Holders of all Debt Securities of that series waive any past default under the Indenture with respect to that series, except a default in the payment of the principal of or premium, if any, or any interest on any Debt Security of that series or in respect of a provision which under the Indenture cannot be modified or amended without the consent of the Holder of each Outstanding Debt Security of that series affected (Section 513). 8 DEFEASANCE Defeasance and Discharge If the Debt Securities of any series so provide, the Company will be discharged (hereinafter, "defeasance") from any and all obligations in respect of Debt Securities of that series (except for certain obligations to register the transfer or exchange of Debt Securities of that series, to replace stolen, lost or mutilated Debt Securities of that series, to maintain paying agencies, to compensate and indemnify the Trustee and to furnish the Trustee (if the Trustee is not the registrar) with the names and addresses of the holders of Debt Securities of that series) upon the irrevocable deposit with the Trustee, in trust, of money and/or securities of the government which issued the currency in which the Debt Securities of that series are payable or securities issued by government agencies backed by the full faith and credit of such government which, through the payment of interest and principal in respect thereof in accordance with their terms, will provide money in an amount sufficient to pay the principal of (and premium, if any) and the interest on the Debt Securities of that series on the Stated Maturity of such payments in accordance with the terms of the Debt Securities of that series (Section 1302). Such a defeasance may be effected only if, among other things, the Company has delivered to the Trustee an Opinion of Counsel (who may be an employee of or counsel for the Company) stating that the Company has received from the Internal Revenue Service a private letter ruling, or that the Internal Revenue Service has published a revenue ruling pertaining to a comparable form of transaction, or that since the date of the Indenture there has been a change in the applicable federal income tax law, in either case to the effect that Holders of the Debt Securities of that series will not recognize income, gain or loss for federal income tax purposes as a result of such defeasance and will be subject to federal income tax on the same amounts, in the same manner and at the same times, as would have been the case if such defeasance had not occurred (Section 1304). In addition, the Company may also obtain a discharge of the Indenture with respect to all Debt Securities issued under the Indenture by depositing with the Trustee, in trust, money sufficient to pay at Stated Maturity or upon redemption all of such Debt Securities, provided that such Debt Securities are by their terms to become due and payable within one year or are to be called for redemption within one year (Section 401). Defeasance of Certain Covenants and Certain Events of Default If the Debt Securities of any series so provide, the Company may omit to comply (hereinafter, "covenant defeasance") with the restrictive covenants described under Restrictive Covenants--Restrictions Upon Secured Debt and -- Restrictions Upon Sale and Lease-Back Transactions and Consolidation, Merger and Sale of Assets and such other covenants as may be included in the Prospectus Supplement for such series, and no Event of Default shall arise with respect to Debt Securities of such series by reason of any failure to comply therewith, upon the irrevocable deposit with the Trustee, in trust, of money and/or securities of the government which issued the currency in which the Debt Securities of that series are payable or securities issued by government agencies backed by the full faith and credit of such government which, through the payment of interest and principal in respect thereof in accordance with their terms, will provide money in an amount sufficient to pay the principal of (and premium, if any) and the interest on the Debt Securities of that series on the Stated Maturity of such payments in accordance with the terms of the Debt Securities of that series (Sections 1303 and 1304). The obligations of the Company under the Debt Securities of that series other than with respect to the covenants referred to above and all Events of Default other than with respect to such covenants shall remain in full force and effect. Such a covenant defeasance may be effected only if, among other things, the Company has delivered to the Trustee an Opinion of Counsel (who may be an employee of or counsel for the Company) to the effect that the Holders of the Debt Securities of that series will not recognize income, gain or loss for federal income tax purposes as a result of such covenant defeasance and will be subject to federal income tax on the same amounts, in the same manner and at the same times, as would have been the case if such covenant defeasance had not occurred (Section 1304). Covenant Defeasance and Certain Other Events of Default In the event the Company exercises its option to effect a covenant defeasance with respect to the Debt Securities of any series as described above and the Debt Securities of that series are thereafter declared due 9 and payable because of the occurrence of any Event of Default other than the Event of Default caused by failing to comply with the covenants which are defeased, the amount of money and securities on deposit with the Trustee would be sufficient to pay amounts due on the Debt Securities of that series at the time of their Stated Maturity but may not be sufficient to pay amounts due on the Debt Securities of that series at the time of the acceleration resulting from such Event of Default. However, the Company would remain liable for such payments. CONSOLIDATION, MERGER AND SALE OF ASSETS Nothing in the Indenture or in any of the Debt Securities shall prevent any consolidation of the Company with or merger of the Company into any other corporation or shall prevent any lease, sale or transfer of all or substantially all of the property and assets of the Company to any other Person; provided, however, and the Company covenants and agrees, that any such consolidation, merger, lease, sale or transfer shall be upon the condition that (i) the due and punctual payment of the principal of, and premium, if any, and interest on, all the Debt Securities according to their tenor, and the due and punctual performance and observance of all the terms, covenants and conditions of the Indenture to be kept or performed by the Company, shall, by an indenture supplemental to the Indenture, executed and delivered to the Trustee, be assumed by the corporation formed by such consolidation or into which the Company shall have merged, or the Person which shall have acquired by lease, sale or transfer all or substantially all of the property and assets of the Company, (ii) after giving effect to such transaction, no Event of Default, and no event which after notice or lapse of time or both, would become an Event of Default, shall have occurred and be continuing and (iii) the corporation formed by such consolidation or into which the Company shall have merged or the Person which shall have acquired by sale or transfer, or which leases, all or substantially all of the property or assets of the Company shall be a corporation organized and existing under the laws of the United States of America, any State thereof or the District of Columbia. (Section 801). If, upon any such consolidation or merger, or upon any such lease, sale or transfer, any Principal Property of the Company or of any Restricted Subsidiary or any shares of capital stock or indebtedness of any Restricted Subsidiary, owned immediately prior thereto, would thereupon become subject to any mortgage, security interest, pledge or lien securing any indebtedness for borrowed money of, or guaranteed by, such other corporation or Person (other than any mortgage, security interest, pledge or lien permitted as described under "Restrictive Covenants--Restrictions Upon Secured Debt" above), the Company, prior to such consolidation, merger, lease, sale or transfer, will by indenture supplemental to the Indenture secure the due and punctual payment of the principal of, and premium, if any, and interest on the Debt Securities (together with, if the Company shall so determine, any other indebtedness of, or guaranteed by, the Company or any Restricted Subsidiary and then existing or thereafter created) equally and ratably with (or, at the option of the Company, prior to) the indebtedness secured by such mortgage, security interest, pledge or lien (Section 802). REGARDING THE TRUSTEE Citibank, N.A., the Trustee under the Indenture, is also trustee with respect to several series of debt securities issued pursuant to the Indenture. The Company maintains banking relationships in the ordinary course of business with Citibank, N.A. and several of its affiliates. Citibank, N.A., through certain of such affiliates, has committed to lend funds to the Company from time to time under various credit agreements among the Company and the banks which are parties thereto. PLAN OF DISTRIBUTION The Company may sell Debt Securities to or through underwriters or dealers, and also may sell Debt Securities directly to one or more other purchasers or through agents. The Prospectus Supplement sets forth the names of any underwriters or agents involved in the sale of the Offered Debt Securities and any applicable commissions or discounts. Underwriters, dealers or agents may offer and sell the Debt Securities at a fixed price or prices, which may be changed, or from time to time at market prices prevailing at the time of sale, at prices related to such prevailing market prices or at negotiated prices. In connection with the sale of the Debt Securities, 10 underwriters or agents may be deemed to have received compensation from the Company in the form of underwriting discounts or commissions and may also receive commissions from purchasers of the Debt Securities for whom they may act as agent. Underwriters or agents may sell the Debt Securities to or through dealers, and such dealers may receive compensation in the form of discounts, concessions or commissions from the underwriters or commissions from the purchasers for whom they may act as agent. The Debt Securities, when first issued, will have no established trading market. Any underwriters or agents to or through whom Debt Securities are sold by the Company for public offering and sale may make a market in such Debt Securities, but such underwriters or agents will not be obligated to do so and may discontinue any market making at any time without notice. No assurance can be given as to the liquidity of the trading market for any Debt Securities. Any underwriters, dealers or agents participating in the distribution of the Debt Securities may be deemed to be underwriters and any discounts and commissions received by them and any profit realized by them on resale of the Debt Securities may be deemed to be underwriting discounts and commissions under the Securities Act of 1933, as amended (the "Act"). Underwriters, dealers or agents may be entitled, under agreements entered into with the Company, to indemnification against or contribution toward certain civil liabilities, including liabilities under the Act. If so indicated in the Prospectus Supplement, the Company will authorize underwriters or agents to solicit offers by certain institutions to purchase Debt Securities from the Company pursuant to contracts providing for payment and delivery on a future date. Institutions with which such contracts may be made include commercial and savings banks, insurance companies, pension funds, investment companies, educational and charitable institutions and others, but in all cases such institutions must be approved by the Company. The obligations of any purchaser under any such contract will be subject to the condition that the purchase of the Offered Debt Securities shall not at the time of delivery be prohibited under the laws of the jurisdiction to which such purchaser is subject. The underwriters and such other persons will not have any responsibility in respect of the validity or performance of such contracts. LEGAL OPINIONS Certain legal matters in connection with the Debt Securities offered hereby will be passed upon for the Company by Deborah M. Regan, Vice President and Secretary of the Company, and Sidley & Austin, Chicago, Illinois. As of December 31, 1994, Ms. Regan beneficially owned 704 shares of the Company's common stock and held options to acquire 6,100 shares of such common stock. Mr. H. Blair White, of counsel to Sidley & Austin, is a director of the Company. EXPERTS The (i) consolidated financial statements and schedules of the Company included in its Annual Report on Form 10-K for the year ended December 31, 1993 and (ii) consolidated financial statements and notes to financial statements of the Company for the year ended December 31, 1994 included in its Current Report on Form 8-K dated February 21, 1995 and incorporated by reference in this Prospectus and elsewhere in the Registration Statement have been audited by Arthur Andersen LLP (formerly Arthur Andersen & Co.), independent public accountants, as indicated in their reports with respect thereto, and are incorporated herein by reference in reliance upon the authority of said firm as experts in accounting and auditing in giving said reports. 11 PART II INFORMATION NOT REQUIRED IN PROSPECTUS ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION. The expenses in connection with the issuance and distribution of the securities being registered, other than underwriting discounts and commissions, are estimated to be: S.E.C. Registration Fee......................................... $172,414 Trustee's Charges............................................... 33,000* Engraving....................................................... 5,000* Accounting Fees................................................. 15,000* Rating Agency Fees.............................................. 80,000* Blue Sky and Legal Fees and Expenses............................ 80,000* Miscellaneous................................................... 14,586* -------- $400,000 ========
- -------- * Estimated ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS. Reference is made to Section 145 of the Delaware General Corporation Law which provides for indemnification of directors and officers in certain circumstances. Article Twelfth of the Company's Certificate of Incorporation, which Certificate was filed as an exhibit to the Company's Form 10-Q for the quarter ended March 31, 1993, is incorporated herein by reference. The Company has purchased liability insurance covering its directors and officers to provide protection in certain circumstances where the Company cannot indemnify a director or officer, in addition to protection to the Company in certain circumstances where a director or officer may be indemnified by the Company under the provisions of Delaware law. The proposed forms of Underwriting Agreement and Agency Agreement, filed as Exhibits 1.1 and 1.2, respectively, to this Registration Statement, provide for indemnification of directors and officers of the Company by the underwriters or agents, as the case may be, against certain liabilities. ITEM 16. EXHIBITS.
EXHIBIT NUMBER DESCRIPTION OF EXHIBIT ------- ---------------------- 1.1 --Form of Underwriting Agreement. 1.2 --Form of Agency Agreement. 4.1 --Indenture dated as of November 1, 1990 between the Company and Citibank, N.A., as Trustee, filed as an Exhibit with Form SE on May 3, 1990 and incorporated by reference herein. 4.2 --Form of Debt Securities (included in 4.1 at pages 14-22). 4.3 --Form of Fixed Rate Note. 4.4 --Form of Floating Rate Note. 5 --Opinion of Deborah M. Regan as to the validity of the Debt Securities. 12 --Computation of Ratio of Earnings to Fixed Charges, filed as an Exhibit with Current Report on Form 8-K dated February 21, 1995 and incorporated by reference. 23.1 --Consent of Arthur Andersen LLP.
II-1
EXHIBIT NUMBER DESCRIPTION OF EXHIBIT ------- ---------------------- 23.2 --The consent of Deborah M. Regan is contained in her opinion filed as Exhibit 5 to this Registration Statement. 24 --Powers of Attorney. 25 --Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of Citibank, N.A.
ITEM 17. UNDERTAKINGS. The Company hereby undertakes (1) to file, during any period in which offers or sales are being made, a post-effective amendment to this Registration Statement: (i) to include any prospectus required by section 10(a)(3) of the Securities Act of 1933; (ii) to reflect in the prospectus any facts or events arising after the effective date of this Registration Statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in this Registration Statement; and (iii) to include any material information with respect to the plan of distribution not previously disclosed in this Registration Statement or any material change to such information in this Registration Statement; provided, however, that paragraphs (1)(i) and (1)(ii) do not apply if this Registration Statement is on Form S-3 or Form S-8 and the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed by the Company pursuant to section 13 or section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in this Registration Statement; (2) that, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof; (3) to remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering; (4) that, for purposes of determining any liability under the Securities Act of 1933, each filing of the Company's annual report pursuant to section 13(a) or section 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan's annual report pursuant to section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference in this Registration Statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof; (5) that, for purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of this Registration Statement in reliance upon Rule 430A and contained in a form of prospectus filed by the Company pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this Registration Statement as of the time it was declared effective; and (6) that, for the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the Company pursuant to the provisions described under Item 15 above or otherwise, the Company has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Company of expenses incurred or paid by a director, officer or controlling person of the Company in the successful defense of any action, suit or proceeding) is asserted against the Company by such director, officer or controlling person in connection with the securities being registered, the Company will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. II-2 SIGNATURES PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT CERTIFIES THAT IT HAS REASONABLE GROUNDS TO BELIEVE THAT IT MEETS ALL OF THE REQUIREMENTS FOR FILING ON FORM S-3 AND HAS CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN THE CITY OF CHICAGO AND THE STATE OF ILLINOIS ON THE 23RD DAY OF FEBRUARY, 1995. R. R. DONNELLEY & SONS COMPANY /s/ Frank R. Jarc By __________________________________ Frank R. Jarc, Executive Vice President and Chief Financial Officer PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS REGISTRATION STATEMENT HAS BEEN SIGNED BELOW ON THE 23RD DAY OF FEBRUARY, 1995 BY THE FOLLOWING PERSONS IN THE CAPACITIES INDICATED. SIGNATURE AND TITLE SIGNATURE AND TITLE * ------------------------------------- * Richard M. Morrow, - ------------------------------------- Director John R. Walter, Chairman of the Board, Chief * Executive Officer and Director ------------------------------------- (Principal Executive Officer) M. Bernard Puckett, Director /s/ Frank R. Jarc - ------------------------------------- * Frank R. Jarc, ------------------------------------- Executive Vice President and John M. Richman, Chief Financial Officer Director (Principal Financial Officer) * * ------------------------------------- - ------------------------------------- William D. Sanders, William L. White, Director Vice President and Controller (Principal Accounting Officer) * ------------------------------------- * Jerre L. Stead, - ------------------------------------- Director Martha Layne Collins, Director * ------------------------------------- * Bide L. Thomas, - ------------------------------------- Director James R. Donnelley, Director * ------------------------------------- * H. Blair White, - ------------------------------------- Director Charles C. Haffner III, Director * ------------------------------------- * Stephen M. Wolf, - ------------------------------------- Director Thomas S. Johnson, Director /s/ Deborah M. Regan *By _________________________________ Deborah M. Regan, Attorney-in-Fact II-3 EX-1.1 2 UNDERWRITING AGREEMENT DRAFT: FEBRUARY 22, 1995 EXHIBIT 1.1 ----------- =============================================================================== R. R. DONNELLEY & SONS COMPANY Debt Securities ______________________ UNDERWRITING AGREEMENT ______________________ Dated ____________, 19__ =============================================================================== R. R. DONNELLEY & SONS COMPANY UNDERWRITING AGREEMENT ---------------------- [Date] [NAMES AND ADDRESSES OF REPRESENTATIVES] Ladies and Gentlemen: From time to time R. R. Donnelley & Sons Company, a Delaware corporation (the "Company"), proposes to enter into one or more Pricing Agreements (each a "Pricing Agreement") in the form of Annex I hereto, with such additions and deletions as the parties thereto may determine, and, subject to the terms and conditions stated herein and therein, to issue and sell to the underwriters named in Schedule I to the applicable Pricing Agreement (with respect to each such Pricing Agreement, the "Underwriters") certain of the Company's debt securities (the "Securities") specified in Schedule II to such Pricing Agreement (with respect to each such Pricing Agreement, the "Designated Securities"), less the principal amount of Designated Securities covered by Delayed Delivery Contracts, if any, as provided in Section 3 hereof and as may be specified in Schedule II to such Pricing Agreement (with respect to such Pricing Agreement, any Designated Securities to be covered by Delayed Delivery Contracts being herein sometimes referred to as "Contract Securities" and the Designated Securities to be purchased by the Underwriters (after giving effect to the deduction, if any, for Contract Securities) being herein sometimes referred to as "Underwriters' Securities"). The terms and rights of any particular issuance of Designated Securities shall be as specified in the Pricing Agreement relating thereto and in or pursuant to the indenture, as it may be supplemented from time to time (the "Indenture"), identified in such Pricing Agreement. 1. Introduction. Particular sales of Designated Securities may be made from time to time to the Underwriters of such Securities, for whom the firms designated as representatives of the Underwriters of such securities in the Pricing Agreement relating thereto will act as representatives (the "Representatives"). The term "Representatives" also refers to a single firm acting as sole representative of the Underwriters and to Underwriters who act without any firm being designated as their representative. This Underwriting Agreement shall not be construed as an obligation of the Company to sell any of the Securities or as an obligation of any of the Underwriters to purchase any of the Securities. The obligation of the Company to issue and sell any of the Securities and the obligation of any of the Underwriters to purchase any of the Securities shall be evidenced by the Pricing Agreement with respect to the Designated Securities specified therein. Each Pricing Agreement shall specify the aggregate principal amount of such Designated Securities, the initial public offering price of such Designated Securities, the purchase price to the Underwriters of such Designated Securities, the names of the Underwriters of such Designated Securities, the names of the Representatives of such Underwriters, the principal amount of such Designated Securities to be purchased by each Underwriter, whether any of such Designated Securities shall be covered by Delayed Delivery Contracts (as defined in Section 3 hereof) and the commission payable to the Underwriters with respect thereto and shall set forth the date, time and manner of delivery of such Designated Securities and payment therefor. The Pricing Agreement shall also specify (to the extent not set forth in the Indenture and the registration statement and prospectus with respect thereto) the terms of such Designated Securities. A Pricing Agreement shall be in the form of an executed writing (which may be in counterparts) and may be evidenced by an exchange of telegraphic communications or any other rapid transmission device designed to produce a written record of communications transmitted. Each Pricing Agreement shall be deemed to be an agreement by the Company and the Underwriters to be bound by the terms of this Agreement. The obligations of the Underwriters under this Agreement and each Pricing Agreement shall be several and not joint. 2. Representations and Warranties. The Company represents and warrants to, and agrees with, each of the Underwriters that: (a) The Company meets all of the requirements for the use of Form S-3 under the Securities Act of 1933, as amended (the "Act"). The Company has prepared and filed with the Securities and Exchange Commission (the "Commission") a registration statement on Form S-3 (File No. 33-_____) in the form heretofore delivered to the Representatives and, excluding exhibits to such registration statement, but including all documents incorporated by reference in the prospectus included therein, to the Representatives for each of the other Underwriters and such registration statement in such form has been declared effective by the Commission and no stop order suspending the effectiveness of such registration statement has been issued and no -2- proceeding for that purpose has been initiated or threatened by the Commission (any preliminary prospectus included in such registration statement being hereinafter called a "Preliminary Prospectus"; the various parts of such registration statement, including all exhibits thereto but excluding Form T-1, each as amended at the time such part became effective, being hereinafter collectively called the "Registration Statement"; the prospectus relating to the Securities, in the form in which it has most recently been filed, or transmitted for filing, with the Commission, on or prior to the date of this Agreement (excluding any preliminary prospectus supplement), being hereinafter called the "Prospectus"; any reference herein to any Preliminary Prospectus or the Prospectus shall be deemed to include the documents incorporated by reference therein pursuant to the applicable form under the Act, as of the date of such Preliminary Prospectus or Prospectus, as the case may be; any reference to any amendment or supplement to any Preliminary Prospectus or the Prospectus shall be deemed to refer to and include any documents filed after the date of such Preliminary Prospectus or Prospectus, as the case may be, under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), but prior to or as of the date of such amendment or supplement, and incorporated by reference; any reference to the Registration Statement, any Preliminary Prospectus or the Prospectus shall be deemed to exclude any statement deemed not to be incorporated by reference therein under Rule 412 of the Act; and any reference to the Prospectus as amended or supplemented shall be deemed to refer to the Prospectus as amended or supplemented in relation to the applicable Designated Securities (excluding any preliminary prospectus supplement) in the form in which it is first filed, or transmitted for filing, with the Commission pursuant to Rule 424 under the Act, including any documents incorporated by reference therein as of the date of such filing or transmission); (b) The documents incorporated by reference in the Prospectus, at the time they became effective or were filed with the Commission, as the case may be, conformed in all material respects to the requirements of the Act or the Exchange Act, as applicable, and the rules and regulations of the Commission thereunder, and none of such documents contained, in the case of a registration statement which became effective under the Act, an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not -3- misleading, and, in the case of other documents which were filed under the Act or the Exchange Act with the Commission, an untrue statement of a material fact or omitted 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, in each case after excluding any statement in any such document which does not constitute part of the Registration Statement or the Prospectus pursuant to Rule 412 under the Act, and any further documents so filed and incorporated by reference in the Prospectus, when they become effective or are filed with the Commission, as the case may be, will conform in all material respects to the requirements of the Act or the Exchange Act, as applicable, and the rules and regulations of the Commission thereunder and will not contain, in the case of a registration statement which becomes effective under the Act, an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading and, in the case of other documents which are filed under the Act or the Exchange Act, an untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they are 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 of Designated Securities through the Representatives expressly for use in the Prospectus as amended or supplemented relating to such Securities; (c) The Registration Statement and the Prospectus conform, and any amendments or supplements thereto will conform, in all material respects to the requirements of the Act and the Trust Indenture Act of 1939, as amended (the "Trust Indenture Act") and the rules and regulations of the Commission thereunder and do not and will not, as of the applicable effective date as to the Registration Statement and any amendment thereto and as of the applicable filing date as to the Prospectus and any supplement thereto, contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein 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 of Designated -4- Securities through the Representatives expressly for use in the Prospectus as amended or supplemented relating to such Designated Securities; (d) 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 Prospectus any loss or interference with its business which is material to the Company and its subsidiaries considered as one enterprise 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, otherwise than as set forth or contemplated in the Prospectus; and, since the respective dates as of which information is given in the Registration Statement and the Prospectus, there has not been any change in the capital stock (other than issuances of common stock pursuant to existing employee benefit or stock option plans, repurchases by the Company of its common stock in the ordinary course of business or conversions of outstanding convertible securities) or long-term debt (other than changes as a result of maturities, sinking fund payments, amortization of debt discount or currency fluctuations) of the Company or any of its subsidiaries or any material adverse change, or any development which will result in a material adverse change, in or affecting the general affairs, management, financial position, stockholders' equity or results of operations of the Company and its subsidiaries considered as one enterprise, otherwise than as set forth or contemplated in the Prospectus; (e) 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 corporate power and authority under such laws to own, lease and operate its properties and to conduct its business as described in the Prospectus; and the Company is duly qualified as a foreign corporation to transact business and is in good standing in each jurisdiction where the character of the business conducted by it or the location of the property owned by it makes such qualification necessary, except where the failure to be so qualified would not have a material adverse effect on the Company and its subsidiaries considered as one enterprise. Each subsidiary of the Company that is a significant subsidiary within the meaning of Rule 1-02 of Regulation S-X under the Act and such other subsidiaries of the Company designated in the list previously furnished to the Representatives by an -5- officer of the Company for the purposes of this Agreement (collectively, the "Subsidiaries") is a corporation duly incorporated and validly existing in good standing under the laws of the state or jurisdiction of its incorporation or formation, and each has corporate power and authority under such laws to own, lease and operate its properties and to conduct its business, and is duly qualified as a foreign corporation to transact business and is in good standing in each jurisdiction where the character of the business conducted by it or the location of the property owned by it makes such qualification necessary, except where the failure to be so qualified would not have a material adverse effect on the Company and its subsidiaries considered as one enterprise. The Company, directly or indirectly, owns all of the issued and outstanding voting securities of each of the Subsidiaries, in each case free and clear of any liens, encumbrances and claims; (f) The Company has an authorized capitalization as set forth in 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; (g) The Securities have been duly authorized and, when Designated Securities are issued, authenticated and delivered against payment of the agreed upon consideration therefor pursuant to this Agreement and the Pricing Agreement with respect to such Designated Securities and, in the case of any Contract Securities, pursuant to Delayed Delivery Contracts (as defined in Section 3 hereof) with respect to such Contract Securities, such Designated Securities 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, which is substantially in the form filed as an exhibit to the Registration Statement; the Indenture has been duly authorized and, at the Time of Delivery (as defined in Section 3(b)(i) hereof) the Indenture will be duly qualified under the Trust Indenture Act and when executed and delivered by the Company and the Trustee, will constitute a valid and legally binding obligation of the Company, enforceable in accordance with its terms, except as enforcement thereof may be limited by bankruptcy, insolvency, reorganization or other similar laws affecting enforcement of creditors' rights generally and except as enforcement thereof is subject to general principles of equity; and the -6- Securities and the Indenture will conform to the description thereof contained in the Prospectus; (h) In the event that any of the Securities are to be purchased pursuant to Delayed Delivery Contracts, each of such Delayed Delivery Contracts has been duly authorized by the Company and, when executed and delivered by the Company and the purchaser named therein, will constitute a valid and legally binding agreement of the Company enforceable in accordance with its terms, except as enforcement thereof may be limited by bankruptcy, insolvency, reorganization or other similar laws affecting enforcement of creditors' rights generally and except as enforcement thereof is subject to general principles of equity; and any Delayed Delivery Contracts will conform to the description thereof in the Prospectus; (i) The issue and sale by the Company of the Designated Securities and the compliance by the Company with all of the provisions of the Designated Securities, the Indenture, each of the Delayed Delivery Contracts, if any, this Agreement and any Pricing Agreement with respect to the Designated Securities, and the consummation of the transactions herein and therein contemplated, will not conflict with or result in a breach of any of the terms or provisions of, or constitute a default under, or result in the creation or imposition of any lien, charge or encumbrance upon any of the property or assets of the Company or any of its subsidiaries under, any 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 for conflicts, breaches, defaults, liens, charges and encumbrances which would not, individually or in the aggregate, have a material adverse effect on the Company and its subsidiaries considered as one enterprise), nor will such action result in any violation of the provisions of the Certificate or Articles of Incorporation, as amended, or the By-Laws of the Company or any of its subsidiaries or any statute, order, rule or regulation applicable to the Company or any of its subsidiaries of any court or of any Federal, state or other regulatory authority or other governmental body having jurisdiction over the Company or any of its subsidiaries; no authorization, approval, consent, registration, qualification or order of or with any court or any such regulatory authority or other governmental agency or body is required for -7- issue and sale of the Designated Securities by the Company or the consummation by the Company of the other transactions contemplated by this Agreement or any Pricing Agreement or the Indenture or any Delayed Delivery Contracts, except such as have been, or will have been prior to the Time of Delivery, obtained under the Act and the Trust Indenture Act and such consents, approvals, authorizations, registrations or qualifications as may be required under state securities or Blue Sky laws in connection with the purchase and distribution of the Designated Securities by the Underwriters; (j) Except as set forth in the Prospectus, there are no actions, suits or proceedings before or by any court or governmental agency or body, domestic or foreign, pending or, to the knowledge of the Company, threatened against or, to the knowledge of the Company, affecting the Company or any of its subsidiaries which are, individually or in the aggregate, reasonably expected to result in any material adverse change in the general affairs, financial position, stockholders' equity or results of operations of the Company and its subsidiaries, considered as one enterprise, or which is reasonably expected to materially and adversely affect the consummation by the Company of this Agreement or the issuance and sale by the Company of any of the Designated Securities; and there are no contracts or exhibits required by the Act or by the rules and regulations of the Commission thereunder to be filed with the Registration Statement or required to be described or incorporated by reference in the Registration Statement or the Prospectus which are not filed, incorporated by reference or described as required; (k) This Agreement and the Pricing Agreement with respect to the Designated Securities have been duly authorized, executed and delivered by the Company. (l) Arthur Andersen LLP, who are reporting upon the audited financial statements and schedules included or incorporated by reference in the Registration Statement, are independent public accountants as required by the Act and the rules and regulations of the Commission thereunder; (m) The consolidated financial statements included or incorporated by reference in the Registration Statement present fairly in all material respects the financial position of the Company and its -8- subsidiaries as of the dates indicated and the consolidated results of the operations and cash flows of the Company and its subsidiaries for the periods specified. Such financial statements (except as disclosed in the notes thereto or otherwise stated therein) have been prepared in conformity with generally accepted accounting principles applied on a consistent basis throughout the entire period involved. The financial statement schedules, if any, included in the Registration Statement present fairly in all material respects the information required to be stated therein. The selected financial data included in the Prospectus present fairly in all material respects the information shown therein and have been compiled on a basis consistent with that of the audited consolidated financial statements included or incorporated by reference in the Registration Statement. The pro forma financial statements and other pro forma financial information, if any, included or incorporated by reference in the Registration Statement present fairly in all material respects the information shown therein, have been prepared in accordance with the Commission's rules and guidelines with respect to pro forma financial statements, have been properly compiled on the pro forma bases described therein, and, in the opinion of the Company, the assumptions used in the preparation thereof are reasonable and the adjustments used therein are appropriate to give effect to the transactions or circumstances referred to therein; (n) Neither the Company nor any of the Subsidiaries is in violation of its charter or in default in the performance or observance of any obligation, agreement, covenant or condition contained in any contract, indenture, mortgage, loan agreement, note, lease or other agreement or instrument to which the Company or any of the Subsidiaries is a party or by which it or any of them may be bound, or to which any of the property or assets of the Company or any of the Subsidiaries is subject, other than defaults (considered in the aggregate) which do not have, or which would not reasonably be expected to result in, a material adverse effect on the general affairs, financial position, stockholders' equity or results of operations of the Company and its subsidiaries considered as one enterprise; (o) The Company and its subsidiaries possess adequate certificates, authorities or permits issued by the appropriate state, federal or foreign regulatory agencies or bodies necessary to conduct the business -9- now operated by them, and neither the Company nor any of its subsidiaries has received any notice of proceedings relating to the revocation or modification of any such certificate, authority or permit, with such exceptions as would not, singly or in the aggregate, materially and adversely affect the general affairs, financial position, stockholders' equity or results of operations of the Company and its subsidiaries considered as one enterprise; and (p) The Company has complied and will comply with the provisions of Florida H.B. 1771 codified as Section 517.075 of the Florida Statutes, 1987, as amended, and all regulations promulgated thereunder related to issuers doing business in Cuba. 3. Purchase and Sale. (a)(i) Upon the execution of the Pricing Agreement applicable to any Designated Securities and authorization by the Representatives of the release of such Designated Securities that are Underwriters' Securities, the several Underwriters propose to offer the Underwriters' Securities for sale upon the terms and conditions set forth in the Prospectus as amended or supplemented. (ii) The Company may specify in Schedule II to the Pricing Agreement applicable to any Designated Securities that the Underwriters are authorized to solicit offers to purchase Designated Securities from the Company pursuant to delayed delivery contracts (herein called "Delayed Delivery Contracts"), substantially in the form of Annex II attached hereto but with such changes therein as the Representatives and the Company may authorize or approve. If so specified, the Underwriters will endeavor to make such arrangements, and as compensation therefor the Company will pay to the Representatives, for the accounts of the Underwriters, at the Time of Delivery (as defined in subsection (b)(i) below), such commission as may be set forth in such Pricing Agreement. Delayed Delivery Contracts, if any, are to be with institutional investors of the types described in the Prospectus and subject to other conditions therein set forth. The Underwriters will not have any responsibility in respect of the validity or performance of any Delayed Delivery Contracts. (iii) The principal amount of Contract Securities to be deducted from the principal amount of Designated Securities to be purchased by each Underwriter as set forth in Schedule I to the Pricing Agreement applicable to such Designated Securities shall be, in each case, the principal amount of Contract Securities which the Company has been advised by the Representatives have been attributed to such Underwriter, provided that, if the Company has not been so advised, the amount of Contract Securities to be so deducted shall be, in each case, -10- that proportion of Contract Securities which the principal amount of Designated Securities to be purchased by such Underwriter under such Pricing Agreement bears to the total principal amount of the Designated Securities (rounded as the Representatives may determine to the nearest $1,000 principal amount). The total principal amount of Underwriters' Securities to be purchased by all the Underwriters pursuant to such Pricing Agreement shall be the total principal amount of Designated Securities set forth in Schedule I to such Pricing Agreement less the principal amount of the Contract Securities. The Company will deliver to the Representatives not later than 3:30 p.m. New York time, on the third business day preceding the Time of Delivery specified in the applicable Pricing Agreement (or such other time and date as the Representatives and the Company may agree upon in writing) a written notice setting forth the principal amount of Contract Securities. (b)(i) Underwriters' Securities to be purchased by each Underwriter pursuant to the Pricing Agreement relating thereto, in definitive form to the extent practicable, or in the form of a global certificate representing all such Underwriters' Securities, if the related Pricing Agreement so provides, and in such authorized denominations and registered in such names as the Representatives may request upon at least forty-eight hours' prior notice to the Company, shall be delivered by or on behalf of the Company to the Representatives for the account of such Underwriter, against payment by such Underwriter or on its behalf of the purchase price therefor by certified or official bank check or checks, payable to the order of the Company in the funds specified in such Pricing Agreement, all at the place and time and date specified in such Pricing Agreement or at such other place and time and date as the Representatives and the Company may agree upon in writing, such time and date being herein called the "Time of Delivery" for such Securities. (ii) Concurrently with the delivery of and payment for the Underwriters' Securities, the Company will deliver to the Representatives for the accounts of the Underwriters a check payable to the order of the party designated in the Pricing Agreement relating to such Securities in the amount of any compensation payable by the Company to the underwriters in respect of any Delayed Delivery Contracts as provided in Section 3(a) hereof and in the Pricing Agreement relating to such Securities. 4. Certain Covenants of the Company. The Company covenants and agrees with each Underwriter as follows: (a) To file with the Commission pursuant to Rule 424 of the Act the Prospectus as amended or supplemented substantially in the form furnished to the Representatives prior -11- to the execution of the Pricing Agreement and to make no further amendment or any supplement to the Registration Statement or Prospectus as amended or supplemented after the date of the Pricing Agreement relating to such Securities and prior to the Time of Delivery for such Securities without furnishing to the Representatives a copy of such amendment or supplement a reasonable time before the filing thereof and obtaining the consent of the Representatives to such filing, which consent may not be unreasonably withheld or delayed; to advise the Representatives promptly of any such amendment or supplement after such Time of Delivery and to furnish the Representatives with copies thereof; to 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, 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 such Securities, and during such same period to advise the Representatives, promptly after the Company receives notice thereof, of the time when any amendment to the Registration Statement has been filed or becomes effective or any amendment or supplement to the Prospectus or any amended Prospectus has been filed or transmitted for filing, of the issuance by the Commission of any stop order or of any order preventing or suspending the use of any prospectus relating to the Securities, of the suspension of the qualification of such Securities for offering or sale in any jurisdiction, of the initiation or threatening of any proceeding for any such purpose, or of any request by the Commission for the amending or supplementing of the Registration Statement or Prospectus or for additional information, and in the event of the issuance of any such stop order or of any such order preventing or suspending the use of any prospectus relating to the Securities or suspending any such qualification, to use promptly its best efforts to obtain its withdrawal; (b) Promptly from time to time to take such action as the Representatives may reasonably request to qualify such Securities for offering and sale under the securities laws of such jurisdictions as the Representatives may request and to comply with such laws so as to permit the continuance of sales and dealings therein in such jurisdictions for as long as may be necessary to complete the distribution, provided that in connection therewith the Company shall not be required to qualify as a foreign corporation or file a general consent to service of process in any jurisdiction; (c) To furnish the Underwriters with copies of the Prospectus as amended or supplemented in such quantities as the Representatives may from time to time reasonably request, and, if the delivery of a prospectus is required at any time in -12- connection with the offering or sale of such Securities, and if at such time any event shall have occurred as a result of which the Prospectus as then amended or supplemented would include an 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 under which they were made when such Prospectus is delivered, not misleading, or, if for any other reason it shall be necessary during such same period to amend or supplement the Prospectus or to file under the Exchange Act any document incorporated by reference in the Prospectus in order to comply with the Act, the Exchange Act or the Trust Indenture Act, to notify the Representatives and upon their request to file such document and to prepare and furnish without charge to each Underwriter, and to any dealer in securities, as many copies as the Representatives may from time to time reasonably request of an amended Prospectus or a supplement to the Prospectus which will correct such statement or omission or effect such compliance. (d) To make generally available to its security holders, as soon as practicable, but in any event not later than eighteen months after the date of the Pricing Agreement for such Designated Securities, an earnings statement of the Company and its subsidiaries (which need not be audited) complying with Section 11(a) of the Act and the rules and regulations of the Commission thereunder (including at the option of the Company Rule 158; (e) During the period beginning from the date of the Pricing Agreement for any Designated Securities and continuing to and including the earlier of (i) the termination of trading restrictions for such Designated Securities, as notified to the Company by the Representatives and (ii) the Time of Delivery for such Designated Securities, not to offer, sell, contract to sell or otherwise dispose of any debt securities of the Company (other than such Designated Securities) which mature more than one year after such Time of Delivery and which are substantially similar to such Designated Securities, without the prior written consent of the Representatives; and (f) If and to the extent specified in Schedule II of the Pricing Agreement, to use its best efforts to cause any Designated Securities to be duly authorized for listing on the New York Stock Exchange or any other exchange and to be registered under the Exchange Act subject to notice of official issuance and a notice of satisfactory distribution of the Designated Securities. 5. Payment of Expenses. (a) The Company will pay and bear all costs and expenses incident to the performance of its obligations under this Agreement, including (i) the preparation, -13- printing and filing of the Registration Statement (including financial statements and exhibits), as originally filed and as amended, the Preliminary Prospectus, any preliminary prospectus supplement, the Prospectus and the Prospectus as amended or supplemented (and any amendments or supplements to the foregoing documents), and the cost of furnishing copies thereof to the Underwriters, (ii) the preparation, printing and distribution of this Agreement, any Pricing Agreements, the Indenture, the Designated Securities, any Delayed Delivery Contracts, the Blue Sky Survey and the Legal Investment Survey, if any, (iii) the delivery of the Designated Securities to the Underwriters, (iv) the fees and disbursements of the Company's counsel and accountants, (v) the fees and disbursements of counsel for the Underwriters in connection with the Blue Sky Survey and the Legal Investment Survey, if any, (vi) any filing fees incident to any required review by the National Association of Securities Dealers, Inc. of the terms of the sale of the Securities, (vii) any fees charged by rating agencies for rating the Designated Securities, (viii) the fees and expenses of the Trustee, including the fees and disbursements of counsel for the Trustee in connection with the Indenture and the Designated Securities and (ix) the expenses, if any, of listing the Designated Securities on the New York Stock Exchange or any other exchange. It is understood, however, that, except as provided in this Section, Section 7, Section 8 and Section 10 hereof, the Underwriters will pay all of their own costs and expenses, including the fees of their counsel, transfer taxes on resale of any of the Securities by them and any advertising expenses connected with any offers they may make. (b) If this Agreement or any Pricing Agreement is terminated by the Representatives in accordance with the provisions of Section 6 or 10(a)(i) the Company will reimburse the Underwriters for all their out-of-pocket expenses, including the reasonable fees and disbursements of counsel for the Underwriters. 6. Conditions of Underwriters' Obligations. The obligations of the Underwriters of any Designated Securities under the Pricing Agreement relating to such Designated Securities shall be subject, in the discretion of the Representatives, to the condition that all representations and warranties and other statements of the Company herein are, at and as of the date of execution of the Pricing Agreement and the Time of Delivery for such Designated Securities, true and correct, the condition that the Company shall have performed all of its obligations hereunder theretofore to be performed, and the following additional conditions: (a) No stop order suspending the effectiveness of the Registration Statement shall have been issued and no proceeding -14- for that purpose shall have been initiated or threatened by the Commission, and all requests for additional information on the part of the Commission shall have been complied with to the reasonable satisfaction of the Representatives; (b) [Name], counsel for the Underwriters, shall have furnished to the Representatives such opinion or opinions, dated the Time of Delivery for such Designated Securities, with respect to the incorporation of the Company, the validity of the Indenture, the Designated Securities, the Delayed Delivery Contracts, if any, the Registration Statement, the Prospectus as amended or supplemented and other related matters as the Representatives may reasonably request, and such counsel shall have received such papers and information as they may reasonably request to enable them to pass upon such matters. In giving such opinion such counsel may rely, as to all matters governed by the laws of jurisdictions other than the law of the State of Illinois and the federal law of the United States and the corporate law of the State of Delaware, upon the opinions of counsel satisfactory to the Representatives. Such counsel may also state that, insofar as such opinion involves factual matters, they have relied, to the extent they deem proper, upon certificates of officers of the Company and its subsidiaries and certificates of public officials; (c) Deborah M. Regan, Vice President and Secretary of the Company, shall have furnished to the Representatives her written opinion, dated the Time of Delivery for such Designated Securities, in form and substance satisfactory to the Representatives, to the effect that: (i) Each of the Subsidiaries is a corporation duly incorporated and validly existing in good standing under the laws of the state or jurisdiction of its incorporation or formation, and each of the Subsidiaries has full corporate power and authority under such laws to own, lease and operate its properties and to conduct its business as described in the Prospectus as amended or supplemented; (ii) The Company has an authorized capitalization as set forth in the Prospectus as amended or supplemented 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; (iii) The Company, directly or indirectly, owns all of the issued and outstanding voting securities of each of the Subsidiaries, in each case free and clear -15- of any liens, encumbrances and claims of which such counsel has knowledge; (iv) The Company and each of the Subsidiaries is a corporation duly qualified as a foreign corporation to transact business and is in good standing in each jurisdiction in which the character of the business conducted by it or the location of the property owned by it makes such qualification necessary except where the failure to be so qualified would not have a material adverse effect on the Company and its subsidiaries considered as one enterprise; (v) To the best of such counsel's knowledge and other than as set forth in the Prospectus, there are no actions, suits or proceedings before or by any court or governmental agency or body, domestic or foreign, pending or threatened against or affecting the Company or any of its subsidiaries which are, individually or in the aggregate, reasonably expected to result in any material adverse change in the general affairs, financial position, stockholders' equity or results of operations of the Company and its subsidiaries considered as one enterprise, or which are reasonably expected to materially and adversely affect the consummation of this Agreement or the issuance and sale by the Company of the Designated Securities; and to the best of such counsel's knowledge, there are no contracts or exhibits required by the Act or by the rules and regulations of the Commission thereunder to be filed with the Registration Statement or required to be described or incorporated by reference in the Registration Statement or the Prospectus as amended or supplemented which are not filed, incorporated by reference or described as required; (vi) The issue and sale by the Company of the Designated Securities and the compliance by the Company with all of the provisions of the Designated Securities, the Indenture, each of the Delayed Delivery Contracts, if any, this Agreement and the Pricing Agreement with respect to the Designated Securities and the consummation of the transactions herein and therein contemplated will not, to the best knowledge of such counsel, conflict with or result in a breach of any of the terms or provisions of, or constitute a default under, or result in the creation or imposition of any lien, charge or encumbrance upon any of the property or assets of any of the subsidiaries of the Company under, any agreement or instrument to which any of the subsidiaries of the Company is a party or by which any -16- of the subsidiaries of the Company may be bound or to which any of the property or assets of any of the subsidiaries of the Company is subject (except for conflicts, breaches, defaults, liens, charges and encumbrances which would not, individually or in the aggregate, have a material adverse effect on the Company and its subsidiaries considered as one enterprise); nor will such action result in any violation of the provisions of the Certificate or Articles of Incorporation, as amended, or the By-Laws of any of the subsidiaries of the Company or, to the best of such counsel's knowledge, any statute or order, rule or regulation applicable to any of the subsidiaries of the Company of any court or of any Federal, state or other regulatory authority or other governmental body having jurisdiction over any of the subsidiaries of the Company; (vii) Nothing has come to the attention of such counsel to cause such counsel to believe that the Registration statement or any amendment thereof at the time it became effective contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading or that the Prospectus as amended or supplemented at the time it was filed or transmitted for filing pursuant to Rule 424 under the Act contained, or as amended or supplemented at the Time of Delivery contains, an untrue statement of a material fact or omitted or omits to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading; (viii) The documents incorporated by reference in the Prospectus as amended or supplemented (other than the financial statements and related schedules and other financial or statistical data included therein, as to which such counsel need express no opinion), when they became effective or were filed with the Commission, as the case may be, complied as to form in all material respects with the requirements of the Act or the Exchange Act, as applicable, and the rules and regulations of the Commission thereunder, and nothing has come to the attention of such counsel to cause such counsel to believe that any of such documents, when they became effective or were so filed, as the case may be, contained, in the case of a registration statement which became effective under the Act, an untrue statement of a material fact or omitted to state a material fact required to be stated therein or -17- necessary to make the statements therein not misleading and, in the case of other documents which were filed under the Act or Exchange Act with the Commission, an untrue statement of a material fact or omitted to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made when such documents were so filed, not misleading, in each case after excluding any statement in any such document which does not constitute part of the Registration Statement or the Prospectus as amended or supplemented pursuant to Rule 412 under the Act; and to such further effect with respect to other legal matters relating to this Agreement and the sale of the Designated Securities hereunder as counsel for the Underwriters may reasonably request; (d) Sidley & Austin, counsel for the Company, shall have furnished to the Representatives their written opinion dated the Time of Delivery for such Designated Securities, in form and substance satisfactory to the Representatives, to the effect that: (i) The Company is a corporation duly incorporated and validly existing in good standing under the laws of the State of Delaware and the Company has full corporate power and authority under such laws to own, lease and operate its properties and to conduct its business as described in the Prospectus as amended or supplemented; (ii) This Agreement and the Pricing Agreement with respect to the Designated Securities have been duly authorized, executed and delivered by the Company; (iii) In the event that any of the Designated Securities are to be purchased pursuant to Delayed Delivered Contracts, each of such Delayed Delivery Contracts that has been executed by the Company has been duly authorized, executed and delivered by the Company and, assuming such contracts have been duly executed and delivered by the institutional purchaser named therein, constitutes a valid and legally binding obligation of the Company enforceable in accordance with its terms, except as enforcement thereof may be limited by bankruptcy, insolvency, reorganization or other similar laws affecting enforcement of creditors' rights generally and except as enforcement thereof is subject to general principles of equity; and any Delayed Delivery Contracts conform in all material -18- respects to the description thereof in the Prospectus as amended or supplemented; (iv) The Designated Securities have been duly authorized; the Underwriters' Securities have been duly executed, authenticated, issued and delivered and, upon receipt by the Company of the agreed upon consideration therefor, will constitute valid and legally binding obligations of the Company entitled to the benefits provided by the Indenture, except as enforcement thereof may be limited by bankruptcy, insolvency, reorganization and other similar laws affecting enforcement of creditors' rights generally and except as enforcement thereof is subject to general principles of equity; and the Contract Securities, if any, when executed, authenticated, issued and delivered pursuant to the Indenture and Delayed Delivery Contracts, if any, will, upon receipt by the Company of the agreed upon consideration therefor, constitute valid and legally binding obligations of the Company entitled to the benefits provided by the Indenture, except as enforcement thereof may be limited by bankruptcy, insolvency, reorganization and other similar laws affecting enforcement of creditors' rights generally and except as enforcement thereof is subject to general principles of equity; (v) The Indenture has been duly authorized, executed and delivered by the Company, is substantially in the form filed as an Exhibit to the Registration Statement, and constitutes a valid and legally binding obligation of the Company, enforceable in accordance with its terms, except as enforcement thereof may be limited by bankruptcy, insolvency, reorganization or other similar laws affecting enforcement of creditors' rights generally and except as enforcement thereof is subject to general principles of equity; and the Indenture has been duly qualified under the Trust Indenture Act; (vi) The issue and sale by the Company of the Designated Securities and the compliance by the Company with all of the provisions of the Designated Securities, the Indenture, each of the Delayed Delivery Contracts, if any, this Agreement and the Pricing Agreement with respect to the Designated Securities and the consummation of the transactions herein and therein contemplated will not, to the best knowledge of such counsel, conflict with or result in a breach of any of the terms or provisions of, or constitute a default under, or result in the creation or imposition of any -19- lien, charge or encumbrance upon any of the property or assets of the Company under any agreement or instrument to which the Company is a party or by which the Company may be bound or to which any of the property or assets of the Company is subject (except for conflicts, breaches, defaults, liens, charges and encumbrances which would not, individually or in the aggregate, have a material adverse effect on the Company and its subsidiaries considered as one enterprise); nor will such action result in any violation of the provisions of the Certificate or Articles of Incorporation, as amended, or the By-Laws of the Company or, to the best of such counsel's knowledge, any statute, order, rule or regulation applicable to the Company of any court or of any Federal, state or other regulatory authority or other governmental body having jurisdiction over the Company; and no authorization approval, consent, registration, qualification or order of or with any such court or any such regulatory authority or other governmental agency or body is required for the issue and sale of the Designated Securities by the Company or the consummation by the Company of the other transactions contemplated by this Agreement or such Pricing Agreement or the Indenture or any of such Delayed Delivery Contracts, except such as have been obtained under the Act and the Trust Indenture Act and such consents, approvals, authorizations, registrations or qualifications as may be required under state securities or Blue Sky laws in connection with the purchase and distribution of the Designated Securities by the Underwriters; (vii) The Registration Statement has become and is now effective under the Act and, to the knowledge of such counsel, no stop order suspending the effectiveness of the Registration Statement has been issued and no proceedings for that purpose have been initiated or threatened by the Commission; (viii) The Registration Statement and the Prospectus as amended or supplemented and any further amendments and supplements thereto made by the Company prior to the Time of Delivery for the Designated Securities (other than the financial statements and related schedules and other financial and statistical data therein, as to which such counsel need express no opinion) comply as to form in all material respects with the requirements of the Act and the Trust Indenture Act and the rules and regulations thereunder; the Designated Securities and the Indenture conform in all material respects to the descriptions thereof -20- contained in the Prospectus as amended and supplemented and the information in the Prospectus and the Prospectus as amended or supplemented under the caption "Description of Debt Securities" or a comparable caption describing the Designated Securities, to the extent that it constitutes matters of law or legal conclusions, has been reviewed by such counsel and is correct in all material respects; nothing has come to the attention of such counsel to cause such counsel to believe that the Registration Statement or any amendment thereof at the time it became effective contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading or that the Prospectus as amended or supplemented at the time it was filed or transmitted for filing pursuant to Rule 424 under the Act contained, or as amended or supplemented at the Time of Delivery contains, an untrue statement of a material fact or omitted or omits to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading; (ix) Any discussion of the federal income tax consequences relating to the purchase and holding of any Designated Securities which are original issue discount securities as set forth under the applicable caption in the Prospectus as amended or supplemented relating to any such Designated Securities, to the extent that it constitutes matters of law or legal conclusions, has been reviewed by such counsel and is correct in all material respects; and to such further effect with respect to other legal matters relating to this Agreement and the sale of the Designated Securities hereunder as counsel for the Underwriters may reasonably request. Such counsel may also state, that insofar as such opinion involves factual matters, they have relied, to the extent they deem proper, upon certificates of officers of the Company and its subsidiaries and certificates of public officials, which certificates, if any, shall be delivered to the Representatives; (e) At the Time of Delivery, the Registration Statement and the Prospectus, as they may then be amended or supplemented, shall contain all statements that are required to be stated therein in accordance with the Act and the rules and regulations of the Commission thereunder and in all material respects shall conform to the requirements of the Act and the Trust Indenture Act and the rules and regulations of the -21- Commission thereunder, and neither the Registration Statement nor the Prospectus, as they may then be amended or supplemented, shall contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading; (f) (i) Neither the Company nor any of its subsidiaries shall have sustained since the date of the latest audited financial statements included or incorporated by reference in the Prospectus as amended or supplemented any 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, otherwise than as set forth or contemplated in the Prospectus as amended or supplemented, and (ii) since the respective dates as of which information is given in the Prospectus as amended or supplemented there shall not have been any change in the capital stock or long-term debt of the Company or any of its subsidiaries or any change, or any development involving a prospective change, in or affecting the general affairs, management, financial position, stockholders' equity or results of operations of the Company and its subsidiaries considered as one enterprise, otherwise than as set forth or contemplated in the Prospectus as amended or supplemented, the effect of which, in any such case described in Clause (i) or (ii), is in the judgment of the Representatives so material and adverse as to make it impracticable or inadvisable to proceed with the public offering or the delivery of the Designated Securities on the terms and in the manner contemplated in the Prospectus as amended or supplemented; (g) On the date of the Pricing Agreement for such Designated Securities and at the Time of Delivery for such Designated Securities, the Representatives and the Company shall have received signed letters from each of the public accounting firms referred to in Annex III hereto dated the date of the Pricing Agreement for such Designated Securities and the Time of Delivery of such Designated Securities to the effect set forth in Annex III hereto, and with respect to such letter dated such Time of Delivery, as to such other matters as the Representatives may reasonably request and in form and substance reasonably satisfactory to the Representatives; (h) Between the date of the Pricing Agreement relating to the Designated Securities and the Time of Delivery, (i) no downgrading shall have occurred in the rating accorded to any of the Company's debt securities by Moody's Investor Service, Inc., Standard & Poor's Corporation or Duff and Phelps, Inc. and (ii) no such organization shall have publicly announced that it proposes to withdraw or has under surveillance or review its rating of any of the Company's debt securities; -22- (i) All proceedings taken at or prior to the Time of Delivery in connection with the authorization, issue and sale of the Designated Securities shall be reasonably satisfactory in form and substance to the Representatives and to counsel for the Underwriters, and such counsel shall have been furnished with all such documents, certificates and opinions as they may reasonably request for the purpose of enabling them to pass upon the matters referred to in subsection (b) of this Section 6 and in order to evidence the accuracy of any of the representations, warranties or statements, the performance of any covenants of the Company, or the compliance with any of the conditions, herein contained; and (j) The Company shall have furnished or caused to be furnished to the Representatives at the Time of Delivery for the Designated Securities a certificate of the Chairman of the Board, the President or a Vice President, and the Secretary or an Assistant Secretary of the Company dated as of the Time of Delivery and satisfactory to the Representatives as to the accuracy of the representations and warranties of the Company herein at and as of such Time of Delivery, as to the performance by the Company of all of its obligations hereunder to be performed at or prior to such Time of Delivery, as to the matters set forth in subsections (a) and (f) of this Section 6, and as to such other matters as the Representatives may reasonably request, such certificate to be based upon knowledge or belief as to proceedings initiated or threatened referred to in subsection (a) and as to the matters set forth in subsection (f). If any of the conditions specified in this Section 6 shall not have been fulfilled when and as required by this Agreement to be fulfilled, this Agreement may be terminated by the Representatives on notice to the Company at any time at or prior to the Time of Delivery, and such termination shall be without liability of any party to any other party, except as provided in Section 5. Notwithstanding any such termination, the provisions of Sections 7, 8 and 9 shall remain in effect. 7. Indemnification. (a) The Company agrees to indemnify and hold harmless each Underwriter (including specifically each person who may be substituted for an Underwriter as provided in Section 11 hereof) and each person, if any, who controls any Underwriter within the meaning of Section 15 of the Act as follows: (i) against any and all loss, liability, claim, damage and expense whatsoever, as incurred, arising out of an untrue statement or alleged untrue statement of material fact contained in the Registration Statement (or any amendment thereto) and all documents incorporated therein by reference, or the omission or -23- alleged omission therefrom of a material fact required to be stated therein or necessary to make the statements therein not misleading, or arising out of an untrue statement or alleged untrue statement of a material fact included in any Preliminary Prospectus, any preliminary prospectus supplement, any Prospectus or any Prospectus as amended or supplemented (or any amendment or supplement to any of the foregoing documents) or the omission or alleged omission therefrom of a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; (ii) against any and all loss, liability, claim, damage and expense whatsoever, as incurred, to the extent of the aggregate amount paid in settlement of any litigation, or investigation or proceeding by any governmental agency or body, commenced or threatened, or of any claim whatsoever based upon any such untrue statement or omission, or any such alleged untrue statement or omission, if such settlement is effected with the written consent of the Company; and (iii) against any and all expense whatsoever, as incurred (including reasonable fees and disbursements of counsel chosen by the Representatives (except to the extent otherwise expressly provided in Section 7(c))), reasonably incurred in investigating, preparing or defending against any litigation, or investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever based upon any such untrue statement or omission, or any such alleged untrue statement or omission, to the extent that any such expense is not paid under subparagraph (i) or (ii) above; provided, however, that this indemnity does not apply to any loss, liability, claim, damage or expense to the extent arising out of an untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with written information furnished to the Company by any Underwriter through the Representatives expressly for use in the Registration Statement (or any amendment thereto) or any Preliminary Prospectus, any preliminary prospectus supplement, any Prospectus, any Prospectus as amended or supplemented (or any amendment or supplement to any of the foregoing documents) and provided, further, that the foregoing indemnity with respect to any untrue statement or alleged untrue statement contained in or any omission or alleged omission from any Preliminary Prospectus or any preliminary prospectus supplement shall not inure to the -24- benefit of any Underwriter from whom the person asserting any such loss, liability, claim, damage or expense purchased any of the Designated Securities that are the subject thereof if such person was not sent or given a copy of the Prospectus (or the Prospectus as amended or supplemented) (in each case exclusive of the documents from which information is incorporated by reference) at or prior to the written confirmation of the sale of such Designated Securities to such Person and the untrue statement or alleged untrue statement contained in or the omission or alleged omission from such Preliminary Prospectus or preliminary prospectus supplement was corrected in the Prospectus (or the Prospectus as amended or supplemented) unless the failure to send or give a copy of the Prospectus (or the Prospectus as amended or supplemented) to such person results from the Company's failure to comply with its obligations under Section 4(c) hereof. (b) Each Underwriter (including specifically each person who may be substituted for an Underwriter as provided in Section 11 hereof) severally, but not jointly, agrees to indemnify and hold harmless the Company, each of its directors, each of its officers who signed the Registration Statement, and each person, if any, who controls the Company within the meaning of Section 15 of the Act, from and against any and all loss, liability, claim, damage and expense described in the indemnity contained in Section 7(a), as incurred, but only with respect to untrue statements or omissions, or alleged untrue statements or omissions, made in the Registration Statement (or any amendment thereto) or any Preliminary Prospectus, preliminary prospectus supplement, Prospectus or Prospectus as amended or supplemented (or any amendment or supplement to any of the foregoing documents), in reliance upon and in conformity with written information furnished to the Company by such Underwriter through the Representatives expressly for use in the Registration Statement (or any amendment thereto) or such Preliminary Prospectus, preliminary prospectus supplement, Prospectus, Prospectus as amended or supplemented (or any amendment or supplement to any of the foregoing documents). (c) Each indemnified party shall give prompt notice to each indemnifying party of any action commenced against it in respect of which indemnity may be sought hereunder, but failure to so notify an indemnifying party shall not relieve it from any liability which it may have under this Section 7 except to the extent it has been prejudiced in any material respect by such failure or from any liability it may have otherwise than on account of this indemnity agreement. An indemnifying party may participate at its own expense in the defense of such action. If it so elects within a reasonable time after receipt of such notice, an indemnifying party, jointly with any other indemnifying parties receiving such notice, may assume the -25- defense of such action with counsel chosen by it and approved by the indemnified parties defendant in such action, which approval shall not be unreasonably withheld, provided that, if such indemnified party or parties reasonably determine that there may be legal defenses available to them which are different from or in addition to those available to such indemnifying party or parties, then such indemnifying party or parties shall not be entitled to assume such defense. If the indemnifying party or parties are not entitled to assume the defense of such action as a result of the proviso to the preceding sentence, counsel for the indemnifying party or parties shall be entitled to conduct the defense of such indemnifying party or parties and counsel for the indemnified party or parties shall be entitled to conduct the defense of such indemnified party or parties. If an indemnifying party assumes the defense of such action, the indemnifying parties shall not be liable for any fees and expenses for counsel for the indemnified parties incurred thereafter in connection with such action. In no event shall the indemnifying party or parties be liable for the fees and expenses of more than one counsel for all indemnified parties in connection with any one action or separate but similar or related actions in the same jurisdiction arising out of the same general allegations or circumstances. 8. Contribution. If the indemnification provided for in Section 7 is unavailable or insufficient to hold harmless an indemnified party thereunder, then each indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of the losses, claims, damages or liabilities referred to in subsection (a) or (b) of Section 7, (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 Designated Securities or (ii) if the allocation provided by Clause (i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in Clause (i) above 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 proportion as the total net proceeds from the offering of the Designated Securities (before deducting expenses) received by the Company bear to the total underwriting discounts and commissions received by the Underwriters, in each case as set forth in the table on the cover page of the Prospectus as amended or supplemented. Relative fault 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 -26- Company or the Underwriters and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such untrue statement or omission. The Company and the Underwriters agree that it would not be just and equitable if contributions pursuant to this Section 8 were to be determined by pro rata allocation (even if the Underwriters were treated as one entity for such purpose) or by any other method of allocation which does not take into account the equitable considerations referred to in the first sentence of this Section 8. The amount paid by an indemnified party as a result of the losses, claims, damages or liabilities referred to in the first sentence of this Section 8 shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in connection with investigation, preparing to defend or defending against any action or claim which is the subject of this Section 8. Notwithstanding the provisions of this Section 8, no Underwriter shall be required to contribute any amount in excess of the amount by which the total price at which the Designated Securities underwritten by it and distributed to the public were offered to the public exceeds the amount of any damages which 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 Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The Underwriters' obligations in this Section 8 to contribute are several in proportion to their respective underwriting obligations and not joint. Each party entitled to contribution agrees that upon the service of a summons or other initial legal process upon it in any action instituted against it in respect to which contribution may be sought, it shall promptly give written notice of such service to the party or parties from whom contribution may be sought, but the omission so to notify such party or parties of any such service shall not relieve the party from whom contribution may be sought for any obligation it may have hereunder or otherwise except to the extent it has been prejudiced in any material respect by such failure or from any liability it may have otherwise than on account of this contribution agreement. 9. Representations, Warranties And Agreements to Survive Delivery. The respective representations, warranties, indemnities, agreements and other statements of the Company or its officers set forth in or made pursuant to this Agreement and the Pricing Agreement and the indemnity and contribution agreements of the Underwriters contained in Section 7(b) and Section 8 hereof will remain operative and in full force and effect, regardless of any investigation (or any statement as to the results thereof) made by or on behalf of the Company, or any officer or director or controlling person of the Company, or any -27- Underwriter or any controlling person of any Underwriter and will survive delivery of and payment for the Designated Securities. 10. Termination of Pricing Agreement. (a) The Representatives may terminate the Pricing Agreement with respect to Designated Securities, by notice to the Company, (i) if there shall have been such a material adverse change in general economic, political, or financial conditions, or if the effect of international conditions on the financial markets in the United States shall be such, as to make it, in the Representatives' judgment, impracticable to market the Designated Securities or enforce contracts for the sale of the Designated Securities or (ii) if trading in any securities of the Company has been suspended by the Commission or the National Association of Securities Dealers, Inc., or if trading generally on the New York Stock Exchange or in the over-the- counter market has been suspended, or minimum or maximum prices for trading have been fixed, or maximum ranges for prices for securities have been required, by such exchange or by order of the Commission, the National Association of Securities Dealers, Inc. or any other governmental authority or (iii) if a banking moratorium has been declared by either federal or New York authorities. (b) If any Pricing Agreement with respect to Designated securities is terminated pursuant to this Section 10, such termination shall be without liability of any party to any other party, except to the extent provided in Section 5 hereof. Notwithstanding any such termination, the provisions of Sections 7, 8 and 9 shall remain in effect. 11. Default. (a) If any Underwriter shall default in its obligations to purchase the Underwriters' Securities which it has agreed to purchase under the Pricing Agreement relating to such Securities, the Representatives may in their discretion arrange for themselves or another party or other parties to purchase such Designated securities on the terms contained herein. If within thirty-six hours after such default by any Underwriter the Representatives do not arrange for the purchase of such Designated Securities, then the Company shall be entitled to a further period of thirty-six hours within which to procure another party or other parties satisfactory to the Representatives to purchase such Designated Securities on such terms. In the event that, within the respective prescribed periods, the Representatives notify the Company that they have so arranged for the purchase of such Designated Securities, or the Company notifies the Representatives that it has so arranged for the purchase of such Designated Securities, the Representatives or the Company shall have the right to postpone the Time of Delivery for such Designated Securities for a period of not more than seven days, in order to effect whatever changes may thereby be made necessary in the Registration Statement or the Prospectus -28- as amended or supplemented, or in any other documents or arrangements, and the Company agrees to file promptly any amendments to the Registration Statement or the Prospectus which may thereby be made necessary. The term "Underwriter" as used in this Agreement shall include any person substituted under this Section with like effect as if such person had originally been a party to the Pricing Agreement with respect to such Designated securities. (b) If, after giving effect to any arrangements for the purchase of the Underwriters' Securities of a defaulting Underwriter or Underwriters by the Representatives and the Company as provided in subsection (a) above, the aggregate principal amount of such Designated Securities which remains unpurchased does not exceed ten percent (10%) of the aggregate principal amount of the Designated Securities, then the Company shall have the right to require each non-defaulting Underwriter to purchase the principal amount of Underwriters' Securities which such Underwriter agreed to purchase under the Pricing Agreement relating to such Designated Securities and, in addition, to require each non-defaulting Underwriter to purchase its pro rata share (based on the principal amount of Designated Securities which such Underwriter agreed to purchase under such Pricing Agreement) of the Underwriters' securities of such defaulting Underwriter or Underwriters for which such arrangements have not been made; but nothing herein shall relieve a defaulting Underwriter from liability for its default. (c) If, after giving effect to any arrangements for the purchase of the Underwriters' Securities of a defaulting Underwriter or Underwriters by the Representatives and the Company as provided in subsection (a) above, the aggregate principal amount of Underwriters' Securities which remains unpurchased exceeds ten percent (10%) of the aggregate principal amount of the Designated Securities, as referred to in subsection (b) above, or if the Company shall not exercise the right described in subsection (b) above to require non-defaulting Underwriters to purchase Underwriters' Securities of a defaulting Underwriter or Underwriters, then the Pricing Agreement relating to such Designated Securities shall thereupon terminate, without liability on the part of any non-defaulting Underwriter or the Company, except for the expenses to be borne by the Company and the Underwriters as provided in Section 5 hereof and the indemnity and contribution agreements in Section 7 and Section 8 hereof; but nothing herein shall relieve a defaulting Underwriter from liability for its default. (d) If any Pricing Agreement shall be terminated pursuant to subsection(c) of this Section 11, the Company shall not then be under any liability to any Underwriter with respect to Designated Securities covered by such Pricing Agreement except -29- as provided in Section 5, Section 7 and Section 8 hereof; but, if for any other reason the Underwriters' Securities are not delivered by or on behalf of the Company as provided herein, the Company will reimburse the Underwriters through the Representatives for all out-of-pocket expenses approved in writing by the Representatives, including fees and disbursements of counsel, reasonably incurred by the Underwriters in making preparations for the purchase, sale and delivery of such Designated Securities, but the Company shall then be under no further liability to any Underwriter with respect to such Designated Securities except as provided in Section 5, Section 7 and Section 8 hereof. 12. Notices. All statements, requests, notices, agreements or other communications hereunder shall be in writing or by telegram if promptly confirmed in writing, and if to the Underwriters shall be sufficient in all respects if delivered or sent by registered mail to the address of the Representatives as set forth in the Pricing Agreement; and if to the Company shall be sufficient in all respects if delivered or sent by registered mail to the address of the Company set forth in the Registration Statement, Attention: Secretary. 13. Parties. This Agreement and each Pricing Agreement shall be binding upon, and inure solely to the benefit of, the Underwriters, the Company and, to the extent provided in Sections 7, 8 and 9 hereof, the officers and directors of the Company and each person who controls the Company or any Underwriter, and their respective heirs, executors, administrators, successors and assigns, and no other person shall acquire or have any right under or by virtue of this Agreement or any such Pricing Agreement. No purchaser of any of the Securities from any Underwriter shall be deemed a successor or assign by reason merely of such purchase. 14. Representation of Underwriters. In all dealings hereunder, the Representatives of the Underwriter of Designated Securities shall act on behalf of each such Underwriter, and the parties hereto shall be entitled to act and rely upon any statement, request, notice or agreement on behalf of any Underwriter made or given by such Representatives jointly or by such of the Representatives, if any, as may be designated for such purpose in the Pricing Agreement. 15. Information Furnished by Underwriters. The statements set forth in the last paragraph on the cover page of the Prospectus as amended or supplemented and under the caption "Underwriting" or "Plan of Distribution" in any Prospectus as amended or supplemented, except for the statements made under either such caption in the Prospectus as amended or supplemented relating to sales or dispositions by the Company, constitute the -30- written information furnished by or on behalf of any Underwriter referred to in subsections (b) and (c) of Section 2 hereof and in subsections (a) and (b) of Section 7 hereof. 16. Time of Essence. Time shall be of the essence of each Pricing Agreement. 17. Governing Law. This Agreement and each Pricing Agreement shall be governed by, and construed in accordance with, the laws of the State of New York. 18. Counterparts. This Agreement and each Pricing Agreement may be executed by any one or more of the parties hereto or thereto in any number of counterparts, each of which shall be deemed to be an original, but all such counterparts shall together constitute one and the same instrument. If the foregoing is in accordance with your understanding, please sign and return to us four counterparts hereof. Very truly yours, R. R. DONNELLEY & SONS COMPANY By: ____________________________ Title: Accepted as of the date first above written: [Name of Representative] By: ______________________________ Title: -31- Annex I Pricing Agreement ----------------- ________, 19__ [Name of Representative] As Representative of the several Underwriters named in Schedule I hereto [Address of Representative] Dear Sirs: R. R. DONNELLEY & SONS COMPANY (the "Company") proposes, subject to the terms and conditions stated herein and in the Underwriting Agreement, dated , 19 (the "Underwriting Agreement"), between the Company on the one hand and [Name of Representative] on the other hand, to issue and sell to the Underwriters named in Schedule I hereto (the "Underwriters") the Securities specified in Schedule II hereto (the "Designated Securities") [less the principal amount of Designated Securities covered by delayed delivery contracts ("Delayed Delivery Contracts") as provided below (such Designated Securities covered by Delayed Delivery Contracts being hereinafter referred to collectively as "Contract Securities")]. Each of the provisions of the Underwriting Agreement is incorporated herein by reference in its entirety, and shall be deemed to be a part of this Pricing Agreement to the same extent as if such provision has been set forth in full herein; and each of the representations and warranties set forth therein shall be deemed to have been made at and as of the date of this Pricing Agreement, except that each representation and warranty with respect to the Prospectus in Section 2 of the Underwriting Agreement shall be deemed to be a representation and warranty as of the date of the Underwriting Agreement in relation to the Prospectus (as therein defined), and also a representation and warranty as of the date of this Pricing Agreement in relation to the Prospectus as amended or supplemented relating to the Designated Securities which are the subject of this Pricing Agreement. Each reference to the Representatives herein and in the provisions of the Underwriting Agreement so incorporated by reference shall be deemed to refer to you. Unless otherwise defined herein, terms defined in the Underwriting Agreement are used herein as therein defined. An amendment to the Registration Statement, or a supplement to the Prospectus, as the case may be, relating to the Designated Securities, in the form heretofore delivered to you is now proposed to be filed, or in the case of a supplement mailed for filing, with the Commission. [None of the Designated Securities are to be purchased from the Company pursuant to Delayed Delivery Contracts.] [The Company hereby authorizes the Underwriters to solicit offers to purchase Designated Securities from the Company pursuant to Delayed Delivery Contracts, substantially in the form of Schedule III attached hereto but with such changes therein as you and the Company may authorize or approve. The Underwriters will endeavor to make such arrangements, and as compensation therefor the Company will pay to you, for the accounts of the Underwriters, at the Time of Delivery, a commission of___ % of the principal amount of Designated Securities for which Delayed Delivery Contracts have been made. Delayed Delivery Contracts are to be with institutional investors of the types mentioned in the final paragraph under the caption "Plan of Distribution" in the Prospectus and subject to other conditions therein set forth. The Company will enter into a Delayed Delivery Contract in each case arranged by the Underwriters where the Company has advised you of its approval of the proposed sale of Contract Securities to the purchaser thereunder; provided, however, that the minimum principal amounts of Designated Securities covered by any Delayed Delivery Contract with any purchaser or any Delayed Delivery Contract with affiliated purchasers shall be $__________ and the aggregate principal amounts of Designated Securities covered by Delayed Delivery Contracts shall not exceed $___________ unless the Company shall otherwise agree in writing. However, if the aggregate principal amount of Designated Securities requested for delayed delivery is less than $_________________, the Company will have the right to reject all requests. The Underwriters will not have any responsibility in respect of the validity or performance of Delayed Delivery Contracts.] [The amount of Contract Securities to be deducted from the principal amount of Designated Securities to be purchased by each Underwriter as set forth in Schedule I hereto shall be, in each case, the amount of Contract Securities which the Company has been advised by you have been attributed to such Underwriter, provided that if the Company has not been so advised, the amount of Contract Securities to be so deducted shall be, in each case, that proportion of Contract Securities which the principal amount of Designated Securities to be purchased by such Underwriter under this Agreement bears to the total principal amount of the Designated Securities (rounded as you may determine to the nearest $1,000 principal amount). The total principal amount of Designated Securities to be purchased by all the Underwriters shall be $__________ less the principal amount of the Designated Securities covered by Delayed Delivery Contracts. The Company -2- will deliver to you not later than 3:30 p.m., New York time, on the business day preceding the Time of Delivery (or such other time and date as you and the Company may agree upon in writing) a written notice setting forth the principal amount of Designated Securities covered by Delayed Delivery Contracts.] Subject to the terms and conditions set forth herein and in the Underwriting Agreement, the Company agrees to issue and sell to each of the Underwriters, and each of the Underwriters agrees, severally and not jointly, to purchase from the Company, at the time and place and at a purchase price to the Underwriters set forth in Schedule II hereto, the principal amount of Designated Securities set forth opposite the name of such Underwriter in Schedule I hereto, less such Underwriter's portion of Contract Securities determined as provided in the preceding paragraph. If the foregoing is in accordance with your understanding, please sign and return to us four counterparts, hereof, and upon acceptance hereof by you, on behalf of each of the Underwriters, this letter and such acceptance hereof, including the provisions of the Underwriting Agreement incorporated herein by reference, shall constitute a binding agreement between each of the Underwriters on the one hand and the Company on the other. It is understood that your acceptance of this letter on behalf of each of the Underwriters is or will be pursuant to the authority set forth in a form of Agreement Among Underwriters, the form of which shall be supplied to the Company for examination, upon request, but without warranty on the part of the Representatives as to the authority of the signers thereof. Very truly yours, R. R. DONNELLEY & SONS COMPANY By: ______________________________ Title: ___________________________ Accepted as of the date hereof: By: [Name of Representative] By:___________________________ Title:________________________ On behalf of each of the Underwriters -3- SCHEDULE I
Principal Amount of Designated Securities to be Underwriter Purchased - ----------- ---------- [Names of Underwriters] ............................ ---------- Total................................................ $ ==========
SCHEDULE II Designated Securities Title of Designated Securities: [ %] [Floating Rate] [Extendable] [Sinking Fund] [Zero Coupon] [Notes] [Debentures], due Aggregate principal amount: $ Price to Public: % of the principal amount of the Designated Securities, plus accrued interest, if any, from to the Time of Delivery [and accrued amortization, if any from to the Time of Delivery]. Purchase Price by Underwriters: % of the principal amount of the Designated Securities, plus accrued interest, if any, from to the Time of Delivery [and accrued amortization, if any from to the Time of Delivery]. Specified funds for payment of purchase price or delayed delivery commission: [New York Clearing House] [same day] funds Indenture: Indenture, dated as of , 19 between the Company and , as Trustee. Maturity: Interest Rate: [ %] [Zero Coupon] [See Floating Rate Provisions] Interest Payment Dates: [Months and dates] Redemption Provisions: [No provisions for redemption] [The Designated Securities may be redeemed, otherwise than through the sinking fund, in whole or in part at the option of the Company, in the amount of $ or an integral multiple thereof, [on or after , at the following redemption prices (expressed as percentages of the principal amount). If [redeemed on or before , and if] redeemed during the 12-month period beginning Redemption Year Price ---- ---------- and thereafter at 100% of their principal amount, together in each case with accrued interest to the redemption date.] [on any interest payment date falling in or after , at the election of the Company, at a redemption price equal to the principal amount thereof, plus accrued interest to the date of redemption.] [other possible redemption provisions, such as mandatory redemption upon occurrence of certain events or redemption for changes in tax law] [Restrictions on refunding] Sinking Fund Provisions: [No sinking fund provisions] [The Designated Securities are entitled to the benefit of a sinking fund to retire $ principal amount of Designated Securities on in each of the years through at 100% of their principal amount plus accrued interest] [, together with [cumulative] [non-cumulative] redemptions at the option of the Company to retire an additional $ principal amount of Designated Securities in the years through at 100% of their principal amount plus accrued interest]. -2- [If Designated Securities are extendable debt Securities, insert Extendable provisions: Designated Securities are repayable on , [insert date and years], at the option of the holder, at their principal amount with accrued interest. Initial annual interest rate will be % and thereafter annual interest rate will be adjusted on , and to a rate not less than % of the effective annual interest rate on U.S. Treasury obligations with -year maturities as of the [insert date 15 days prior to maturity date] prior to such [insert maturity date].] [If Designated Securities are Floating Rate Debt Securities, insert- Floating rate provisions: [Insert applicable terms] MISCELLANEOUS Time of Delivery: [Time and date], 19 Closing Location: Delayed Delivery: [None] [Underwriters' commission shall be % of the principal amount of Designated Securities for which Delayed Delivery Contracts have been entered into. Such commission shall be payable to the other of ] Names and addresses of Representatives: Designated Representatives: Address for Notices, etc.: [Other Terms]: ________________ A description of particular tax, accounting or other unusual features of the Securities should be set forth, or referenced to an attached and accompanying description, if necessary to the issuer's understanding of the transaction contemplated. Such a description might appropriately be in -3- the form in which such features will be described in the Prospectus Supplement for the offering. -4- Annex II DELAYED DELIVERY CONTRACT ------------------------- R. R. DONNELLEY & SONS COMPANY [Name and address of Representative(s)] Attention: Dear Sirs: The undersigned hereby agrees to purchase from R. R. Donnelley & Sons Company (hereinafter called the "Company"), and the Company agrees to sell to the undersigned: $ principal amount of the Company's [Title of Designated Securities] (hereinafter called the "Designated Securities"), offered by the Prospectus of the Company dated , 19 as amended or supplemented, receipt of a copy of which is hereby acknowledged at a purchase price of % of the principal amount thereof, plus accrued interest from the date from which interest accrues as set forth below, and on the further terms and conditions set forth in this contract. [The undersigned will purchase the Designated Securities from the Company on , 19 (the "Delivery Date") and interest on the Designated Securities so purchased will accrue from , 19 .] [The undersigned will purchase the Designated Securities from the Company on the delivery date or dates and in the principal amount or amounts set forth below:
Principal Date from Which Delivery Date Amount Interest Accrues - --------------- --------- ---------------- , 19 $ , 19 , 19 $ , 19
Each such date on which Designated Securities are to be purchased hereunder is hereinafter referred to as a "Delivery Date".] Payment for the Debt Securities which the undersigned has agreed to purchase on [the] [each] Delivery Date shall be made to the Company or its order by certified or official bank check in [ Clearing House] [same day] funds, at the offices of , , or by wire transfer in similar funds to a bank account specified by the Company on [the] [such] Delivery Date (or in such other funds and/or at such other place as the Company and the undersigned may agree upon in writing), upon delivery to the undersigned of the Designated Securities then to be purchased by the undersigned and in definitive fully registered form and in such denominations and registered in such names as the undersigned may designate by written or telegraphic communication addressed to the Company not less than five full business days prior to [the] [such] Delivery Date. The obligation of the Company to sell and of the undersigned to take delivery of and make payment for the Designated Securities on [the] [each] Delivery Date shall be subject to the condition[s] that the purchase of the Designated Securities to be made by the undersigned shall not on [the] [such] Delivery Date be prohibited under the laws of the jurisdiction to which the undersigned is subject [and the Company, on or before , 19 , shall have sold to the several Underwriters (the "Underwriters") pursuant to the Pricing Agreement dated , 19 , between the Company and the Underwriters, an aggregate principal amount of Designated Securities equal to $ , minus the aggregate principal amount of Designated Securities covered by this contract and other contracts similar to this contract]. The obligation of the undersigned to take delivery of and make payment for the Designated Securities shall not be affected by the failure of any purchaser to take delivery of and make payment for the Designated Securities pursuant to other contracts similar to this contract. [The undersigned understands that the Underwriters are also purchasing Designated Securities from the Company, but that the obligations of the undersigned hereunder are not contingent on such purchases.] Promptly after completion of the sale to the Underwriters, the Company will mail or deliver to the undersigned at its address set forth below a notice to such effect, accompanied by a copy of the Opinion of Counsel for the Company delivered to the Underwriters in connection therewith. By the execution hereof, the undersigned represents and warrants to the Company that (1) its investment in the Designated Securities is not, as of the date hereof, prohibited under the laws of any jurisdiction to which the undersigned is subject, (2) all necessary corporate action for the due execution and delivery of this contract and the payment for and purchase of the Designated Securities has been taken by it and no further authorization or approval of any governmental or other regulatory authority is required for such execution, delivery, payment or purchase and (3) upon the acceptance hereof by the Company and the mailing or delivery of a copy hereof as provided below, this contract will constitute a valid and binding agreement of the undersigned in accordance with its terms. This contract will inure to the benefit of and be binding upon the parties hereto and their respective successors, -2- but will not be assignable by either party hereto without the written consent of the other. This contract shall be governed by the laws of the State of New York. This contract may be executed by either of the parties hereto in any number of counterparts, each of which shall be deemed to be an original, but all such counterparts shall together constitute one and the same instrument. It is understood [that the Company will not accept Delayed Delivery Contracts for an aggregate principal amount of the Debt Securities in excess of $ and] that the acceptance of any Delayed Delivery Contract (including this contract) is in the Company's sole discretion and that, without limiting the foregoing, acceptances of such contracts need not be on a first- come, first-served basis. If this contract is acceptable to the Company, it is requested that the Company sign the form of acceptance below and mail or deliver a signed copy hereof to the undersigned at its address set forth below. This will become a binding contract between the Company and the undersigned when such copy is so mailed or delivered. Yours very truly, ____________________________ (Name of Purchaser) By _________________________ (signatures) ------------------------- ____________________________ (Name and Title) ____________________________ (address) Accepted , 19 R. R. Donnelley & SONS COMPANY By ________________________ Title:_____________________ -3- Annex III A. Pursuant to Section 6(g) of the Underwriting Agreement, Arthur Andersen LLP, or such other independent accountants for the Company as appropriate, shall furnish letters to the Underwriters to the effect that: (i) They are independent certified public accountants with respect to the Company and its subsidiaries within the meaning of the Act and the Exchange Act and the applicable published rules and regulations thereunder, and no information as to them is required to be furnished pursuant to Item 509 of Regulation S-K; (ii) In their opinion, the financial statements and any supplementary financial information and schedules of the Company examined by them and included or incorporated by reference in the Registration Statement or the Prospectus comply as to form with the applicable accounting requirements of the Act or the Exchange Act, as the case may be, and the published rules and regulations thereunder; and, if applicable, they have made a review in accordance with standards established by the American Institute of Certified Public Accountants of the consolidated interim financial statements, selected financial data, pro forma financial information and/or condensed financial statements derived from audited financial statements of the Company for the periods specified in such letter, as indicated in their reports thereon, copies of which have been furnished to the representatives of the Underwriters (the "Representatives"); (iii) In their opinion, the unaudited selected financial information with respect to the consolidated results of operations and financial position of the Company for the five most recent fiscal years included in the Prospectus and included or incorporated by reference in Item 6 of the Company's Annual Report on Form 10-K for the most recent fiscal year for which such a Form 10-K has been filed with the Commission (the "Form 10-K") complied as to form with the applicable accounting requirements of the Act or the Exchange Act, as the case may be, and the published rules and regulations thereunder and is fairly stated in relation to, and agrees with the corresponding amounts (after restatement where applicable) in, the audited consolidated financial statements for such fiscal years which were included or incorporated by reference in the Company's Annual Reports on Form 10-K for such five fiscal years or included in a Form S-K (a "Form S- K") incorporated by reference in the Prospectus; (iv) on the basis of limited procedures, not constituting an examination in accordance with generally accepted auditing standards, consisting of a reading of the unaudited financial statements and other information referred to below, a reading of the latest available interim financial statements of the Company and its subsidiaries, inspection of the minute books of the Company and its subsidiaries since the date of the latest audited financial statements included or incorporated by reference in the Prospectus, inquiries of officials of the Company and its subsidiaries responsible for financial and accounting matters and such other inquiries and procedures as may be specified in such letter, nothing came to their attention that caused them to believe that: (A) the unaudited condensed consolidated statements of income, consolidated balance sheets and consolidated statements of cash flows included or incorporated by reference in the Company's Quarterly Reports on Form 10-Q incorporated by reference in the Prospectus do not comply as to form with the applicable accounting requirements of the Exchange Act and published rules and regulations thereunder or are not presented in conformity with generally accepted accounting principles applied on a basis substantially consistent with the basis for the audited consolidated statements of income, consolidated balance sheets and consolidated statements of cash flows included or incorporated by reference in the Form 10-K or included in a Form 8-K; (B) any unaudited income statement data and balance sheet items included or incorporated by reference in the Prospectus do not agree with the corresponding items in the unaudited consolidated financial statements from which such data and items were derived, and any such unaudited data and items were not determined on a basis substantially consistent with the basis for the corresponding amounts in the audited consolidated financial statements included or incorporated by reference in the Form 10-K or included in a Form 8-K; (C) the unaudited financial statements which were not included or incorporated by reference in the Prospectus but from which were derived the unaudited condensed financial information, income statement data and balance sheet items included or incorporated by reference in the Prospectus and referred to in Clause (A) or (B) are not fairly presented in conformity with generally accepted accounting principles applied on a basis substantially consistent with the basis for the audited financial statements included or -2- incorporated by reference in the Form 10-K or included in a Form 8-K; (D) any unaudited pro forma financial statements included or incorporated by reference in the Prospectus do not comply as to form with the applicable accounting requirements of Rule 11-02 of Regulation S-X, that the pro forma financial statements were not compiled on the respective bases described therein, that the pro forma adjustments have not been properly applied to the historical amounts in the compilation of such statements, that the pro forma adjustments with respect to such pro forma financial statements were not appropriate adjustments or that such pro forma financial statements would require any further adjustments to give effect to the transaction or transactions giving rise to the inclusion of such pro forma financial statements; (E) as of a specified date not more than five days prior to the date of delivery of such letter, there have been any changes in the consolidated capital stock (other than issuances of capital stock upon exercise of options and upon conversion of convertible securities which were outstanding on the date of the latest statement of financial condition included or incorporated by reference in the Prospectus) or any increases in the consolidated long term debt of the Company and its subsidiaries or any decreases in consolidated net current assets or net assets or other items specified by the Representatives, or any changes in any other items specified by the Representatives, in each case as compared with amounts shown in the latest balance sheet included or incorporated by reference in the Prospectus, except in each case for changes, increases or decreases which the Prospectus discloses have occurred or may occur or which are described in such letter; and (F) for the period from the date of the latest financial statements included or incorporated by reference in the Prospectus to the specified date referred to in Clause (E) there were any decreases in consolidated net revenue, or operating profit or the total or per share amounts of consolidated net income or any changes in any other items specified by the Representatives in each case as compared with the comparable period of the preceding year and with any other period of corresponding length specified by the Representatives, except in each case for changes, increases or decreases which the Prospectus discloses have occurred or may occur or which are described in such letter; (v) With respect to any unaudited pro forma financial information of the Company included or incorporated by -3- reference in the Prospectus, they have compared such unaudited pro forma financial information to corresponding amounts reflected in the audited consolidated financial statements of the Company and found them to be in agreement; (vi) In addition to the examination referred to in their report(s) included or incorporated by reference in the Prospectus and the limited procedures, inspection of minute books, inquiries and other procedures referred to in subparagraphs (iii) and (iv) above, they have carried out certain specified procedures, not constituting an examination in accordance with generally accepted auditing standards, with respect to certain amounts, percentages and financial information specified by the Representatives which are derived from the general accounting records of the Company and its subsidiaries and which appear in the Prospectus, in Part II of, or in exhibits and schedules to, the Registration Statement or in documents incorporated by reference in the Prospectus, and have compared certain of such amounts, percentages and financial information with the accounting records of the Company and its subsidiaries and have found them to be in agreement; and B. Pursuant to Section 6(g) of the Underwriting Agreement, the Underwriters shall receive additional letters as to such matters as the Representatives may reasonably request, in form and substance satisfactory to the Representatives, from the independent certified public accountants for any entity other than the Company for which financial statements are included or incorporated by reference in the Registration Statement or Prospectus. All references in this Annex III to the Prospectus shall be deemed to refer to the Prospectus (including the documents incorporated by reference therein) as defined in the Underwriting Agreement as of the date of the letter delivered on the date of the Pricing Agreement for purposes of such letter and to the Prospectus as amended or supplemented (including the documents incorporated by reference therein) in relation to the applicable Designated Securities for purposes of the letter delivered at the Time of Delivery for such Designated Securities. -4- EX-1.2 3 AGENCY AGREEMENT DRAFT: FEBRUARY 22, 1995 EXHIBIT 1.2 ----------- U.S. $___,000,000/*/ R. R. Donnelley & Sons Company Medium-Term Notes, Series __ AGENCY AGREEMENT ---------------- [Date] [Names and Addresses of Agents] Ladies and Gentlemen: R. R. Donnelley & Sons Company, a Delaware corporation (the "Company"), confirms its agreement with each of you (individually, an "Agent" and collectively, the "Agents") with respect to the issue and sale by the Company of up to an aggregate initial offering price of $___,000,000/*/ in gross proceeds of its Medium-Term Notes, Series __ (the "Notes"). The Notes are to be issued from time to time pursuant to an indenture, dated as of November 1, 1990 (as it may be supplemented or amended from time to time, the "Indenture"), between the Company and Citibank, N.A., as trustee (the "Trustee"). Subject to the terms and conditions stated herein, and subject to the reservation by the Company of the rights to sell Notes directly on its own behalf, and to sell Notes to or through such other agents as the Company shall designate from time to time on terms substantially identical to those set forth herein, the Company hereby appoints the Agents as agents for the purpose of soliciting purchases of the Notes from the Company by others and agrees that whenever the Company determines to sell Notes directly to an Agent as principal for resale to others, it will enter into a Purchase Agreement (hereafter defined) relating to such sale in accordance with the provisions of Section 11 hereof. Each Agent may, with the prior approval of the Company (which approval shall not be unreasonably withheld), appoint sub-agents or engage the services of any other broker or dealer in connection with the offer or sale of the Notes. The Company - ----------------- /*/ Or the U.S. dollar equivalent in certain specified foreign currencies or currency units. shall notify the Agents of any sale made to or through other agents on or prior to the settlement date for such sale. The Notes shall have the maturity ranges, annual interest rates, currencies, redemption provisions and other terms set forth in the Prospectus referred to in Section 1(a) as it may be amended or supplemented from time to time, including any supplement providing for the interest rate and maturity of any Note (a "Pricing Supplement"). The Notes will be issued, and the terms thereof established, from time to time, by the Company in accordance with the Indenture and the Procedures referred to below. This Agreement shall only apply to sales of the Notes and not to sales of any other securities or evidences of indebtedness of the Company and only on the specific terms set forth herein. The Agents may take any action contemplated by this Agreement through wholly- owned subsidiaries. SECTION 1. Representations, Warranties and Agreements. ------------------------------------------ The Company represents and warrants to each Agent as of the date hereof, as of the Closing Date (defined herein) referred to in Section 2(f) hereof, and as of the times referred to in Sections 6(a) and 6(b) hereof (the Closing Date and each such time being hereinafter sometimes referred to as a "Representation Date"), as follows: (a) The Company meets all of the requirements for the use of Form S-3 under the Securities Act of 1933, as amended (the "Act"). The Company has prepared and filed with the Securities and Exchange Commission (the "Commission") (i) a registration statement on Form S-3 (File No. 33-_____) in the form heretofore delivered to the Agents and such registration statement in such form has been declared effective by the Commission and no stop order suspending the effectiveness of such registration statement or the use of the Prospectus (as hereinafter defined) has been issued and no proceeding for that purpose has been initiated or threatened by the Commission (such registration statement, including all exhibits thereto but excluding Form T-1, as amended at the time such registration statement or any part thereof became effective, and as from time to time amended or supplemented thereafter, being hereinafter called the "Registration Statement"; the prospectus (including all documents incorporated therein by reference) included in the Registration Statement, together with any amendments or supplements (including in each case all documents incorporated therein by reference and the applicable Pricing Supplement) relating to the Notes, as filed with the Commission pursuant to Section 424(b) of the rules and regulations of the Commission under the Act (the "Rules and Regulations") being hereinafter called the "Prospectus"). 2 (b) The documents incorporated by reference in the Prospectus, at the time they became effective or were filed with the Commission, as the case may be, conformed in all material respects to the requirements of the Act or the Securities Exchange Act of 1934 (the "Exchange Act"), as applicable, and the rules and regulations of the Commission thereunder, and such documents, when read together with the other information in the Prospectus, do not contain, in the case of a registration statement which became effective under the Act, an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading, and, in the case of other documents which were filed under the Act or the Exchange Act with the Commission, an 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, in each case after excluding any statement in any such document which does not constitute part of the Registration Statement or the Prospectus pursuant to Rule 412 under the Act; and any further documents so filed and incorporated by reference in the Prospectus, when they become effective or are filed with the Commission, as the case may be, will conform in all material respects to the requirements of the Act or the Exchange Act, as applicable, and the rules and regulations of the Commission thereunder, and will not contain, in the case of a registration statement which becomes effective under the Act, an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading and, in the case of other documents which are filed under the Act or the Exchange Act, an untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they are 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 any Agent expressly for use in the Prospectus. (c) The Registration Statement and the Prospectus conform, and the Registration Statement and the Prospectus will conform as of the applicable Representation Date, in all material respects to the requirements of the Act and the Trust Indenture Act of 1939 (the "Trust Indenture Act") and the rules and regulations of the Commission thereunder; the Registration Statement, at the time it became effective, did not, and as of the applicable Representation Date will not, contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading, and the Prospectus, at the time the Registration Statement became effective did not, as of the date 3 hereof does not, and as of the applicable Representation Date will not, contain an 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, 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 any Agent specifically for inclusion therein. (d) 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 Prospectus any loss or interference with its business which is material to the Company and its subsidiaries considered as one enterprise 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, otherwise than as set forth or contemplated in the Prospectus; and, since the respective dates as of which information is given in the Registration Statement and the Prospectus, there has not been any change in the capital stock (other than issuances of common stock pursuant to existing employee benefit or stock option plans, repurchases by the Company of its common stock in the ordinary course of business or conversions of outstanding convertible securities) or long-term debt (other than changes as a result of maturities, sinking fund payments, amortization of debt discount or currency fluctuations) of the Company or any of its subsidiaries or any material adverse change, or any development which will result in a material adverse change, in or affecting the general affairs, management, financial position, stockholders' equity or results of operations of the Company and its subsidiaries considered as one enterprise, otherwise than as set forth or contemplated in the Prospectus. (e) 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 corporate power and authority under such laws to own, lease and operate its properties and to conduct its business as described in the Prospectus; and the Company is duly qualified as a foreign corporation to transact business and is in good standing in each jurisdiction where the character of the business conducted by it or the location of the property owned by it makes such qualification necessary, except where the failure to be so qualified would not have a material adverse effect on the Company and its subsidiaries considered as one enterprise. Each subsidiary of the Company that is a significant subsidiary within the meaning of Rule 1-02 of Regulation S-X under the Act and such other subsidiaries of the Company designated in the list previously furnished to the Agents 4 by an officer of the Company for the purposes of this Agreement (collectively, the "Subsidiaries") is a corporation duly incorporated and validly existing in good standing under the laws of the state of its incorporation or formation, and each has corporate power and authority under such laws to own, lease and operate its properties and to conduct its business, and each is duly qualified as a foreign corporation to transact business and is in good standing in each jurisdiction where the character of the business conducted by it or the location of the property owned by it makes such qualification necessary, except where the failure to be so qualified would not have a material adverse effect on the Company and its subsidiaries considered as one enterprise. The Company, directly or indirectly, owns all of the issued and outstanding voting securities of each of the Subsidiaries, in each case free and clear of any liens, encumbrances and claims. (f) The Company has an authorized capitalization as set forth in 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. (g) The Notes have been duly authorized and, when the terms of the Notes and of their issue and sale have been duly established in accordance with the Indenture and the Notes have been duly executed, authenticated, issued and delivered against payment of the agreed upon consideration therefor, such Notes 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, which is substantially in the form filed as an exhibit to the Registration Statement; the Indenture has been duly authorized by the Company, has been duly qualified under the Trust Indenture Act, has been duly executed and delivered by the Company and the Trustee and constitutes a valid and legally binding obligation of the Company, enforceable in accordance with its terms, except as enforcement thereof may be limited by bankruptcy, insolvency, reorganization or other similar laws affecting enforcement of creditors' rights generally and except as enforcement thereof is subject to general principles of equity; and the Notes and the Indenture conform to the description thereof contained in the Prospectus. (h) The issue and sale by the Company of the Notes and compliance by the Company with all of the provisions of the Notes, the Indenture and this Agreement and the consummation of the transactions herein and therein contemplated, will not conflict with or result in a breach of any of the terms or provisions of, or constitute a default under, or result in the creation or imposition of any lien, charge or encumbrance upon 5 any of the property or assets of the Company or any of its subsidiaries under any 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 may be bound or to which any of the property or assets of the Company or any of its subsidiaries is subject (except for conflicts, breaches, defaults, liens, charges and encumbrances which would not, individually or in the aggregate, have a material adverse effect on the Company and its subsidiaries considered as one enterprise); nor will such action result in any violation of the provisions of the Certificate or Articles of Incorporation, as amended, or the By-Laws of the Company or any of its subsidiaries or any statute, order, rule or regulation applicable to the Company or any of its subsidiaries of any court or of any Federal, state or other regulatory authority or other governmental body having jurisdiction over the Company or any of its subsidiaries; no authorization, approval, consent, registration, qualification or order of or with any court or any regulatory authority or other governmental agency or body is required for issue and sale of the Notes by the Company, or the consummation by the Company of the other transactions contemplated by this Agreement or the Indenture, except such as have been obtained under the Act and the Trust Indenture Act and such consents, approvals, authorizations, registrations or qualifications as may be required under state securities or Blue Sky laws in connection with the offer and sale of the Notes by the Company. (i) Except as set forth in the Prospectus, there are no actions, suits or proceedings before or by any court or governmental agency or body, domestic or foreign, pending, or, to the knowledge of the Company, threatened against or, to the knowledge of the Company, affecting the Company or any of its subsidiaries, which are, individually or in the aggregate, reasonably expected to result in any material adverse change in the general affairs, financial position, stockholders' equity or results of operations of the Company and its subsidiaries considered as one enterprise, or which is reasonably expected to materially and adversely affect the consummation by the Company of this Agreement or the issuance and sale by the Company of any of the Notes; and there are no contracts or exhibits required by the Act or by the Rules and Regulations to be filed with the Registration Statement required to be described or incorporated by reference in the Registration Statement or the Prospectus which are not filed, incorporated by reference or described as required. (j) This Agreement and the Purchase Agreement (if any) with respect to the Notes have been duly authorized, executed and delivered by the Company. 6 (k) Arthur Andersen LLP (formerly Arthur Andersen & Co.), who are reporting upon the audited financial statements and schedules included or incorporated by reference in the Registration Statement are independent public accountants with respect to the Company as required by the Act and the Rules and Regulations. (l) The consolidated financial statements included or incorporated by reference in the Prospectus present, and as of the applicable Representation Date will present, fairly in all material respects, the financial position of the Company and its subsidiaries as of the dates indicated and the consolidated results of the operations and cash flows of the Company and its subsidiaries for the periods specified. Such financial statements (except as disclosed in the notes thereto or otherwise stated therein) have been prepared in conformity with generally accepted accounting principles applied on a consistent basis throughout the entire period or periods involved. The financial statement schedules, if any, included or incorporated by reference in the Prospectus present, and as of the applicable Representation Date will present, fairly in all material respects, the information required to be stated therein. The selected financial data included in the Prospectus present, and as of the applicable Representation Date will present, fairly in all material respects, the information shown therein and have been compiled on a basis consistent with that of the audited consolidated financial statements included or incorporated by reference in the Registration Statement. The pro forma financial statements and other pro forma financial information, if any, included or incorporated by reference in the Prospectus present, and as of the applicable Representation Date will present, fairly in all material respects, the information shown therein, have been, and will be, prepared in accordance with the Commission's rules and guidelines with respect to pro forma financial statements, have been, and will be, properly compiled on the pro forma basis described therein, and, in the opinion of the Company, the assumptions used in the preparation thereof are, and as of the applicable Representation Date will be, reasonable and the adjustments used therein are, and as of the applicable Representation Date will be, appropriate to give effect to the transactions or circumstances referred to therein. (m) Neither the Company nor any of the Subsidiaries is in violation of its charter or in default in the performance or observance of any obligation, agreement, covenant or condition contained in any contract, indenture, mortgage, loan agreement, note, lease or other agreement or instrument to which the Company or any of the Subsidiaries is a party or by which it or any of them may be bound, or to which any of the property or assets of the Company or any of the Subsidiaries is subject, other than 7 defaults (considered in the aggregate) which do not have, or which would not reasonably be expected to result in, a material adverse effect on the general affairs, financial position, stockholders' equity or results of operations of the Company and its subsidiaries considered as one enterprise. (n) The Company and its subsidiaries possess adequate certificates, authorities or permits issued by the appropriate state, Federal or foreign regulatory agencies or bodies necessary to conduct the business now operated by them, and neither the Company nor any of its subsidiaries has received any notice of proceedings relating to the revocation or modification of any such certificate, authority or permit, with such exceptions as would not, singly or in the aggregate, materially and adversely affect the general affairs, financial position, stockholders' equity or results of operations of the Company and its subsidiaries considered as one enterprise. (o) The Company has complied and will comply with the provisions of Florida H.B. 1771 codified as Section 517.075 of the Florida Statutes, 1987, as amended, and all regulations promulgated thereunder related to issuers doing business in Cuba. (p) The Notes, when issued, authenticated and delivered pursuant to the provisions of this Agreement and the Indenture, will be excluded or exempted under the provisions of the Commodity Exchange Act. SECTION 2. Solicitations as Agent. ---------------------- (a) Reasonable Best Efforts to Solicit. On the basis of the representations and warranties contained herein, but subject to the terms and conditions herein set forth, each Agent agrees, as an agent of the Company, to use its reasonable best efforts to solicit offers to purchase the Notes upon the terms and conditions set forth in the Prospectus. (b) Suspension of Solicitation. The Company reserves the right, in its sole discretion, to suspend solicitation of offers to purchase the Notes commencing at any time for any period of time or permanently. Upon receipt of at least one business day's prior notice from the Company, the Agents will forthwith suspend solicitation of offers to purchase Notes from the Company until such time as the Company has advised the Agents that such solicitation may be resumed. Upon receipt of such notice by the Agents, the Company's obligations to deliver the officers' certificates, opinions of counsel and letters from accountants required to be delivered by Sections 6(b), 6(c) and 6(d) hereof for each such amendment or supplement to the Registration Statement or the Prospectus occurring since the date 8 of such notice shall likewise be suspended until the earlier of (i) receipt by the Agents of notice from the Company to re-commence solicitation of offers to purchase the Notes and (ii) such time that the Company delivers, or causes to be delivered, as the case may be, to the Agents such certificate(s), opinion(s) and letter(s) relating to the amendments or supplements to the Registration Statement or the Prospectus or the documents incorporated by reference into the Prospectus since the last certificates, opinions or letters so delivered, except that such certificates, opinions and letters need not cover any statement in any such document which does not constitute part of the Registration Statement or the Prospectus pursuant to Rule 412 of the Act. For the purpose of this paragraph, "business day" shall mean any day which is not a Saturday or Sunday and which in New York City is not a day on which banking institutions are generally authorized or obligated by law or executive order to close. (c) Agent's Commission. Promptly upon the closing of the sale of any Notes sold by the Company as a result of a solicitation made by an Agent, the Company agrees to pay such Agent a commission in accordance with the schedule set forth in Exhibit A hereto. (d) Solicitation of Offers. The Agents are authorized to solicit offers to purchase the Notes only in denominations of U.S. $l00,000/**/ or any amount in excess thereof which is an integral multiple of U.S. $1,000, at a purchase price equal to 100% of the principal amount thereof or such other principal amount as shall be specified by the Company. Each Agent shall communicate to the Company, orally or in writing, each offer to purchase Notes received by it as Agent, and which it determines to be reasonable in its discretion reasonably exercised. The Company shall have the sole right to accept offers to purchase the Notes and may reject any such offer in whole or in part. Each Agent shall have the right, in its discretion reasonably exercised without advising the Company, to reject any offer to purchase the Notes received by it, in whole or in part, and any such rejection shall not be deemed a breach of its agreement contained herein. (e) Administrative Procedures. Administrative procedures respecting the sale of Notes (the "Procedures") are - ----------------- /**/ Or the equivalent (rounded down to an integral multiple of units of the denomination specified in a supplement to the Prospectus) in the relevant foreign currency or currency unit, or such larger amount in integral multiples of units of such denomination. 9 set forth in Exhibit B hereto and may be amended in writing from time to time by the Agents and the Company. Each Agent and the Company agree to perform the respective duties and obligations specifically provided to be performed by each of them herein and in the Procedures. (f) Delivery of Documents. The documents required to be delivered by Section 5 hereof shall be delivered at the offices of [Name], [Address], not later than 10:00 A.M., Chicago time, on the date of this Agreement or at such later time as may be mutually agreed upon by the Company and the Agents, which in no event shall be later than the time at which the Agents commence solicitation of offers to purchase Notes hereunder (the "Closing Date"). SECTION 3. Covenants of the Company. ------------------------ The Company covenants and agrees: (a) Delivery of Signed Registration Statement and Prospectus. To furnish promptly to the Agents and to their counsel a total of two signed copies of the Registration Statement as originally filed and each amendment or supplement thereto, and a copy of each Prospectus filed with the Commission, including all supplements thereto and all documents incorporated therein by reference and all consents and exhibits filed therewith; (b) Delivery of Other Documents. To deliver promptly to the Agents such number of the following documents as they may reasonably request: (i) conformed copies of the Registration Statement (excluding exhibits other than the computation of the ratio of earnings to fixed charges, the Indenture and this Agreement), (ii) the Prospectus and (iii) any documents incorporated by reference in the Prospectus; (c) Revisions to Prospectus - Material Changes. If, during any period in which, in the opinion of counsel for the Agents, a prospectus relating to the Notes is required to be delivered under the Act, any event occurs as a result of which the Prospectus would include an untrue statement of a material fact or omit to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, or if it is necessary at any time to amend the Prospectus to comply with the Act, to notify the Agents promptly, in writing, to suspend solicitation of purchases of the Notes (and, if so notified, such Agents shall cease such solicitation as soon as practicable, but in any event not later than one (1) business day after such notification); and if the Company shall decide to amend or supplement the Registration 10 Statement or the Prospectus, to promptly advise the Agents by telephone (with confirmation in writing) and to promptly prepare and file with the Commission an amendment or supplement which will correct such statement or omission or an amendment which will effect such compliance; provided, however, that if during the period referred to above any Agent shall own any Notes which it has purchased from the Company as principal with the intention of reselling them, the Company shall promptly prepare and timely file with the Commission any amendment or supplement to the Registration Statement or any Prospectus that may, in the judgment of the Company or the Agents, be required by the Act or requested by the Commission; (d) Commission Filings. To timely file with the Commission during the period referred to in (c) above all documents (and any amendments to previously filed documents) required to be filed by the Company pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act; (e) Copies of Filings with Commission. Prior to filing with the Commission during the period referred to in (c) above (i) any amendment or supplement to the Registration Statement, (ii) any amendment or supplement to the Prospectus or (iii) any document incorporated by reference in any of the foregoing or any amendment of or supplement to any such incorporated documents, to furnish a copy thereof to the Agents; (f) Notice to Agent of Certain Events. To advise the Agents immediately (i) when any post-effective amendment to the Registration Statement relating to or covering the Notes becomes effective, (ii) of any request or proposed request by the Commission for an amendment or supplement to the Registration Statement, to the Prospectus, to any document incorporated by reference in any of the foregoing or for any additional information, (iii) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or any part thereof or any order directed to the Prospectus or any document incorporated therein by reference or the initiation or threat of any stop order, proceeding or of any challenge to the accuracy or adequacy of any document incorporated by reference in the Prospectus, (iv) of receipt by the Company of any notification with respect to the suspension of the qualification of the Notes for sale in any jurisdiction or the initiation or threat of any proceeding for that purpose and (v) of the happening of any event which makes untrue any statement of a material fact made in the Registration Statement or the Prospectus or which requires the making of a change in or addition to the Registration Statement or the Prospectus in order to make any material statement therein not misleading; 11 (g) Stop Orders. If, during the period referred to in (c) above, the Commission shall issue a stop order suspending the effectiveness of the Registration Statement, to make every reasonable effort to obtain the lifting of that order at the earliest possible time; (h) Earnings Statements. To make generally available to its security holders, in the manner contemplated by Rule 158(b) under the Act or otherwise, as soon as practicable, but in any event not later than 18 months after the date of each acceptance by the Company of an offer to purchase Notes hereunder, an earnings statement of the Company satisfying the requirements of Section 11(a) of the Act; (i) Copies of Reports, Releases and Financial Statements. So long as any of the Notes are outstanding, to furnish to the Agents, not later than the time the Company makes the same publicly available, copies of all public reports or releases and all reports and financial statements furnished by the Company to any securities exchange on which the Notes are listed pursuant to requirements of or agreements with such exchange or to the Commission pursuant to the Exchange Act or any rule or regulation of the Commission thereunder; and (j) Blue Sky Qualifications. To endeavor, in cooperation with the Agents, to qualify the Notes for offering and sale under the securities laws of such jurisdictions as the Agents may designate, and to maintain such qualifications in effect for as long as may be required for the distribution of the Notes; and to file such statements and reports as may be required by the laws of each jurisdiction in which the Notes have been qualified as above provided; provided, however, that in connection therewith, the Company shall not be required to qualify as a foreign corporation or file a general consent to service of process. SECTION 4. Payment of Expenses. ------------------- The Company will pay: (a) the costs incident to the authorization, issuance, sale and delivery of the Notes and any taxes payable in that connection; (b) the costs incident to the preparation, printing and filing under the Act of the Registration Statement and any amendments and exhibits thereto; 12 (c) the costs incident to the preparation, printing and filing of any document and any amendments and exhibits thereto required to be filed by the Company under the Exchange Act; (d) the costs of distributing the Registration Statement, as originally filed, and each amendment and post-effective amendment thereof (including exhibits), the Prospectus, any supplement or amendment to the Prospectus and any documents incorporated by reference in any of the foregoing documents; (e) the fees and expenses of the Trustee, any paying agent, any calculation agent, any exchange rate agent and any other agents appointed by the Company, and their respective counsel; (f) the costs and fees in connection with the listing of the Notes on any securities exchange; (g) the cost and fees of any required filings with the National Association of Securities Dealers, Inc.; (h) the fees and disbursements of counsel to the Company and counsel to the Agents; (i) the fees paid to rating agencies in connection with the rating of the Notes; (j) the fees and expenses of qualifying the Notes under the securities laws of the several jurisdictions as provided in Section 3(j) hereof and of preparing and printing a Blue Sky Memorandum and a memorandum concerning the legality of the Notes as an investment (including fees and expenses of counsel for the Agents in connection therewith); (k) all advertising expenses in connection with the offering of the Notes incurred with the consent of the Company; and (l) all other costs and expenses incident to the performance of the Company's obligations under this Agreement. 13 SECTION 5. Conditions. ---------- The obligation of the Agents, as agents of the Company, under this Agreement to solicit offers to purchase the Notes, the obligation of any person who has agreed to purchase Notes to make payment for and take delivery of Notes, and the obligation of any Agent to purchase Notes pursuant to any Purchase Agreement (as defined), is subject to the accuracy, on each Representation Date, of the representations and warranties of the Company contained herein, to the accuracy of the statements of the Company's officers made in any certificate furnished pursuant to the provisions hereof, to the performance by the Company of its obligations hereunder, and to each of the following additional terms and conditions: (a) Registration Statements. No stop order suspending the effectiveness of the Registration Statement or any part thereof nor any order directed to any document incorporated by reference in the Prospectus shall have been issued or threatened by the Commission and no challenge shall have been made to the accuracy or adequacy of any document incorporated by reference in the Prospectus; any request of the Commission for inclusion of additional information in the Registration Statement or the Prospectus or otherwise shall have been complied with to the Agents' reasonable satisfaction; and the Company shall have not filed with the Commission any amendment or supplement to the Registration Statement or the Prospectus (or any document incorporated by reference therein) without the consent of the Agent that arranged such purchase, which consent shall not be unreasonably withheld or delayed. (b) No Suspension of Sale of the Notes. No order suspending the sale of the Notes in any jurisdiction designated by the Agents pursuant to Section 3(j) hereof shall have been issued, and no proceeding for that purpose shall have been initiated or threatened. (c) No Material Omissions or Untrue Statements. The Agents shall not have discovered and disclosed to the Company that the Registration Statement or any Prospectus contains an untrue statement of a fact which, in the opinion of counsel for the Agents, is material or omits to state a fact which, in the opinion of such counsel, is material and is required to be stated therein or is necessary to make the statements therein not misleading. 14 (d) Legal Matters Satisfactory to Counsel. All corporate proceedings and other legal matters incident to the authorization, form and validity of this Agreement, the Notes, the Indenture, the form of the Registration Statement, each Prospectus and all other legal matters relating to this Agreement and the transactions contemplated hereby shall be satisfactory in all respects to counsel for the Agents and the Company shall have furnished to such counsel all documents and information that they may reasonably request to enable them to pass upon such matters. (e) Opinions of Company Counsel. At the Closing Date, the Agents shall have received (1) the opinion, addressed to the Agents and dated the Closing Date, of Deborah M. Regan, Esq., Vice President and Secretary of the Company, in form and substance satisfactory to the Agents, to the effect that: (i) Each of the Subsidiaries is a corporation duly incorporated and validly existing in good standing under the laws of the respective state or jurisdiction of its incorporation or formation, and each of the Subsidiaries has full corporate power and authority under such laws to own, lease and operate its properties and to conduct its business as described in the Prospectus; (ii) The Company has an authorized capitalization as set forth in 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; (iii) The Company, directly or indirectly, owns all of the issued and outstanding voting securities of each of the Subsidiaries, in each case free and clear of any liens, encumbrances or claims of which such counsel has knowledge; (iv) The Company and each of the Subsidiaries is a corporation duly qualified as a foreign corporation to transact business and is in good standing in each jurisdiction in which the character of the business conducted by it or the location of the property owned by it makes such qualification necessary except where the failure to be so qualified would not have a material adverse effect on the Company and its subsidiaries considered as one enterprise; (v) To the best of such counsel's knowledge and other than as set forth in the Prospectus, there are no actions, suits or proceedings before or by any court or governmental agency or body, domestic or foreign, pending or threatened, against or affecting the Company or any of its subsidiaries which are, individually or in the aggregate, reasonably 15 expected to result in any material adverse change in the general affairs, financial position, stockholders' equity or results of operations of the Company and its subsidiaries considered as one enterprise, or which are reasonably expected to materially and adversely affect the consummation of this Agreement or the issuance and sale by the Company of the Notes; and to the best of such counsel's knowledge, there are no contracts or exhibits required by the Act or by the Rules and Regulations, or which are required to be filed by the Exchange Act or the rules and regulations of the Commission thereunder, to be filed with the Registration Statement or required to be summarized, described or incorporated by reference in the Registration Statement or the Prospectus which are not filed, incorporated by reference, summarized or described as required; (vi) The issue and sale by the Company of the Notes and the compliance by the Company with all of the provisions of the Notes, the Indenture, this Agreement and the Purchase Agreement (if any) and the consummation of the transactions herein and therein contemplated will not, to the best knowledge of such counsel, conflict with or result in a breach of any of the terms or provisions of, or constitute a default under, or result in the creation or imposition of any lien, charge or encumbrance upon any of the property or assets of any of the subsidiaries of the Company under, any agreement or instrument to which any of the subsidiaries of the Company is a party or by which any of the subsidiaries of the Company may be bound or to which any of the property or assets of any of the subsidiaries of the Company is subject (except for conflicts, breaches, defaults, liens, charges and encumbrances which would not, individually or in the aggregate, have a material adverse effect on the Company and its subsidiaries considered as one enterprise); nor will such action result in any violation of the provisions of the Certificate or Articles of Incorporation, as amended, or the By-Laws of any of the subsidiaries of the Company or, to the best of such counsel's knowledge, any statute or order, rule or regulation applicable to any of the subsidiaries of the Company of any court or of any Federal, state or other regulatory authority or other governmental body having jurisdiction over any of the subsidiaries of the Company; (vii) Nothing has come to the attention of such counsel to cause such counsel to believe that either the Registration Statement or any amendment thereof at the time each became effective contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading or that the Prospectus contains an 16 untrue statement of a material fact or omitted or omits to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading; and (viii) The documents incorporated by reference in the Prospectus (other than the financial statements and related schedules and other financial or statistical data included therein, as to which such counsel need express no opinion), when they became effective or were filed with the Commission, as the case may be, complied as to form in all material respects with the requirements of the Act or the Exchange Act, as applicable, and the rules and regulations of the Commission thereunder, and nothing has come to the attention of such counsel to cause such counsel to believe that any of such documents, when they became effective or were so filed, as the case may be, contained, in the case of a registration statement which became effective under the Act, an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading and, in the case of other documents which were filed under the Act or Exchange Act with the Commission, an untrue statement of a material fact or omitted to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made when such documents were so filed, not misleading, in each case after excluding any statement in any such document which does not constitute part of the Registration Statement or the Prospectus pursuant to Rule 412 under the Act; and to such further effect with respect to other legal matters relating to this Agreement, the Purchase Agreement (if any), or the sale of the Notes hereunder as counsel for the Agents may/ reasonably request; and (2) the opinion, addressed to the Agents and dated the Closing Date, of Sidley & Austin, counsel for the Company, in form and substance satisfactory to the Agents and their counsel, to the effect that: (i) The Company is a corporation duly incorporated and validly existing in good standing under the laws of the State of Delaware and the Company has full corporate power and authority under such laws to own, lease and operate its properties and to conduct its business as described in the Prospectus. (ii) This Agreement and the Purchase Agreement (if any) have been duly authorized, executed and delivered by the Company; 17 (iii) The Notes have been duly authorized and, when the terms thereof have been duly established in accordance with the Indenture and when the Notes have been duly executed, authenticated, issued and delivered, and upon receipt by the Company of the agreed upon consideration therefor, will constitute valid and legally binding obligations of the Company entitled to the benefits provided by the Indenture, except as enforcement thereof may be limited by bankruptcy, insolvency, reorganization and other similar laws affecting enforcement of creditors' rights generally and except as enforcement thereof is subject to general principles of equity; the Indenture has been duly authorized, executed and delivered by the Company and duly qualified under the Trust Indenture Act and is substantially in the form filed as an exhibit to the Registration Statement, and constitutes a valid and legally binding obligation of the Company, enforceable in accordance with its terms, except as enforcement thereof may be limited by bankruptcy, insolvency, reorganization or other similar laws affecting enforcement of creditors' rights generally and except as enforcement thereof is subject to general principles of equity; (iv) The issue and sale by the Company of the Notes and the compliance by the Company with all of the provisions thereof, and of the Indenture, this Agreement and the Purchase Agreement (if any) and the consummation of the transactions herein and therein contemplated will not, to the best knowledge of such counsel, conflict with or result in a breach of any of the terms or provisions of, or constitute a default under, or result in the creation or imposition of any lien, charge or encumbrance upon any of the property or assets of the Company under any agreement or instrument to which the Company is a party or by which the Company may be bound or to which any of the property or assets of the Company is subject (except for conflicts, breaches, defaults, liens, charges and encumbrances which would not, individually or in the aggregate, have a material adverse effect on the Company and its subsidiaries considered as one enterprise); nor will such action result in any violation of the provisions of the Certificate of Incorporation, as amended, or the By-Laws of the Company or, to the best of such counsel's knowledge, any statute, order, rule or regulation applicable to the Company of any court or of any Federal, state or other regulatory authority or other governmental body having jurisdiction over the Company; and no authorization, approval, consent, registration, qualification or order of or with any such court or any such regulatory authority or other governmental agency or body is required for the issue and sale of the Notes by the Company 18 or the consummation by the Company of the other transactions contemplated by this Agreement, the Purchase Agreement (if any) or the Indenture, except such as have been obtained under the Act and the Trust Indenture Act and such consents, approvals, authorizations, registrations or qualifications as may be required under state securities or Blue Sky laws in connection with the offer and sale of the Notes by the Company; (v) The Registration Statement has become and is now effective under the Act and, to the knowledge of such counsel, no stop order suspending the effectiveness of the Registration Statement has been issued and no proceedings for that purpose have been initiated or threatened by the Commission; (vi) The Registration Statement and the Prospectus and any further amendments and supplements thereto made by the Company prior to the Closing Date (other than the financial statements and related schedules and other financial and statistical data therein as to which such counsel need express no opinion) comply as to form in all material respects with the requirements of the Act and the Trust Indenture Act and the rules and regulations thereunder; the Notes and the Indenture conform in all material respects to the descriptions thereof contained in the Registration Statement and the Prospectus, and the information in the Prospectus under the captions "Description of Debt Securities" and "Description of Notes" or a comparable caption describing the Notes, to the extent that it constitutes matters of law or legal conclusions, has been reviewed by such counsel and is correct in all material respects; nothing has come to the attention of such counsel to cause such counsel to believe that either the Registration Statement at the time it became effective contained or as of the Closing Date contains an untrue statement of a material fact or omitted or omits to state a material fact required to be stated therein or necessary to make the statements therein not misleading or that the Prospectus as of the Closing Date contains an untrue statement of a material fact or omits to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading; and (vii) The statements contained under the caption "United States Federal Income Tax Consequences" relating to the Notes, to the extent that they constitute matters of law or legal conclusions, have been reviewed by such counsel and are correct in all material respects; 19 and to such further effect with respect to other legal matters relating to this Agreement, the Purchase Agreement (if any), or the sale of the Notes hereunder as counsel for the Agents may reasonably request. Such counsel may also state, that insofar as such opinion involves factual matters, they have relied, to the extent they deem proper, upon certificates of officers of the Company and its subsidiaries and certificates of public officials, which certificates, if any, shall be delivered to counsel for the Agents. (f) Officers' Certificate. The Company shall have furnished to the Agents on the Closing Date a certificate, dated the Closing Date and addressed to the Agents, of its Chairman of the Board, the President or a Vice President and its Secretary or an Assistant Secretary stating that the representations and warranties of the Company herein are true and correct at and as of the Closing Date; the Company complied with all of its obligations hereunder to be performed at or prior to the Closing Date; and the conditions set forth in Sections 5(a) and 5(b) hereof have been fulfilled; such certificate to be based upon knowledge or belief as to proceedings initiated or threatened referred to in Sections 5(a) and 5(b). (g) Accountant's Letter. The Company shall have furnished to the Agents on the Closing Date a letter of Arthur Andersen LLP, addressed jointly to the Company and the Agents and dated the Closing Date, of the type described in the American Institute of Certified Public Accountants' Statement on Auditing Standards No. 72, covering such specified financial statement items and procedures as the Agents may reasonably request and in form and substance reasonably satisfactory to the Agents. (h) Additional Conditions. There shall not have occurred: (i) any change, or any development involving a prospective change, in or affecting the general affairs, management, financial position, stockholders' equity or results of operations of the Company and its subsidiaries considered as one enterprise, otherwise than as set forth or contemplated in the Prospectus as amended or supplemented on the date of the acceptance by the Company of an offer to purchase a Note, the effect of which, in any such case described in this clause is, in the judgment of the Agents, so material and adverse as to make it impracticable or inadvisable to proceed with the solicitation of offers to purchase Notes or the purchase of Notes from the Company as principal pursuant to the applicable Purchase Agreements, as the case may be; (ii) a suspension or material limitation in trading in securities generally, or in the Common Stock of the Company, on the New York Stock Exchange or the establishment of minimum prices on such exchange; (iii) a general moratorium on commercial banking activities declared by either 20 Federal or New York State authorities; (iv) any downgrading in the rating accorded to any of the Company's debt securities by any "nationally recognized statistical rating organization", as that term is defined by the Commission for purposes of Rule 436(g)(2) under the Act or any public announcement that any such organization has under surveillance or review its rating of any debt securities of the Company (other than an announcement with positive implications of a possible upgrading, and no implication of a possible downgrading, of such rating); (v) any outbreak or escalation of major hostilities in which the United States is involved, any declaration of war by Congress or any other substantial national calamity or emergency; or (vi) any material adverse change in the existing financial, political or economic conditions in the United States that, or any effect of international conditions on the financial markets in the United States that, in the judgment of the Agents, makes it impracticable or inadvisable to proceed with the solicitation of offers to purchase Notes or the purchase of Notes from the Company as principal pursuant to the applicable Purchase Agreement, as the case may be. (i) Other Information and Documentation. Prior to the Closing Date, the Company shall have furnished to the Agents such further information, certificates and documents as the Agents or counsel to the Agents may reasonably request. All opinions, letters, evidence and certificates mentioned above or elsewhere in this Agreement shall be deemed to be in compliance with the provisions hereof only if they are in the form and substance satisfactory to counsel for the Agents. SECTION 6. Additional Covenants of the Company. ----------------------------------- The Company covenants and agrees that: (a) Acceptance of Offer Affirms Representations and Warranties. Each acceptance by the Company of an offer for the purchase of Notes shall be deemed to be an affirmation that the representations and warranties of the Company contained in this Agreement and in any certificate theretofore given to the Agents pursuant hereto are true and correct at the time of such acceptance, and an undertaking that such representations and warranties will be true and correct at the time of delivery to the purchaser or his agent of the Notes relating to such acceptance as though made at and as of each such time (and it is understood that such representations and warranties shall relate to the Registration Statement and the Prospectus as amended or supplemented to each such time). 21 (b) Subsequent Delivery of Officers' Certificates. Each time that the Registration Statement or the Prospectus shall be amended or supplemented (other than by an amendment or supplement providing solely for the interest rates or maturities of the Notes or the principal amount of Notes remaining to be sold or other changes as agreed to by the Agents on a case-by-case basis) or the Company files with the Commission any document incorporated by reference into the Prospectus, the Company shall, concurrently with such amendment, supplement or filing, furnish the Agents with a certificate of the Chairman of the Board, the President or any Vice President and the Secretary or any Assistant Secretary of the Company in form satisfactory to the Agents to the effect that the statements contained in the certificate referred to in Section 5(f) hereof which was last furnished to the Agents are true and correct at the time of such amendment, supplement or filing, as the case may be, as though made at and as of such time (except that such statements shall be deemed to relate to the Registration Statement and the Prospectus as amended and supplemented to such time) or, in lieu of such certificate, a certificate of the same tenor as the certificate referred to in said Section 5(f), modified as necessary to relate to the Registration Statement and the Prospectus as amended and supplemented to the time of delivery of such certificate. (c) Subsequent Delivery of Legal Opinions. Each time that the Registration Statement or the Prospectus shall be amended or supplemented (other than by an amendment or supplement providing solely for the interest rates or maturities of the Notes or the principal amount of Notes remaining to be sold or other changes as agreed to by the Agents on a case-by-case basis) or the Company files with the Commission any document incorporated by reference into the Prospectus, the Company shall, concurrently with such amendment, supplement or filing, furnish the Agents and their counsel with written opinions of the counsel to the Company specified in Section 5(e), addressed to the Agents and dated the date of delivery of such opinions, in form satisfactory to the Agents, of the same tenor as the respective opinions referred to in Section 5(e)(1) and (2) hereof, but modified, as necessary, to relate to the Registration Statement and the Prospectus as amended or supplemented to the time of delivery of such opinions; provided, however, that in lieu of such opinions, such counsel may furnish the Agents with letters to the effect that the Agents may rely on such prior opinions to the same extent as though they were dated the date of such letter authorizing reliance (except that statements in such prior opinions shall be deemed to relate to the Registration Statement and the Prospectus as amended or supplemented to the time of delivery of such letters authorizing reliance). 22 (d) Subsequent Accountant's Letter. Each time that the Registration Statement or the Prospectus shall be amended or supplemented to include additional financial information or the Company files with the Commission any document incorporated by reference into the Prospectus which contains additional financial information the Company shall cause Arthur Andersen LLP to furnish the Agents, concurrently with such amendment, supplement or filing, a letter, addressed jointly to the Company and the Agents and dated the date of delivery of such letter, in form and substance reasonably satisfactory to the Agents, of the same tenor as the letter referred to in Section 5(g) hereof but modified to relate to the Registration Statement and the Prospectus, as amended and supplemented to the date of such letter, with such changes as may be necessary to reflect changes in the financial statements and other information derived from the accounting records of the Company; provided, however, that if the Registration Statement or the Prospectus is amended or supplemented solely to include financial information as of and for a fiscal quarter, Arthur Andersen LLP may limit the scope of such letter to the unaudited financial statements included in such amendment or supplement unless there is contained therein any other accounting, financial or statistical information that, in the reasonable judgment of the Agents, should be covered by such letter, in which event such letter shall also cover such other information. (e) On any settlement date for the sale of Notes, the Company shall furnish to the Agent that solicited or received the offer to purchase any Notes being delivered on such settlement date, if requested by such Agent prior to acceptance of such offer by the Company, with written opinions of the counsel to the Company set forth in Section 5(e), dated such settlement date, in form satisfactory to such Agent, to the effect set forth in section 5(e) hereof, but modified, as necessary, to relate to the Prospectus relating to the Notes to be delivered on such settlement date; provided, however, that in lieu of such opinion, such counsel may furnish the Agent with a letter to the effect that the Agent may rely on such prior opinion to the same extent as though it was dated such settlement date (except that statements in such prior opinion shall be deemed to relate to the Registration Statement and such Prospectus as amended or supplemented to the time of delivery of such letter authorizing reliance). SECTION 7. Indemnification and Contribution. -------------------------------- (a) The Company shall indemnify and hold harmless each Agent and each person, if any, who controls any Agent within the meaning of the Act from and against any loss, claim, damage or liability, joint or several, and any action in respect thereof, 23 to which such Agent or controlling person may become subject, under the Act, the Exchange Act or other Federal, state or foreign statutory law or regulation, at common law or otherwise, insofar as such loss, claim, damage, liability or action arises out of, or is based upon, any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement or the Prospectus, or arises out of, or is based upon, the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, and shall reimburse each Agent and controlling person promptly after receipt of invoices therefrom for any legal and other expenses reasonably incurred by such Agent or controlling person in investigating or defending or preparing to defend against any such loss, claim, damage, liability or action; provided, however, that the Company shall not be liable in any such case to the extent that any such loss, claim, damage, liability or action arises out of, or is based upon, any untrue statement or alleged untrue statement or omission or the alleged omission made in the Registration Statement or the Prospectus in reliance upon and in conformity with written information furnished to the Company by the Agents specifically for inclusion therein. The foregoing indemnity agreement is in addition to any liability which the Company may otherwise have to any Agent or controlling person. The statements with respect to the Agents set forth on the last paragraph of the cover page of the Prospectus Supplement relating to the Notes and under the heading "Supplemental Plan of Distribution" in such Prospectus Supplement constitute the only information furnished in writing by the Agents specifically for inclusion in the Registration Statement, and each of you, as the Agents, confirm that such statements are correct. (b) Each Agent shall severally, but not jointly, indemnify and hold harmless the Company, each of its directors, each of its officers who signed the Registration Statement and any person who controls the Company within the meaning of the Act from and against any loss, claim, damage or liability, joint or several, and any action in respect thereof, to which the Company or any such director, officer or controlling person may become subject, under the Act, the Exchange Act or Federal, state or foreign statutory law or regulation, at common law or otherwise, insofar as such loss, claim, damage, liability or action arises out of, or is based upon, any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement or the Prospectus, or arises out of, or is based upon, the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, but in each case only to the extent that the untrue statement or alleged untrue statement or omission or alleged omission was made in reliance upon and in conformity with 24 written information furnished to the Company by such Agent specifically for inclusion therein, and shall reimburse the Company or any such director, officer or controlling person, promptly after receipt of invoices therefrom, for any legal and other expenses reasonably incurred by such indemnified party in investigating or defending or preparing to defend against any such loss, claim, damage, liability or action. The foregoing indemnity agreement is in addition to any liability which any Agent may otherwise have to the Company or any of its directors, officers or controlling persons. (c) Promptly after receipt by an indemnified party under this Section of notice of any claim or the commencement of any action, the indemnified party shall, if a claim in respect thereof is to be made against the indemnifying party under this Section, notify the indemnifying party in writing of the claim or the commencement of that action; provided, however, that the failure to notify the indemnifying party shall not relieve it from any liability which it may have to an indemnified party otherwise than under this Section except to the extent that it has been materially prejudiced by such failure. If any such claim or action shall be brought against an indemnified party, and it shall notify the indemnifying party thereof, the indemnifying party shall be entitled to participate therein, and, to the extent that it wishes, jointly with any other similarly notified indemnifying party, to assume the defense thereof with counsel satisfactory to the indemnified party. After notice from the indemnifying party to the indemnified party of its election to assume the defense of such claim or action, the indemnifying party shall not be liable to the indemnified party under this Section for any legal or other expenses subsequently incurred by the indemnified party in connection with the defense thereof other than reasonable costs of investigation; provided, however, that the Agents shall have the right to employ counsel to represent the Agents who may be subject to liability arising out of any claim in respect of which indemnity may be sought by the Agents against the Company under this Section if, in the reasonable judgment of the Agents, it is advisable for the Agents to be represented by separate counsel, and in that event the fees and expenses of such counsel shall be paid by the Company. The indemnifying party 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 party agrees to indemnify the indemnified party from and against any loss or liability by reason of such settlement or judgment. Notwithstanding the foregoing sentence, if at any time an indemnified party shall have requested an indemnifying party to reimburse the indemnified party for fees and expenses of counsel, the indemnifying party agrees that it shall be liable for any settlement of any 25 proceeding effected without its written consent if (i) such settlement is entered into more than 30 days after receipt by such indemnifying party of the aforesaid request and (ii) such indemnifying party shall not have reimbursed the indemnified party in accordance with such request prior to the date of such settlement. No indemnifying party shall, without the prior written consent of the indemnified party, effect any settlement of any pending or threatened proceeding in respect of which any indemnified party is or could have been a party and indemnity could have been sought hereunder by such indemnified party, unless such settlement includes an unconditional release of such indemnified party from all liability on claims that are the subject matter of such proceeding. In no event shall the indemnifying party or parties be liable for the fees and expenses of more than one counsel for all indemnified parties in connection with any one action or separate but similar or related actions in the same jurisdiction arising out of the same general allegations or circumstances. (d) If the indemnification provided for in this Section 7 shall for any reason be unavailable or insufficient to hold harmless an indemnified party under Section 7(a) or 7(b) hereof in respect of any loss, claim, damage or liability, or any action in respect thereof, referred to therein, then each indemnifying party shall, in lieu of indemnifying such indemnified party, contribute to the amount paid or payable by such indemnified party as a result of such loss, claim, damage or liability, or action in respect thereof, (i) in such proportion as shall be appropriate to reflect the relative benefits received by the Company on the one hand and the Agents on the other from the offering of the Notes or (ii) if the allocation provided by clause (i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of the Company on the one hand and the Agents on the other with respect to the statements or omissions which resulted in such loss, claim, damage or liability, or action in respect thereof, as well as any other relevant equitable considerations. The relative benefits received by the Company on the one hand and the Agents on the other with respect to such offering shall be deemed to be in the same proportion as the total net proceeds from the offering of the Notes (before deducting expenses) received by the Company bears to the total commissions received by such Agent with respect to such offering. The relative fault shall be determined by reference to whether the untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact relates to information supplied by the Company or any Agent, the intent of the parties and their relative knowledge, and access to information and opportunity to correct or prevent such statement or omission. The Company and 26 the Agents agree that it would not be just and equitable if contributions pursuant to this Section 7(d) were to be determined by pro rata allocation (even if the Agents were treated as one entity for such purpose) or by any other method of allocation which does not take into account the equitable considerations referred to herein. The amount paid or payable by an indemnified party as a result of the loss, claim, damage or liability, or action in respect thereof, referred to above in this Section 7(d) shall be deemed to include, for purposes of this Section 7(d), any legal or other expenses reasonably incurred by such indemnified party in connection with investigating, preparing to defend or defending any such action or claim. Notwithstanding the provisions of this Section 7(d), no Agent shall be required to contribute any amount in excess of the amount by which the total price at which the Notes sold through such Agent and distributed to the public were offered to the public exceed the amount of any damages which such Agent has otherwise paid or become liable to pay by reason of any 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 Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The Agents' obligations under this Section 7(d) are several and not joint. Any party receiving notice of its obligation to contribute any amount pursuant to this Section 7(d) shall provide prompt notice to all other parties required to contribute hereunder. SECTION 8. Status of each Agent. -------------------- In soliciting offers to purchase the Notes from the Company pursuant to this Agreement (other than offers to purchase pursuant to Section 11), each Agent is acting solely as agent for the Company and not as principal. Each Agent will make reasonable efforts to assist the Company in obtaining performance by each purchaser whose offer to purchase Notes from the Company has been solicited by such Agent and accepted by the Company but such Agent shall have no liability to the Company in the event any such purchase is not consummated for any reason. If the Company shall default in its obligations to deliver Notes to a purchaser whose offer it has accepted, the Company shall (i) hold each Agent harmless against any loss, claim or damage arising from or as a result of such default by the Company and (ii) in particular, pay to each Agent any commission to which it would be entitled in connection with such sale. 27 SECTION 9. Representations and Warranties to Survive Delivery. -------------------------------------------------- All representations and warranties of the Company contained in this Agreement, or contained in certificates of officers of the Company submitted pursuant hereto, shall remain operative and in full force and effect, regardless of the termination or cancellation of this Agreement or any investigation made by or on behalf of any Agent or any person controlling such Agent or by or on behalf of the Company, and shall survive each delivery of and payment for any of the Notes. SECTION 10. Termination. ----------- This Agreement may be terminated for any reason with respect to any party hereto, at any time, by any party hereto upon the giving of one day's written notice of such termination to the other parties hereto; provided, however, that in case of termination by less than all the Agents such termination shall be effective only with respect to such terminating Agent. If, at the time of termination, an offer to purchase any of the Notes has been accepted by the Company but the time of delivery to the purchaser has not occurred, the provisions of Sections 3(c), 3(g), 3(i) and 3(j) shall remain in effect until such Notes are delivered. The provisions of Sections 3(d), 3(h), 4, 7, 8, 9, 12, 13, 14 and 15 hereof shall survive any such termination. SECTION 11. Purchases as Principal. ---------------------- (a) From time to time any Agent may agree with the Company to purchase Notes from the Company as principal, in which case such purchase shall be made in accordance with the terms of a separate agreement (a "Purchase Agreement") to be entered into between such Agent and the Company in the form attached hereto as Exhibit C. A Purchase Agreement, to the extent set forth therein, may incorporate by reference specified provisions of this Agreement. Each Purchase Agreement shall be substantially in the form of Exhibit C hereto but may take the form of (i) an exchange of any form of written telecommunication between the Agent and the Company or (ii) an oral agreement with an authorized officer of the Company promptly confirmed in writing. The Agent's commitment to purchase Notes as principal shall be deemed to have been made on the basis of the representations and warranties of the Company herein contained and shall be subject to the terms and conditions herein set forth as well as any other representations, warranties, terms and conditions set forth in the Purchase Agreement. 28 (b) Unless otherwise agreed to between the Company and an Agent in a Purchase Agreement, any Note sold to an Agent as principal (i) shall be purchased by such Agent at a price equal to 100% of the principal amount thereof less a percentage equal to the commission applicable to an agency sale of a Note of identical maturity and (ii) may be resold by such Agent at varying prices from time to time or, if set forth in the applicable Purchase Agreement and Pricing Supplement, at a fixed public offering price. In connection with any resale of Notes purchased, any such Agent may use a selling or dealer group and may reallow to any broker or dealer any portion of the discount or commission payable pursuant hereto. SECTION 12. Sales of Notes Denominated in a Foreign Currency and Indexed ------------------------------------------------------------ Notes. - ----- If at any time the Company and any of the Agents shall determine to issue and sell Notes denominated in a currency or currency unit other than U.S. Dollars, which other currency may include a composite currency, or with respect to which an index is used to determine the amounts of payments of principal or any premium or interest, the Company and any such Agent shall execute and deliver an Amendment (a "Foreign Currency Amendment" or "Indexed Note Amendment," as the case may be) in the form attached hereto as Exhibit D. Such Amendment shall establish, as appropriate, additions and modifications that shall apply to the sales, whether offered on an agency or principal basis, of the Notes covered thereby. SECTION 13. Notices. ------- Except as otherwise provided herein, all notices and other communications hereunder shall be in writing and shall be deemed to have been duly given if mailed or transmitted by any standard form of telecommunication. Notices to the Agents shall be directed to each of them as follows: ; notices to the Company shall be directed to it as follows: R. R. Donnelley & Sons Company, 77 West Wacker Drive, Chicago, Illinois 60601, Attention: Treasurer. SECTION 14. Binding Effect; Benefits. ------------------------ This Agreement shall be binding upon each Agent, the Company, and their respective successors. This Agreement and the terms and provisions hereof are for the sole benefit of only those persons, except that (a) the representations, warranties, indemnities and agreements of the Company contained in this Agreement shall also be deemed to be for the benefit of the person or persons, if any, who control any Agent within the 29 meaning of Section 15 of the Act, (b) the agreements of the Agents contained in Section 7 hereof shall be deemed to be for the benefit of directors of the Company, officers of the Company who have signed the Registration Statement and any person controlling the Company and (c) to the extent any person who has agreed to purchase Notes may be relieved of his obligation to make payment thereof and take delivery thereof pursuant to the first paragraph of Section 5 hereof. Nothing in this Agreement is intended or shall be construed to give any person, other than the persons referred to in this Section, any legal or equitable right, remedy or claim under or in respect of this Agreement or any provision contained herein. SECTION 15. Governing Law; Counterparts. --------------------------- This Agreement shall be governed by and construed in accordance with the laws of New York. This Agreement may be executed in counterparts and the executed counterparts shall together constitute a single instrument. SECTION 16. Paragraph Headings. ------------------ The paragraph headings used in this Agency Agreement are for convenience of reference only, and are not to affect the construction hereof or be taken into consideration in the interpretation hereof. 30 If the foregoing correctly sets forth our agreement, please indicate your acceptance hereof in the space provided for that purpose below. Very truly yours, R. R. DONNELLEY & SONS COMPANY By____________________________ Name: Title: CONFIRMED AND ACCEPTED, as of the date first above written: [AGENT] By____________________________ Name: Title: 31 EXHIBIT A R. R. Donnelley & Sons Company Medium-Term Notes, Series __ Schedule of Payments The Company agrees to pay each Agent a commission equal to the following percentage of the aggregate U.S. dollar equivalent of the principal amount of Notes:
Term Commission Rate ---- --------------- __ year to less than __ years % __ years to less than __ years % __ years to less than __ years % __ years to less than __ years % __ years to less than __ years % __ years to __ years and one month %
EXHIBIT B R. R. Donnelley & Sons Company Medium-Term Notes, Series __ Administrative Procedures Medium-Term Notes, Series __, due from _____ year[s] to ___ years and one month from date of issue (the "Notes") may be offered on a continuing basis by R. R. Donnelley & Sons Company (the "Company"). ___________________, _____________________ and ______________________ as agents (each an "Agent" and collectively, the "Agents"), have each agreed to use their reasonable best efforts to solicit offers to purchase the Notes. The Notes are being sold pursuant to an Agency Agreement between the Company and the Agents dated ________, 199_ (as it may be supplemented or amended from time to time, the "Agency Agreement") to which these administrative procedures are attached as an exhibit. The Notes will be issued pursuant to an Indenture, dated as of November 1, 1990 (as it may be amended or supplemented from time to time, the "Indenture"), between the Company and Citibank, N.A., as trustee (the "Trustee"). The Notes will rank equally with all other unsecured and unsubordinated indebtedness of the Company and will have been registered with the Securities and Exchange Commission (the "Commission"). Unless otherwise noted, terms not defined herein shall have the same meaning as in the Prospectus Supplement relating to the Notes (the "Prospectus") and in the Agency Agreement. Special administrative procedures for Multi-Currency Notes and for Global Securities for Book-Entry Notes follow these administrative procedures. Administrative responsibilities, document control and record-keeping functions to be performed by the Company will be performed by its Treasury Department. Administrative procedures for the offering are explained below. Price to Public - --------------- Each Note will be issued at 100% of principal amount, unless otherwise determined by the Company. Date of Issuance - ---------------- Each Note will be dated and issued as of the date of its authentication by the Trustee. B-1 Maturities - ---------- Each Note will mature on a Business Day selected by the initial purchaser and agreed upon by the Company, such date being at least ____ year[s] but not more than ___ years and one month from the date of issuance. Each Floating Rate Note will mature on an Interest Payment Date (as defined below). Registration - ------------ Notes will be issued only in fully registered form as either a Book- Entry Note or a Certificated Note. Certificated Notes may be presented for registration of transfer or exchange at the Trustee's New York office. Denominations - ------------- Unless otherwise indicated in the applicable Pricing Supplement, Notes (other than Book-Entry Notes) will be issued and payable in U.S. dollars in the denomination of $100,000 and integral multiples of $1,000 in excess thereof. Interest Payments - ----------------- Each Note bearing interest at a fixed rate (a "Fixed Rate Note") will bear interest from its issue date at the annual rate stated on the face thereof, payable either semi-annually on May 15 and November 15 or annually on May 15 of each year (each an "Interest Payment Date" with respect to such Fixed Rate Note) and at Maturity. Special provisions are set forth in a supplement to the Prospectus relating to Notes bearing interest at a rate or rates determined by reference to an interest rate formula (the "Floating Rate Notes") stated on the face thereof, payable in arrears on such dates as are specified therein (each an "Interest Payment Date" with respect to such Floating Rate Note). Interest on Fixed Rate Notes will be calculated and paid on the basis of a 360-day year of twelve 30-day months. Interest will be payable to the person in whose name such Note is registered at the close of business on each of May 1 or November 1, or May 1, as the case may be (whether or not a Business Day) (the "Regular Record Dates") next preceding the respective Interest Payment Date. Any payment of principal and interest on such Note required to be paid on an Interest Payment Date or at Maturity which is not a Business Day shall be postponed to the next day which is a Business Day. The first payment of interest on any Note originally issued between a Regular Record Date and an Interest Payment Date will be made on the Interest Payment B-2 Date following the next succeeding Regular Record Date. All interest payments, excluding interest payments made at Maturity, will be made by check mailed to the person entitled thereto as provided in the supplement to the Prospectus relating to the Notes, or, at the option of the Company, by wire transfer to an account maintained by such person with a bank located in the United States. Notwithstanding the foregoing, the holder of $10 million or more in aggregate principal amount of Notes with the same Interest Payment Date shall upon written request be entitled to receive payments of interest (other than at Stated Maturity or upon redemption) by wire transfers to an account maintained by such holder with a bank located in the United States. On the fifth Business Day immediately preceding each Interest Payment Date, the Trustee will furnish the Company with the total amount of the interest payments to be made on such Interest Payment Date. The Trustee (or any duly selected paying agent) will provide monthly to the Company's Treasury Department a list of the principal and interest to be paid on Notes maturing in the next succeeding month. The Company will provide to the Trustee not later than the payment date sufficient moneys to pay in full all principal and interest payments due on such payment date. The Trustee will assume responsibility for withholding taxes on interest paid as required by law. Acceptance and Rejection of Offers - ---------------------------------- The Company shall have the sole right to accept offers to purchase Notes and may reject any such offer in whole or in part. Each Agent shall promptly communicate to the Company, orally or in writing, each reasonable offer to purchase Notes from the Company received by it other than those rejected by such Agent. Each Agent shall have the right, in its discretion reasonably exercised without advising the Company, to reject any offers in whole or in part. Settlement - ---------- The receipt of immediately available funds in U.S. Dollars by the Company in the City of New York in payment for a Note (less the applicable commission) and the authentication and issuance of such Note shall, with respect to such Note, constitute "Settlement." All offers accepted by the Company will be settled from one to five Business Days from the date of acceptance by the Company pursuant to the timetable for Settlement set forth below unless the Company and the purchaser agree to Settlement on a later date; provided, however, that the Company will so notify the Trustee of any such later date on or before the Business Day immediately prior to the Settlement date. B-3 Settlement Procedures for Certificated Notes - -------------------------------------------- In the event of a purchase of Notes by an Agent, as principal, appropriate Settlement details will be set forth in the applicable Purchase Agreement to be entered into between such Agent and the Company pursuant to the Agency Agreement. In the Event of the sale of a Multi-Currency Note or an Indexed Note, additional or different Settlement details may be set forth in the applicable Amendment to be entered into between the Agent and the Company pursuant to the Agency Agreement. Settlement procedures with regard to each Note sold through each Agent shall be as follows: A. Such Agent will advise the Company by telex or facsimile of the following Settlement information: 1. Exact name in which the Note is to be registered ("Registered Owner"). 2. Exact address of the Registered Owner and address for payment of principal and interest, if any. 3. Taxpayer identification number of the Registered Owner (if available). 4. Principal amount of the Note (and, if multiple Notes are to be issued, denominations thereof). 5. Settlement date (Original Issue Date). 6. Stated Maturity. 7. Issue Price. 8. Trade Date. 9. Specified Currency and whether the option to elect payments in a Specified Currency applies and if the Specified Currency is not U.S. Dollars, the authorized denominations. 10. Interest rate: (a) Fixed Rate Notes: i) interest rate B-4 ii) overdue rate, if any (b) Floating Rate Notes: i) Interest Rate Basis (e.g., Commercial Paper Rate) ii) Initial Interest Rate iii) Spread or Spread Multiplier, if any iv) Interest Reset Dates v) Index Maturity vi) maximum and minimum interest rates, if any vii) overdue rate, if any (c) Indexed Notes The applicable terms thereof 11. Interest Payment Date(s) and Interest Payment Period. 12. Optional Interest Reset Date, if any, and Subsequent Interest Period, if any. 13. Extension Period, if any, and Final Maturity Dates, if any. 14. The date on or after which the Notes are redeemable at the option of the Company or repurchasable by the Company at the option of the holder, and additional redemption or repurchase provisions, if any. 15. Amortization schedule, if any. 16. Wire transfer information, if applicable. 17. Agent's Commission (to be paid in the form of a discount from the proceeds remitted to the Company upon Settlement). 18. Whether such Certificated Note is issued at an original issue discount ("OID"), and, if so, the total amount of OID, the yield to maturity and the initial accrual period of OID. B. The Company will confirm the above Settlement information to the Trustee by telex or facsimile. If the B-5 Company rejects an offer, the Company will promptly notify such Agent by telephone. C. The Trustee will assign a Note number to the transaction and will complete the first page of the preprinted 4-ply Note packet, the form of which was previously approved by the Company, the Agents and the Trustee. D. The Trustee will deliver the Note (with the attached white confirmation) and the yellow and blue stubs to the Agent. Such Agent will acknowledge receipt of the Note by completing the yellow stub and returning it to the Trustee. E. Such Agent will cause to be wire transferred to a bank account designated by the Company immediately available funds in U.S. dollars in the amount of the principal amount of the Note, less the applicable commission or discount, if any. F. Such Agent will deliver the Note (with the attached white confirmation) to the purchaser against payment in immediately available funds in the amount of the principal amount of the Note. Such Agent will deliver to the purchaser a copy of the most recent Prospectus applicable to the Note with or prior to any written offer of Notes, delivery of the Note and the confirmation and payment by the purchaser for the Note. G. Such Agent will obtain the acknowledgement of receipt for the Note and Prospectus by the purchaser through the purchaser's completion of the blue stub. H. The Trustee will mail the pink stub to the Company's Treasurer. Settlement Procedures Timetable - ------------------------------- For offers accepted by the Company, Settlement procedures "A" through "H" set forth above shall be completed on or before the respective times set forth below: Settlement Procedure Time (New York) --------- ---- A 5:00 PM on date of order B 3:00 PM on the Business Day prior to Settlement date B-6 C-D 12 noon on the Settlement date E 2:15 PM on the Settlement date F-G 3:00 PM on the Settlement date H 5:00 PM on Business Day after the Settlement date Failure - ------- In the event that a purchaser of a Note shall either fail to accept delivery of or make payment for such Note on the date fixed by the Company for Settlement, such Agent will immediately notify the Trustee and the Company's Treasurer by telephone, confirmed in writing, of such failure and return the Note to the Trustee. Upon the Trustee's receipt of the Note from the Agent, the Company will promptly return to the Agent an amount of immediately available funds in U.S. dollars equal to any amount previously transferred to the Company in respect of the Note pursuant to advances made by the Agent. Such returns will be made on the Settlement date, if possible, and in any event not later than 12 noon (New York City time) on the Business Day following the Settlement date. The Company will reimburse such Agent on an equitable basis for its loss of the use of the funds during the period when the funds were credited to the account of the Company. Upon receipt of the Note in respect of which the default occurred, the Trustee will mark the Note "cancelled", make appropriate entries in its records and deliver the Note to the Company with an appropriate debit advice. Such Agent will not be entitled to any commission with respect to any Note which the purchaser does not accept or make payment for. Redemption - ---------- Except as otherwise specified in the applicable Pricing Supplement and on the Notes, the Notes will not be redeemable prior to their Stated Maturity. If so specified in a Pricing Supplement and on the Note, such Note will be subject to redemption by the Company, at any time on or after the date set forth on such supplement and the Note, in whole or from time to time in part, at the option of the Company, at the redemption price, together with interest accrued thereon on the date of redemption. Notice of redemption shall be given by first-class mail postage prepaid, mailed not less than 30 days nor more than 60 days prior to the date of redemption, to each holder of Notes to be redeemed, in the manner and in accordance with the Indenture. In the event of redemption in part of any Note, a new Note for the amount of the unredeemed portion shall be issued in the name of the Holder upon cancellation of the redeemed Note. B-7 Maturity -------- Upon presentation of each Note at Maturity the Trustee (or any duly appointed Paying Agent) will pay the principal amount thereof, together with accrued interest through the date of redemption. Such payment shall be made in immediately available funds in U.S. dollars, provided that the Note is presented to the Trustee (or any such Paying Agent) in time for the Trustee (or such Paying Agent) to make payments in such funds in accordance with its normal procedures. The Company will provide the Trustee (and any such Paying Agent) with funds available for immediate use for such purpose. Notes presented at Maturity will be cancelled by the Trustee as provided in the Indenture. Procedures for Establishing the Terms of the Notes - -------------------------------------------------- The Company and the Agents will discuss from time to time the rates to be borne by the Notes that may be sold as a result of the solicitation of offers by the Agents. Once any Agent has recorded any indication of interest in Notes upon certain terms and communicated with the Company, if the Company accepts an offer to purchase Notes upon such terms, the Company will prepare a Pricing Supplement, in the form previously approved by the Agents, reflecting the terms of such Notes and, after approval from such Agent, will arrange to electronically transmit for filing with the SEC under the EDGAR system a copy of such Pricing Supplement (together with the Prospectus, if amended or supplemented) filed with the Commission and will supply an appropriate number of copies of the Prospectus, as then amended or supplemented, together with such Pricing Supplement, to the Agent who presented such offer. See "Delivery of Prospectus." No settlements with respect to Notes upon such terms may occur prior to such filing and such Agents will not, prior to such filing, mail confirmations to customers who have offered to purchase Notes upon such terms. After such filing, sales, mailing of confirmations and settlements may occur with respect to Notes upon such terms, subject to the provisions of "Delivery of Prospectus" below. If the Company decides to post rates and a decision has been reached to change interest rates, the Company will promptly notify each Agent. Each Agent will forthwith suspend solicitation of purchases. At that time, the Agents will recommend and the Company will establish rates to be so "posted". Following establishment of posted rates and prior to the filing described in the following sentence, the Agents may only record indications of interest in purchasing Notes at the posted rates. Once any Agent has recorded any indication of interest in Notes at the posted rates and communicated with the Company, if the B-8 Company plans to accept an offer at the posted rate, the Company will prepare a Pricing Supplement reflecting such posted rates and, after approval from the Agents, will arrange to electronically transmit for filing with the SEC under the EDGAR system a copy of such Pricing Supplement (together with the Prospectus if amended or supplemented) filed with the Commission and will supply an appropriate number of copies of the Prospectus, as then amended or supplemented, to the Agent who presented such offer. See "Delivery of Prospectus." No settlements at the posted rates may occur prior to such filing and the Agents will not, prior to such filing, mail confirmations to customers who have offered to purchase Notes at the posted rates. After such filing, sales, mailing of confirmations and settlements may resume, subject to the provisions of "Delivery of Prospectus" below. Suspension of Solicitation; Amendment or Supplement - --------------------------------------------------- In the event that at the time the Agents, at the direction of the Company, suspend solicitation of offers to purchase from the Company there shall be any orders outstanding which have not been settled, the Company will promptly advise the Agents and the Trustee whether such orders may be settled and whether copies of the Prospectus as theretofore amended and/or supplemented as in effect at the time of the suspension may be delivered in connection with the settlement of such orders. The Company will have the sole responsibility for such decision and for any arrangements which may be made in the event that the Company determines that such orders may not be settled or that copies of such Prospectus may not be so delivered. Delivery of Prospectus - ---------------------- A copy of the Prospectus as most recently amended or supplemented on the date of delivery thereof, together with the applicable Pricing Supplement, must be delivered to a purchaser prior to or simultaneously with the earlier of the delivery of (i) the written confirmation of a sale sent to a purchaser or his agent and (ii) any Note purchased by such purchaser. The Company shall ensure that the applicable Agent receives copies of the Prospectus and each amendment or supplement thereto (including the applicable Pricing Supplement) in such quantities and within such time limits as will enable such Agent to deliver such confirmation or Note to a purchaser as contemplated by these procedures and in compliance with the preceding sentence. Copies of Pricing Supplements should be delivered to: B-9 If, since the date of acceptance of a purchaser's offer, the Prospectus shall have been supplemented solely to reflect any sale of Notes on terms different from those agreed to between the Company and such purchaser or a change in posted rates not applicable to such purchaser, such purchaser shall not receive the Prospectus as supplemented by such new supplement, but shall receive the Prospectus as supplemented to reflect the terms of the Notes being purchased by such purchaser and otherwise as most recently amended or supplemented on the date of delivery of the Prospectus. The Trustee will make all such deliveries with respect to all Notes sold directly by the Company. Authenticity of Signatures - -------------------------- The Company will cause the Trustee to furnish the Agents from time to time with the specimen signatures of each of the Trustee's officers, employees and agents who have been authorized by the Trustee to authenticate Notes, but the Agents will have no obligation or liability to the Company or the Trustee in respect of the authenticity of the signature of any officer, employee or agent of the Company or the Trustee on any Note. Advertising Costs - ----------------- The Company will determine with the Agents the amount and nature of advertising that may be appropriate in offering the Notes. Advertising expenses incurred with the consent of the Company will be paid by the Company. B-10 SPECIAL ADMINISTRATIVE PROCEDURES FOR MULTI-CURRENCY NOTES Unless otherwise set forth in an applicable Foreign Currency Amendment, the following procedures and terms shall apply to Multi-Currency Notes in addition to, and to the extent inconsistent therewith in replacement of, the procedures and terms set forth above. Denominations - ------------- The authorized denominations of any Multi-Currency Note will be the amount of the Specified Currency for such Multi-Currency Note equivalent, at the noon buying rate in the City of New York for cable transfers for such Specified Currency (the "Market Exchange Rate") on the first Business Day in the City of New York and the country issuing such currency (or in the case of ECUs, Brussels) next preceding the date on which the Company accepts the offer to purchase such Multi-Currency Note, to U.S.$100,000 (rounded down to an integral multiple of 10,000 units of such Specified Currency) and any greater amount that is an integral multiple of 10,000 units of such Specified Currency. Currencies - ---------- Unless otherwise specified in the applicable Pricing Supplement, payments of principal of (and premium, if any) and interest on all Multi- Currency Notes will be made in the applicable Specified Currency, provided, however, that payments of principal of (and premium, if any) and interest on Multi-Currency Notes denominated in other than U.S dollars will nevertheless be made in U.S. dollars (i) at the option of the Holders thereof under the procedures decribed below and (ii) at the option of the Company in the case of imposition of exchange controls or other circumstances beyond the control of the Company as described below. Payment of Principal and Interest - --------------------------------- If so specified in the applicable Pricing Supplement, except as provided in the next paragraph, payments of interest and principal (and premium, if any) with respect to any Multi-Currency Note will be made in U.S. dollars if the Holder of such Note on the relevant Regular Record Date or at Maturity, as the case may be, has transmitted a written request for such payment in U.S. dollars to the Trustee at its Corporate Trust Office in The City of New York on or prior to such Regular Record Date or the date 15 days prior to Maturity, as the case may be. Such request may be in writing (mailed or hand delivered) or by cable, telex or other form or facsimile transmission. Any such request B-11 made with respect to any Multi-Currency Note by a Holder will remain in effect with respect to any further payments of interest and principal (and premium, if any) with respect to such Multi-Currency Note payable to such Holder, unless such request is revoked on or prior to the relevant Regular Record Date or the date 15 days prior to Maturity, as the case may be. Holders of Multi-Currency Notes denominated in other than U.S. dollars whose Notes are registered in the name of a broker or nominee should contact such broker or nominee to determine whether and how an election to receive payments in U.S. dollars may be made. The U.S. dollar amount to be received by a Holder of a Multi-Currency Note who elects to receive payments in U.S. dollars will be based on the highest bid quotation in The City of New York received by the Currency Determination Agent (as defined below) as of noon New York City time on the third Business Day next preceding the applicable payment date from three recognized foreign exchange dealers (one of which may be the Currency Determination Agent) for the purchase by the quoting dealer of the Specified Currency for U.S. dollars for settlement on such payment date in the aggregate amount of the Specified Currency payable to all Holders of Multi-Currency Notes electing to receive U.S. dollar payments and at which the applicable dealer commits to execute a contract. If three such bid quotations are not available on the third Business Day preceding the date of payment of principal (and premium, if any) or interest with respect to any such Multi-Currency Note, such payment will be made in the Specified Currency. All currency exchange costs associated with any payment in U.S. dollars on any such Multi-Currency Note will be borne by the Holder thereof by deductions from such payment. Unless otherwise provided in the applicable Pricing Supplement, Citibank, N. A. will be the Currency Determination Agent (the "Currency Determination Agent") with respect to the Multi-Currency Notes. Payment Currency - ---------------- If the principal of (and premium, if any) or interest on any Multi- Currency Note is payable in any currency other than U.S. dollars and such Specified Currency is not available due to the imposition of exchange controls or other circumstances beyond the control of the Company, the Company will be entitled to satisfy its obligations to Holders of the Multi-Currency Notes by making such payment in U.S. dollars on the basis of the Market Exchange Rate on the last date such Specified Currency was available (the "Conversion Date"). Any payment made under such circumstances in U.S. dollars where the required payment is in other than U.S. dollars will not constitute an Event of Default under the Indenture. B-12 If payment in respect of a Note is required to be made in any currency unit (e.g., ECU) and such currency unit is unavailable due to the imposition of exchange controls or other circumstances beyond the Company's control, then all payments in respect of such Multi-Currency Note shall be made in U.S. dollars until such currency unit is again available. The amount of each payment in U.S. dollars shall be computed on the basis of the equivalent of the currency unit in U.S. dollars, which shall be determined by the Company or its agent on the following basis. The component currencies of the currency unit for this purpose (the "Component Currencies") shall be the currency amounts that were components of the currency unit as of the Conversion Date for such currency unit. The equivalent of the currency unit in U.S. dollars shall be calculated by aggregating the U.S. dollar equivalents of the Component Currencies. The U.S. dollar equivalent of each of the Component Currencies shall be determined by the Company or such agent on the basis of the Market Exchange Rate for each such Component Currency that is available as of the third Business Day prior to the date on which the relevant payment is due and for each such Component Currency that is unavailable, if any, as of the Conversion Date for such Component Currency. If the official unit of any Component Currency is altered by way of combination or subdivision, the number of units of that currency as a Component Currency shall be divided or multiplied in the same proportion, if two or more Component Currencies are consolidated into a single currency, the amounts of those currencies as Component Currencies shall be replaced by an amount in such single currency equal to the sum of the amounts of the consolidated Component Currencies expressed in such single currency. If any Component Currency is divided into two or more currencies, the amount of the original Component Currency shall be replaced by the amounts of such two or more currencies, the sum of which shall be equal to the amount of the original Component Currency. Outstanding Multi-Currency Notes - -------------------------------- For purposes of calculating the principal amount of any Multi-Currency Note for any purpose under the Indenture, the principal amount of such Multi- Currency Note at any time outstanding shall be deemed to be the U.S. dollar equivalent at the Market Exchange Rate, determined as of the date of the original issuance of such Multi-Currency Note, of the principal amount of such Multi-Currency Note. B-13 Details for Settlement of Multi-Currency Notes - ---------------------------------------------- In addition to the Settlement information specified in "Settlement Procedures" above, the Agents shall communicate to the Company in the manner set forth in "Settlement Procedures" the following information: 1. Specified Currency. 2. Denominations. 3. Wire transfer and overseas bank account information (if holder has elected payment in a Specified Currency). B-14 SPECIAL ADMINISTRATIVE PROCEDURES FOR BOOK-ENTRY NOTES Each Note will be represented by either a Global Security (as defined hereinafter) delivered to the Trustee, as agent for the Depository Trust Company ("DTC"), and recorded in the book-entry system maintained by DTC (a "Book-Entry Note") or a certificate delivered to the Holder thereof or a Person designated by such Holder (a "Certificated Note"). An owner of a Book-Entry Note will not be entitled to receive a certificate representing such Note. In connection with the qualification of the Book-Entry Notes for eligibility in the book-entry system maintained by DTC, the Trustee will perform the custodial, document control and administrative functions described below, in accordance with its respective obligations under a Letter of Representations from the Company and the Trustee to DTC dated the date hereof and a Medium-Term Note Certificate Agreement between the Trustee and DTC, dated as of October 31, 1988, and its obligations as a participant in DTC, including DTC's Same-Day Funds Settlement System ("SDFS"). Except as otherwise set forth in this Exhibit B, Book-Entry Notes will be issued in accordance with the administrative procedures set forth below. Issuance: On any date of settlement (as defined under "Settlement" below) for one or more Fixed Rate Book-Entry Notes, the Company will issue a single Global Security in fully registered form without coupons (a "Global Security") representing up to $150,000,000 principal amount of all of such Notes that have the same Original Issue Date, interest rate and Stated Maturity. Similarly, on any settlement date for one or more Floating Rate Book-Entry Notes, the Company will issue a single Global Security representing up to $150,000,000 principal amount of all of such Notes that have the same Original Issue Date, Interest Rate Basis, Initial Interest Rate, Interest Payment Period, Interest Payment Dates, Index Maturity, Spread or Spread Multiplier, if any, minimum interest rate (if any), maximum interest rate (if any), redemption provisions, if any, and Stated Maturity. Each Global Security B-15 will be dated and issued as of the date of its authentication by the Trustee, as Trustee. No Global Security will represent (i) both Fixed Rate and Floating Rate Book-Entry Notes or (ii) any Certificated Note or (iii) any Multi-Currency or Indexed Note. Identification The Company will arrange, on or prior to Numbers: commencement of a program for the offering of Book-Entry Notes, with the CUSIP Service Bureau of Standard & Poor's Corporation (the "CUSIP Service Bureau") for the reservation of a series of CUSIP numbers (including tranche numbers), consisting of approximately 900 CUSIP numbers and relating to Global Securities representing the Book-Entry Notes. The Trustee has or will obtain from the CUSIP Service Bureau a written list of such series of reserved CUSIP numbers and will deliver to the Company and DTC such written list of 900 CUSIP numbers of such series. The Trustee will assign CUSIP numbers to Global Securities as described below under Settlement Procedure "B". DTC will notify the CUSIP Service Bureau periodically of the CUSIP numbers that the Trustee has assigned to Global Securities. The Trustee will notify the Company at any time when fewer than 100 of the reserved CUSIP numbers remain unassigned to Global Securities, and if it deems necessary, the Company will reserve additional CUSIP numbers for assignment to Global Securities representing Book- Entry Notes. Upon obtaining such additional CUSIP numbers the Trustee shall deliver such additional CUSIP numbers to the Company and DTC. B-16 Registration: Each Global Security will be registered in the name of Cede & Co., as nominee for DTC, on the Security Register maintained under the Indenture. The beneficial owner of a Book-Entry Note (or one or more indirect participants in DTC designated by such owner) will designate one or more participants in DTC (with respect to such Note, the "Participants") to act as agent or agents for such owner in connection with the book-entry system maintained by DTC, and DTC will record in book-entry form, in accordance with instructions provided by such Participants, a credit balance with respect to such Note in the account of such Participants. The ownership interest of such beneficial owner in such Note will be recorded through the records of such Participants or through the separate records of such Participants and one or more indirect participants in DTC. Transfers: Transfers of a Book-Entry Note will be accomplished by book entries made by DTC and, in turn, by Participants (and in certain cases, one or more indirect participants in DTC) acting on behalf of beneficial transferors and transferees of such Note. Consolidation and The Trustee may deliver to DTC and the CUSIP Exchange: Service Bureau at any time a written notice of consolidation specifying (i) the CUSIP numbers of two or more Outstanding Global Securities that represent (A) Fixed Rate Book-Entry Notes having the same Original Issue Date, interest rate and Stated Maturity and with respect to which interest has been paid to the same date or (B) Floating Rate Book-Entry Notes having the same B-17 Interest Rate Basis, Original Issue Date, Initial Interest Rate, Interest Payment Dates, Index Maturity, Spread or Spread Multiplier, if any, minimum interest rate (if any), maximum interest rate (if any), redemption provisions, if any, and Stated Maturity and with respect to which interest has been paid to the same date, (ii) a date, occurring at least thirty days after such written notice is delivered and at least thirty days before the next Interest Payment Date for such Book-Entry Notes, on which such Global Securities shall be exchanged for a single replacement Global Security and (iii) a new CUSIP number, obtained from the Company, to be assigned to such replacement Global Security. Upon receipt of such a notice, DTC will send to its participants (including the Trustee) a written reorganization notice to the effect that such exchange will occur on such date. Prior to the specified exchange date, the Trustee will deliver to the CUSIP Service Bureau a written notice setting forth such exchange date and the new CUSIP number and stating that, as of such exchange date, the CUSIP numbers of the Global Securities to be exchanged will no longer be valid. On the specified exchange date, the Trustee will exchange such Global Securities for a single Global Security bearing the new CUSIP number, and the CUSIP numbers of the exchanged Global Securities will, in accordance with CUSIP Service Bureau procedures, be cancelled and not immediately reassigned. Notwithstanding the foregoing, if the Global Securities to be exchanged exceed $150,000,000 in aggregate principal amount, one Global Security will be B-18 authenticated and issued to represent each $150,000,000 of principal amount of the exchanged Global Securities and an additional Global Security will be authenticated and issued to represent any remaining principal amount of such Global Securities (see "Denominations" below). Maturities: Each Book-Entry Note will mature on a date not less than ____ year[s] or more than ___ years and one month after the settlement date for such Note. A Floating Rate Book-Entry Note will mature only on an Interest Payment Date for such Note. Denominations: Book-Entry Notes will be issued in principal amounts of $100,000 or any amount in excess thereof that is an integral multiple of $1,000. Global Securities representing one or more Book- Entry Notes will be denominated in principal amounts not in excess of $150,000,000. If one or more Book-Entry Notes having an aggregate principal amount in excess of $150,000,000 would, but for the preceding sentence, be represented by a single Global Security, then one Global Security will be issued to represent each $150,000,000 principal amount of such Book-Entry Note or Notes and an additional Global Security will be issued to represent any remaining principal amount of such Book-Entry Note or Notes. In such a case, each of the Global Securities representing such Book-Entry Note or Notes shall be assigned the same CUSIP number. Interest: General. Interest on each Book-Entry Note will accrue from the Original Issue Date or the most recent Interest Payment Date to which interest has been paid on the B-19 Global Security representing such Note. Each payment of interest on a Book-Entry Note will include interest accrued through the day preceding, as the case may be, the Interest Payment Date or Maturity; provided, however, that if the Interest Reset Dates with respect to any such Note are daily or weekly, interest payable on any Interest Payment Date, other than interest payable on any date on which principal for such Note is payable, will include interest accrued from but excluding the second preceding Regular Record Date to and including the next preceding Regular Record Date. Standard & Poor's Corporation will use the information received in the pending deposit message described under Settlement Procedure "C" below in order to include the amount of any interest payable and certain other information regarding the related Global Security in the appropriate weekly bond report published by Standard & Poor's Corporation. Promptly after each Interest Determination Date for Floating Rate Notes, the Company will notify the Trustee, and the Trustee in turn will notify Standard & Poor's Corporation, of the interest rates determined on such Interest Determination Date. Payments of Payments of Interest Only. Promptly after each Principal Regular Record Date, the Trustee will deliver to and Interest: the Company and DTC a written notice specifying by CUSIP number the amount of interest to be paid on each Global Security on the following Interest Payment Date (other than an Interest Payment Date coinciding with Maturity) and the total of such amounts. DTC B-20 will confirm the amount payable on each Global Security on such Interest Payment Date by reference to the daily bond reports published by Standard & Poor's Corporation. The Company will pay to the Trustee, as paying agent, the total amount of interest due on such Interest Payment Date (other than at Maturity), and the Trustee will pay such amount to DTC at the times and in the manner set forth below under "Manner of Payment". Payments at Maturity. On or about the first Business Day of each month, the Trustee will deliver to the Company, DTC and each of the Trustees a written list of principal and interest to be paid on each Global Security maturing in the following month. The Company, the Trustee and DTC will confirm the amounts of such principal and interest payments with respect to each such Global Security on or about the fifth Business Day preceding the Maturity of such Global Security. The Company will pay to the Trustee, as the paying agent, the principal amount of such Global Security, together with interest due at such Maturity. The Trustee will pay such amount to DTC at the times and in the manner set forth below under "Manner of Payment". Promptly after payment to DTC of the principal and interest due at the Maturity of such Global Security, the Trustee will cancel such Global Security and deliver it to the Company with an appropriate debit advice. Manner of Payment. The total amount of any principal and interest due on Global Securities on any Interest Payment Date or at B-21 Maturity shall be paid by the Company to the Trustee in funds available for use by the Trustee as of 9:30 A.M. (New York City time) on such date. The Company will make such payment on such Global Securities by instructing the Trustee to withdraw funds from an account maintained by the Company at the Trustee. The Company will confirm such instructions in writing to the Trustee. For maturity, redemption or any other principal payments: prior to 10 A.M. (New York City time) on such date or as soon as possible thereafter, the Trustee will make such payments to DTC in same day funds in accordance with DTC's Same Day Funds Settlement Paying Agent Operating Procedures. For interest payments: the Trustee will make such payments to DTC in accordance with existing arrangements between DTC and the Trustee. DTC will allocate such payments to its participants in accordance with its existing operating procedures. Neither the Company (either as issuer or as Paying Agent) nor the Trustee shall have any direct responsibility or liability for the payment by DTC to such Participants of the principal of and interest on the Book-Entry Notes. Withholding Taxes. The amount of any taxes required under applicable law to be withheld from any interest payment on a Book-Entry Note will be determined and withheld by the Participant, indirect participant in DTC or other Person responsible for forwarding payments and materials directly to the beneficial owner of such Note. Settlement Settlement Procedures with regard B-22 Procedures: to each Book-Entry Note which will be registered in the name of the nominee of DTC (unless otherwise indicated in the applicable Pricing Supplement, "Cede & Co.") sold by the Company through an Agent, as agent, shall be as follows: A. Such Agent will advise the Company by telex or facsimile of the following settlement information: 1. Principal amount of the Note (and, if multiple Notes are to be issued, denominations thereof). 2. Settlement date (Original Issue Date). 3. Stated Maturity. 4. Issue Price. 5. Trade Date. 6. Specified Currency and whether the option to elect payments in a Specified Currency applies and if the Specified Currency is not U.S. Dollars, the authorized denominations. 7. Interest rate: (a) Fixed Rate Notes: i) interest rate ii) overdue rate, if any (b) Floating Rate Notes: i) Interest Rate Basis (e.g., Commercial Paper Rate) ii) Initial Interest Rate iii) Spread or Spread Multiplier, if any B-23 iv) Interest Reset Dates v) Index Maturity vi) maximum and minimum interest rates, if any vii) overdue rate, if any (c) Currency Indexed Notes The applicable terms thereof 8. Interest Payment Date(s) and Interest Payment Period. 9. Optional Interest Reset Date, if any, and Subsequent Interest Period, if any. 10. Extension Period, if any, and Final Maturity Dates, if any. 11. The date on or after which the Notes are redeemable at the option of the Company or repurchasable by the Company at the option of the holder, and additional redemption or repurchase provisions, if any. 12. Amortization schedule, if any. 13. Wire transfer information, if applicable. 14. Agent's Commission (to be paid in the form of a discount from the proceeds remitted to the Company upon Settlement). 15. Whether such Book-Entry Note is issued at an original issue discount ("OID"), and, if so, the total amount of OID, the yield to maturity and the initial accrual period of OID. B. The Company will advise the Trustee by electronic transmission of the information set forth in Settlement Procedure "A" above and the name of such Agent. Each such B-24 communication by the Company shall constitute a representation and warranty by the Company to the Trustee and each Agent that (i) such Note is then, and at the time of issuance and sale thereof will be, duly authorized for issuance and sale by the Company, (ii) such Note, and the Global Security representing such Note, will conform with the terms of the Indenture and (iii) upon authentication and delivery of such Global Security, the aggregate initial offering price of all Notes issued under the Indenture will not exceed $150,000,000 (except for Book-Entry Notes represented by Global Securities authenticated and delivered in exchange for or in lieu of Global Securities pursuant to Sections 304, 305, 906 or 907 of the Indenture and except for Certificated Notes authenticated and delivered upon registration of transfer of, in exchange for, or in lieu of Certificated Notes pursuant to any such Section). C. The Trustee will assign a CUSIP number to the Global Security representing such Note and enter a pending deposit message through DTC's Participant Terminal System, providing the following settlement information to DTC, such Agent and Standard & Poor's Corporation: 1. The applicable information set forth in Settlement Procedure "A". 2. Identification as a Fixed Rate Book- Entry Note or a Floating Rate Book-Entry Note. 3. Initial Interest Payment Date for such Note, number of days by which such date succeeds the related "DTC Regular B-25 Record Date" (which term means the Regular Record Date except in the case of floating rate notes which reset daily or weekly in which case it means the date 5 calendar days immediately preceding the Interest Payment Date) and amount of interest payable on such Interest Payment Date per $1,000 of principal amount of such Note. 4. Frequency of interest payments (monthly, semiannually, quarterly, etc.). 5. CUSIP number of the Global Security representing such Note. 6. Whether such Global Security will represent any other Book-Entry Note (to the extent known at such time). D. Such Agent will deliver to the purchaser a copy of the most recent Prospectus applicable to the Note with or prior to any written offer of Notes and the confirmation and payment by the purchaser of the Note. Such Agent will confirm the purchase of such Note to the purchaser either by transmitting to the Participants with respect to such Note a confirmation order or orders through DTC's institutional delivery system or by mailing a written confirmation to such purchaser. E. The Trustee, as Trustee, will complete and authenticate the note certificate evidencing the Global Security representing such Book- Entry Note. B-26 F. DTC will credit such Note to the Trustee's participant account at DTC. G. The Trustee will enter an SDFS deliver order through DTC's Participant Terminal System instructing DTC to (i) debit such Note to the Trustee's participant account and credit such Note to such Agent's participant account and (ii) debit such Agent's settlement account and credit the Trustee's settlement account for an amount equal to the price of such Note less such Agent's commission. The entry of such a deliver order shall constitute a representation and warranty by the Trustee to DTC that (i) the Global Security representing such Book-Entry Note has been issued and authenticated and (ii) the Trustee is holding such Global Security pursuant to the Medium- Term Note Certificate Agreement between the Trustee and DTC (the "Certificate Agreement"). H. Such Agent will enter an SDFS deliver order through DTC's Participant Terminal System instructing DTC (i) to debit such Note to such Agent's participant account and credit such Note to the participant accounts of the Participants with respect to such Note and (ii) to debit the settlement accounts of such Participants and credit the settlement account of such Agent for an amount equal to the price of such Note. I. Transfers of funds in accordance with SDFS deliver orders described in Settlement Procedures "G" and "H" will be settled in accordance with SDFS operating procedures in effect on the Settlement date. B-27 J. The Trustee will credit to an account of the Company maintained at the Trustee funds available for immediate use in the amount transferred to the Trustee in accordance with Settlement Procedure "G". Settlement For orders of Book-Entry Notes solicited by an Procedures Agent, as agent, and accepted by the Company for Timetable: settlement, Settlement Procedures "A" through "J" set forth above shall be completed as soon as possible but not later than the respective times (New York City time) set forth below: Settlement Procedure Time --------- ---- A 11:00 A.M. on the sale date B 12 Noon on the sale date C 2:00 P.M. on the sale date D Day after sale date E 3:00 P.M. on day before Settlement date F 10:00 A.M. on Settlement date G-H 2:00 P.M. on Settlement date I 4:45 P.M. on Settlement date B-28 J 5:00 P.M. on Settlement date If a sale is to be settled more than one Business Day after the sale date, Settlement Procedures "A", "B" and "C" shall be completed as soon as practicable but no later than 11:00 A.M., 12 Noon and 2:00 P.M., as the case may be, on the first Business Day after the sale date. If the initial interest rate for a Floating Rate Book-Entry Note has not been determined at the time that Settlement Procedure "A" is completed, Settlement Procedures "B" and "C" shall be completed as soon as such rate has been determined but no later than 12:00 Noon and 2:00 P.M., respectively, on the second Business Day before the Settlement date. Settlement Procedure "J" is subject to extension in accordance with any extension of Fedwire closing deadlines and in the other events specified in the SDFS operating procedures in effect on the Settlement date. If Settlement of a Book-Entry Note is rescheduled or canceled, the Trustee will deliver to DTC, through DTC's Participant Terminal System, a cancellation message to such effect by no later than 2:00 P.M. on the Business Day immediately preceding the scheduled Settlement date. Failure to If the Trustee has not entered an SDFS deliver Settle: order with respect to a Book-Entry Note pursuant to Settlement Procedure "G", then, upon written request (which may be effected by facsimile transmission) of the Company, the Trustee shall deliver to DTC, through DTC's Participant Terminal System, as soon as practicable but no later than 2:00 P.M. on any Business Day, a withdrawal message instructing DTC to debit such Note to the Trustee's participant account. DTC will process the withdrawal message, provided that the Trustee's participant account contains a principal amount of the Global Security representing such Note that is B-29 at least equal to the principal amount to be debited. If a withdrawal message is processed with respect to all the Book-Entry Notes represented by a Global Security, the Trustee will mark such Global Security "canceled", make appropriate entries in the Trustee's records and send such canceled Global Security to the Company. The CUSIP number assigned to such Global Security shall, in accordance with CUSIP Service Bureau procedures, be canceled and not immediately reassigned. If a withdrawal message is processed with respect to one or more, but not all, of the Book-Entry Notes represented by a Global Security, the Trustee will exchange such Global Security for two Global Securities, one of which shall represent such Book-Entry Note or Notes and shall be canceled immediately after issuance and the other of which shall represent the other Book- Entry Notes previously represented by the surrendered Global Security and shall bear the CUSIP number of the surrendered Global Security. If the purchase price for any Book-Entry Note is not timely paid to the Participants with respect to such Note by the beneficial purchaser thereof (or a Person, including an indirect participant in DTC, acting on behalf of such purchaser), such Participants and, in turn, the Agent for such Note may enter SDFS deliver orders through DTC's Participant Terminal System debiting such Book- Entry Note free to such Agent's participant account and crediting such Book-Entry Note free to the participant account of the Trustee and shall notify the Trustee and the Company thereof. Thereafter, the Trustee (i) will immediately notify the Company, once the Trustee has confirmed that such Book-Entry Note has been credited to its participant account, and the Company shall immediately transfer by Fed wire (immediately available funds) to such Agent an amount equal to the amount with B-30 respect to such Book-Entry Note which was previously sent by wire transfer to the account of the Company in accordance with Settlement Procedure "J", and (ii) the Trustee will deliver the withdrawal message and take the related actions described in the preceding paragraph. Such debits and credits will be made on the Settlement date, if possible, and in any event not later than 5:00 P.M. on the following Business Day. If such failure shall have occurred for any reason other than a default by the Agent in the performance of its obligations hereunder and under the Agency Agreement, then the Company will reimburse the Agent on an equitable basis for the loss of the use of the funds during the period when they were credited to the account of the Company. Notwithstanding the foregoing, upon any failure to settle with respect to a Book-Entry Note, DTC may take any actions in accordance with its SDFS operating procedures then in effect. In the event of a failure to settle with respect to one or more, but not all, of the Book-Entry Notes to have been represented by a Global Security, the Trustee will provide, in accordance with Settlement Procedure "E", for the authentication and issuance of a Global Security representing the other Book- Entry Notes to have been represented by such Global Security and will make appropriate entries in its records. Trustee Not to Nothing herein shall be deemed to require the Risk Funds: Trustee to risk or expend its own funds in connection with any payment to the Company, DTC, the Agents, or the purchaser, it being understood by all parties that payments made by the Trustee to the Company, DTC, the Agents, or the purchaser shall be made only to such extent that funds are provided to the Trustee for such purpose. Similarly, nothing herein shall alter any duty, or B-31 limit or diminish any right or immunity, of the Trustee under the Indenture. B-32 EXHIBIT C PURCHASE AGREEMENT ------------------ R. R. Donnelley & Sons Company _____________, __, 19__ 77 West Wacker Drive Chicago, Illinois 60601 Attention: Treasurer The undersigned agrees to purchase the following principal amount of the Notes described in the Agency Agreement dated August__, 1994 (as it may be supplemented or amended from time to time, the "Agency Agreement"): Principal Amount [$] __________________________ Specified Currency: __________________________ Indexed Currency: __________________________ Interest Rate: ______% Discount: ______% of Principal Amount Aggregate Price to be paid to Company (in immediately available funds): [$] __________________________ Settlement Date: __________________________ Other Terms: __________________________ [In the case of Notes issued in a foreign currency or currency unit, unless otherwise specified below, settlement and payments of principal and interest will be in U.S. dollars based on the highest bid quotation in The City of New York received by the Exchange Rate Agent at approximately 11:00 A.M., New York City time, on the second Business Day preceding the applicable payment date from three recognized foreign exchange dealers selected by the Exchange Rate Agent and approved by the Company (one of which may be the Exchange Rate Agent) for the purchase by the quoting dealer of the Specified Currency for U.S. dollars for settlement on such payment date in the aggregate amount of the Specified Currency payable to all holders of Notes denominated in such Specified Currency electing to receive U.S. dollar payments and at which the applicable dealer commits to execute a contract. If such bid quotations are not available, payments will be made in the Specified Currency.] Our obligation to purchase Notes hereunder is subject to the continued accuracy of your representations and warranties contained in the Agency Agreement and to your performance and observance of all applicable covenants and agreements contained therein, including, C-1 without limitation, your obligations pursuant to Section 6 and Section 7 thereof. Our obligation hereunder is subject to the conditions set forth in Section 5 of the Agency Agreement and to the further condition that we shall receive (a) the opinions required to be delivered pursuant to Sections 5(d) and 5(e) of the Agency Agreement, (b) the certificate required to be delivered pursuant to Section 5(f) of the Agency Agreement, (c) the letter referred to in Section 5(g), in each case dated as of the above Settlement Date and (d) and such further information, certificates and documents as the Agents or counsel to the Agents may reasonably request. In further consideration of our agreement hereunder, you agree that between the date hereof and the above Settlement date, you will not offer or sell, or enter into any agreement to sell, any debt securities of the Company, [other than borrowings under your revolving credit agreements and lines of credit, the private placement of securities and issuances of your commercial paper or other issuances of Notes]. We may terminate this Agreement, immediately upon notice to you, at any time prior to the Settlement date, if after the date hereof and prior to the Settlement date, there shall have occurred: (i) any change, or any development involving a prospective change, in or affecting the general affairs, management, financial position, stockholders' equity or results of operations of the Company and its subsidiaries considered as one enterprise, otherwise than as set forth or contemplated in the Prospectus as amended or supplemented on the date hereof, the effect of which, in any such case described in this clause is, in our judgment, so material and adverse as to make it impracticable or inadvisable to proceed with the purchase of Notes from the Company as principal pursuant to this Purchase Agreement; (ii) a suspension or material limitation in trading in securities generally on the New York Stock Exchange or the establishment of minimum prices on such exchange; (iii) a general moratorium on commercial banking activities declared by Federal or State of New York authorities; (iv) any downgrading in the rating accorded the Company's debt securities by any "nationally recognized statistical rating organization", as that term is defined by the Commission for purposes of Rule 436(g)(2) under the Act or any public announcement that any such organization has under surveillance or review its rating of any debt securities of the Company (other than an announcement with positive implications of a possible upgrading, and no implication of a possible downgrading, of such rating); (v) any outbreak or escalation of major hostilities in which the United States is involved, any declaration of war by Congress or any other substantial national calamity or emergency; or (vi) any material adverse change in the existing financial, political or economic conditions in the United States, including any effect of international conditions on the financial markets in the United States, that in our judgment makes it impracticable or inadvisable to proceed with the purchase of Notes from the Company or you are unable to C-2 provide any of the opinions, certificates or letters referred to in the second preceding paragraph. In the event of such termination, no party shall have any liability to the other party hereto, except as provided in Sections 4, 7 and 14 of the Agency Agreement. This Agreement shall be governed by and construed in accordance with the laws of New York. [Insert name of Agent[s]] By_____________________________ [Title] Accepted: , 19__ R. R. Donnelley & Sons Company By____________________________ [Title] C-3 EXHIBIT D [FOREIGN CURRENCY] [INDEXED NOTE] AMENDMENT NO. _____________ TO AGENCY AGREEMENT DATED ________, 19__, AS AMENDED __________________________________________ [Insert Title of Foreign Currency and, in the case of Indexed Notes, the Indexed Basis] The undersigned hereby agree that for the purposes of the issue and sale of Notes denominated in [title of currency or currency unit] (the "Specified Currency") [and indexed to [title of index basis] (the "Index Basis")] pursuant to the Agency Agreement, dated August 17, 1994, as it may be amended (the "Agency Agreement"), the following additions and modifications shall be made to the Agency Agreement. The additions and modifications adopted hereby shall be of the same effect for the sale under the Agency Agreement of all Notes denominated in the Specified Currency [and indexed to the Index Basis], whether offered on an agency or principal basis, but shall be of no effect with respect to Notes denominated in any currency or currency unit other than the Specified Currency. Except as otherwise expressly provided herein, all terms used herein which are defined in the Agency Agreement shall have the same meanings as in the Agency Agreement. The term[s] Agent [or Agents], as used in the Agency Agreement, shall be deemed to refer [only] to the undersigned Agent[s] for purposes of this Amendment. [Insert appropriate additions and modifications to the Agency Agreement, for example, to opinions of counsel, conditions to obligations and settlement procedures, etc.] _____________________, 19__ R. R. Donnelley & Sons Company By______________________ Name: Title: [Name(s) of Agent(s) participating in the offering of Notes in the Specified Currency] By_____________________ Name: Title: EX-4.3 4 FIXED RATE NOTE EXHIBIT 4.3 [Face of Note] CUSIP NO. R. R. DONNELLEY & SONS COMPANY REGISTERED NO. FXB MEDIUM-TERM NOTE, SERIES __ PRINCIPAL AMOUNT: (Fixed Rate) If the registered owner of this Note (as indicated below) is The Depository Trust Company (the "U.S. Depositary") or a nominee of the U.S. Depositary, this Note is a global Note and the following legend is applicable: Unless this certificate is presented by an authorized representative of The Depository Trust Company (55 Water Street, New York, New York) to the issuer or its agent for registration of transfer, exchange or payment, and any certificate issued is registered in the name of CEDE & CO., or such other name as requested by an authorized representative of The Depository Trust Company and any payment is made to CEDE & CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL since the registered owner hereof, CEDE & CO., has an interest herein. The following summary of terms is subject to the information set forth on the reverse hereof: OPTIONAL REDEMPTION: [_] YES [_] NO ORIGINAL ISSUE DATE: INITIAL REDEMPTION DATE: STATED MATURITY: REDEMPTION PRICE: Initially % of Principal Amount and declining by % of the Principal SPECIFIED CURRENCY: Amount on each anniversary of the Initial Redemption Date until the Redemption Price is AUTHORIZED DENOMINATIONS: 100% of the Principal Amount. OPTION TO ELECT PAYMENTS IN U.S. DOLLARS [_] YES [_] NO FORM: [_] BOOK-ENTRY [_] CERTIFICATED OPTION TO ELECT REPAYMENT: [_] YES [_] NO INTEREST RATE: OPTIONAL REPAYMENT DATES: INTEREST PAYMENT DATE[S]: OPTIONAL REPAYMENT PRICES: REGULAR RECORD DATE[S]: OPTIONAL INTEREST RESET: [_] YES [_] NO OVERDUE RATE: OPTIONAL INTEREST RESET DATES: U.S. DEPOSITARY: OPTIONAL EXTENSIONS OF MATURITY: [_] YES [_] NO CURRENCY DETERMINATION AGENT: EXTENSION PERIOD: AMORTIZING NOTE: [_] YES [_] NO NUMBER OF EXTENSION PERIODS: OTHER PROVISIONS: FINAL MATURITY DATE: If this Security was issued with "original issue discount" for purposes of Section 1273 of the Internal Revenue Code of 1986, as amended, the following shall be completed: ORIGINAL ISSUE DISCOUNT SECURITY: TOTAL AMOUNT OF OID: ISSUE PRICE (expressed as a percentage of aggregate [_] Yes [_] No principal amount): YIELD TO MATURITY: SHORT ACCRUAL METHOD USED TO PERIOD OID: DETERMINE YIELD FOR SHORT ACCRUAL PERIOD: [_] Approximate [_] Exact R. R. DONNELLEY & SONS COMPANY, a corporation duly organized and existing under the laws of Delaware (herein called the "Company," which term includes any successor corporation under the Indenture referred to on the reverse hereof), for value received, hereby promises to pay to , or registered assigns, the principal sum set forth above on the Stated Maturity shown above, and to pay interest thereon from the Original Issue Date shown above or from and including the most recent Interest Payment Date (as hereinafter defined) to which interest has been paid or duly provided for, as the case may be. (Continued on next page.) IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed under its corporate seal. Dated: TRUSTEE'S CERTIFICATION R. R. DONNELLEY & SONS COMPANY OF AUTHENTICATION This is one of the Securities of the By:___________________________________ series designated herein Its:__________________________________ and referred to in the within-mentioned Indenture. CITIBANK, N.A. Attest: _______________________________ as Trustee Its: ________________________ By: ___________________ (Continued from previous page.) Interest will be paid on the Interest Payment Date or Dates shown above ("Interest Payment Dates"), commencing with the first such Interest Payment Date next succeeding the Original Issue Date shown above (except as provided below), at the rate per annum specified above, until the principal hereof is paid or made available for payment and on Stated Maturity, and, if specified above, interest shall accrue on any overdue principal and on any overdue installment of interest (to the extent that the payment of such interest shall be legally enforceable) at the overdue rate per annum set forth above. 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 Note (or one or more predecessor Notes) is registered at the close of business on the Regular Record Date set forth above next preceding such Interest Payment Date, which shall be the fifteenth calendar day next preceding such Interest Payment Date. The first payment of interest on any Note originally issued between a Regular Record Date and an Interest Payment Date will be made on the Interest Payment Date following the next succeeding Regular Record Date to the registered owner on such succeeding Regular Record Date. Except as otherwise provided in the Indenture, 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 Note (or one or more predecessor Notes) 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 to be given to Holders of Notes of this series not less than 10 calendar 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 Notes 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. Payments of interest to be paid in U.S. dollars (other than interest, and if this is an Amortizing Note, principal (if this is not a global Note) payable at Stated Maturity) will be made by mailing a check to the Holder at the address of the Holder appearing in the Security Register as of the applicable Regular Record Date. Notwithstanding the foregoing, at the option of the Company, all payments of interest and, if this is an Amortizing Note, principal on this Note may be made by wire transfer of immediately available funds to an account maintained by such Holder with a bank located in the United States as designated by the Holder not less than 15 calendar days prior to the Interest Payment Date. If a Holder holds U.S. $10,000,000 or more in aggregate principal amount of Notes of like tenor and terms (including the same Interest Payment Date) (or is the Holder of the equivalent thereof in a Specified Currency other than U.S. dollars), such Holder shall be entitled to receive payments of interest (other than at Stated Maturity or upon earlier redemption or repayment) in U.S. dollars by wire transfer of immediately available funds, but only if appropriate payment instructions have been received in writing by the Trustee not less than 15 calendar days prior to the applicable Interest Payment Date. Simultaneously with the election by the Holder to receive payments in a Specified Currency other than U.S. dollars (by written request to the Trustee, as provided below), the Holder shall provide appropriate payment instructions to the Trustee, and all such payments will be made in immediately available funds to a bank account maintained by the Holder in the country of the Specified Currency (or, with respect to ECUs, Brussels). If such a payment with respect to this Note cannot be made by wire transfer because the required designation has not been received by the Trustee on or before the requisite date or for any other reason, a notice will be mailed to the Holder at its registered address requesting a designation pursuant to which such wire transfer can be made and, upon the Trustee's receipt of such a designation, such payment will be made within 15 days of such receipt. The Company will pay any administrative costs imposed by banks in connection with making payments by wire transfer, but not any tax, assessment or governmental charge imposed upon the Holder of this Note. In the event that payment is so made in accordance with the instructions of the Holder, such wire transfer shall be deemed to constitute full and complete payment of such interest and principal on this Note. If this is not a global Note, payment of the principal, premium, if any, and interest payable at Maturity in respect of this Note will be paid in immediately available funds upon surrender of this Note accompanied by wire instructions at the principal office of the Trustee, provided that the Note is presented in time for the Trustee to make such payments in such funds in accordance with its normal procedures. If the Holder of this Note (as indicated above) is the U.S. Depositary or a nominee of the U.S. Depositary, this Note is a global Note and the following legend is applicable except as specified on the reverse hereof: THIS GLOBAL NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE U.S. DEPOSITARY OR BY A NOMINEE OF THE U.S. DEPOSITARY TO THE U.S. DEPOSITARY OR ANOTHER NOMINEE OF THE U.S. DEPOSITARY OR BY THE U.S. DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR OF THE U.S. DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR. REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS NOTE SET FORTH ON THE REVERSE HEREOF, WHICH FURTHER PROVISIONS SHALL FOR ALL PURPOSES HAVE THE SAME EFFECT AS IF SET FORTH AT THIS PLACE. Unless the certificate of authentication hereon has been executed by the Trustee referred to on the reverse hereof, directly or through an Authenticating Agent, by manual signature of an authorized signatory, this Note shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose. -2- [Reverse of Note] R. R. DONNELLEY & SONS COMPANY MEDIUM-TERM NOTE, SERIES __ SECTION 1. General. This Note is one of a duly authorized issue of Securities of the Company (herein called the "Notes"), issued and to be issued in one or more series under an Indenture, dated as of November 1, 1990 (herein called the "Indenture"), between the Company and Citibank, N.A., as Trustee (herein called the "Trustee," which term includes any successor trustee under the Indenture), to which Indenture and all indentures supplemental thereto reference is hereby made for a statement of the respective rights, limitations of rights, duties and immunities thereunder of the Company, the Trustee and the Holders of the Notes and of the terms upon which the Securities are, and are to be, authenticated and delivered. This Note is one of the Securities of the series designated on the face hereof. The Notes may bear different dates, mature at different times, bear interest at different rates, be subject to different redemption provisions and may otherwise vary, all as provided in the Indenture. The Notes are limited to $___,000,000 in aggregate principal amount (or the equivalent thereof in the Specified Currency, calculated at the Market Exchange Rate on the applicable trade date). SECTION 2. Payments. Interest on this Note will be payable on the Interest Payment Date or Interest Payment Dates as specified on the face hereof and, in either case, at Stated Maturity or earlier redemption or repayment. Interest payments on each Interest Payment Date for this Note will include accrued interest from the Original Issue Date or from and including the last date in respect of which interest has been paid, as the case may be, to, but excluding, such Interest Payment Date or the date of Maturity, as the case may be. Interest payments for this Note shall be computed and paid on the basis of a 360-day year of twelve 30-day months. Unless otherwise specified on the face hereof, if this Note is specified on the face hereof as an Amortizing Note, payments with respect to this Note will be applied first to interest due and payable hereon and then to the reduction of the unpaid principal amount hereof. If this Note is specified on the face hereof as an Amortizing Note, a table setting forth repayment information in respect to this Note will be provided to the original purchaser hereof and will be available, upon request, to subsequent Holders. If the Specified Currency shown on the face hereof is a currency or currency unit other than U.S. dollars, except as provided below, payments of interest and principal (and premium, if any) with respect to this Note will be made in U.S. dollars if the Holder of this Note on the relevant Regular Record Date or at Maturity, as the case may be, has transmitted a written request for such payment in U.S. dollars to the Paying Agent at its principal office on or prior to such Regular Record Date or the date 15 days prior to Maturity, as the case may be. Such request may be delivered by mail, by hand or by cable, telex or any other form of facsimile transmission. Any such request made with respect to this Note by a Holder will remain in effect with respect to any further payments of interest and principal (and premium, if any) with respect to this Note payable to such Holder, unless such request is revoked by written notice received by the Paying Agent on or prior to the relevant Regular Record Date or the date 15 days prior to Maturity, as the case may be (but no such revocation may be made with respect to payments made on this Note if an Event of Default has occurred with respect hereto or upon the giving of a notice of redemption). A Holder whose Note is registered in the name of a broker or nominee should contact such broker or nominee to determine whether and how an election to receive payments in U.S. dollars may be made. The U.S. dollar amount to be received by a Holder of a Note who elects to receive payments in U.S. dollars will be based on the highest indicated bid quotation for the purchase of U.S. dollars in exchange for the Specified Currency obtained by the Currency Determination Agent (as defined below) at approximately 11:00 A.M., New York City time, on the second Business Day next preceding the applicable payment date (the "Conversion Date") from the bank composite or multicontributor pages of the Quoting Source for three (or two if three are not available) major banks in The City of New York. The first three (or two) such banks selected by the Currency Determination Agent which are offering quotes on the Quoting Source will be used. If fewer than two such bid quotations are available at 11:00 A.M., New York City time, on the second Business day next preceding the applicable payment date, such payment will be based on the Market Exchange Rate as of the second Business Day next preceding the applicable payment date. If the Market Exchange Rate for such date is not then available, such payment will be made in the Specified Currency. As used herein, the "Quoting Source" means Reuters Monitor Foreign Exchange Service, or if the Currency Determination Agent determines that such service is not available, Telerate Monitor Foreign Exchange Service, or if the Currency Determination Agent determines that neither service is available, such comparable display or other comparable manner of obtaining quotations as shall be agreed between the Company and the Currency Determination Agent. All currency exchange costs associated with any payment in U.S. dollars on this Note will be borne by the Holder by deductions from such payment. Any currency determination agent (the "Currency Determination Agent") is specified on the face hereof. If payment in respect of this Note is required to be made in any currency unit (e.g. ECUs) and such currency unit is unavailable, in the good faith judgment of the Company, due to the imposition of exchange controls or other circumstances beyond the Company's control, then all payments in respect of this Note shall be made in U.S. dollars until such currency unit is again available. The amount of each payment of U.S. dollars shall be computed on the basis of the equivalent of the currency unit in U.S. dollars, which shall be determined by the Currency Determination Agent on the following basis. The component currencies of the currency unit for this purpose (the "Component Currencies") shall be the currency amounts that were components of the currency unit as of the Conversion Date. The equivalent of the currency unit in U.S. dollars shall be calculated by aggregating the U.S. dollar equivalents of the Component Currencies. The U.S. dollar equivalent of each of the Component Currencies shall be determined by the Currency Determination Agent on the basis of the Market Exchange Rate for each such Component Currency as of the Conversion Date. "Market Exchange Rate" means the noon buying rate in The City of New York for cable transfers of such Specified Currency as certified for customs purposes by the Federal Reserve Bank of New York. If the official unit of any Component Currency is altered by way of combination or subdivision, the number of units of that currency as a Component Currency shall be divided or multiplied in the same proportion. If two or more Component Currencies are consolidated into a single currency, the amounts of those currencies as Component Currencies shall be replaced by an amount in such single currency equal to the sum of the amounts of the consolidated Component Currencies expressed in such single currency. If any Component Currency is divided into -3- two or more currencies, the amount of the original Component Currency shall be replaced by the amounts of such two or more currencies, the sum of which shall be equal to the amount of the original Component Currency. All determinations referred to above made by the Currency Determination Agent shall be at its sole discretion and shall, in the absence of manifest error, be conclusive for all purposes and binding on the Holder of this Note. All percentages resulting from any calculations under this Note will be rounded, if necessary, to the nearest one hundred thousandth of a percentage point (with five one-millionths of a percentage point being rounded upward) and all currency or currency unit or dollar amounts used in or resulting from any such calculation in respect of the Notes will be rounded to the nearest one- hundredth of a unit (with five one-thousandths being rounded upward) or nearest cent, as the case may be. SECTION 3. Redemption. If so specified on the face hereof, the Company may at its option redeem this Note in whole or from time to time in part on or after the date designated as the Initial Redemption Date on the face hereof at the redemption price specified on the face hereof, together with accrued and unpaid interest to the date of redemption, but interest installments whose Stated Maturity is on or prior to the date of redemption will be payable to the Holder of this Note of record at the close of business on the relevant Regular Record Date referred to on the face hereof, all as provided in the Indenture. The Company may exercise such option by causing the Trustee to mail a notice of such redemption at least 30 but not more than 60 calendar days prior to the date of redemption, subject to all the conditions and provisions of the Indenture. In the event of redemption of this Note in part only, a new Note or Notes for the unredeemed portion hereof shall be issued in the name of the Holder hereof upon the cancellation hereof. SECTION 4. Repayment. If so specified on the face hereof, this Note will be repayable prior to Stated Maturity at the option of the Holder on the Optional Repayment Dates shown on the face hereof at the Optional Repayment Prices shown on the face hereof together with interest accrued and unpaid thereon to the date of repayment. In order for this Note (if it is repayable at the option of the Holder) to be repaid prior to Stated Maturity, the Paying Agent must receive at least 30 but not more than 45 calendar days prior to an Optional Repayment Date (i) this Note with the form below entitled "Option to Elect Repayment" duly completed or (ii) a telegram, telex, facsimile transmission or letter (first class, postage prepaid) from a member of a national securities exchange or the National Association of Securities Dealers, Inc. or a commercial bank or trust company in the United States of America setting forth the name of the Holder of this Note, the principal amount of the Note to be repaid, the certificate number or a description of the tenor and terms of this Note, a statement that the option to elect repayment is being exercised thereby and a guarantee that this Note with the form below entitled "Option to Elect Repayment" duly completed will be received by the Paying Agent not later than five Business Days after the date of such telegram, telex, facsimile transmission or letter (first class, postage prepaid). If the procedure described in clause (ii) of the preceding sentence is followed, this Note with such form duly completed must be received by the Trustee by such fifth Business Day. Exercise of the repayment option by the Holder of this Note shall be irrevocable, except that a Holder who has tendered this Note for repayment may revoke any such tender for repayment by written notice to the Paying Agent received prior to the close of business on the tenth calendar day prior to the repayment date. The repayment option may be exercised by the Holder of this Note for less than the entire principal amount of the Note provided that the principal amount of the Note remaining outstanding after repayment is an authorized denomination. Upon such partial repayment this Note shall be cancelled and a new Note or Notes for the remaining principal amount hereof shall be issued in the name of the Holder of this Note. SECTION 5. Optional Interest Reset. If so specified on the face hereof, the interest rate on this Note may be reset by the Company on the date or dates specified on the face hereof (each an "Optional Interest Reset Date"). The Company may exercise such option by notifying the Trustee of such exercise at least 45 but not more than 60 calendar days prior to an Optional Interest Reset Date. If the Company so notifies the Trustee of such exercise, not later than 40 calendar days prior to each Optional Interest Reset Date, the Trustee will send by telegram, telex, facsimile transmission or letter (first class, postage prepaid) to the Holder of this Note a notice (the "Reset Notice") indicating (i) that the Company has elected to reset the interest rate, (ii) such new interest rate and (iii) the provisions, if any, for redemption during the period from such Optional Interest Reset Date to the next Optional Interest Reset Date or, if there is no such next Optional Interest Reset Date, to Stated Maturity of this Note (each such period a "Subsequent Interest Period"), including the date or dates on which or the period or periods during which and the price or prices at which such redemption may occur during such Subsequent Interest Period. Notwithstanding the foregoing, not later than 20 calendar days prior to an Optional Interest Reset Date, the Company may, at its option, revoke the interest rate provided for in the Reset Notice and establish a higher interest rate for the Subsequent Interest Period commencing on such Optional Interest Reset Date by causing the Trustee to send by telegram, telex, facsimile transmission or letter (first class, postage prepaid) notice of such higher interest rate to the Holder of this Note. Such notice shall be irrevocable. All Notes with respect to which the interest rate is reset on an Optional Interest Reset Date will bear such higher interest rate, whether or not tendered for repayment as provided in the next paragraph. If the Company elects prior to an Optional Interest Reset Date to reset the interest rate of this Note, the Holder of this Note will have the option to elect repayment of this Note by the Company on such Optional Interest Reset Date at a price equal to the principal amount hereof plus interest accrued and unpaid thereon to such Optional Interest Reset Date. In order to obtain repayment on an Optional Interest Reset Date, the Holder must follow the procedures set forth under Section 4 for optional repayment except that the period for delivery or notification to the Trustee shall be at least 25 but not more than 35 calendar days prior to such Optional Interest Reset Date. If the Holder has tendered this Note for repayment following receipt of a Reset Notice, the Holder may revoke such tender for repayment by written notice to the Trustee received prior to the close of business on the tenth calendar day prior to such Optional Interest Reset Date. SECTION 6. Optional Extension of Maturity. If so specified on the face hereof, the Stated Maturity of this Note may be extended at the option of the Company for the period or periods of from one to five whole years specified on the face hereof (each an "Extension Period") up to but not beyond the date (the "Final Maturity Date") set forth on the face hereof. The Company may exercise such option with respect to a Note by notifying the Trustee of such exercise at least 45 but not more than 60 calendar days prior to Stated Maturity of such Note in effect prior to the exercise of such option (the "Original Stated Maturity Date"). If the Company so notifies the Trustee of such exercise, the Trustee will send by telegram, telex, facsimile transmission or letter (first class, postage prepaid) to the Holder of this Note not later than 40 calendar days prior to the Original Stated Maturity Date a notice (the "Extension Notice") indicating (i) that the Company has elected to extend the Stated Maturity of this Note, (ii) the new Stated Maturity, (iii) the interest rate applicable to the Extension Period and (iv) the provisions, if any, for redemption during such Extension Period, including the date or dates on which or the period or periods during which and the price or prices at -4- which such redemption may occur during such Extension Period. Upon the Trustee's sending of the Extension Notice, Stated Maturity of this Note shall be extended automatically and, except as modified by the Extension Notice and as described in the next two paragraphs, this Note will have the same terms as prior to the sending of such Extension Notice. Notwithstanding the foregoing, not later than 20 calendar days before the Original Stated Maturity Date of this Note, the Company may, at its option, revoke the interest rate provided for in the Extension Notice and establish a higher interest rate for the Extension Period by causing the Trustee to send by telegram, telex, facsimile transmission or letter (first class, postage prepaid) notice of such higher interest rate to the Holder of this Note. Such notice shall be irrevocable. All Notes with respect to which Stated Maturity is extended will bear such higher interest rate for the Extension Period, whether or not tendered for repayment as provided in the next paragraph. If the Company extends the Stated Maturity of this Note, the Holder will have the option to elect repayment of this Note by the Company on the Original Stated Maturity Date at a price equal to the principal amount hereof, plus interest accrued and unpaid thereon to such date. In order to obtain repayment on the Original Stated Maturity Date once the Company has extended the Stated Maturity hereof, the Holder must follow the procedures set forth under Section 4 for optional repayment except that the period for delivery or notification to the Trustee shall be at least 25 but not more than 35 calendar days prior to the Original Stated Maturity Date. A Holder who has tendered this Note for repayment following receipt of an Extension Notice may revoke such tender for repayment by written notice to the Trustee received prior to the close of business on the tenth calendar day before the Original Stated Maturity Date. SECTION 7. Sinking Fund. This Note will not be subject to any sinking fund. SECTION 8. Original Issue Discount Notes. Notwithstanding anything herein to the contrary, if this Note is an Original Issue Discount Note, the amount payable in the event of redemption or repayment prior to the Stated Maturity hereof in lieu of the principal amount due at the Stated Maturity hereof shall be the Amortized Face Amount of this Note as of the redemption date or the date of repayment, as the case may be. The "Amortized Face Amount" of this Note shall be the amount equal to (a) the Issue Price (as set forth on the face hereof) plus (b) that portion of the difference between the Issue Price and the principal amount hereof that has accrued at the yield to maturity (as set forth on the face hereof) (computed in accordance with generally accepted United States bond yield computation principles) at the date as of which the Amortized Face Amount is calculated but in no event shall the Amortized Face Amount of this Note exceed its principal amount. SECTION 9. Events of Default. If any Event of Default with respect to Notes of this series shall occur and be continuing, the principal of the Notes of this series may be declared due and payable in the manner and with the effect provided in the Indenture; provided, however, that notwithstanding anything herein to the contrary, if this Note is an Original Issue Discount Note, the amount so declared due and payable shall be the Amortized Face Amount of this Note as of the date of such declaration. SECTION 10. Modifications and Waivers; Obligation of the Company Absolute. The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Company and the rights of the Holder 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 Note shall be conclusive and binding upon such Holder and upon all future Holders of this Note and of any Note 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 Note. No reference herein to the Indenture and no provision of this Note or of the Indenture shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal of, and premium, if any, and interest on this Note at the times, places and rates, and in the coin or currency, herein prescribed. SECTION 11. Defeasance and Covenant Defeasance. The Indenture contains provisions for defeasance at any time of (a) the entire indebtedness of the Company on this Note and (b) certain restrictive covenants and the related Events of Default, upon compliance by the Company with certain conditions set forth therein, which provisions apply to this Note. SECTION 12. Authorized Denominations. Unless otherwise noted on the face hereof, the Notes of this series are issuable only in global or certificated registered form, without coupons, in denominations of $100,000 and any integral multiple of $1,000 in excess thereof. As provided in the Indenture and subject to certain limitations therein set forth and to the limitations described below, if applicable, Notes of this series are exchangeable for a like aggregate principal amount of Notes of this series and of like tenor of a different authorized denomination, as requested by the Holder surrendering the same. SECTION 13. Registration of Transfer. As provided in the Indenture and subject to certain limitations therein set forth and to the limitations described below, if applicable, the transfer of this Note is registerable in the Security Register upon surrender of this Note for registration of transfer at the office or agency of the Company maintained for that purpose in the Borough of Manhattan, The City of New York, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Company and the Security Registrar (which shall initially be the Trustee, 111 Wall Street, 5th Floor, New York, N.Y. 10043 (Attention: Corporate Trust Department) or at such other address as it may designate as its principal corporate trust office in The City of New York) duly executed by, the Holder hereof or his attorney duly authorized in writing, and thereupon one or more new Notes of this series and of like tenor, of authorized denominations and for the same Stated Maturity and aggregate principal amount, will be issued to the designated transferee or transferees. If this Note is a global Note (as specified on the face hereof), this Note is exchangeable only if (x) the U.S. Depositary notifies the Company that it is unwilling or unable to continue as U.S. Depositary for this global Note or if at any time the U.S. Depositary ceases to be a clearing agency registered under the Securities Exchange Act of 1934, as amended, (y) the Company in its sole discretion determines that this Note shall be exchangeable for certificated Notes in registered form or (z) an Event of Default, or an event which with the passage of time or the giving of notice would become an Event of Default, with respect to the Notes represented hereby has occurred and is continuing, provided that the definitive Notes so issued in exchange for this permanent global Note shall be in denominations of $100,000 and any integral multiple of $1,000 in -5- excess thereof and be of like aggregate principal amount and tenor as the portion of this permanent global Note to be exchanged, and provided further that, unless the Company agrees otherwise, Notes of this series in certificated registered form will be issued in exchange for this permanent global Note, or any portion hereof, only if such Notes in certificated registered form were requested by written notice to the Trustee or the Security Registrar by or on behalf of a person who is beneficial owner of an interest hereof given through the Holder hereof. Except as provided above, owners of beneficial interests in this permanent global Note will not be entitled to receive physical delivery of Notes in certificated registered form and will not be considered the Holders thereof for any purpose under the Indenture. 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. SECTION 14. Owners. Prior to due presentment of this Note 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 Note is registered as the owner hereof for all purposes, whether or not this Note be overdue, and none of the Company, the Trustee or any such agent shall be affected by notice to the contrary. SECTION 15. Governing Law. The Indenture and the Notes shall be governed by and construed in accordance with the laws of the State of New York. SECTION 16. Defined Terms. All terms used in this Note which are defined in the Indenture shall have the meanings assigned to them in the Indenture; and all references in the Indenture to "Security" or "Securities" shall be deemed to include the Notes. "Business Day" means any Monday, Tuesday, Wednesday, Thursday or Friday that in The City of New York is not a day on which banking institutions are authorized or required by law, regulation or executive order to close; provided that with respect to a Specified Currency, such day is also not a day on which banking institutions are authorized or required by law, regulation or executive order to close in the principal financial center of the country of such Specified Currency (or in the case of ECUs, is not a day designated as an ECU Non-Settlement Day by the ECU Banking Association in Paris or otherwise generally regarded in the ECU interbank market as a day on which payment on ECUs shall not be made). -6- OPTION TO ELECT REPAYMENT [To be completed only if this Note is repayable at the option of the Holder and the Holder elects to exercise such rights] The undersigned owner of this Note hereby irrevocably elects to have the Company repay the principal amount of this Note or portion hereof below designated at (i) the applicable Optional Repayment Price indicated on the face hereof, together with interest accrued and unpaid thereon to the date of repayment, if this Note is to be repaid pursuant to Section 4 of this Note, or (ii) 100% of the principal amount of this Note to be repaid plus interest accrued and unpaid thereon to the Optional Interest Reset Date, if this Note is to be repaid pursuant to Section 5 hereof, or to the Original Stated Maturity Date, if this Note is to be repaid pursuant to Section 6 hereof. Specify the denomination or denominations (which shall be $100,000 or an integral multiple of $1,000 in excess thereof or, if the Note is denominated in a currency other than U.S. dollars, an Authorized Denomination) of the Note or Notes to be issued to the Holder for the portion of the within Note not being repaid (in the absence of any specification, one such Note will be issued for the portion not being repaid): ______________________________. Dated: _______________________ ___________________________________ Signature Sign exactly as name appears on the front of this Note. Principal amount to be repaid Indicate address where check if amount to be repaid is less is to be sent, if repaid: than the entire principal amount of this Note (principal amount ___________________________________ remaining must be an authorized denomination) ___________________________________ $ ______________________ (which shall be an integral multiple of $1,000 or, if the Note is denominated in a currency other than U.S. SOCIAL SECURITY OR OTHER dollars, of an amount equal TAXPAYER ID NUMBER to the integral multiples referred to on the face hereof _____________________________ under "Authorized Denominations" (or, if no such reference is made, an amount equal to the minimum Authorized Denomination)). ABBREVIATIONS The following abbreviations, when used in the inscription on the face of this instrument, shall be construed as though they were written out in full according to applicable laws or regulations: TEN COM - as tenants in common TEN ENT - as tenants by the entireties JT TEN - as joint tenants with right of survivorship and not as tenants in common UNIF GIFT MIN ACT - ............Custodian............ (Cust) (Minor) Under Uniform Gifts to Minors Act ................................. (State) Additional abbreviations may also be used though not in the above list. ____________________________________ FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE ______________________________ | | |______________________________| ________________________________________________________________________________ PLEASE PRINT OR TYPE NAME AND ADDRESS INCLUDING POSTAL ZIP CODE OF ASSIGNEE ________________________________________________________________________________ the within Note and all rights thereunder, hereby irrevocably constituting and appointing _______________________ attorney to transfer said Note on the books of the Company, with full power of substitution in the premises. Dated: _________________ ____________________________________________ Signature Sign exactly as name appears on the front of this Note [SIGNATURE MUST BE GUARANTEED by a commercial bank, a trust company or by a member of the New York Stock Exchange] NOTICE: THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS WRITTEN UPON THE FACE OF THE WITHIN INSTRUMENT IN EVERY PARTICULAR, WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATEVER. EX-4.4 5 FLOATING RATE NOTE EXHIBIT 4.4 [Face of Note] CUSIP NO. REGISTERED NO. FLB PRINCIPAL AMOUNT: R. R. DONNELLEY & SONS COMPANY MEDIUM-TERM NOTE, SERIES __ (Floating Rate) If the registered owner of this Note (as indicated below) is The Depository Trust Company (the "U.S. Depositary") or a nominee of the U.S. Depositary, this Note is a global Note and the following legend is applicable: Unless this certificate is presented by an authorized representative of The Depository Trust Company (55 Water Street, New York, New York) to the issuer or its agent for registration of transfer, exchange or payment, and any certificate issued is registered in the name of CEDE & CO., or such other name as requested by an authorized representative of The Depository Trust Company and any payment is made to CEDE & CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL since the registered owner hereof, CEDE & CO., has an interest herein. The following summary of terms is subject to the information set forth on the reverse hereof: OPTIONAL REDEMPTION: [_] YES [_] NO ORIGINAL ISSUE DATE: INITIAL REDEMPTION DATE: STATED MATURITY: REDEMPTION PRICE: Initially ____% of Principal Amount and declining by ____% of the Principal SPECIFIED CURRENCY: Amount on each anniversary of the Initial Redemption Date until the Redemption Price is AUTHORIZED DENOMINATIONS: 100% of the Principal Amount. OPTION TO ELECT PAYMENTS IN U.S. DOLLARS: [_] YES [_] NO FORM: [_] BOOK ENTRY OPTION TO ELECT REPAYMENT: [_] YES [_] NO [_] CERTIFICATED INTEREST RATE BASIS: OPTIONAL REPAYMENT DATES: INDEX MATURITY: OPTIONAL REPAYMENT PRICES: REGULAR RECORD DATES: OPTIONAL INTEREST RESET: [_] YES [_] NO INITIAL INTEREST RATE: OPTIONAL INTEREST RESET DATES: MAXIMUM INTEREST RATE: OPTIONAL EXTENSIONS OF MATURITY: [_] YES [_] NO MINIMUM INTEREST RATE: SPREAD: EXTENSION PERIOD: SPREAD MULTIPLIER: NUMBER OF EXTENSION PERIODS: INTEREST RESET PERIOD: FINAL MATURITY DATE: INTEREST RESET DATES: OTHER PROVISIONS: INTEREST DETERMINATION DATE: INTEREST PAYMENT DATES: OVERDUE RATE: CALCULATION AGENT: CURRENCY DETERMINATION AGENT: AMORTIZING NOTE: [_] YES [_] NO U.S. DEPOSITARY: If this Security was issued with "original issue discount" for purposes of Section 1273 of the Internal Revenue Code of 1986, as amended, the following shall be completed:
ORIGINAL ISSUE DISCOUNT TOTAL AMOUNT OF OID: ISSUE PRICE (expressed as percentage of SECURITY: aggregate principal amount): [_] Yes [_] No YIELD TO MATURITY: SHORT ACCRUAL PERIOD OID: METHOD USED TO DETERMINE YIELD FOR SHORT ACCRUAL PERIOD: [_] Approximate [_] Exact
R. R. DONNELLEY & SONS COMPANY, a corporation duly organized and existing under the laws of Delaware (herein called the "Company," which term includes any successor corporation under the Indenture referred to on the reverse hereof), for value received, hereby promises to pay to ________________ ____________________________________ or registered assigns, the principal sum set forth above on the Stated Maturity shown above, and to pay interest thereon from the Original Issue Date shown above or from and including the most recent Interest Payment Date (as hereinafter defined) to which interest has been paid or duly provided for, as the case may be. Interest will be paid on the Interest Payment Dates shown above ("Interest Payment Dates"), at the rate per annum determined in accordance with the provisions on the reverse hereof, depending on the Interest Rate Basis specified above, commencing with the first such Interest Payment Date next succeeding the Original Issue Date shown above (except as provided below) until the principal hereof is paid or made available for payment and on Stated Maturity, and, if specified above, interest shall accrue on any overdue principal and on any overdue installment of interest (to the extent that the payment of such interest shall be legally enforceable) at the Overdue Rate per annum set forth above. 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 Note (or one or more predecessor Notes) is registered at the close of business on the Regular Record Date set forth above next preceding such Interest Payment Date, which shall be the fifteenth calendar day next preceding such Interest Payment Date. The first payment of interest on any Note originally issued between a Regular Record Date and an Interest Payment Date will be made on the Interest Payment Date following the next succeeding Regular Record Date to the registered owner on such succeeding Regular Record Date. Except as otherwise provided in the Indenture, 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 Note (or one or more predecessor Notes) 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 to be given to Holders of Notes of this series not less than 10 calendar 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 Notes 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. Payments of interest to be paid in U.S. dollars (other than interest, and if this is an Amortizing Note, principal (if this is not a global Note) payable at Stated Maturity) will be made by mailing a check to the Holder at the address of the Holder appearing in the Security Register as of the applicable Regular Record Date. Notwithstanding the foregoing, at the option of the Company, all payments of interest and, if this is an Amortizing Note, principal on this Note may be made by wire transfer of immediately available funds to an account maintained by such Holder with a bank located in the United States as designated by the Holder not less than 15 calendar days prior to the Interest Payment Date. If a Holder holds U.S. $10,000,000 or more in aggregate principal amount of Notes of like tenor and terms (including the same Interest Payment Date) (or is the Holder of the equivalent thereof in a Specified Currency other than U.S. dollars), such Holder shall be entitled to receive payments of interest (other than at Stated Maturity or upon earlier redemption or repayment) in U.S. dollars by wire transfer of immediately available funds, but only if appropriate payment instructions have been received in writing by the Trustee not less than 15 calendar days prior to the applicable Interest Payment Date. Simultaneously with the election by the Holder to receive payments in a Specified Currency other than U.S. dollars (by written request to the Trustee, as provided below), the Holder shall provide appropriate payment instructions to the Trustee, and all such payments will be made in immediately available funds to a bank account maintained by the Holder in the country of the Specified Currency (or, with respect to ECUs, Brussels). If such a payment with respect to this Note cannot be made by wire transfer because the required designation has not been received by the Trustee on or before the requisite date or for any other reason, a notice will be mailed to the Holder at its registered address requesting a designation pursuant to which such wire transfer can be made and, upon the Trustee's receipt of such a designation, such payment will be made within 15 days of such receipt. The Company will pay any administrative costs imposed by banks in connection with -2- making payments by wire transfer, but not any tax, assessment or governmental charge imposed upon the Holder of this Note. In the event that payment is so made in accordance with the instructions of the Holder, such wire transfer shall be deemed to constitute full and complete payment of such interest and principal on this Note. If this is not a global Note, payment of the principal, premium, if any, and interest payable at Maturity in respect of this Note will be paid in immediately available funds upon surrender of this Note accompanied by wire instructions at the principal office of the Trustee, provided that the Note is presented in time for the Trustee to make such payments in such funds in accordance with its normal procedures. If the Holder of this Note (as indicated above) is the U.S. Depositary or a nominee of the U.S. Depositary, this Note is a global Note and the following legend is applicable except as specified on the reverse hereof: THIS GLOBAL NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE U.S. DEPOSITARY OR BY A NOMINEE OF THE U.S. DEPOSITARY TO THE U.S. DEPOSITARY OR ANOTHER NOMINEE OF THE U.S. DEPOSITARY OR BY THE U.S. DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR OF THE U.S. DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR. REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS NOTE SET FORTH ON THE REVERSE HEREOF, WHICH FURTHER PROVISIONS SHALL FOR ALL PURPOSES HAVE THE SAME EFFECT AS IF SET FORTH AT THIS PLACE. Unless the certificate of authentication hereon has been executed by the Trustee referred to on the reverse hereof, directly or through an Authenticating Agent, by manual signature of an authorized signatory, this Note shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose. IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed under its corporate seal. Dated: R. R. DONNELLEY & SONS COMPANY By:________________________________ Its:____________________________ Attest:____________________________ Its:___________________________ TRUSTEE'S CERTIFICATE OF AUTHENTICATION This is one of the Securities of the series designated herein and referred to in the within-mentioned Indenture. CITIBANK, N.A. as Trustee By:_______________________________ Authorized Officer -3- [Reverse of Note] R. R. DONNELLEY & SONS COMPANY MEDIUM-TERM NOTE, SERIES __ SECTION 1. General. This Note is one of a duly authorized issue of Securities of the Company (herein called the "Notes"), issued and to be issued in one or more series under an Indenture, dated as of November 1, 1990 (herein called the "Indenture"), between the Company and Citibank, N.A., as Trustee (herein called the "Trustee," which term includes any successor trustee under the Indenture), to which Indenture and all indentures supplemental thereto reference is hereby made for a statement of the respective rights, limitations of rights, duties and immunities thereunder of the Company, the Trustee and the Holders of the Notes and of the terms upon which the Securities are, and are to be, authenticated and delivered. This Note is one of the Securities of the series designated on the face hereof. The Notes may bear different dates, mature at different times, bear interest at different rates, be subject to different redemption provisions and may otherwise vary, all as provided in the Indenture. The Notes are limited to $___,000,000 in aggregate principal amount (or the equivalent thereof in the Specified Currency, calculated at the Market Exchange Rate on the applicable trade date). SECTION 2. Interest Rate Calculations; Payments. The interest rate on this Note will be equal to either (i) the interest rate calculated by reference to the specified Interest Rate Basis plus or minus the Spread, if any, or (ii) the interest rate calculated by reference to the specified Interest Rate Basis multiplied by the Spread Multiplier, if any. The "Spread" is the number of basis points (one basis point equals one-hundredth of a percentage point) specified on the face hereof as being applicable to this Note, and the "Spread Multiplier" is the percentage specified on the face hereof as being applicable to this Note. Set forth on the face hereof is the Interest Rate Basis and the Spread or Spread Multiplier, if any, and the maximum or minimum interest rate limitation, if any, applicable to this Note. Set forth on the face hereof are particulars as to the Calculation Agent (unless specified otherwise, Citibank, N.A. (in such capacity, the "Calculation Agent")), Index Maturity, Original Issue Date, the interest rate in effect for the period from the Original Issue Date to the first Interest Reset Date set forth on the face hereof (the "Initial Interest Rate"), Interest Determination Dates, Interest Payment Dates, Regular Record Dates and Interest Reset Dates with respect to this Note. Except as provided below, interest on this Note will be payable (i) if this Note resets daily, weekly or monthly, on the third Wednesday of each month or on the third Wednesday of March, June, September and December of each year, as specified on the face hereof; (ii) if this Note resets quarterly, on the third Wednesday of March, June, September and December of each year; (iii) if this Note resets semiannually, on the third Wednesday of each of two months of each year specified on the face hereof; and (iv) if this Note resets annually, on the third Wednesday of one month of each year specified on the face hereof (each such day being an "Interest Payment Date"), and in each case at Maturity. If any Interest Payment Date, other than Maturity, for this Note would otherwise be a day that is not a Business Day, such Interest Payment Date shall be postponed to the next day that is a Business Day, except that if this Note is a LIBOR Note, if such Business Day is in the next succeeding calendar month, such Interest Payment Date shall be the immediately preceding London Business Day. If the Maturity for this Note falls on a day that is not a Business Day, payment of principal, premium, if any, and interest with respect to this Note will be made on the next succeeding Business Day with the same force and effect as if made on the due date, and no interest shall be payable on the date of payment for the period from and after the due date. The rate of interest on this Note will be reset daily, weekly, monthly, quarterly, semiannually or annually (such period being the "Reset Period" for such Note, and the first day of each Reset Period being an "Interest Reset Date"), as specified on the face hereof. The Interest Reset Date will be, if this Note resets daily, each Business Day; if this Note resets weekly (unless the Interest Rate Basis on the face hereof is the Treasury Rate), the Wednesday of each week; if this Note resets weekly and the Interest Rate Basis on the face hereof is the Treasury Rate, the Tuesday of each week; if this Note resets monthly (unless the Interest Rate Basis on the face hereof is the 11th District Cost of Funds Rate), the third Wednesday of each month; if this Note resets monthly and the Interest Rate Basis on the face hereof is the 11th District Cost of Funds Rate, the first calendar date of the month; if this Note resets quarterly, the third Wednesday of each March, June, September and December; if this Note resets semiannually, the third Wednesday of the two months of each year specified on the face hereof; and if this Note resets annually, the third Wednesday of one month of each year specified on the face hereof; provided, however, that the interest rate in effect from the date of issue to the first Interest Reset Date will be the Initial Interest Rate specified on the face hereof. If the Interest Reset Date would otherwise be a day that is not a Business Day, the Interest Reset Date shall be postponed to the next day that is a Business Day, except that if the Interest Rate Basis on the face hereof is LIBOR, if such Business Day is in the next succeeding calendar month, such Interest Reset Date shall be the immediately preceding Business Day. Each adjusted rate shall be applicable on and after the Interest Reset Date to which it relates to, but not including, the next succeeding Interest Reset Date or until Stated Maturity or the date of redemption, as the case may be. The interest rate for each Reset Period will be the rate determined by the Calculation Agent on the Calculation Date (as defined below) pertaining to the Interest Determination Date pertaining to the Interest Reset Date for -4- such Reset Period. Unless otherwise specified on the face hereof, the "Interest Determination Date" pertaining to an Interest Reset Date for (a) a Commercial Paper Rate Note (the "Commercial Paper Interest Determination Date"), (b) a Federal Funds Rate Note (the "Federal Funds Interest Determination Date"), (c) a CD Rate Note (the "CD Interest Determination Date"), (d) a Prime Rate Note (the "Prime Interest Determination Date"), (e) a CMT Rate Note (the "CMT Interest Determination Date"), or (f) a Kenny Rate Note (the "Kenny Rate Interest Determination Date") will be the second Business Day prior to such Interest Reset Date. Unless otherwise specified on the face hereof, the Interest Determination Date pertaining to an Interest Reset Date for an 11th District Cost of Funds Rate Note (the "11th District Interest Determination Date") will be the last Business Day of the month immediately preceding such Interest Reset Date on which the Federal Home Loan Bank of San Francisco (the "FHLB of San Francisco") publishes the Index (as defined below). Unless otherwise specified on the face hereof, the Interest Determination Date pertaining to an Interest Reset Date for a LIBOR Note (the "LIBOR Interest Determination Date") will be the second London Business Day immediately preceding each Interest Reset Date. Unless otherwise specified on the face hereof, the Interest Determination Date pertaining to an Interest Reset Date for a Treasury Rate Note (the "Treasury Interest Determination Date") will be the day of the week in which such Interest Reset Date falls on which Treasury bills would normally be auctioned. Treasury bills are usually sold at auction on Monday of each week, unless that day is a legal holiday, in which case the auction is usually held on the following Tuesday, except that such auction may be held on the preceding Friday. If, as a result of a legal holiday, an auction is so held on the preceding Friday, such Friday will be the Treasury Interest Determination Date pertaining to the Reset Period commencing in the next succeeding week, if an auction date shall fall on any Interest Reset Date for a Treasury Rate Note, then such Interest Reset Date shall instead be the first Business Day immediately following such auction date. Unless otherwise specified on the face hereof, the "Calculation Date" pertaining to any Interest Determination Date shall be the earlier of (i) the tenth calendar day after the Interest Determination Date or, if such day is not a Business Day, the next succeeding Business Day, or (ii) the Business Day preceding the applicable Interest Payment Date or Maturity, as the case may be. As used herein, "Business Day" means, unless otherwise specified on the face hereof, any Monday, Tuesday, Wednesday, Thursday or Friday that in The City of New York is not a day on which banking institutions are authorized or required by law, regulation or executive order to close and, if the Interest Rate Basis of this Note is LIBOR, is also a London Business Day; provided that with respect to a Specified Currency, such day is also not a day on which banking institutions are authorized or required by law, regulation or executive order to close in the principal financial center of the country of such Specified Currency (or in the case of ECUs, is not a day designated as an ECU Non-Settlement Day by the ECU Banking Association in Paris or otherwise generally regarded in the ECU interbank market as a day on which payment on ECUs shall not be made). As used herein, "London Business Day" means any day (a) if the Designated LIBOR Currency is other than the ECU, on which dealings in deposits in such Designated LIBOR Currency are transacted in the London interbank market or (b) if the Designated LIBOR Currency is the ECU, that is not designated as an ECU Non-Settlement Day by the ECU Banking Association in Paris or otherwise generally regarded in the ECU interbank market as a day on which payments on ECUs shall not be made. "Index Maturity" means the period to maturity of the instrument or obligation on which the interest rate formula is based, as specified on the face hereof. Unless otherwise specified on the face hereof, if this Note is specified on the face hereof as an Amortizing Note, payments with respect to this Note will be applied first to interest due and payable hereon and then to the reduction of the unpaid principal amount hereof. If this Note is specified on the face hereof as an Amortizing Note, a table setting forth repayment information in respect to this Note will be provided to the original purchaser hereof and will be available, upon request, to subsequent Holders. Unless otherwise indicated on the face hereof, interest on this Note will accrue from and including the date of issue or from and including the immediately preceding Interest Payment Date in respect of which interest has been paid or duly provided for, as the case may be, to but excluding the Interest Payment Date or the Maturity, as the case may be. Accrued interest is calculated by multiplying the face amount of this Note by an accrued interest factor. This accrued interest factor is computed by adding the interest factors calculated for each day from the date of issue, or from the last date to which interest has been paid, to the date for which accrued interest is being calculated. The interest factor for each such day is computed by dividing the interest rate applicable to such day by 360, in the case of Commercial Paper Rate Notes, CD Rate Notes, 11th District Cost of Funds Rate Notes, Federal Funds Rate Notes, LIBOR Notes and Prime Rate Notes, or by the actual number of days in the year, in the case of Treasury Rate Notes or CMT Rate Notes, or by 365 days in the case of Kenny Rate Notes. The Calculation Agent shall calculate the interest rate on this Note, as provided below. The Calculation Agent will, upon the request of the Holder of this Note, provide the interest rate then in effect and, if then determined, the interest rate which will become effective as a result of a determination made with respect to the most recent Interest Determination Date with respect to this Note. The Trustee shall act as the initial Calculation Agent for the Notes. For purposes of calculating the rate of interest payable on this Note, the Company will enter into an agreement with the Calculation Agent. The Calculation Agent's determination of any interest rate shall be final and binding in the absence of manifest error. Notwithstanding the determination of the interest rate as provided below, the interest rate on this Note for any interest period shall not be greater than the maximum interest rate, if any, or less than the minimum interest rate, if -5- any, specified on the face hereof. The interest rate on this Note will in no event be higher than the maximum rate permitted by New York or other applicable law, as the same may be modified by United States law of general application. DETERMINATION OF COMMERCIAL PAPER RATE. If the Interest Rate Basis specified on the face hereof is Commercial Paper Rate, the interest rate determined with respect to the Commercial Paper Rate Interest Determination Date shall be the Commercial Paper Rate plus or minus the Spread, if any, or multiplied by the Spread Multiplier, if any, as specified on the face hereof, as determined on such Commercial Paper Rate Interest Determination Date. "Commercial Paper Rate" means, with respect to any Commercial Paper Interest Determination Date, the Money Market Yield (calculated as described below) of the rate on such date for commercial paper having the Index Maturity designated on the face hereof as published by the Board of Governors of the Federal Reserve System in "Statistical Release H.15(519), Selected Interest Rates" or any successor publication of the Board of Governors ("H.15(519)") under the heading "Commercial Paper." In the event that such rate is not published prior to 9:00 A.M., New York City time, on the Calculation Date pertaining to such Commercial Paper Interest Determination Date, then the Commercial Paper Rate with respect to such Commercial Paper Interest Determination Date shall be the Money Market Yield of the rate on such Commercial Paper Interest Determination Date for commercial paper having the Index Maturity designated on the face hereof as published by the Federal Reserve Bank of New York in its daily statistical release "Composite 3:30 P.M. Quotations for U.S. Government Securities" or any successor publication ("Composite Quotations") under the heading "Commercial Paper." If by 3:00 P.M., New York City time, on such Calculation Date such rate is not yet published in either H.15(519) or Composite Quotations, then the Commercial Paper Rate for such Commercial Paper Interest Determination Date shall be calculated by the Calculation Agent and shall be the Money Market Yield of the arithmetic mean of the offered rates (quoted on a bank discount basis) as of 11:00 A.M., New York City time, on such Commercial Paper Interest Determination Date, of three leading dealers of commercial paper in The City of New York selected by the Calculation Agent for commercial paper having the Index Maturity designated on the face hereof placed for an industrial issuer whose bond rating is "AA," or the equivalent, from a nationally recognized securities rating agency; provided, however, that if the dealers selected as aforesaid by the Calculation Agent are not quoting as mentioned in this sentence, the Commercial Paper Rate with respect to such Commercial Paper Interest Determination Date will be the Commercial Paper Rate in effect immediately prior to such Commercial Paper Interest Determination Date. "Money Market Yield" shall be a yield (expressed as a percentage rounded, if necessary, to the nearest one hundred-thousandth of a percent) calculated in accordance with the following formula: Money Market Yield = D x 360 x 100 ------------- 360 - (D x M) where "D" refers to the per annum rate for commercial paper, quoted on a bank discount basis and expressed as a decimal; and "M" refers to the actual number of days in the period for which accrued interest is being calculated. DETERMINATION OF CD RATE. If the Interest Rate Basis specified on the face hereof is CD Rate, the interest rate determined with respect to the CD Interest Determination Date shall be the CD Rate plus or minus the Spread, if any, or multiplied by the Spread Multiplier, if any, as specified on the face hereof, as determined on such CD Interest Determination Date. "CD Rate" means, with respect to any CD Interest Determination Date, the rate on such date for negotiable certificates of deposit having the Index Maturity designated on the face hereof as published in H.15(519) under the heading "CDs (Secondary Market)." In the event that such rate is not published prior to 9:00 A.M., New York City time, on the Calculation Date pertaining to such CD Interest Determination Date, then the CD Rate with respect to such CD Interest Determination Date shall be the rate on such CD Interest Determination Date for negotiable certificates of deposit having the Index Maturity designated on the face hereof as published in Composite Quotations under the heading "Certificates of Deposit." If by 3:00 P.M., New York City time, on such Calculation Date such rate is not published in either H.15(519) or Composite Quotations, then the CD Rate on such CD Interest Determination Date shall be calculated by the Calculation Agent and shall be the arithmetic mean of the secondary market offered rates as of 10:00 A.M., New York City time, on such CD Interest Determination Date of three leading nonbank dealers in negotiable U.S. dollar certificates of deposit in The City of New York selected by the Calculation Agent for negotiable certificates of deposit of major United States money market banks (in the market for negotiable certificates of deposit) with a remaining maturity closest to the Index Maturity specified on the face hereof in a denomination of $5,000,000; provided, however, that if the dealers selected as aforesaid by the Calculation Agent are not quoting as mentioned in this sentence, the CD Rate with respect to such CD Interest Determination Date will be the CD Rate in effect immediately prior to such CD Interest Determination Date. DETERMINATION OF CMT RATE. If the Interest Rate Basis specified on the face hereof is CMT Rate, the interest rate determined with respect to the CMT Interest Determination Date shall be the CMT Rate plus or minus the Spread, if any, or multiplied by the Spread Multiplier, if any, as specified on the face hereof, as determined on such CMT Interest Determination Date. "CMT Rate" means, with respect to any CMT Interest Determination Date, the rate displayed in the Designated CMT Telerate Page (as defined below) under the caption "... Treasury Constant Maturities...Federal Reserve Board Release H. 15... Mondays Approximately 3:45 P.M.," under the column for the Designated CMT Maturity Index (as defined below) for (i) if the Designated CMT Telerate Page is 7055, the rate on such CMT Interest Determination Date and -6- (ii) if the Designated CMT Telerate Page is 7052, the week, or the month, as applicable, ended immediately preceding the week in which the applicable CMT Interest Determination Date occurs. If such rate is no longer displayed on the relevant page, or if not displayed by 3:00 P.M., New York City time, on the Calculation Date pertaining to such CMT Interest Determination Date, then the CMT Rate for such CMT Interest Determination Date will be such treasury constant maturity rate for the Designated CMT Maturity Index as published in the relevant H. 15(519). If such rate is no longer published, or if not published by 3:00 P.M., New York City time, on the Calculation Date pertaining to such CMT Interest Determination Date, then the CMT Rate for such CMT Interest Determination Date will be such treasury constant maturity rate for the Designated CMT Maturity Index (or other United States Treasury rate for the Designated CMT Maturity Index) for the CMT Interest Determination Date with respect to such Interest Reset Date as may then be published by either the Board of Governors of the Federal Reserve System or the United States Department of the Treasury that the Calculation Agent determines to be comparable to the rate formerly displayed on the Designated CMT Telerate Page and published in the relevant H.15(519). If such information is not provided by 3:00 P.M., New York City time, on the Calculation Date pertaining to such CMT Interest Determination Date, then the CMT Rate for the CMT Interest Determination Date will be calculated by the Calculation Agent and will be a yield to maturity, based on the arithmetic mean of the secondary market closing offer side prices as of approximately 3:30 P.M., New York City time, on the CMT Interest Determination Date reported, according to their written records, by three leading primary United States government securities dealers (each, a "Reference Dealer") in The City of New York selected by the Calculation Agent (from five such Reference Dealers selected by the Calculation Agent and eliminating the highest quotation (or, in the event of equality, one of the highest) and the lowest quotation (or, in the event of equality, one of the lowest)), for the most recently issued direct noncallable fixed rate obligations of the United States ("Treasury Notes") with an original maturity of approximately the Designated CMT Maturity Index and a remaining term to maturity of not less than such Designated CMT Maturity Index minus one year. If the Calculation Agent cannot obtain three such Treasury Note quotations, the CMT Rate for such CMT Interest Determination Date will be calculated by the Calculation Agent and will be a yield to maturity based on the arithmetic mean of the secondary market offer side prices as of approximately 3:30 P.M., New York City time, on the CMT Interest Determination Date of three Reference Dealers in The City of New York (from five such Reference Dealers selected by the Calculation Agent and eliminating the highest quotation (or, in the event of equality, one of the highest) and the lowest quotation (or, in the event of equality, one of the lowest)), for Treasury Notes with an original maturity of the number of years that is the next highest to the Designated CMT Maturity Index and a remaining term to maturity closest to the Designated CMT Maturity Index and in an amount of at least $100,000,000. If three or four (and not five) of such Reference Dealers are quoting as described above, then the CMT Rate will be based on the arithmetic mean of the offer prices obtained and neither the highest nor the lowest of such quotes will be eliminated; provided, however, that if fewer than three Reference Dealers selected by the Calculation Agent are quoting as described herein, the CMT Rate will he the CMT Rate in effect on such CMT Interest Determination Date. If two Treasury Notes with an original maturity as described in the third preceding sentence have remaining terms to maturity equally close to the Designated CMT Maturity Index, the quotes for the Treasury Note with the shorter remaining term to maturity will be used. "Designated CMT Telerate Page" means the display on the Dow Jones Telerate Service on the page specified on the face hereof (or any other page as may replace such page on that service for the purpose of displaying Treasury Constant Maturities as published in H.15(519)), for the purpose of displaying Treasury Constant Maturities as published in H.15(519). If no such page is specified on the face hereof, the Designated CMT Telerate Page shall be 7052, for the most recent week. "Designated CMT Maturity Index" means the original period to maturity of the Treasury Notes (either one, two, three, five, seven, ten, twenty or thirty years) specified on the face hereof with respect to which the CMT Rate will be calculated. If no such maturity is specified on the face hereof, the Designated CMT Maturity Index shall be two years. DETERMINATION OF FEDERAL FUNDS RATE. If the Interest Rate Basis specified on the face hereof is Federal Funds Rate, the interest rate determined with respect to the Federal Funds Interest Determination Date shall be the Federal Funds Rate plus or minus the Spread, if any, or multiplied by the Spread Multiplier, if any, specified on the face hereof, as determined on such Federal Funds Interest Determination Date. "Federal Funds Rate" means, with respect to any Federal Funds Interest Determination Date, the rate on such date for Federal Funds as published in H.15(519) under the heading "Federal Funds (Effective)." In the event that such rate is not published prior to 9:00 A.M., New York City time, on the Calculation Date pertaining to such Federal Funds Interest Determination Date, then the Federal Funds Rate shall be the rate on such Federal Funds Interest Determination Date as published in Composite Quotations under the heading "Federal Funds/Effective Rate." If by 3:00 P.M., New York City time, on such Calculation Date such rate is not published in either H.15(519) or Composite Quotations, then the Federal Funds Rate with respect to such Federal Funds Interest Determination Date shall be calculated by the Calculation Agent and shall be the arithmetic mean (rounded, if necessary, to the nearest one hundred- thousandth of a percent) of the rates as of 9:00 A.M., New York City time, on such Federal Funds Interest Determination Date for the last transaction in overnight Federal Funds arranged by three leading brokers of Federal Funds transactions in The City of New York selected by the Calculation Agent; provided, however, that if the brokers selected as aforesaid by the Calculation Agent are not quoting as mentioned in this sentence, the Federal Funds Rate with respect to such Federal Funds Interest Determination Date will be the Federal Funds Rate in effect immediately prior to such Federal Funds Interest Determination Date. -7- DETERMINATION OF 11TH DISTRICT COST OF FUNDS RATE. If the Interest Rate Basis specified on the face hereof is 11th District Cost of Funds Rate, the interest rate determined with respect to the 11th District Interest Determination Date shall be the 11th District Cost of Funds Rate plus or minus the Spread, if any, or multiplied by the Spread Multiplier, if any, specified on the face hereof, as determined on such 11th District Interest Determination Date. "11th District Cost of Funds Rate" means, with respect to any 11th District Interest Determination Date, the rate equal to the monthly weighted average cost of funds for the calendar month preceding such 11th District Cost of Funds Rate Interest Determination Date as set forth under the caption "11th District" on Telerate Page 7058 as of 11:00 A.M., San Francisco time, on such 11th District Interest Determination Date. If such rate does not appear on Telerate Page 7058 on any related 11th District Interest Determination Date, the 11th District Cost of Funds Rate for such 11th District Interest Determination Date shall be the monthly weighted average cost of funds paid by member institutions of the Eleventh Federal Home Loan Bank District that was most recently announced (the "Index") by the FHLB of San Francisco as such cost of funds for the calendar month preceding the date of such announcement. If the FHLB of San Francisco fails to announce such rate for the calendar month next preceding such 11th District Interest Determination Date, then the 11th District Cost of Funds Rate for such 11th District Interest Determination Date will be the 11th District Cost of Funds Rate then in effect on such 11th District Interest Determination Date. KENNY RATE NOTES. If the Interest Rate Basis specified on the face hereof is Kenny Rate, the interest rate determined with respect to the Kenny Rate Interest Determination Date shall be the Kenny Rate plus or minus the Spread, if any, or multiplied by the Spread Multiplier, if any, specified on the face hereof, as determined on such Kenny Rate Interest Determination Date. "Kenny Rate" means, with respect to any Kenny Rate Interest Determination Date, the high grade weekly index (the "Weekly Index") on such date made available by Kenny Information Systems ("Kenny") to the Calculation Agent. The Weekly Index is, and shall be, based upon 30 day yield evaluations at par of bonds, the interest on which is exempt from Federal income taxation under the Internal Revenue Code of 1986, as amended, of not less than five high grade component issuers selected by Kenny which shall include, without limitation, issuers of general obligation bonds. The specific issuers included among the component issuers may be changed from time to time by Kenny in its discretion. The bonds on which the Weekly Index is based shall not include any bonds on which the interest is subject to a minimum tax or similar tax under the Internal Revenue Code of 1986, as amended, unless all tax-exempt bonds are subject to such tax. In the event Kenny ceases to make available such Weekly Index, a successor indexing agent will be selected by the Calculation Agent, such index to reflect the prevailing rate for bonds rated in the highest short- term rating category by Moody's Investors Service, Inc. and Standard & Poor's Corporation in respect of issuers most closely resembling the high grade component issuers selected by Kenny for its Weekly Index, the interest on which is (A) variable on a weekly basis, (B) exempt from Federal income taxation under the Internal Revenue Code of 1986, as amended, and (C) not subject to a minimum tax or similar tax under the Internal Revenue Code of 1986, as amended, unless all tax-exempt bonds are subject to such tax. If such successor indexing agent is not available, the rate for any Kenny Rate Interest Determination Date shall be 67% of the rate determined if the Treasury Rate option had been originally selected. DETERMINATION OF LIBOR. If the Interest Rate Basis specified on the face hereof is LIBOR, the interest rate determined with respect to the LIBOR Interest Determination Date shall be LIBOR plus or minus the Spread, if any, or multiplied by the Spread Multiplier, if any, specified on the face hereof, as determined on such LIBOR Interest Determination Date. LIBOR will be determined by the Calculation Agent in accordance with the following provisions: (i) With respect to any LIBOR Interest Determination Date, LIBOR will be either: (a) if "LIBOR Reuters" is specified on the face hereof, the arithmetic mean of the offered rates (unless the specified designated LIBOR Page (as defined below) by its terms provides only for a single rate, in which case such single rate shall be used) for deposits in the Designated LIBOR Currency (as defined below) having the Index Maturity designated on the face hereof, commencing on the second London Business Day immediately following the LIBOR Interest Determination Date, which appear on the Designated LIBOR Page specified on the face hereof as of 11:00 A.M., London time, on that LIBOR Interest Determination Date, if at least two such offered rates appear (unless, as aforesaid, only a single rate is required) on such Designated LIBOR Page, or (b) if "LIBOR Telerate" is specified on the face hereof, the rate for deposits in the Designated LIBOR Currency (as defined below) having the Index Maturity designated on the face hereof, commencing on the second London Business Day immediately following such LIBOR Interest Determination Date, which appears on the Designated LIBOR page specified on the face hereof as of 11:00 A.M. London time on that LIBOR Interest Determination Date. Notwithstanding the foregoing, if fewer than two offered rates appear on the Designated LIBOR Page with respect to LIBOR Reuters (unless the specified Designated LIBOR Page with respect to LIBOR Reuters by its terms provides only for a single rate, in which case such single rate shall be used), or if no rate appears on the Designated LIBOR Page with respect to LIBOR Telerate, whichever may be applicable, LIBOR in respect of the related LIBOR Interest Determination Date will be determined as if the parties had specified the rate described in clause (ii) below. (ii) With respect to any LIBOR Interest Determination Date on which fewer than two offered rates appear on the Designated LIBOR Page with respect to LIBOR Reuters (unless the Designated LIBOR -8- Page by its terms provides only for a single rate, in which case such single rate shall be used), or if no rate appears on the Designated LIBOR Page with respect to LIBOR Telerate, as the case may be, the Calculation Agent will request the principal London office of each of four major banks in the London interbank market selected by the Calculation Agent to provide the Calculation Agent with its offered rate quotation for deposits in the Designated LIBOR Currency (as defined below) for the period of the Index Maturity specified on the face hereof, commencing on the second London Business Day immediately following such LIBOR Interest Determination Date, to prime banks in the London interbank market as of 11:00 A.M., London time, on such LIBOR Interest Determination Date and in a principal amount that is representative for a single transaction in such Designated LIBOR Currency in such market at such time. If at least two such quotations are provided, LIBOR determined on such LIBOR Interest Determination Date will be the arithmetic mean of such quotations. If fewer than two quotations are provided, LIBOR determined on such LIBOR Interest Determination Date will be the arithmetic mean of the rates quoted as of 11:00 A.M. in the applicable major banks in such Principal Financial Center (as defined below), on such LIBOR Interest Determination Date by three major banks in such Principal Financial Center selected by the Calculation Agent for loans in the Designated LIBOR Currency to leading banks, having the Index Maturity designated on the face hereof in a principal amount that is representative for a single transaction in such Designated LIBOR Currency in such market at such time; provided, however, that if the banks so selected by the Calculation Agent are not quoting as mentioned in this sentence, LIBOR determined on such LIBOR Interest Determination Date will be LIBOR in effect on such LIBOR Interest Determination Date. "Designated LIBOR Currency" means the currency (including a composite currency), if any, designated on the face hereof as the Designated LIBOR Currency. If no such currency is designated in on the face hereof, the Designated LIBOR Currency shall be U.S. dollars. "Designated LIBOR Page" means either (a) the display on the Reuters Monitor Money Rates Service for the purpose of displaying the London interbank rates of major banks for the applicable Designated LIBOR Currency (if "LIBOR Reuters" is designated on the face hereof), or (b) the display on the Dow Jones Telerate Service for the purpose of displaying the London interbank rates of major banks for the applicable designated LIBOR Currency (if "LIBOR Telerate" is designated on the face hereof). If neither LIBOR Reuters nor LIBOR Telerate is specified on the face hereof, LIBOR for the applicable Designated LIBOR Currency will be determined as if LIBOR Telerate (and, if the U.S. dollar is the Designated LIBOR Currency, page 3750) had been chosen. "Principal Financial Center" means, unless otherwise specified on the face hereof, the capital city of the country that issues as its legal tender the Designated LIBOR Currency of this Note, except that with respect to U.S. dollars and ECUs, the Principal Financial Center shall be The City of New York and Brussels, respectively. DETERMINATION OF TREASURY RATE. If the Interest Rate Basis specified on the face hereof is Treasury Rate, the interest rate determined with respect to the Treasury Interest Determination Date shall be the Treasury Rate plus or minus the Spread, if any, or multiplied by the Spread Multiplier, if any, specified on the face hereof, as determined on such Treasury Interest Determination Date. "Treasury Rate" means, with respect to any Treasury Interest Determination Date, the rate for the most recent auction of direct obligations of the United States ("Treasury bills") having the Index Maturity specified on the face hereof as published in H.15(519) under the heading, "Treasury bills -- auction average (investment)" or, if not so published by 3:00 P.M., New York City time, on the Calculation Date pertaining to such Treasury Interest Determination Date, the average auction rate (expressed as a bond equivalent, on the basis of a year of 365 or 366 days, as applicable, and applied on a daily basis) as otherwise announced by the U.S. Department of the Treasury. In the event that such rate is not available by 3:00 P.M., New York City time, on such Treasury Interest Determination Date, or if no such auction is held in a particular week, then the Treasury Rate with respect to such Treasury Interest Determination Date shall be calculated by the Calculation Agent and shall be a yield to maturity (expressed as a bond equivalent, on the basis of a year of 365 or 366 days, as applicable, and applied on a daily basis) of the arithmetic mean of the secondary market bid rates, as of approximately 3:30 P.M., New York City time, on such Treasury Interest Determination Date, of three leading primary U.S. government securities dealers selected by the Calculation Agent for the issue of Treasury bills with a remaining maturity closest to the Index Maturity designated on the face hereof; provided, however, that if the dealers selected as aforesaid by the Calculation Agent are not quoting as mentioned in this sentence, the Treasury Rate with respect to such Treasury Interest Determination Date will be the Treasury Rate in effect immediately prior to such Treasury Interest Determination Date. DETERMINATION OF PRIME RATE. If the Interest Rate Basis specified on the face hereof is the Prime Rate, the interest rate determined with respect to the Prime Interest Determination Date shall be the Prime Rate plus or minus the Spread, if any, or Spread Multiplier, if any, specified on the face hereof, as determined on such Prime Interest Determination Date. "Prime Rate" means, with respect to any Prime Interest Determination Date, the rate set forth on such date in H.15(519) under the heading "Bank Prime Loan." In the event that such rate is not published prior to 9:00 A.M., New York City time, on the Calculation Date pertaining to such Prime Rate Interest Determination Date, then the Prime Rate -9- with respect to such Prime Interest Determination Date shall be the arithmetic mean of the rates of interest publicly announced by each bank that appears on the Reuters Screen NYMF Page as such bank's prime rate or base lending rate as in effect for that Prime Interest Determination Date. If fewer than four such rates appear on the Reuters Screen NYMF Page for the Prime Interest Determination Date, the Prime Rate shall be the arithmetic mean of the prime rates quoted on the basis of the actual number of days in the year divided by a 360-day year as of the close of business on such Prime Interest Determination Date by four major money center banks in The City of New York selected by the Calculation Agent. If fewer than two quotations are provided, the Prime Rate with respect to such Prime Interest Determination Date shall be determined on the basis of the rates furnished in The City of New York by the appropriate number of substitute banks or trust companies organized and doing business under the laws of the United States, or any state thereof, having total equity capital of at least U.S. $500 million and being subject to supervision or examination by Federal or state authority, selected by the Calculation Agent to provide such rate or rates; provided, however, that if the bank or trust company selected as aforesaid is not quoting as mentioned in this sentence, the Prime Rate with respect to such Prime Interest Determination Date will be the Prime Rate in effect immediately prior to such Prime Interest Determination Date. "Reuters Screen NYMF Page" means the display designated as page "NYMF" on the Reuters Monitor Money Rate Service (or such other page as may replace the NYMF page on the service for the purpose of displaying the prime rate or base lending rate of major banks). The Calculation Agent shall calculate the interest rate on this Note in accordance with the foregoing as soon as practicable after the Interest Determination Date. If the Specified Currency shown on the face hereof is a currency or currency unit other than U.S. dollars, except as provided below, payments of interest and principal (and premium, if any) with respect to this Note will be made in U.S. dollars if the Holder of this Note on the relevant Regular Record Date or at Maturity, as the case may be, has transmitted a written request for such payment in U.S. dollars to the Paying Agent at its principal office on or prior to such Regular Record Date or the date 15 days prior to Maturity, as the case may be. Such request may be delivered by mail, by hand or by cable, telex or any other form of facsimile transmission. Any such request made with respect to this Note by a Holder will remain in effect with respect to any further payments of interest and principal (and premium, if any) with respect to this Note payable to such Holder, unless such request is revoked by written notice received by the Paying Agent on or prior to the relevant Regular Record Date or the date 15 days prior to Maturity, as the case may be (but no such revocation may be made with respect to payments made on this Note if an Event of Default has occurred with respect thereto or upon the giving of a notice of redemption). A Holder whose Note is registered in the name of a broker or nominee should contact such broker or nominee to determine whether and how an election to receive payments in U.S. dollars may be made. The U.S. dollar amount to be received by the Holder of this Note who elects to receive payments in U.S. dollars will be based on the highest indicated bid quotation for the purchase of U.S. dollars in exchange for the Specified Currency obtained by the Currency Determination Agent (as defined below) at approximately 11:00 A.M., New York City time, on the second Business Day next preceding the applicable payment date (the "Conversion Date") from the bank composite or multicontributor pages of the Quoting Source for three (or two if three are not available) major banks in The City of New York. The first three (or two) such banks selected by the Currency Determination Agent which are offering quotes on the Quoting Source will be used. If fewer than two such bid quotations are available at 11:00 A.M., New York City time, on the second Business day next preceding the applicable payment date, such payment will be based on the Market Exchange Rate as of the second Business Day next preceding the applicable payment date. If the Market Exchange Rate for such date is not then available, such payment will be made in the Specified Currency. As used herein, the "Quoting Source" means Reuters Monitor Foreign Exchange Service, or if the Currency Determination Agent determines that such service is not available, Telerate Monitor Foreign Exchange Service, or if the Currency Determination Agent determines that neither service is available, such comparable display or other comparable manner of obtaining quotations as shall be agreed between the Company and the Currency Determination Agent. All currency exchange costs associated with any payment in U.S. dollars on this Note will be borne by the Holder by deductions from such payment. Any currency determination agent (the "Currency Determination Agent") with respect to this Note is specified on the face hereof. If payment in respect of this Note is required to be made in any currency unit (e.g. ECUs) and such currency unit is unavailable, in the good faith judgment of the Company, due to the imposition of exchange controls or other circumstances beyond the Company's control, then all payments in respect of this Note shall be made in U.S. dollars until such currency unit is again available. The amount of each payment of U.S. dollars shall be computed on the basis of the equivalent of the currency unit in U.S. dollars, which shall be determined by the Currency Determination Agent on the following basis. The component currencies of the currency unit for this purpose (the "Component Currencies") shall be the currency amounts that were components of the currency unit as of the Conversion Date. The equivalent of the currency unit in U.S. dollars shall be calculated by aggregating the U.S. dollar equivalents of the Component Currencies. The U.S. dollar equivalent of each of the Component Currencies shall be determined by the Currency Determination Agent on the Basis of the Market Exchange Rate for each such Component Currency as of the Conversion Date. "Market Exchange Rate" means the noon buying rate in The City of New York for cable transfers of such Specified Currency as certified for customs purposes by the Federal Reserve Bank of New York. If the official unit of any Component Currency is altered by way of combination or subdivision, the number of units of that currency as a Component Currency shall be divided or multiplied in the same proportion. If two or more Component Currencies are consolidated into a single currency, the amounts of those currencies as Component Currencies shall be replaced by an amount in such single currency equal to the sum of the amounts of the consolidated -10- Component Currencies expressed in such single currency. If any Component Currency is divided into two or more currencies, the amount of the original Component Currency shall be replaced by the amounts of such two or more currencies, the sum of which shall be equal to the amount of the original Component Currency. All determinations referred to above made by the Currency Determination Agent shall be at its sole discretion and shall, in the absence of manifest error, be conclusive for all purposes and binding on the Holder of this Note. All percentages resulting from any calculations under this Note will be rounded, if necessary, to the nearest one hundred thousandth of a percentage point (with five one-millionths of a percentage point being rounded upward) and all currency or currency unit or dollar amounts used in or resulting from any such calculation in respect of the Notes will be rounded to the nearest one- hundredth of a unit (with five one-thousandths being rounded upward) or nearest cent, as the case may be. SECTION 3. Redemption. If so specified on the face hereof, the Company may at its option redeem this Note in whole or from time to time in part on or after the date designated as the Initial Redemption Date on the face hereof at the redemption price specified on the face hereof, together with accrued and unpaid interest to the date of redemption, but interest installments whose Stated Maturity is on or prior to the date of redemption will be payable to the Holder of this Note of record at the close of business on the relevant Regular Record Date referred to on the face hereof, all as provided in the Indenture. The Company may exercise such option by causing the Trustee to mail a notice of such redemption at least 30 but not more than 60 calendar days prior to the date of redemption. In the event of redemption of this Note in part only, a new Note or Notes for the unredeemed portion hereof shall be issued in the name of the Holder hereof upon the cancellation hereof. SECTION 4. Repayment. If so specified on the face hereof, this Note will be repayable prior to Stated Maturity at the option of the Holder on the Optional Repayment Dates shown on the face hereof at the Optional Repayment Prices shown on the face hereof together with interest accrued and unpaid thereon to the date of repayment. In order for this Note (if it is repayable at the option of the Holder) to be repaid prior to Stated Maturity, the Paying Agent must receive at least 30 but not more than 45 calendar days prior to an Optional Repayment Date (i) this Note with the form below entitled "Option to Elect Repayment" duly completed or (ii) a telegram, telex, facsimile transmission or letter (first class, postage prepaid) from a member of a national securities exchange or the National Association of Securities Dealers, Inc. or a commercial bank or trust company in the United States of America setting forth the name of the Holder of this Note, the principal amount of the Note to be repaid, the certificate number or a description of the tenor and terms of this Note, a statement that the option to elect repayment is being exercised thereby and a guarantee that this Note with the form below entitled "Option to Elect Repayment" duly completed will be received by the Paying Agent not later than five Business Days after the date of such telegram, telex, facsimile transmission or letter (first class, postage prepaid). If the procedure described in clause (ii) of the preceding sentence is followed, this Note with such form duly completed must be received by the Trustee by such fifth Business Day. Exercise of the repayment option by the Holder of this Note shall be irrevocable, except that a Holder who has tendered this Note for repayment may revoke any such tender for repayment by written notice to the Paying Agent received prior to the close of business on the tenth calendar day prior to the repayment date. The repayment option may be exercised by the Holder of this Note for less than the entire principal amount of the Note provided that the principal amount of the Note remaining outstanding after repayment is an authorized denomination. Upon such partial repayment this Note shall be cancelled and a new Note or Notes for the remaining principal amount hereof shall be issued in the name of the Holder of this Note. SECTION 5. Optional Interest Reset. If so specified on the face hereof, the Spread or the Spread Multiplier on this Note may be reset by the Company on the date or dates specified on the face hereof (each an "Optional Interest Reset Date"). The Company may exercise such option by notifying the Trustee of such exercise at least 45 but not more than 60 calendar days prior to an Optional Interest Reset Date. If the Company so notifies the Trustee of such exercise, not later than 40 calendar days prior to each Optional Interest Reset Date, the Trustee will send by telegram, telex, facsimile transmission or letter (first class, postage prepaid) to the Holder of this Note a notice (the "Reset Notice") indicating (i) that the Company has elected to reset the Spread or the Spread Multiplier, (ii) such new Spread or Spread Multiplier and (iii) the provisions, if any, for redemption during the period from such Optional Interest Reset Date to the next Optional Interest Reset Date or, if there is no such next Optional Interest Reset Date, to Stated Maturity of this Note (each such period a "Subsequent Interest Period"), including the date or dates on which or the period or periods during which and the price or prices at which such redemption may occur during such Subsequent Interest Period. Notwithstanding the foregoing, not later than 20 calendar days prior to an Optional Interest Reset Date, the Company may, at its option, revoke the Spread and/or the Spread Multiplier provided for in the Reset Notice and establish a higher Spread and/or Spread Multiplier for the Subsequent Interest Period commencing on such Optional Interest Reset Date by causing the Trustee to send by telegram, telex, facsimile transmission or letter (first class, postage prepaid) notice of such higher Spread and/or Spread Multiplier to the Holder of this Note. Such notice shall be irrevocable. All Notes with respect to which the Spread and/or Spread Multiplier is reset on an Optional Interest Reset Date will bear such higher Spread and/or Spread Multiplier, whether or not tendered for repayment as provided in the next paragraph. If the Company elects prior to an Optional Interest Reset Date to reset the interest rate of this Note, the Holder of this Note will have the option to elect repayment of this Note by the Company on such Optional Interest Reset -11- Date at a price equal to the principal amount hereof plus interest accrued and unpaid thereon to such Optional Interest Reset Date. In order to obtain repayment on an Optional Interest Reset Date, the Holder must follow the procedures set forth under Section 4 for optional repayment except that the period for delivery or notification to the Trustee shall be at least 25 but not more than 35 calendar days prior to such Optional Interest Reset Date. If the Holder has tendered this Note for repayment following receipt of a Reset Notice, the Holder may revoke such tender for repayment by written notice to the Trustee received prior to the close of business on the tenth calendar day prior to such Optional Interest Reset Date. SECTION 6. Optional Extension of Maturity. If so specified on the face hereof, the Stated Maturity of this Note may be extended at the option of the Company for the period or periods of from one to five whole years specified on the face hereof (each an "Extension Period") up to but not beyond the date (the "Final Maturity Date") set forth on the face hereof. The Company may exercise such option with respect to a Note by notifying the Trustee of such exercise at least 45 but not more than 60 calendar days prior to Stated Maturity of such Note in effect prior to the exercise of such option (the "Original Stated Maturity Date"). If the Company so notifies the Trustee of such exercise, the Trustee will send by telegram, telex, facsimile transmission or letter (first class, postage prepaid) to the Holder of this Note not later than 40 calendar days prior to the Original Stated Maturity Date a notice (the "Extension Notice") indicating (i) that the Company has elected to extend the Stated Maturity of this Note, (ii) the new Stated Maturity, (iii) the Spread and/or Spread Multiplier applicable to the Extension Period and (iv) the provisions, if any, for redemption during such Extension Period, including the date or dates on which or the period or periods during which and the price or prices at which such redemption may occur during such Extension Period. Upon the Trustee's sending of the Extension Notice, Stated Maturity of this Note shall be extended automatically and, except as modified by the Extension Notice and as described in the next two paragraphs, this Note will have the same terms as prior to the sending of such Extension Notice. Notwithstanding the foregoing, not later than 20 calendar days before the Original Stated Maturity Date of this Note, the Company may, at its option, revoke the Spread and/or Spread Multiplier provided for in the Extension Notice and establish a higher Spread and/or Spread Multiplier for the Extension Period by causing the Trustee to send by telegram, telex, facsimile transmission or letter (first class, postage prepaid) notice of such higher Spread and/or Spread Multiplier to the Holder of this Note. Such notice shall be irrevocable. All Notes with respect to which Stated Maturity is extended will bear such higher Spread and/or Spread Multiplier for the Extension Period, whether or not tendered for repayment as provided in the next paragraph. If the Company extends the Stated Maturity of this Note, the Holder will have the option to elect repayment of this Note by the Company on the Original Stated Maturity Date at a price equal to the principal amount hereof, plus interest accrued and unpaid thereon to such date. In order to obtain repayment on the Original Stated Maturity Date once the Company has extended the Stated Maturity hereof, the Holder must follow the procedures set forth under Section 4 for optional repayment except that the period for delivery or notification to the Trustee shall be at least 25 but not more than 35 calendar days prior to the Original Stated Maturity Date. A Holder who has tendered this Note for repayment following receipt of an Extension Notice may revoke such tender for repayment by written notice to the Trustee received prior to the close of business on the tenth calendar day before the Original Stated Maturity Date. SECTION 7. Sinking Fund. This Note will not be subject to any sinking fund. SECTION 8. Original Issue Discount Notes. Notwithstanding anything herein to the contrary, if this Note is an Original Issue Discount Note, the amount payable in the event of redemption or repayment prior to the Stated Maturity hereof in lieu of the principal amount due at the Stated Maturity hereof shall be the Amortized Face Amount of this Note as of the redemption date or the date of repayment, as the case may be. The "Amortized Face Amount" of this Note shall be the amount equal to (a) the Issue Price (as set forth on the face hereof) plus (b) that portion of the difference between the Issue Price and the principal amount hereof that has accreted at the yield to maturity (as set forth on the face hereof) (computed in accordance with generally accepted United States bond yield computation principles) at the date as of which the Amortized Face Amount is calculated but in no event shall the Amortized Face Amount of this Note exceed its principal amount. SECTION 9. Events of Default. If any Event of Default with respect to Notes of this series shall occur and be continuing, the principal of the Notes of this series may be declared due and payable in the manner and with the effect provided in the Indenture; provided, however, that notwithstanding anything herein to the contrary, if this Note is an Original Issue Discount Note, the amount so declared due and payable shall be the Amortized Face Amount of this Note as of the date of such declaration. SECTION 10. Modifications and Waivers; Obligation of the Company Absolute. The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Company and the rights of the Holder 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 Note shall be conclusive and binding upon such Holder and upon all future Holders of this Note and of any Note issued upon the -12- 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 Note. No reference herein to the Indenture and no provision of this Note or of the Indenture shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal of, and premium, if any, and interest on this Note at the times, places and rates, and in the coin or currency, herein prescribed. SECTION 11. Defeasance and Covenant Defeasance. The Indenture contains provisions for defeasance at any time of (a) the entire indebtedness of the Company on this Note and (b) certain restrictive covenants and the related Events of Default, upon compliance by the Company with certain conditions set forth therein, which provisions apply to this Note. SECTION 12. Authorized Denominations. Unless otherwise noted on the face hereof, the Notes of this series are issuable only in global or certified registered form, without coupons, in denominations of $100,000 and any integral multiple of $1,000 in excess thereof. As provided in the Indenture and subject to certain limitations therein set forth and to the limitations described below, if applicable, Notes of this series are exchangeable for a like aggregate principal amount of Notes of this series and of like tenor of a different authorized denomination, as requested by the Holder surrendering the same. SECTION 13. Registration of Transfer. As provided in the Indenture and subject to certain limitations therein set forth and to the limitations described below, if applicable, the transfer of this Note is registrable in the Security Register upon surrender of this Note for registration of transfer at the office or agency of the Company maintained for that purpose in the Borough of Manhattan, The City of New York, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Company and the Security Registrar (which shall initially be the Trustee, 111 Wall Street, 5th Floor, New York, New York 10043 (Attention: Corporate Trust Department) or at such other address as it may designate as its principal corporate trust office in The City of New York) duly executed by, the Holder hereof or his attorney duly authorized in writing, and thereupon one or more new Notes 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. If this Note is a global Note (as specified on the face hereof), this Note is exchangeable only if (x) the U.S. Depositary notifies the Company that it is unwilling or unable to continue as U.S. Depositary for this global Note or if at any time the U.S. Depositary ceases to be a clearing agency registered under the Securities Exchange Act of 1934, as amended, (y) the Company in its sole discretion determines that this Note shall be exchangeable for certificated Notes in registered form or (z) an Event of Default, or an event which with the passage of time or the giving of notice would become an Event of Default, with respect to the Notes represented hereby has occurred and is continuing, provided that the definitive Notes so issued in exchange for this permanent global Note shall be in denominations of $100,000 and any integral multiple of $1,000 in excess thereof and be of like aggregate principal amount and tenor as the portion of this permanent global Note to be exchanged, and provided further that, unless the Company agrees otherwise, Notes of this series in certificated registered form will be issued in exchange for this permanent global Note, or any portion hereof, only if such Notes in certificated registered form were requested by written notice to the Trustee or the Security Registrar by or on behalf of a person who is beneficial owner of an interest hereof given through the Holder hereof. Except as provided above, owners of beneficial interests in this permanent global Note will not be entitled to receive physical delivery of Notes in certificated registered form and will not be considered the Holders thereof for any purpose under the Indenture. 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. SECTION 14. Owners. Prior to due presentment of this Note 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 Note be registered as the owner hereof for all purposes, whether or not this Note be overdue, and none of the Company, the Trustee or any such agent shall be affected by notice to the contrary. SECTION 15. Governing Law. The Indenture and the Notes shall be governed by and construed in accordance with the laws of the State of New York. SECTION 16. Defined Terms. All terms used in this Note which are defined in the Indenture shall have the meanings assigned to them in the Indenture; and all references in the Indenture to "Security" or "Securities" shall be deemed to include the Notes. -13- OPTION TO ELECT REPAYMENT [To be completed only if this Note is repayable at the option of the Holder and the Holder elects to exercise such rights] The undersigned owner of this Note hereby irrevocably elects to have the Company repay the principal amount of this Note or portion hereof below designated at (i) the applicable Optional Repayment Price indicated on the face hereof, together with interest accrued and unpaid thereon to the date of repayment, if this Note is to be repaid pursuant to Section 4 of this Note, or (ii) 100% of the principal amount of this Note to be repaid plus interest accrued and unpaid thereon to the Optional Interest Reset Date, if this Note is to be repaid pursuant to Section 5 hereof, or to the Original Stated Maturity Date, if this Note is to be repaid pursuant to Section 6 hereof. Specify the denomination or denominations (which shall be $100,000 or an integral multiple of $1,000 in excess thereof or, if the Note is denominated in a currency other than U.S. dollars, an Authorized Denomination) of the Note or Notes to be issued to the Holder for the portion of the within Note not being repaid (in the absence of any specification, one such Note will be issued for the portion not being repaid): ___________________________. Dated: ____________________ ______________________________ Signature Sign exactly as name appears on the front of this Note. Principal amount to be Indicate address where check if amount to be repaid is to be sent, if repaid: is less than the entire principal amount of this ______________________________ Note (principal amount remaining must be an authorized denomination) $______________________ (which shall be an integral multiple of $1,000 or, if the Note is denominated in a currency other than U.S. SOCIAL SECURITY OR OTHER dollars, of an amount equal TAXPAYER ID NUMBER to the integral multiples referred to on the face hereof ________________________ under "Authorized Denominations" (or, if no such reference is made, an amount equal to the minimum Authorized Denomination)) ______________________ ABBREVIATIONS The following abbreviations, when used in the inscription on the face of this instrument, shall be construed as though they were written out in full according to applicable laws or regulations: TEN COM - as tenants in common TEN ENT - as tenants by the entireties JT TEN - as joint tenants with right of survivorship and not as tenants in common UNIF GIFT MIN ACT - ..........Custodian.............. (Cust) (Minor) Under Uniform Gifts to Minors Act ................................. (State) Additional abbreviations may also be used though not in the above list. ____________________________________ FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE _________________________________ | | |_______________________________| ________________________________________________________________________________ PLEASE PRINT OR TYPE NAME AND ADDRESS INCLUDING POSTAL ZIP CODE OF ASSIGNEE ________________________________________________________________________________ the within Note and all rights thereunder, hereby irrevocably constituting and appointing _______________________ attorney to transfer said Note on the books of the Company, with full power of substitution in the premises. Dated:____________ ________________________________________ Signature Sign exactly as name appears on the front of this Note [SIGNATURE MUST BE GUARANTEED by a commercial bank, a trust company or by a member of the New York Stock Exchange] NOTICE: THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS WRITTEN UPON THE FACE OF THE WITHIN INSTRUMENT IN EVERY PARTICULAR, WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATEVER. EX-5 6 OPINION OF DEBORAH REGAN EXHIBIT 5 February 23, 1995 R. R. Donnelley & Sons Company 77 West Wacker Drive Chicago, Illinois 60601 Re: Registration Statement on Form S-3 of $500,000,000 Principal Amount of Debt Securities ------------------------------------------------ Ladies and Gentlemen: I refer to the Registration Statement on Form S-3 (the "Registration Statement") being filed by R.R. Donnelley & Sons Company (the "Company") with the Securities and Exchange Commission (the "SEC") under the Securities Act of 1933, as amended (the "Securities Act"), relating to the shelf registration of $500,000,000 principal amount of the Company's debt securities (the "Debt Securities"). The Debt Securities are to be issued under an Indenture (the "Indenture") between the Company and Citibank, N.A., as trustee (the "Trustee"). I am familiar with the proceedings to date with respect to the proposed issuance and sale of the Debt Securities and have examined such records, documents and questions of law, and have satisfied myself as to such matters of fact, as I have considered relevant and necessary as a basis for this opinion. Based on the foregoing, I am of the opinion that: 1. The Company is duly incorporated and validly existing under the laws of the State of Delaware. 2. The Company has duly executed and delivered the Indenture and has corporate power and authority to authorize and sell the Debt Securities. 3. Each series of Debt Securities will be legally issued and binding obligations of the Company (except to the extent enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer or other similar laws affecting the enforcement of creditors' rights generally and by the effect of general principles of equity, regardless of whether enforceability is considered in a R. R. Donnelley & Sons Company February 23, 1995 Page 2 proceeding in equity or at law) when (i) the Registration Statement, as finally amended (including any necessary post-effective amendments), shall have become effective under the Securities Act and any necessary supplemental indenture to the Indenture shall have been qualified under the Trust Indenture Act of 1939, as amended, and duly executed and delivered by the Company and the Trustee; (ii) a Prospectus Supplement with respect to such series of Debt Securities shall have been filed (or transmitted for filing) with the SEC pursuant to Rule 424 under the Securities Act; (iii) the Company's Board of Directors or a duly authorized committee thereof shall have duly adopted final resolutions authorizing the issuance and sale of such series of Debt Securities as contemplated by the Registration Statement and the Indenture; and (iv) such series of Debt Securities shall have been duly executed and authenticated as provided in the Indenture and such resolutions and shall have been duly delivered to the purchasers thereof against payment of the agreed consideration therefor. For the purposes of this opinion, I have assumed that there will be no changes in the laws currently applicable to the Company and that such laws will be the only laws applicable to the Company. I do not find it necessary for the purposes of this opinion to cover, and accordingly express no opinion as to, the application of the securities or blue sky laws of the various states to the offer or sale of the Debt Securities. I hereby consent to the filing of this opinion as an Exhibit to the Registration Statement and to the use of my name under the caption "Legal Opinions" in the Registration Statement upon its effectiveness and in any Prospectus Supplement relating to the Registration Statement reviewed and approved by me prior to the distribution of such Prospectus Supplement and filing thereof with the SEC. Very truly yours, /s/ Deborah M. Regan EX-23.1 7 CONSENT OF ARTHUR ANDERSEN EXHIBIT 23.1 CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS As independent public accountants, we hereby consent to the incorporation by reference in this Registration Statement on Form S-3 of (a) our reports dated January 27, 1994 included in the Form 10-K for the year ended December 31, 1993 of R.R. Donnelley & Sons Company (the "Company") and (b) our report dated January 26, 1995 included in the Current Report on Form 8-K dated February 21, 1995 of the Company and to all references to our Firm included in this Registration Statement. /s/ Arthur Andersen LLP _____________________________________ ARTHUR ANDERSEN LLP Chicago, Illinois February 23, 1995 EX-24 8 POWERS OF ATTORNEY EXHIBIT 24 POWER OF ATTORNEY The undersigned hereby constitutes and appoints Frank R. Jarc, Ronald G. Eidell and Deborah M. Regan, and each of them with full power to act without the other, his or her true and lawful attorney-in-fact, with full power and authority, for the purpose of executing, in the name and on behalf of the undersigned as a director and/or officer of R. R. Donnelley & Sons Company, a Delaware corporation (the "Company"), a Registration Statement on Form S-3 for the registration under the Securities Act of 1933, as amended, of the Company's debt securities and any and all amendments to such Registration Statement, including post-effective amendments, and to deliver on behalf of the undersigned such Registration Statement and any and all amendments thereto, as each thereof is so executed, for filing with the Securities and Exchange Commission. The undersigned hereby grants unto each such attorney-in-fact full power of substitution and revocation in the premises and hereby ratifies and confirms all that each such attorney-in-fact may do or cause to be done by virtue of these presents. Dated: January 26, 1995 /s/ John R. Walter ---------------------------- John R. Walter EXHIBIT 24 POWER OF ATTORNEY The undersigned hereby constitutes and appoints Ronald G. Eidell and Deborah M. Regan, and each of them with full power to act without the other, his or her true and lawful attorney-in-fact, with full power and authority, for the purpose of executing, in the name and on behalf of the undersigned as a director and/or officer of R. R. Donnelley & Sons Company, a Delaware corporation (the "Company"), a Registration Statement on Form S-3 for the registration under the Securities Act of 1933, as amended, of the Company's debt securities and any and all amendments to such Registration Statement, including post-effective amendments, and to deliver on behalf of the undersigned such Registration Statement and any and all amendments thereto, as each thereof is so executed, for filing with the Securities and Exchange Commission. The undersigned hereby grants unto each such attorney-in-fact full power of substitution and revocation in the premises and hereby ratifies and confirms all that each such attorney-in- fact may do or cause to be done by virtue of these presents. Dated: January 26, 1995 /s/ Frank R. Jarc ---------------------------- Frank R. Jarc EXHIBIT 24 POWER OF ATTORNEY The undersigned hereby constitutes and appoints Frank R. Jarc, Deborah M. Regan and Roanld G. Eidell, and each of them with full power to act without the other, his or her true and lawful attorney-in-fact, with full power and authority, for the purpose of executing, in the name and on behalf of the undersigned as a director and/or officer of R. R. Donnelley & Sons Company, a Delaware corporation (the "Company"), a Registration Statement on Form S-3 for the registration under the Securities Act of 1933, as amended, of the Company's debt securities and any and all amendments to such Registration Statement, including post-effective amendments, and to deliver on behalf of the undersigned such Registration Statement and any and all amendments thereto, as each thereof is so executed, for filing with the Securities and Exchange Commission. The undersigned hereby grants unto each such attorney-in-fact full power of substitution and revocation in the premises and hereby ratifies and confirms all that each such attorney-in-fact may do or cause to be done by virtue of these presents. Dated: January 26, 1995 /s/ William L. White ---------------------------- William L. White EXHIBIT 24 POWER OF ATTORNEY The undersigned hereby constitutes and appoints Frank R. Jarc, Ronald G. Eidell and Deborah M. Regan, and each of them with full power to act without the other, his or her true and lawful attorney-in-fact, with full power and authority, for the purpose of executing, in the name and on behalf of the undersigned as a director and/or officer of R. R. Donnelley & Sons Company, a Delaware corporation (the "Company"), a Registration Statement on Form S-3 for the registration under the Securities Act of 1933, as amended, of the Company's debt securities and any and all amendments to such Registration Statement, including post-effective amendments, and to deliver on behalf of the undersigned such Registration Statement and any and all amendments thereto, as each thereof is so executed, for filing with the Securities and Exchange Commission. The undersigned hereby grants unto each such attorney-in-fact full power of substitution and revocation in the premises and hereby ratifies and confirms all that each such attorney-in-fact may do or cause to be done by virtue of these presents. Dated: January 26, 1995 /s/ Martha Layne Collins ---------------------------- Martha Layne Collins EXHIBIT 24 POWER OF ATTORNEY The undersigned hereby constitutes and appoints Frank R. Jarc, Ronald G. Eidell and Deborah M. Regan, and each of them with full power to act without the other, his or her true and lawful attorney-in-fact, with full power and authority, for the purpose of executing, in the name and on behalf of the undersigned as a director and/or officer of R. R. Donnelley & Sons Company, a Delaware corporation (the "Company"), a Registration Statement on Form S-3 for the registration under the Securities Act of 1933, as amended, of the Company's debt securities and any and all amendments to such Registration Statement, including post-effective amendments, and to deliver on behalf of the undersigned such Registration Statement and any and all amendments thereto, as each thereof is so executed, for filing with the Securities and Exchange Commission. The undersigned hereby grants unto each such attorney-in-fact full power of substitution and revocation in the premises and hereby ratifies and confirms all that each such attorney-in-fact may do or cause to be done by virtue of these presents. Dated: January 26, 1995 /s/ James R. Donnelley ---------------------------- James R. Donnelley EXHIBIT 24 POWER OF ATTORNEY The undersigned hereby constitutes and appoints Frank R. Jarc, Ronald G. Eidell and Deborah M. Regan, and each of them with full power to act without the other, his or her true and lawful attorney-in-fact, with full power and authority, for the purpose of executing, in the name and on behalf of the undersigned as a director and/or officer of R. R. Donnelley & Sons Company, a Delaware corporation (the "Company"), a Registration Statement on Form S-3 for the registration under the Securities Act of 1933, as amended, of the Company's debt securities and any and all amendments to such Registration Statement, including post-effective amendments, and to deliver on behalf of the undersigned such Registration Statement and any and all amendments thereto, as each thereof is so executed, for filing with the Securities and Exchange Commission. The undersigned hereby grants unto each such attorney-in-fact full power of substitution and revocation in the premises and hereby ratifies and confirms all that each such attorney-in-fact may do or cause to be done by virtue of these presents. Dated: January 26, 1995 /s/ Charles C. Haffner III ---------------------------- Charles C. Haffner III EXHIBIT 24 POWER OF ATTORNEY The undersigned hereby constitutes and appoints Frank R. Jarc, Ronald G. Eidell and Deborah M. Regan, and each of them with full power to act without the other, his or her true and lawful attorney-in-fact, with full power and authority, for the purpose of executing, in the name and on behalf of the undersigned as a director and/or officer of R. R. Donnelley & Sons Company, a Delaware corporation (the "Company"), a Registration Statement on Form S-3 for the registration under the Securities Act of 1933, as amended, of the Company's debt securities and any and all amendments to such Registration Statement, including post-effective amendments, and to deliver on behalf of the undersigned such Registration Statement and any and all amendments thereto, as each thereof is so executed, for filing with the Securities and Exchange Commission. The undersigned hereby grants unto each such attorney-in-fact full power of substitution and revocation in the premises and hereby ratifies and confirms all that each such attorney-in-fact may do or cause to be done by virtue of these presents. Dated: January 26, 1995 /s/ Thomas S. Johnson ---------------------------- Thomas S. Johnson EXHIBIT 24 POWER OF ATTORNEY The undersigned hereby constitutes and appoints Frank R. Jarc, Ronald G. Eidell and Deborah M. Regan, and each of them with full power to act without the other, his or her true and lawful attorney-in-fact, with full power and authority, for the purpose of executing, in the name and on behalf of the undersigned as a director and/or officer of R. R. Donnelley & Sons Company, a Delaware corporation (the "Company"), a Registration Statement on Form S-3 for the registration under the Securities Act of 1933, as amended, of the Company's debt securities and any and all amendments to such Registration Statement, including post-effective amendments, and to deliver on behalf of the undersigned such Registration Statement and any and all amendments thereto, as each thereof is so executed, for filing with the Securities and Exchange Commission. The undersigned hereby grants unto each such attorney-in-fact full power of substitution and revocation in the premises and hereby ratifies and confirms all that each such attorney-in-fact may do or cause to be done by virtue of these presents. Dated: January 26, 1995 /s/ Richard M. Morrow ---------------------------- Richard M. Morrow EXHIBIT 24 POWER OF ATTORNEY The undersigned hereby constitutes and appoints Frank R. Jarc, Ronald G. Eidell and Deborah M. Regan, and each of them with full power to act without the other, his or her true and lawful attorney-in-fact, with full power and authority, for the purpose of executing, in the name and on behalf of the undersigned as a director and/or officer of R. R. Donnelley & Sons Company, a Delaware corporation (the "Company"), a Registration Statement on Form S-3 for the registration under the Securities Act of 1933, as amended, of the Company's debt securities and any and all amendments to such Registration Statement, including post-effective amendments, and to deliver on behalf of the undersigned such Registration Statement and any and all amendments thereto, as each thereof is so executed, for filing with the Securities and Exchange Commission. The undersigned hereby grants unto each such attorney-in-fact full power of substitution and revocation in the premises and hereby ratifies and confirms all that each such attorney-in-fact may do or cause to be done by virtue of these presents. Dated: January 26, 1995 /s/ M. Bernard Puckett ---------------------------- M. Bernard Puckett EXHIBIT 24 POWER OF ATTORNEY The undersigned hereby constitutes and appoints Frank R. Jarc, Ronald G. Eidell and Deborah M. Regan, and each of them with full power to act without the other, his or her true and lawful attorney-in-fact, with full power and authority, for the purpose of executing, in the name and on behalf of the undersigned as a director and/or officer of R. R. Donnelley & Sons Company, a Delaware corporation (the "Company"), a Registration Statement on Form S-3 for the registration under the Securities Act of 1933, as amended, of the Company's debt securities and any and all amendments to such Registration Statement, including post-effective amendments, and to deliver on behalf of the undersigned such Registration Statement and any and all amendments thereto, as each thereof is so executed, for filing with the Securities and Exchange Commission. The undersigned hereby grants unto each such attorney-in-fact full power of substitution and revocation in the premises and hereby ratifies and confirms all that each such attorney-in-fact may do or cause to be done by virtue of these presents. Dated: January 26, 1995 /s/ John M. Richman ---------------------------- John M. Richman EXHIBIT 24 POWER OF ATTORNEY The undersigned hereby constitutes and appoints Frank R. Jarc, Ronald G. Eidell and Deborah M. Regan, and each of them with full power to act without the other, his or her true and lawful attorney-in-fact, with full power and authority, for the purpose of executing, in the name and on behalf of the undersigned as a director and/or officer of R. R. Donnelley & Sons Company, a Delaware corporation (the "Company"), a Registration Statement on Form S-3 for the registration under the Securities Act of 1933, as amended, of the Company's debt securities and any and all amendments to such Registration Statement, including post-effective amendments, and to deliver on behalf of the undersigned such Registration Statement and any and all amendments thereto, as each thereof is so executed, for filing with the Securities and Exchange Commission. The undersigned hereby grants unto each such attorney-in-fact full power of substitution and revocation in the premises and hereby ratifies and confirms all that each such attorney-in-fact may do or cause to be done by virtue of these presents. Dated: January 26, 1995 /s/ William D. Sanders ---------------------------- William D. Sanders EXHIBIT 24 POWER OF ATTORNEY The undersigned hereby constitutes and appoints Frank R. Jarc, Ronald G. Eidell and Deborah M. Regan, and each of them with full power to act without the other, his or her true and lawful attorney-in-fact, with full power and authority, for the purpose of executing, in the name and on behalf of the undersigned as a director and/or officer of R. R. Donnelley & Sons Company, a Delaware corporation (the "Company"), a Registration Statement on Form S-3 for the registration under the Securities Act of 1933, as amended, of the Company's debt securities and any and all amendments to such Registration Statement, including post-effective amendments, and to deliver on behalf of the undersigned such Registration Statement and any and all amendments thereto, as each thereof is so executed, for filing with the Securities and Exchange Commission. The undersigned hereby grants unto each such attorney-in-fact full power of substitution and revocation in the premises and hereby ratifies and confirms all that each such attorney-in-fact may do or cause to be done by virtue of these presents. Dated: January 26, 1995 /s/ Jerre L. Stead ---------------------------- Jerre L. Stead EXHIBIT 24 POWER OF ATTORNEY The undersigned hereby constitutes and appoints Frank R. Jarc, Ronald G. Eidell and Deborah M. Regan, and each of them with full power to act without the other, his or her true and lawful attorney-in-fact, with full power and authority, for the purpose of executing, in the name and on behalf of the undersigned as a director and/or officer of R. R. Donnelley & Sons Company, a Delaware corporation (the "Company"), a Registration Statement on Form S-3 for the registration under the Securities Act of 1933, as amended, of the Company's debt securities and any and all amendments to such Registration Statement, including post-effective amendments, and to deliver on behalf of the undersigned such Registration Statement and any and all amendments thereto, as each thereof is so executed, for filing with the Securities and Exchange Commission. The undersigned hereby grants unto each such attorney-in-fact full power of substitution and revocation in the premises and hereby ratifies and confirms all that each such attorney-in-fact may do or cause to be done by virtue of these presents. Dated: January 26, 1995 /s/ Bide L. Thomas ---------------------------- Bide L. Thomas EXHIBIT 24 POWER OF ATTORNEY The undersigned hereby constitutes and appoints Frank R. Jarc, Ronald G. Eidell and Deborah M. Regan, and each of them with full power to act without the other, his or her true and lawful attorney-in-fact, with full power and authority, for the purpose of executing, in the name and on behalf of the undersigned as a director and/or officer of R. R. Donnelley & Sons Company, a Delaware corporation (the "Company"), a Registration Statement on Form S-3 for the registration under the Securities Act of 1933, as amended, of the Company's debt securities and any and all amendments to such Registration Statement, including post-effective amendments, and to deliver on behalf of the undersigned such Registration Statement and any and all amendments thereto, as each thereof is so executed, for filing with the Securities and Exchange Commission. The undersigned hereby grants unto each such attorney-in-fact full power of substitution and revocation in the premises and hereby ratifies and confirms all that each such attorney-in-fact may do or cause to be done by virtue of these presents. Dated: January 26, 1995 /s/ H. Blair White ---------------------------- H. Blair White EXHIBIT 24 POWER OF ATTORNEY The undersigned hereby constitutes and appoints Frank R. Jarc, Ronald G. Eidell and Deborah M. Regan, and each of them with full power to act without the other, his or her true and lawful attorney-in-fact, with full power and authority, for the purpose of executing, in the name and on behalf of the undersigned as a director and/or officer of R. R. Donnelley & Sons Company, a Delaware corporation (the "Company"), a Registration Statement on Form S-3 for the registration under the Securities Act of 1933, as amended, of the Company's debt securities and any and all amendments to such Registration Statement, including post-effective amendments, and to deliver on behalf of the undersigned such Registration Statement and any and all amendments thereto, as each thereof is so executed, for filing with the Securities and Exchange Commission. The undersigned hereby grants unto each such attorney-in-fact full power of substitution and revocation in the premises and hereby ratifies and confirms all that each such attorney-in-fact may do or cause to be done by virtue of these presents. Dated: January 26, 1995 /s/ Stephen M. Wolf ---------------------------- Stephen M. Wolf EX-25 9 CITIBANK FORM T-1 EXHIBIT 25 ---------- SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ___________________________ FORM T-1 STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939 OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE Check if an application to determine eligibility of a Trustee pursuant to Section 305(b)(2) ________________________ CITIBANK, N.A. (Exact name of trustee as specified in its charter) 13-5266470 (I.R.S. Employer Identification No.) 399 Park Avenue, New York, New York 10043 (Address of principal executive offices) (Zip Code) _______________________ R.R. DONNELLEY & SONS COMPANY (Exact name of obligor as specified in its charter) Delaware 36-1004130 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 77 West Wacker Drive Chicago, Illinois 60601 (Address of principal executive offices) (Zip Code) _______________________ Debt Securities (Title of the indenture securities) 1. General Information. Furnish the following information as to the trustee: (a) Name and address of each examining or supervising authority to which it is subject. Name Address ---- ------- Comptroller of the Currency Washington, D.C. Federal Reserve Bank of New York New York, N.Y. Federal Deposit Insurance Corporation Washington, D.C. (b) Whether it is authorized to exercise corporate trust powers. Yes. 2. Affiliations with Obligor. If the obligor is an affiliate of the Trustee, describe each such affiliation. None. 16. List of Exhibits ---------------- Exhibit 1 -- Copy of Articles of Association of the Trustee, as now in effect. (Exhibit 1 to T-1 to Registration Statement No. 2-79983). Exhibit 2 -- Copy of certificate of authority of the Trustee to commence business. (Exhibit 2 to T-1 to Registration Statement No. 2-29577). Exhibit 3 -- Copy of authorization of the Trustee to exercise corporate trust powers. (Exhibit 3 to T-1 to Registration Statement No. 2-55519). Exhibit 4 -- Copy of existing By-Laws of the Trustee. (Exhibit 4 to T-1 to Registration Statement No. 33-34988). Exhibit 5 -- Not applicable. Exhibit 6 -- The consent of the Trustee required by Section 321(b) of the Trust Indenture Act of 1939. (Exhibit 6 to T-1 to Registration Statement No. 33-19227). Exhibit 7 -- Copy of the latest Report of Condition of Citibank, N.A. (as of September 30, 1994 -- attached) Exhibit 8 -- Not applicable. Exhibit 9 -- Not applicable. SIGNATURE Pursuant to the requirements of the Trust Indenture Act of 1939, the Trustee,Citibank, N.A., a national banking association organized and existing under the laws of the United States of America, has duly caused this statement of eligibility and qualification to be signed on its behalf by the undersigned, thereunto duly authorized, all in The City of New York and State of New York, on the 14th day of February, 1995. CITIBANK, N.A. By /s/ R.T. Kirchner -------------------- R.T. Kirchner Vice President Charter No. 1461 Comptroller of the Currency Northeastern District REPORT OF CONDITION CONSOLIDATING DOMESTIC AND FOREIGN SUBSIDIARIES OF CITIBANK, N. A. of New York in the State of New York, at the close of business on September 30, 1994, published in response to call made by Comptroller of the Currency, under Title 12, United States Code, Section 161. Charter Number 1461 Comptroller of the Currency Northeastern District.
ASSETS Thousands of dollars Cash and balances due from depository institutions: Noninterest-bearing balances and currency and coin............ $ 6,482,000 Interest-bearing balances..................................... 7,724,000 Securities: Held-to-maturity securities................................... 3,836,000 Available-for-sale securities................................. 12,275,000 Federal funds sold and securities purchased under agreements to resell in domestic offices of the bank and of its Edge and Agreement subsidiaries, and in IBFs: Federal funds sold............................................. 1,954,000 Securities purchased under agreements to resell................ 1,613,000 Loans and lease financing receivables: Loans and leases, net of unearned income..........$124,721,000 LESS: Allowance for loan and lease losses......... 3,871,000 ------------ Loans and leases, net of unearned income and allowance........ 120,850,000 Assets held in trading accounts................................. 39,855,000 Premises and fixed assets (including capitalized leases)........ 3,173,000 Other real estate owned......................................... 2,689,000 Investments in unconsolidated subsidiaries and associated companies...................................................... 1,010,000 Customers' liability to this bank on acceptances outstanding.... 1,404,000 Intangible assets............................................... 14,000 Other assets.................................................... 7,463,000 ------------ TOTAL ASSETS.................................................... $210,342,000 ============ LIABILITIES Deposits: In domestic offices........................................... $ 32,505,000 Noninterest-bearing..............................$11,333,000 Interest-bearing................................. 21,172,000 ----------- In foreign offices, Edge and Agreement subsidiaries, and IBFs. 105,210,000 Noninterest-bearing.............................. 7,568,000 Interest-bearing................................. 97,642,000 ----------- Federal funds purchased and securities sold under agreements to repurchase in domestic offices of the bank and of its Edge and Agreement subsidiaries, and in IBFs: Federal funds purchased....................................... 5,588,000 Securities sold under agreements to repurchase................ 1,390,000 Trading liabilities............................................. 25,140,000 Other borrowed money: With original maturity of one year or less.................... 8,448,000 With original maturity of more than one year.................. 3,751,000 Mortgage indebtedness and obligations under capitalized leases.. 61,000 Bank's liability on acceptances executed and outstanding........ 1,425,000 Notes and debentures subordinated to deposits................... 5,200,000 Other liabilities............................................... 8,813,000 ------------ TOTAL LIABILITIES............................................... $197,531,000 ------------ EQUITY CAPITAL Common stock.................................................... $ 751,000 Surplus......................................................... 6,006,000 Undivided profits and capital reserves.......................... 6,402,000 Net unrealized holding gains (losses) on available-for-sale securities..................................................... 228,000 Cumulative foreign currency translation adjustments............. (576,000) ------------ TOTAL EQUITY CAPITAL............................................ $ 12,811,000 ------------ TOTAL LIABILITIES AND EQUITY CAPITAL............................ $210,342,000 ============
I, Roger W. Trupin, Controller of the above-named bank do hereby declare that this Report of Condition is true and correct to the best of my knowledge and belief. ROGER W. TRUPIN We, the undersigned directors, attest to the correctness of this Report of Condition. We declare that it has been examined by us, and to the best of our knowledge and belief has been prepared in conformance with the instructions and is true and correct. CHRISTOPHER J. STEFFEN ) WILLIAM R. RHODES ) Directors PAUL J. COLLINS ) -----END PRIVACY-ENHANCED MESSAGE-----