-----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, p1kx4zQzAY5Pljz3a/Z41KDZ/Peac0YqKqKBO5esT9euLAQe0z5roTPTRBlJjzHp RRZmK3gIDMF2NQpTTbBxkQ== 0000912057-94-001391.txt : 19940419 0000912057-94-001391.hdr.sgml : 19940419 ACCESSION NUMBER: 0000912057-94-001391 CONFORMED SUBMISSION TYPE: 424B3 PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 19940418 FILER: COMPANY DATA: COMPANY CONFORMED NAME: GENERAL ELECTRIC CAPITAL CORP CENTRAL INDEX KEY: 0000040554 STANDARD INDUSTRIAL CLASSIFICATION: 6172 IRS NUMBER: 131500700 STATE OF INCORPORATION: NY FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 424B3 SEC ACT: 1933 Act SEC FILE NUMBER: 033-50909 FILM NUMBER: 94523166 BUSINESS ADDRESS: STREET 1: 260 LONG RIDGE RD CITY: STAMFORD STATE: CT ZIP: 06927 BUSINESS PHONE: 2033574000 FORMER COMPANY: FORMER CONFORMED NAME: GENERAL ELECTRIC CREDIT CORP DATE OF NAME CHANGE: 19871216 424B3 1 424B3 PROSPECTUS SUPPLEMENT TO PROSPECTUS DATED APRIL 1, 1994 U.S.$6,722,762,866 General Electric Capital Corporation Global Medium-Term Notes, Series B Global Medium-Term Notes, Series C Due From 9 Months to 60 Years From Date of Issue ------------------- General Electric Capital Corporation (the "Company") may offer from time to time its Global Medium-Term Notes which are issuable in one or more series and may be offered and sold outside the United States, in the United States or both in and outside the United States simultaneously. The Global Medium-Term Notes, Series B (the "Series B Notes") and the Global Medium-Term Notes, Series C (the "Series C Notes" and, together with the Series B Notes, the "Notes") offered by this Prospectus Supplement are offered outside the United States in an aggregate principal amount of up to U.S.$6,722,762,866, or the equivalent thereof in other currencies, including composite currencies such as the European Currency Unit (the "ECU") (provided that, with respect to Original Issue Discount Notes (as defined under "Description of Notes--Original Issue Discount Notes"), the initial offering price of such Notes shall be used in calculating the aggregate principal amount of Notes offered hereunder). Such aggregate amount is subject to reduction as a result of the sale in the United States of the Company's Global Medium-Term Notes, Series A. See"Description of Notes--General" and "Plan of Distribution" herein. The Notes may be denominated in U.S. dollars or such other currency or composite currency (each such currency or composite currency a "Specified Currency") as specified in the applicable pricing supplement to this Prospectus Supplement (the "Pricing Supplement"). (CONTINUED ON NEXT PAGE) ------------------------ THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED 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 PROSPECTUS SUPPLEMENT, ANY PRICING SUPPLEMENT OR THE PROSPECTUS TO WHICH IT RELATES. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
PRICE TO AGENTS' PROCEEDS TO PUBLIC(1) COMMISSIONS(2)(3) COMPANY(2)(4) Per Note.............................. 100% .050%-.600% 99.400%-99.950% Total................................. $6,722,762,866(5)(6) $3,361,381-$40,336,577 $6,719,401,485-$6,682,426,289(5) (1) Unless otherwise indicated in a Pricing Supplement, Notes will be issued at 100% of their principal amount. (2) The Company will pay a commission to Kidder, Peabody International PLC, CS First Boston Limited, Merrill Lynch International Limited, Swiss Bank Corporation, Goldman Sachs International, S.G. Warburg Securities Ltd. and UBS Limited (collectively, the "European Agents") and, with respect to Notes denominated or payable in Deutschemarks, to CS First Boston Effectbank Aktiengesellschaft, Goldman, Sachs & Co. oHG, Merrill Lynch Bank AG, S.G. Warburg & Co. GmbH, Schweizerische Bankgesellschaft (Deutschland) AG and Schweizerischer Bankverein (Deutschland) AG (collectively, the "German Agents" and, together with the European Agents, the "Agents") ranging (except as otherwise provided in a Pricing Supplement with respect to Original Issue Discount Notes) from .050% to .600% of the principal amount of any Note, depending upon its maturity, sold through such Agent. The Company may also sell Notes to any Agent as principal at a discount for resale to one or more investors or other purchasers at fixed offering prices or at varying prices related to prevailing market prices at the time of resale or otherwise, as determined by such Agent. Unless otherwise indicated in an applicable Pricing Supplement, any Note sold to an Agent as principal 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 any agency sale of a Note of identical maturity. See "Plan of Distribution." (3) The Company has agreed to indemnify the several Agents against certain liabilities, including liabilities under the Securities Act of 1933. (4) Before deducting other expenses payable by the Company, estimated at up to $3,480,576. (5) Including the U.S. dollar equivalent with respect to any Notes denominated in foreign or composite currencies. (6) This number does not include $17,371,509,252 of the Company's Global Medium-Term Notes, Series A, B and C previously registered and issued by the Company.
------------------------ The Notes are being offered on a continuing basis by the Company through the Agents, which have agreed to use their best efforts to solicit offers to purchase the Notes. The Company also may sell Notes to any Agent acting as principal for resale to investors or other purchasers and has reserved the right to sell Notes directly to or through additional agents and to investors on its own behalf. Unless otherwise specified herein or in the applicable Pricing Supplement, the Notes will not be listed on any securities exchange, and there can be no assurance that the Notes offered by this Prospectus Supplement will be sold or that there will be a secondary market for the Notes. The Company reserves the right to withdraw, cancel or modify the offer made hereby without notice. The Company may reject any offer, or any Agent, if it receives the offer, may reject any unreasonable offer, to purchase Notes, in whole or in part. See "Plan of Distribution." Chase Bank AG has agreed with the Company to act as German Arranger (the "German Arranger") with respect to issuances of Notes denominated or payable in Deutschemarks. See "Special Provisions Relating to Foreign Currency Notes" and "Plan of Distribution" herein. This Prospectus Supplement and the accompanying Prospectus may also be used by Kidder, Peabody International PLC ("Kidder"), an affiliate of the Company, in connection with offers and sales of Notes related to market-making transactions, by and through Kidder, at negotiated prices related to prevailing market prices at the time of sale or otherwise. Kidder may act as principal or agent in such transactions. KIDDER, PEABODY INTERNATIONAL PLC CS FIRST BOSTON GOLDMAN SACHS INTERNATIONAL MERRILL LYNCH INTERNATIONAL S.G. WARBURG SECURITIES LTD. LIMITED SWISS BANK CORPORATION UBS LIMITED THE DATE OF THIS PROSPECTUS SUPPLEMENT IS APRIL 1, 1994. Each Note will mature on a day from 9 months to 60 years from its date of issue. Unless otherwise indicated herein or in the applicable Pricing Supplement and unless certain events occur involving United States taxation or information reporting requirements, the Notes may not be redeemed prior to maturity by the Company and are not subject to repayment prior to maturity at the option of the holders thereof. Any terms relating to a Specified Currency other than U.S. dollars will be as set forth in the applicable Pricing Supplement. See "Special Provisions Relating to Foreign Currency Notes." The Notes may be issued in fully registered form, in bearer form, or in any combination of registered and bearer form. Unless otherwise indicated in the applicable Pricing Supplement, definitive Bearer Notes will be issued in denominations of 1,000, 10,000 or 100,000 units of the Specified Currency, and Certificated Notes will be issued in denominations of 100,000 units of the Specified Currency and any integral multiple of 1,000 units of such Specified Currency in excess thereof. The interest rate or interest rate formula, if any, issue price, terms of redemption or repayment, if any, stated maturity and any other terms not otherwise provided in this Prospectus Supplement or in the accompanying Prospectus (the "Prospectus") will be established for each Note by the Company prior to the date of issuance of such Note and will be indicated in a Pricing Supplement. Interest rates and interest rate formulae are subject to change by the Company but no such change will affect any Note already issued or which the Company has agreed to issue. Unless otherwise indicated in the applicable Pricing Supplement, each Note will bear interest at a fixed rate or at a floating rate. The applicable Pricing Supplement will specify whether a Note bearing interest at a floating rate is a Regular Floating Rate Note, a Floating Rate/Fixed Rate Note or an Inverse Floating Rate Note and whether its rate of interest is determined by reference to one or more of the CD Rate, the Commercial Paper Rate, the Eleventh District Cost of Funds Rate, the Federal Funds Rate, LIBOR, the Prime Rate or the Treasury Rate (each an "Interest Rate Basis"), or any other interest rate basis or formula, as adjusted by the Spread and/or Spread Multiplier, if any, applicable to such Note. Unless otherwise indicated in the applicable Pricing Supplement, interest on Fixed Rate Notes is payable each March 15 and September 15 and at stated maturity or upon any earlier redemption or repayment. Interest on Floating Rate Notes is payable on the dates indicated herein and in the applicable Pricing Supplement. See "Description of Notes--Interest and Interest Rates." Original Issue Discount Notes may provide that holders of such Notes will not receive periodic payments of interest. See "Description of Notes--Original Issue Discount Notes." Notes may also be issued as Indexed Notes, as Dual Currency Notes or as Amortizing Notes, as described under "Description of Notes." Any Note purchased on original issuance by or on behalf of a United States person, subject to certain exceptions, must be a Registered Note. Bearer Notes purchased on original issuance by any other purchaser initially will be represented by a temporary global Bearer Note to be deposited with a common depositary for the Euroclear Operator and Cedel. Interests in each temporary global Bearer Note will be exchangeable for interests in a permanent global Bearer Note or for definitive Registered or Bearer Notes in the manner and upon compliance with the procedures described under "Description of Notes--Forms, Denominations, Exchange and Transfer." The Bearer Notes are subject to certain U.S. Federal income tax law requirements. Except as described herein, the Bearer Notes may not be offered, sold or delivered, directly or indirectly, in the United States or to U.S. persons. Payments on the Notes will be increased by the amount of any deduction for United States withholding taxes to the extent described under "Description of Notes--Payment of Additional Amounts." Application has been made to list the Series B Notes on the Luxembourg Stock Exchange (the "Stock Exchange"). Series C Notes will not be listed on any stock exchange. References herein to "U.S. dollars" or "U.S. $" or "$" are to the lawful currency of the United States of America. References herein to "Japanese yen" or "Y" are to the lawful currency of Japan. References herein to "Pounds sterling" or "L" are to the lawful currency of the United Kingdom of Great Britain and Northern Ireland. References herein to "Deutschemarks" or "DM" are to the lawful currency of the Federal Republic of Germany. References herein to "Dutch guilder" or "Dfl." are to the lawful currency of the Netherlands. ------------------------ NO DEALER, SALESMAN OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN OR INCORPORATED BY REFERENCE IN THIS PROSPECTUS SUPPLEMENT, THE ACCOMPANYING PROSPECTUS AND ANY PRICING SUPPLEMENT IN CONNECTION WITH THE OFFER CONTAINED IN THIS PROSPECTUS SUPPLEMENT, THE ACCOMPANYING PROSPECTUS AND ANY PRICING SUPPLEMENT AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR BY THE AGENTS. NEITHER THE DELIVERY OF THIS PROSPECTUS SUPPLEMENT, THE ACCOMPANYING PROSPECTUS AND ANY PRICING SUPPLEMENT NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATES AS OF WHICH INFORMATION IS GIVEN IN THIS PROSPECTUS SUPPLEMENT AND IN THE ACCOMPANYING PROSPECTUS. THIS PROSPECTUS SUPPLEMENT, AND THE ACCOMPANYING PROSPECTUS AND ANY PRICING SUPPLEMENT DO NOT CONSTITUTE AN OFFER OR SOLICITATION BY ANYONE IN ANY JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION IS NOT AUTHORIZED OR IN WHICH THE PERSON MAKING SUCH OFFER OR SOLICITATION IS NOT QUALIFIED TO DO SO OR TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION. IN CONNECTION WITH THE ISSUE OF NOTES UNDER THE PROGRAM DESCRIBED HEREIN, THE AGENT THAT IS SPECIFIED IN THE PRICING SUPPLEMENT IN RELATION TO THE RELEVANT ISSUE OF NOTES MAY OVER-ALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE NOTES OF SUCH ISSUE AT A LEVEL WHICH MIGHT NOT OTHERWISE PREVAIL. SUCH STABILIZATION, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME. S-2 TABLE OF CONTENTS PROSPECTUS SUPPLEMENT
PAGE --------- Description of the Company................................................................................ S-4 Capitalization............................................................................................ S-4 Selected Consolidated Earnings and Financial Position Data................................................ S-5 Description of Notes...................................................................................... S-6 Special Provisions Relating to Foreign Currency Notes..................................................... S-28 Foreign Currency Risks.................................................................................... S-31 United States Tax Considerations.......................................................................... S-33 Plan of Distribution...................................................................................... S-35 Legal Opinions............................................................................................ S-38 General Information....................................................................................... S-38
PROSPECTUS
PAGE --------- Available Information..................................................................................... 2 Documents Incorporated by Reference....................................................................... 2 The Company............................................................................................... 3 Use of Proceeds........................................................................................... 3 Plan of Distribution...................................................................................... 3 Description of Notes...................................................................................... 4 Description of Warrants................................................................................... 8 Legal Opinions............................................................................................ 9 Experts................................................................................................... 9
------------------------ S-3 DESCRIPTION OF THE COMPANY See "The Company" in the Prospectus for a description of the Company. The Directors of the Company are: N.D.T. ANDREWS............. Director, Executive Vice President J.R. BUNT.................. Director M.A. CARPENTER............. Director D.D. DAMMERMAN............. Director P. FRESCO.................. Director B.W. HEINEMAN, JR.......... Director B.J. KLOSTER, JR........... Director, Senior Vice President, General Counsel and Secretary HUGH J. MURPHY............. Director D.J. NAYDEN................ Director, Executive Vice President J.A. PARKE................. Director, Senior Vice President, Finance J.M. SAMUELS............... Director E.D. STEWART............... Director, Executive Vice President J.F. WELCH, JR............. Director G.C. WENDT................. Chairman of the Board of Directors, President and Chief Executive Officer
All of the directors of the Company are officers of the Company, GE Capital Services, Inc. ("GE Capital Services") or GE Company. Mr. Carpenter is chairman of the board, president and chief executive officer of Kidder, Peabody Group Inc. (a subsidiary of GE Capital Services). CAPITALIZATION The following table sets forth the capitalization of the Company and its consolidated affiliates, consisting of notes payable and equity, at December 31, 1993:
OUTSTANDING AT (DOLLAR AMOUNTS IN MILLIONS) DECEMBER 31, 1993 ----------------- Notes Payable: Notes Payable Within One Year........................................................... $ 52,903 Senior Notes Payable After One Year..................................................... 25,112 Subordinated Notes Payable After One Year............................................... 697 -------- Total Debt........................................................................ 78,712 -------- Equity: Variable cumulative preferred stock--par value $100, liquidation preference $100,000 per share (10,500 shares authorized and 8,750 shares outstanding).......................... 1 Common stock, $200 par value (3,866,000 shares authorized and 3,837,825 shares outstanding)........................................................................... 768 Additional paid-in capital.............................................................. 2,172 Retained earnings....................................................................... 7,008 Other................................................................................... 421 -------- Total Equity...................................................................... 10,370 -------- Total Capitalization...................................................................... $ 89,082 -------- --------
S-4 SELECTED CONSOLIDATED EARNINGS AND FINANCIAL POSITION DATA The following earnings data for each of the years in the three-year period ended December 31, 1993, and the financial position data as of December 31, 1993 and 1992, have been taken or computed from the audited financial statements of the Company and its consolidated affiliates included in the Annual Report of the Company on Form 10-K for the fiscal year ended December 31, 1993. The Annual Report referred to above is among the documents incorporated by reference in the Prospectus. The following selected earnings and financial position data should be read in conjunction with the financial statements of the Company and its consolidated affiliates contained in such documents. EARNINGS DATA
YEAR ENDED DECEMBER 31, ------------------------------- 1993 1992 1991 --------- --------- --------- (DOLLAR AMOUNTS IN MILLIONS) Earned income......................................................................... $ 14,444 $ 12,250 $ 11,328 Interest and discount expense......................................................... 3,461 3,665 4,225 Operating and administrative expense.................................................. 4,894 3,941 2,735 Insurance losses and policyholder and annuity benefits................................ 1,259 611 599 Provision for losses on financing receivables......................................... 987 1,056 1,102 Depreciation and amortization of buildings and equipment and equipment on operating leases.............................................................................. 1,587 1,297 1,187 Minority interest in net earnings of consolidated affiliates.......................... 114 14 (7) --------- --------- --------- Earnings before income taxes.......................................................... 2,142 1,666 1,487 Provision for income taxes............................................................ 664 415 362 --------- --------- --------- Net earnings........................................................................ $ 1,478 $ 1,251 $ 1,125 --------- --------- --------- --------- --------- ---------
The consolidated ratio of earnings to fixed charges for the year ended December 31, 1993 was 1.62. For purposes of computing the consolidated ratio of earnings to fixed charges, earnings consist of net earnings adjusted for the provision for income taxes, minority interest, and fixed charges. Fixed charges consist of interest and discount on all indebtedness and one-third of annual rentals, which the Company believes is a reasonable approximation of the interest factor of such rentals. FINANCIAL POSITION DATA
AT DECEMBER 31, --------------------- 1993 1992 ---------- --------- (DOLLAR AMOUNTS IN MILLIONS) Financing receivables: Time sales and loans--net of deferred income............................................ $ 40,748 $ 37,070 Investment in financing leases, net of deferred income.................................. 24,930 23,925 ---------- --------- Total financing receivables........................................................... 65,678 60,995 Allowance for losses on financing receivables........................................... (1,730) (1,607) ---------- --------- Financing receivables--net............................................................ $ 63,948 $ 59,388 ---------- --------- ---------- --------- Percent of allowance for losses on financing receivables to total financing receivables... 2.63% 2.63% ---------- --------- ---------- --------- Equipment on operating leases--net........................................................ $ 10,650 $ 9,395 ---------- --------- ---------- --------- Total assets.............................................................................. $ 117,939 $ 92,632 ---------- --------- ---------- --------- Capitalization: Notes payable within one year........................................................... $ 52,903 $ 48,492 Long-term senior debt................................................................... 25,112 21,182 Long-term subordinated debt............................................................. 697 697 Equity (a).............................................................................. $ 10,370 $ 8,892 ---------- --------- ---------- ---------
The consolidated ratios of debt to equity at December 31, 1993 and 1992 were 7.59(a) and 7.91, respectively. - -------------------------- (a) The Corporation adopted SFAS No. 115, "Accounting for Certain Investments in Debt and Equity Securities," on December 31, 1993 resulting in the inclusion of $485 million of net unrealized gains on investment securities in equity at the end of the year. Excluding such unrealized gains on investment securities, the Corporation's equity and debt to equity ratio would have been $9,885 million and 7.96 to 1 at December 31, 1993, respectively. S-5 DESCRIPTION OF NOTES GENERAL The following description of the particular terms of the Notes offered hereby (referred to in the accompanying Prospectus as the "Debt Securities") supplements, and to the extent inconsistent therewith replaces, the description of the general terms and provisions of the Debt Securities set forth in the Prospectus, to which description reference is hereby made. Unless otherwise specified in the applicable Pricing Supplement, the Notes will have the terms described below, except that references to interest payments and interest-related information do not apply to certain Original Issue Discount Notes. The Notes are to be issued under an Indenture, dated as of September 1, 1982 between the Company and The Chase Manhattan Bank (National Association), as trustee (as to which Mercantile-Safe Deposit and Trust Company (the "Trustee") is successor trustee), as supplemented (as so supplemented, the "Indenture"). The following summaries of certain provisions of the Indenture do not purport to be complete, and are subject to, and are qualified in their entirety by reference to, all the provisions of the Indenture, including the definitions therein of certain terms. The Notes will be unsecured and will rank equally with all other unsecured and unsubordinated obligations of the Company. The Notes will not limit other indebtedness or securities which may be issued by the Company and will contain no financial or similar restrictions on the Company, except as described under "Description of Notes--Certain Covenants of the Company" in the Prospectus. This Prospectus Supplement and any Pricing Supplement, may be used in connection with the offer, sale and listing from time to time of Notes in an aggregate initial public offering price of up to U.S.$6,722,762,866, or the equivalent thereof in a foreign or composite currency (provided that, with respect to Original Issue Discount Notes, the initial offering price of such Notes shall be used in calculating the aggregate principal amount of Notes offered hereunder). The aggregate principal amount of Notes authorized to be issued hereunder may be increased by the Company from time to time. Such aggregate amount is subject to reduction as a result of the sale of the Company's Global Medium-Term Notes, Series A and other issues of Debt Securities and Warrants to purchase Debt Securities offered from time to time as described in the accompanying Prospectus. As of March 31, 1994, an aggregate principal amount of $17,371,509,252 of the Company's Global Medium-Term Notes of all Series have been issued (including $8,455,255,853 aggregate principal amount of Notes). See "Plan of Distribution." The Pricing Supplement relating to a Note will describe the following terms: (i) the Specified Currency for such Note and, if other than the Specified Currency, the currency or composite currency in which payments on such Note will be made (and, if the Specified Currency or currency or composite currency of payment is other than U.S. dollars, certain other terms relating to such Note (a "Foreign Currency Note") and such Specified Currency or such currency or composite currency of payment); (ii) whether such Note is a Fixed Rate Note or a Floating Rate Note (including whether such Note is a Regular Floating Rate Note, a Floating Rate/Fixed Rate Note or an Inverse Floating Rate Note); (iii) the price at which such Note will be issued (the "Issue Price"); (iv) the date on which such Note will be issued (the "Original Issue Date"); (v) the date on which such Note will mature; (vi) if such Note is a Fixed Rate Note, the rate per annum at which such Note will bear interest, if any; (vii) if such Note is a Floating Rate Note, the Base Rate, the Initial Interest Rate, the Interest Payment Dates, the Index Maturity, the Spread and/or Spread Multiplier, if any (all as defined below) and any other terms relating to the particular method of calculating the interest rate for such Note; (viii) if such Note is an Indexed Note, the terms relating to the particular Note; (ix) if such Note is a Dual Currency Note, the terms relating to the particular Note; (x) if such Note is an Amortizing Note, the amortization schedule and any other terms relating to the particular Note; (xi) whether such Note is an Original Issue Discount Note; (xii) whether such Note may be redeemed at the option of the Company, or repaid at the option of the holder, prior to its stated maturity as described under "Optional Redemption" and "Repayment at the Noteholders' Option; Repurchase" below and, if so, the provisions relating to such S-6 redemption or repayment, including, in the case of any Original Issue Discount Notes, the information necessary to determine the amount due upon redemption or repayment; (xiii) any relevant tax consequences associated with the terms of the Notes which have not been described under "United States Tax Considerations" below; (xiv) if such Notes are Additional Notes (as defined below), a description of the original issue date and aggregate principal amount of the prior issue of Notes having terms (other than original issue date and public offering price) identical to such Additional Notes and (xv) any other terms of such Note not inconsistent with the provisions of the Indenture. Subject to such additional restrictions as are described under "Special Provisions Relating to Foreign Currency Notes," each Note will mature on a day from 9 months to 60 years from the date of issue, as specified in the applicable Pricing Supplement, as selected by the initial purchaser and agreed to by the Company. In the event that such maturity date of any Note or any date fixed for redemption or repayment of any Note (collectively, the "Maturity Date") is not a Business Day (as defined below), principal and interest payable at maturity or upon such redemption or repayment will be paid on the next succeeding Business Day with the same effect as if such Business Day were the Maturity Date. No interest shall accrue for the period from and after the Maturity Date to such next succeeding Business Day. Except as may be provided in the applicable Pricing Supplement and except for Indexed Notes, all Notes will mature at par. If any Note is to be issued as a Foreign Currency Note, the applicable Pricing Supplement will specify the currency or currencies, which may be composite currencies such as the ECU, in which the purchase price of such Note is to be paid by the purchaser, and the currency or currencies, which may be composite currencies such as the ECU, in which the principal at maturity or earlier redemption, premium, if any, and interest, if any, with respect to such Note may be paid, if applicable, along with any other terms relating to the non-U.S. dollar denomination. See "Special Provisions Relating to Foreign Currency Notes" and "Foreign Currency Risks." FORMS, DENOMINATIONS, EXCHANGE AND TRANSFER Unless otherwise specified in the applicable Pricing Supplement, the Notes may be issued (i) in fully registered definitive form without coupons ("Registered Notes") or (ii) in definitive bearer form with coupons attached or in temporary or permanent global bearer form without coupons attached (in each case, "Bearer Notes") or in any combination of the above such registered or bearer forms. Except as otherwise provided in the applicable Pricing Supplement, the Notes will be issued only in denominations of 1,000, 10,000 or 100,000 units of the Specified Currency, in the case of definitive Bearer Notes, and 100,000 units of the Specified Currency and integral multiples of 1,000 units of the Specified Currency in excess thereof, in the case of Registered Notes; provided that Notes denominated in currencies other than the U.S. dollars shall be issued in such denominations as are set forth under "Special Provisions Relating to Foreign Currency Notes." Each Bearer Note (including any global Note) and interest coupon, if any, will bear a legend substantially to the following effect: "Any United States person who holds this obligation will be subject to limitations under the United States income tax laws, including the limitations provided in Sections 165(j) and 1287(a) of the United States Internal Revenue Code." Bearer Notes may not be offered or sold, directly or indirectly, in connection with their original issuance or during the Restricted Period (as defined below), in the United States (as defined below) or to or for the account of any United States persons (as defined below), other than to a Qualifying Foreign Branch (as defined below) or to certain other persons as provided under United States Treasury Regulations Section 1.163-5(c)(2)(i)(D)(1)(iii)(B) and (C). An offer or sale will be considered to be made to a person within the United States if the offeror or seller of such Note has an address within the United States for the offeree or purchaser of such Bearer Note with respect to the offer or sale. Bearer Notes may not be delivered in the United States. As used herein, "United States person" means a citizen or resident of the United States, a corporation, partnership or other entity created or organized in or under the laws of the United States S-7 or any political subdivision thereof, or an estate or trust the income of which is subject to United States federal income taxation regardless of its source, "United States" means the United States (including the States and the District of Columbia), its territories and its possessions and "Qualifying Foreign Branch" means a branch of a United States financial institution, as defined in United States Treasury Regulations Section 1.165-12(c)(1)(v), located outside the United States that is purchasing for its own account or for resale, and that has agreed, as a condition of purchase, to comply with the requirements of Section 165(j)(3)(A), (B) or (C) of the United States Internal Revenue Code of 1986, as amended (the "Code"), and the regulations thereunder. An "Ownership Certificate" is a certificate to the effect that the relevant Bearer Note or portion thereof is owned by (i) a person that is not a United States person; (ii) a Qualifying Foreign Branch; (iii) a United States person who acquired the Bearer Notes through a Qualifying Foreign Branch and who holds the Bearer Notes through such Qualifying Foreign Branch on the date of certification; or (iv) a financial institution for purposes of resale during the Restricted Period and such financial institution (whether or not also described in clause (i), (ii) or (iii)) certifies that it has not acquired the Bearer Notes for purposes of resale directly or indirectly to a United States person or to a person within the United States. As used herein, "Restricted Period" with respect to each issuance means the period which begins on the earlier of the date on which the Company receives the proceeds of the sale of Bearer Notes with respect to such issuance, or the first date on which the Bearer Notes of such issuance are offered to persons other than the Agents, and which ends 40 days after the date on which the Company receives the proceeds of the sale of such Bearer Notes; provided that with respect to a Bearer Note held as part of an unsold allotment or subscription, any offer or sale of such Bearer Note by the Company or any Agent shall be deemed to be during the Restricted Period. Registered Notes will be exchangeable for Registered Notes in other authorized denominations, in an equal aggregate principal amount in accordance with the provisions set forth in the Indenture. Bearer Notes will be exchangeable for Registered Notes in an equal aggregate principal amount in accordance with the provisions set forth in the Indenture. Registered Notes will not be exchangeable for Bearer Notes. Registered Notes may be presented for registration of transfer or exchange at the offices of the Registrar (as defined below) or at the offices of any transfer agent designated by the Company for such purpose. See "Registrar and Transfer Agents." Bearer Notes may be presented for exchange in the manner set forth below. No service charge will be made for any registration of transfer or exchange of Notes but the Company may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection therewith. Bearer Notes and any coupons appertaining thereto will be transferable by delivery. Each Bearer Note will be represented initially by a temporary global Bearer Note, without interest coupons, to be deposited with a common depositary for Morgan Guaranty Trust Company of New York, Brussels office, as operator of the Euroclear System (the "Euroclear Operator"), and Cedel S.A. ("Cedel"), for credit to the account designated by or on behalf of the purchaser thereof. Upon deposit of each such temporary global Bearer Note, the Euroclear Operator or Cedel, as the case may be, will credit each subscriber with a principal amount of Notes equal to the principal amount thereof for which it has subscribed and paid. The interests of the beneficial owner or owners in a temporary global Bearer Note will be exchangeable, (i) after the expiration of the Restricted Period (the "Exchange Date"), for an interest in a permanent global Bearer Note to be held by a Common Depository for the Euroclear Operator and Cedel, for credit to the account designated by or on behalf of the beneficial owner thereof; PROVIDED, HOWEVER, that such exchange will be made only upon receipt of Ownership Certificates or (ii) if provided for in an applicable Pricing Supplement, during the Restricted Period, for an interest in a Registered Note. The beneficial owner of a Note represented by a permanent global Bearer Note may, upon 30 days' written notice to the Principal Paying Agent (as defined below), given by the beneficial owner through either the Euroclear Operator or Cedel, exchange such owner's interest in such permanent global Bearer Note for a definitive Bearer Note or Notes, with coupons, if any, attached or a definitive Registered Note or Notes, of any authorized denominations. No individual Bearer Note will be S-8 delivered in or to the United States. References herein to "Bearer Notes" shall, except where otherwise indicated, include interests in a permanent global Bearer Note as well as definitive Bearer Notes and any appurtenant coupons. At the option of the holder, and subject to the terms of the Indenture, definitive Bearer Notes (with all unmatured coupons, and all matured coupons, if any, in default) will be exchangeable into Registered Notes of any authorized denominations of like tenor and in an equal aggregate principal amount, in accordance with the provisions of the Indenture at the office of the Registrar or at the office of any transfer agent designated by the Company for such purpose. See "Registrar and Transfer Agents." Definitive Bearer Notes surrendered in exchange for Registered Notes after the close of business at any such office on (i) any record date for the payment of interest on a Registered Note on an Interest Payment Date (a "Regular Record Date") and before the opening of business at such office on the relevant Interest Payment Date, or (ii) any record date to be established for the payment of defaulted interest on a Registered Note (a "Special Record Date") and before the opening of business at such office on the related proposed date for payment of defaulted interest, shall be surrendered without the coupon relating to such date for payment of interest. Definitive Bearer Notes will be exchangeable for definitive Bearer Notes in other authorized denominations, in an equal aggregate principal amount, in accordance with the provisions of the Indenture and at the offices of the Principal Paying Agent in London, England or at the office of any transfer agent designated by the Company for such purpose. See "Registrar and Transfer Agents." The Company shall not be required (i) to register the transfer of or exchange Notes to be redeemed for a period of fifteen calendar days preceding the first publication of the relevant notice of redemption, or if Registered Notes are outstanding and there is no publication, the mailing of the relevant notice of redemption, or (ii) to register the transfer of or exchange any Registered Note selected for redemption or surrendered for optional repayment, in whole or in part, except the unredeemed or unpaid portion of any such Registered Note being redeemed or repaid, as the case may be, in part, or (iii) to exchange any Bearer Note selected for redemption or surrendered for optional repayment, except that such Bearer Note may be exchanged for a Registered Note of like tenor, PROVIDED that such Registered Note shall be simultaneously surrendered for redemption or repayment, as the case may be. PAYMENTS AND PAYING AGENTS Interest, if any, payable on a Bearer Note represented by a temporary global Bearer Note or any portion thereof in respect of an Interest Payment Date will be paid in the Specified Currency (unless otherwise provided in the applicable Pricing Supplement) to each of the Euroclear Operator and Cedel, as the case may be, with respect to that portion of such temporary global Bearer Note held for its account upon delivery to the Principal Paying Agent of an Ownership Certificate signed by the Euroclear Operator or Cedel, as the case may be, dated no earlier than such Interest Payment Date, which certificate must be based on Ownership Certificates provided to the Euroclear Operator or Cedel, as the case may be, by its member organizations. Each of the Euroclear Operator and Cedel, as the case may be, will in such circumstances credit the interest received by it in respect of such temporary global Bearer Note or any portion thereof to the accounts of the beneficial owners thereof. Each permanent global Bearer Note will provide that principal of and premium, if any, and interest, if any, on such permanent global Bearer Note, in respect of an Interest Payment Date, will be paid in the Specified Currency (unless otherwise provided in the applicable Pricing Supplement) to each of the Euroclear Operator and Cedel, as the case may be, with respect to that portion of such permanent global Bearer Note held for its account. Each of the Euroclear Operator and Cedel will in such circumstances credit such principal and any interest received by it in respect of such permanent global Bearer Note to the respective accounts of the beneficial owners of such permanent global Bearer Note at maturity, redemption or repayment or on such Interest Payment Date, as the case may be. If a Registered Note is issued in exchange for any portion of a permanent global Bearer Note after the close of business at the office or agency where such exchange occurs on (a) any Regular Record S-9 Date and before the opening of business at such office or agency on the relevant Interest Payment Date, or (b) any Special Record Date and before the opening of business at such office or agency on the related proposed date for payment of defaulted interest, any interest or defaulted interest, as the case may be, will not be payable on such Interest Payment Date or proposed date for payment, as the case may be, in respect of such Registered Note, but will be payable on such Interest Payment Date or proposed date for payment, as the case may be, only to the Euroclear Operator and Cedel, and the Euroclear Operator and Cedel will in such circumstances credit any such interest to the account of the beneficial owner of such portion of such permanent global Bearer Note on such Regular Record Date or Special Record Date, as the case may be. Payment of principal of, and premium, if any, and any interest due at maturity, redemption or repayment (in the event, with respect to payment of interest, that any such maturity date or redemption or repayment date is other than an Interest Payment Date) in respect of any permanent global Bearer Note will be made to the Euroclear Operator and Cedel in immediately available funds. Payment of principal of and premium, if any, and interest on Bearer Notes at maturity or upon redemption or repayment will be made in immediately available funds in the Specified Currency (unless otherwise provided in the applicable Pricing Supplement), subject to any applicable laws and regulations, only against presentation and surrender of such Note and any coupons at the offices of a Paying Agent outside the United States, at the option of the holder, by check or by wire transfer of immediately available funds to an account maintained by the payee with a bank located outside the United States if appropriate wire instructions have been received by a Paying Agent not less than 10 calendar days prior to an applicable payment date. Payment of interest on Bearer Notes due on any Interest Payment Date will be made only against presentation and surrender of the coupon relating to such Interest Payment Date. No payment with respect to any Bearer Note will be made at any office or agency of the Company in the United States or by check mailed to any address in the United States or by wire transfer to an account maintained with a bank located in the United States except as may be permitted under United States federal tax laws and regulations then in effect without adverse tax consequences to the Company. Notwithstanding the foregoing, payments of principal of and premium, if any, and interest on Bearer Notes denominated and payable in U.S. dollars will be made at the office of the Company's paying agent in the Borough of Manhattan, The City of New York, if and only if (i) payment of the full amount thereof in U.S. dollars at all offices or agencies outside the United States is illegal or effectively precluded by exchange controls or other similar restrictions and (ii) such paying agent in the Borough of Manhattan, The City of New York, under applicable law and regulations, would be able to make such payment. Payment of principal of and premium, if any, and interest on Registered Notes at maturity or upon redemption or repayment will be made in immediately available funds in the Specified Currency (unless otherwise provided in the applicable Pricing Supplement) against presentation of such Note at the office of a Paying Agent. Payment of interest on Registered Notes will be made to the person in whose name such Note is registered at the close of business on the Regular Record Date next preceding the Interest Payment Date either by check mailed to the address of the person entitled thereto as such address shall appear in the security register or by wire transfer to an account selected by the person entitled thereto if appropriate wire instructions have been received by the Paying Agent not less than 10 calendar days prior to the applicable payment date; PROVIDED, HOWEVER, that (i) if the Company fails to pay such interest on such Interest Payment Date, such defaulted interest will be paid to the person in whose name such Note is registered at the close of business on the Special Record Date and (ii) interest payable at maturity, redemption or repayment will be payable to the person to whom principal shall be payable. The first payment of interest on any Registered 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 next Regular Record Date. Interest rates and interest rate formulae are subject to change by the Company from time to time but no such change will affect any Note theretofore issued or which the Company has agreed to issue. Unless otherwise indicated in the applicable Pricing Supplement, the Interest Payment Dates and the Regular Record Dates for Fixed Rate Notes shall be as described below under S-10 "Fixed Rate Notes." The Interest Payment Dates for Floating Rate Notes shall be as indicated in the applicable Pricing Supplement and in such Note, and, unless otherwise specified in the applicable Pricing Supplement, each Regular Record Date for a Registered Floating Rate Note will be the fifteenth day (whether or not a Business Day) next preceding each Interest Payment Date. The Company has initially designated The Chase Manhattan Bank (National Association) as its paying agent for the Registered Notes in the United States, and The Chase Manhattan Bank (National Association), London Branch, as its principal paying agent (the "Principal Paying Agent", which term includes any successor principal paying agent appointed by the Company) and Chase Manhattan Bank Luxembourg S.A. and Banque Bruxelles Lambert S.A., as its paying agents for the Notes outside the United States (each a "Paying Agent", which term includes the Principal Paying Agent and any additional or successor paying agent appointed by the Company). So long as the Series B Notes are listed on the Stock Exchange and such Exchange so requires, the Company shall maintain a Paying Agent in Luxembourg. All moneys paid by the Company to the Principal Paying Agent or any Paying Agent for the payment of any amounts payable on any Notes which remain unclaimed at the end of three years after such amounts shall have become due and payable shall be repaid to the Company, and the holders of the Notes shall thereafter look only to the Company for payment. REGISTRAR AND TRANSFER AGENTS The Company has initially designated The Chase Manhattan Bank (National Association) as registrar and transfer agent for the Registered Notes (the "Registrar", which term includes any successor Registrar appointed by the Company), and The Chase Manhattan Bank (National Association), London Branch, as transfer agent for the Bearer Notes. Any initial designation by the Company of the Registrar or a transfer agent may be rescinded at any time, except that, so long as any Notes remain outstanding, the Company will maintain in the The City of New York, one or more offices or agencies where Registered Notes may be presented for registration of transfer and exchange. The Company may at any time designate additional transfer agents with respect to the Notes. OPTIONAL REDEMPTION The Pricing Supplement will indicate either that the Notes cannot be redeemed prior to maturity (other than as provided under "Tax Redemption" below) or will indicate the terms on which the Notes will be redeemable at the option of the Company; PROVIDED, HOWEVER, that Notes denominated in currencies other than U.S. dollars may be subject to different restrictions on redemption as set forth under "Special Provisions Relating to Foreign Currency Notes--Minimum Denominations, Restrictions on Maturities, Repayment and Redemption" herein. Notice of redemption to holders of Bearer Notes shall be published as described under "Notices" below once in each of three successive calendar weeks, the first publication to be not less than 30 nor more than 60 calendar days prior to the date set for redemption. Notice of redemption to holders of Registered Notes shall be provided as described under "Notices" below at least 30 and not more than 60 calendar days prior to the date fixed for redemption. REPAYMENT AT THE NOTEHOLDERS' OPTION; REPURCHASE If applicable, the Pricing Supplement will indicate that the Notes will be repayable at the option of the holder on a date or dates specified prior to its stated maturity date (an "Optional Repayment Date") and, unless otherwise specified in such Pricing Supplement, at a price equal to 100% of the principal amount thereof, together with accrued interest to, but not including, the date of repayment; PROVIDED, HOWEVER, that Notes denominated in currencies other than U.S. dollars may be subject to different restrictions on repayment as set forth under "Special Provisions Relating to Foreign Currency Notes--Minimum Denominations, Restrictions on Maturities, Repayment and Redemption" herein. If no Optional Repayment Date is included with respect to a Note, such Note will not be repayable at the option of the holder prior to its maturity. S-11 In order for such a Note to be repaid, and unless provided otherwise in the applicable Pricing Supplement, a Paying Agent must receive at least 30 but not more than 60 calendar days prior to the Optional Repayment Date, (i) the Note with the form entitled "Option to Elect Repayment" on the reverse of the Note duly completed or (ii) a telegram, facsimile transmission or a letter from a member of a national securities exchange or a member of the National Association of Securities Dealers, Inc. (the "NASD") or a commercial bank or trust company in the United States or Western Europe which must set forth the name of the holder of the Note (in the case of a Registered Note only), the principal amount of the Note, the principal amount of the Note to be repaid, the certificate number or a description of the tenor and terms of the Note, a statement that the option to elect repayment is being exercised thereby and a guarantee that the Note to be repaid, together with the duly completed form entitled "Option to Elect Repayment" on the reverse of the Note, will be received by the Paying Agent not later than the fifth Business Day after the date of such telegram, facsimile transmission or letter; PROVIDED, HOWEVER, that such telegram, facsimile transmission or letter from a member of a national securities exchange or a member of the NASD, or a commercial bank or trust company in the United States or Western Europe shall only be effective in such case if such Note and form duly completed are received by a Paying Agent by such fifth Business Day. Exercise of the repayment option by the holder of a Note will be irrevocable. The repayment option may be exercised by the holder of a Note for less than the entire principal amount of the Note but, in that event, the principal amount of the Note remaining outstanding after repayment must be an authorized denomination. The Company may at any time purchase Notes at any price in the open market or otherwise. Notes purchased by the Company may, at its discretion, be held, resold or surrendered to the Registrar for cancellation. TAX REDEMPTION ALL NOTES. All Notes issued on the same date may be redeemed as a whole, at the option of the Company at any time prior to maturity, upon the giving of a notice of redemption as described below, at a redemption price (except as otherwise specified herein or in the applicable Pricing Supplement) equal to 100% of the principal amount thereof, together with accrued interest to the date fixed for redemption, or, in the case of Original Issue Discount Notes, at 100% of the portion of the face amount thereof that has accreted to the date of redemption, if the Company determines that, as a result of any change in or amendment to the laws (or any regulations or rulings promulgated thereunder) of the United States or of any political subdivision or taxing authority thereof or therein affecting taxation, or any change in official position regarding the application or interpretation of such laws, regulations or rulings, which change or amendment becomes effective on or after the date of issuance of such Notes (if sold on an agency basis) or the date on which an Agent acting as principal agreed to purchase such Notes, the Company has or will become obligated to pay Additional Amounts with respect to such Notes as described under "Payment of Additional Amounts." Prior to the giving of any notice of redemption pursuant to this paragraph, the Company shall deliver to the Trustee (i) a certificate stating that the Company is entitled to effect such redemption and setting forth a statement of facts showing that the conditions precedent to the right of the Company to so redeem have occurred (the date on which such certificate is delivered to the Trustee is herein called the "Redemption Determination Date"), and (ii) an opinion of counsel satisfactory to the Company to such effect based on such statement of facts; provided that no such notice of redemption shall be given earlier than 90 days prior to the earliest date on which the Company would be obligated to pay such Additional Amounts if a payment in respect of such Notes were then due. Notice of redemption will be given not less than 30 nor more than 60 days prior to the date fixed for redemption, which date and the applicable redemption price will be specified in the notice. Such notice will be given in accordance with "Notices" below. If any date fixed for redemption is a date prior to the Exchange Date, definitive Bearer Notes will be issuable on and after such redemption date as if such redemption date had been the Exchange Date, subject to receipt of Ownership Certificates described above under "Forms, Denominations, Exchange and Transfer," delivery of which is a condition to delivery of definitive Bearer Notes. S-12 SPECIAL TAX REDEMPTION OF BEARER NOTES. If the Company shall determine that any payment made outside the United States by the Company or any Paying Agent of principal or interest due in respect of any Bearer Note or coupon would or would be likely to, under any present or future laws or regulations of the United States, be subject to any certification, identification or other information reporting requirement of any kind, the effect of which requirement is the disclosure to the Company, any Paying Agent or any governmental authority of the nationality, residence or identity of a beneficial owner of such Bearer Note or coupon who is a United States Alien (as defined in "Payment of Additional Amounts") (other than such a requirement (a) which would not be applicable to a payment made by the Company or any Paying Agent (i) directly to the beneficial owner or (ii) to a custodian, nominee or other agent of the beneficial owner, or (b) which can be satisfied by such custodian, nominee or other agent certifying to the effect that such beneficial owner is a United States Alien, provided that in each case referred to in clauses (a)(ii) and (b) payment by such custodian, nominee or agent to such beneficial owner is not otherwise subject to any such requirement), the Company shall redeem the Bearer Notes of such series, as a whole, at a redemption price equal to 100% of the principal amount thereof, together with accrued interest to the date fixed for redemption, or, in the case of Original Issue Discount Notes, at 100% of the portion of the face amount thereof that has accreted to the date of redemption, or, at the election of the Company if the conditions of the next paragraph are satisfied, pay the additional amounts specified in such paragraph. The Company shall make such determination and election as soon as practicable and publish prompt notice thereof (the "Determination Notice") stating the effective date of such certification, identification or other information reporting requirements, whether the Company will redeem the Bearer Notes of such series or has elected to pay the additional amounts specified in the next paragraph, and (if applicable) the last date by which the redemption of the Bearer Notes of such series must take place, as provided in the next sentence. If the Company redeems the Bearer Notes of such series, such redemption shall take place on such date, not later than one year after the publication of the Determination Notice, as the Company shall elect by notice to the Trustee at least 60 days prior to the date fixed for redemption. Notice of such redemption of the Bearer Notes of such series will be given to the holders of such Bearer Notes not more than 60 nor less than 30 days prior to the date fixed for redemption. Such redemption notice shall include a statement as to the last date by which the Bearer Notes of such series to be redeemed may be exchanged for Registered Notes. Notwithstanding the foregoing, the Company shall not so redeem such Bearer Notes if the Company shall subsequently determine, not less than 30 days prior to the date fixed for redemption, that subsequent payments would not be subject to any such requirement, in which case the Company shall publish prompt notice of such determination and any earlier redemption notice shall be revoked and of no further effect. The right of the holders of Bearer Notes called for redemption pursuant to this paragraph to exchange such Bearer Notes for Registered Notes will terminate at the close of business of the Principal Paying Agent on the fifteenth day prior to the date fixed for redemption, and no further exchanges of Bearer Notes for Registered Notes shall be permitted. If and so long as the certification, identification or other information reporting requirements referred to above in the preceding paragraph would be fully satisfied by payment of a backup withholding tax or similar charge, the Company may elect to pay as additional amounts such amounts as may be necessary so that every net payment made outside the United States following the effective date of such requirements by the Company or any Paying Agent of principal or interest due in respect of any Bearer Note or any coupon of which the beneficial owner is a United States Alien (as defined below) (but without any requirement that the nationality, residence or identity of such beneficial owner be disclosed to the Company, any Paying Agent or any governmental authority, with respect to the payment of such additional amounts), after deduction or withholding for or on account of such backup withholding tax or similar charge (other than a backup withholding tax or similar charge which (i) would not be applicable in the circumstances referred to in the second parenthetical clause of the first sentence of the preceding paragraph, or (ii) is imposed as a result of presentation of such Bearer Note or coupon for payment more than 15 days after the date on which such payment becomes due and payable or on which payment thereof is duly provided for, whichever occurs later), will not be less than the amount provided for in such Bearer Note or coupon to be then due and payable. In the event the S-13 Company elects to pay any additional amounts pursuant to this paragraph, the Company shall have the right to redeem the Bearer Notes of such series as a whole at any time pursuant to the applicable provisions of the preceding paragraph and the redemption price of such Bearer Notes shall not be reduced for applicable withholding taxes. If the Company elects to pay additional amounts pursuant to this paragraph and the condition specified in the first sentence of this paragraph should no longer be satisfied, then the Company shall redeem the Bearer Notes of such series as a whole, pursuant to the applicable provisions of the preceding paragraph. PAYMENT OF ADDITIONAL AMOUNTS The Company will, subject to certain exceptions and limitations set forth below, pay such additional amounts (the "Additional Amounts") to the holder of any Note or of any coupon appertaining thereto who is a United States Alien (as defined below) as may be necessary in order that every net payment of the principal of and interest on such Note and any other amounts payable on such Note, after withholding for or on account of any present or future tax, assessment or governmental charge imposed upon or as a result of such payment by the United States (or any political subdivision or taxing authority thereof or therein), will not be less than the amount provided for in such Note or coupon to be then due and payable. However, the Company will not be required to make any payment of Additional Amounts to any such holder for or on account of: (a) any such tax, assessment or other governmental charge which would not have been so imposed but for (i) the existence of any present or former connection between such holder (or between a fiduciary, settlor, beneficiary, member or shareholder of such holder, if such holder is an estate, a trust, a partnership or a corporation) and the United States, including, without limitation, such holder (or such fiduciary, settlor, beneficiary, member or shareholder) being or having been a citizen or resident thereof or being or having been engaged in a trade or business or present therein or having, or having had, a permanent establishment therein or (ii) the presentation by the holder of any such Note or coupon for payment on a date more than 15 days after the date on which such payment became due and payable or the date on which payment thereof is duly provided for, whichever occurs later; (b) any estate, inheritance, gift, sales, transfer or personal property tax or any similar tax, assessment or governmental charge; (c) any tax, assessment or other governmental charge imposed by reason of such holder's past or present status as a personal holding company or foreign personal holding company or controlled foreign corporation or passive foreign investment company with respect to the United States or as a corporation which accumulates earnings to avoid United States federal income tax or as a private foundation or other tax-exempt organization; (d) any tax, assessment or other governmental charge which is payable otherwise than by withholding from payments on or in respect of any Note; (e) any tax, assessment or other governmental charge required to be withheld by any Paying Agent from any payment of principal of, or interest on, any Note, if such payment can be made without such withholding by any other Paying Agent in a city in Western Europe; (f) any tax, assessment or other governmental charge which would not have been imposed but for the failure to comply with certification, information or other reporting requirements concerning the nationality, residence or identity of the holder or beneficial owner of such Note, if such compliance is required by statute or by regulation of the United States or of any political subdivision or taxing authority thereof or therein as a precondition to relief or exemption from such tax, assessment or other governmental charge; (g) any tax, assessment or other governmental charge imposed by reason of such holder's past or present status as the actual or constructive owner of 10% or more of the total combined voting power of all classes of stock entitled to vote of the Company or as a direct or indirect subsidiary of the Company; (h) any tax, assessment or other governmental charge required to be withheld on contingent interest described in Section 871(h)(4) of the Internal Revenue Code of 1986, as amended; or (i) any combination of items (a), (b), (c), (d), (e), (f), (g) or (h); S-14 nor shall Additional Amounts be paid with respect to any payment on a Note to a United States Alien who is a fiduciary or partnership or other than the sole beneficial owner of such payment to the extent such payment would be required by the laws of the United States (or any political subdivision thereof) to be included in the income, for tax purposes, of a beneficiary or settlor with respect to such fiduciary or a member of such partnership or a beneficial owner who would not have been entitled to the Additional Amounts had such beneficiary, settlor, member or beneficial owner been the holder of the Note. The term "United States Alien" means any person who, for United States federal income tax purposes, is a foreign corporation, a non-resident alien individual, a non-resident alien fiduciary of a foreign estate or trust, or a foreign partnership, one or more of the members of which is a foreign corporation, a non-resident alien individual or a non-resident alien fiduciary of a foreign estate or trust. INTEREST AND INTEREST RATES GENERAL Unless otherwise specified in the applicable Pricing Supplement, each Note will bear interest at either (a) a fixed rate (the "Fixed Rate Notes") or (b) a floating rate determined by reference to an Interest Rate Basis (the "Floating Rate Notes"), which may be adjusted by a Spread and/or Spread Multiplier (each as defined below). Any Floating Rate Note may also have either or both of the following: (i) a maximum interest rate limitation, or ceiling, on the rate at which interest may accrue during any interest period; and (ii) a minimum interest rate limitation, or floor, on the rate at which interest may accrue during any interest period. The applicable Pricing Supplement will designate (a) a fixed rate per annum, in which case such Notes will be Fixed Rate Notes; or (b) one or more of the following Interest Rate Bases as applicable to such Notes, in which case such Notes will be Floating Rate Notes: (i) the CD Rate, in which case such Notes will be "CD Rate Notes"; (ii) the Commercial Paper Rate, in which case Notes will be "Commercial Paper Rate Notes"; (iii) the Eleventh District Cost of Funds Rate, in which case such Notes will be "Eleventh District Cost of Funds Rate Notes"; (iv) the Federal Funds Rate, in which case such Notes will be "Federal Funds Rate Notes"; (v) LIBOR, in which case such Notes will be "LIBOR Notes"; (vi) the Prime Rate, in which case such Notes will be "Prime Rate Notes"; (vii) the Treasury Rate, in which case such Notes will be "Treasury Rate Notes"; or (viii) such other interest rate basis or formula as is set forth in such Pricing Supplement. Each Note will bear interest from its date of issue or from the most recent date to which interest on such Note has been paid or duly provided for, at the annual rate, or at a rate determined pursuant to an interest rate formula, stated therein, until the principal thereof is paid or made available for payment. Interest will be payable on each Interest Payment Date (except for certain Original Issue Discount Notes and except for Notes originally issued between a Regular Record Date and an Interest Payment Date) and at maturity or on redemption or repayment, if any. Interest will be payable on a Registered Note to the person in whose name such Note is registered at the close of business on the Regular Record Date next preceding the Interest Payment Date; PROVIDED, HOWEVER, that (i) if the Company fails to pay such interest on such Interest Payment Date, such defaulted interest will be paid to the person in whose name such Registered Note is registered at the close of business on the record date to be established for the payment of defaulted interest and (ii) interest payable at maturity, redemption or repayment will be payable to the person to whom principal shall be payable. The first payment of interest on any Registered 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 next Regular Record Date. Interest rates and interest rate formulae are subject to change by the Company from time to time but no such change will affect any Note theretofore issued or which the Company has agreed to issue. Unless otherwise indicated in the applicable Pricing Supplement, the Interest Payment Dates and any Regular Record Dates for Fixed Rate Notes shall be as described below under "Fixed Rate Notes." The Interest Payment Dates for Floating Rate Notes shall be as indicated in the S-15 applicable Pricing Supplement and in such Note, and, unless otherwise specified in the applicable Pricing Supplement, any Regular Record Date for a Floating Rate Note will be the fifteenth calendar day (whether or not a Business Day) next preceding each Interest Payment Date. FIXED RATE NOTES Each Fixed Rate Note will bear interest at the annual rate specified therein and in the applicable Pricing Supplement. Unless otherwise specified in the applicable Pricing Supplement, the Interest Payment Dates for the Fixed Rate Notes will be on March 15 and September 15 of each year and the Regular Record Dates for Fixed Rate Notes in registered form will be on the last day of February and August of each year. Unless otherwise specified in the applicable Pricing Supplement, interest on Fixed Rate Notes will be computed and paid on the basis of a 360-day year of twelve 30-day months. In the event that any Interest Payment Date or Maturity Date for any Fixed Rate Note is not a Business Day (as defined below under "Floating Rate Notes"), interest on such Fixed Rate Note will be paid on the next succeeding Business Day and no interest on such payment shall accrue for the period from and after such Interest Payment Date to such next succeeding Business Day. FLOATING RATE NOTES Unless otherwise specified in an applicable Pricing Supplement, Floating Rate Notes will be issued as described below. Each applicable Pricing Supplement will specify certain terms with respect to which such Floating Rate Note is being delivered, including: whether such Floating Rate Note is a Regular Floating Rate Note, an Inverse Floating Rate Note or a Floating Rate/Fixed Rate Note (each as defined below); the Interest Rate Basis or Bases, Initial Interest Rate, Interest Reset Dates, Interest Reset Period, Regular Record Dates (if any), Interest Payment Dates, Index Maturity, maximum interest rate and minimum interest rate, if any, and the Spread and/or Spread Multiplier, if any, and if one or more of the specified Interest Rate Bases is LIBOR, the Index Currency, as described below. The interest rate borne by the Floating Rate Notes will be determined as follows: (a) Unless such Floating Rate Note is designated as a Floating Rate/Fixed Rate Note, an Inverse Floating Rate Note or as having an Addendum attached, such Floating Rate Note will be designated a "Regular Floating Rate Note" and, except as described below or in an applicable Pricing Supplement, will bear interest at the rate determined by reference to the applicable Interest Rate Basis (i) plus or minus the applicable Spread, if any, and/or (ii) multiplied by the applicable Spread Multiplier, if any. Commencing on the Initial Interest Reset Date, the rate at which interest on such Regular Floating Rate Note shall be payable shall be reset as of each Interest Reset Date; PROVIDED, HOWEVER, that (i) the interest rate in effect for the period from the Original Issue Date to the Initial Interest Reset Date will be the Initial Interest Rate, and (ii) unless otherwise specified in the applicable Pricing Supplement, the interest rate in effect for the ten calendar days immediately prior to a Maturity Date shall be that in effect on the tenth calendar day preceding such Maturity Date. (b) If such Floating Rate Note is designated as a "Floating Rate/Fixed Rate Note," then, except as described below or in an applicable Pricing Supplement, such Floating Rate Note will initially bear interest at the rate determined by reference to the applicable Interest Rate Basis (i) plus or minus the applicable Spread, if any, and/or (ii) multiplied by the applicable Spread Multiplier, if any. Commencing on the Initial Interest Reset Date, the rate at which interest on such Floating Rate/Fixed Rate Note shall be payable shall be reset as of each Interest Reset Date; PROVIDED, HOWEVER, that (i) the interest rate in effect for the period from the Original Issue Date to the Initial Interest Reset Date will be the Initial Interest Rate; (ii) unless otherwise specified in the applicable Pricing Supplement, the interest rate in effect for the ten calendar days immediately prior to the Fixed Rate Commencement Date shall be that in effect on the tenth calendar day preceding the Fixed Rate Commencement Date; and (iii) the interest rate in effect commencing on, and including, the Fixed Rate Commencement Date to the Maturity Date shall be the Fixed Interest Rate, if such rate is specified in the applicable Pricing Supplement, or if no such Fixed S-16 Interest Rate is so specified and the Floating Rate/Fixed Rate Note is still outstanding on such day, the interest rate in effect thereon on the day immediately preceding the Fixed Rate Commencement Date. (c) If such Floating Rate Note is designated as an "Inverse Floating Rate Note," then, except as described below or in an applicable Pricing Supplement, such Floating Rate Note will bear interest equal to the Fixed Interest Rate specified in the related Pricing Supplement minus the rate determined by reference to the Interest Rate Basis (i) plus or minus the applicable Spread, if any, and/or (ii) multiplied by the applicable Spread Multiplier, if any; PROVIDED, HOWEVER, that the interest rate thereon will not be less than zero. Commencing on the Initial Interest Reset Date, the rate at which interest on such Inverse Floating Rate Note is payable shall be reset as of each Interest Reset Date; PROVIDED, HOWEVER, that (i) the interest rate in effect for the period from the Original Issue Date to the Initial Interest Reset Date will be the Initial Interest Rate, and (ii) unless otherwise specified in the applicable Pricing Supplement, the interest rate in effect for the ten calendar days immediately prior to a Maturity Date shall be that in effect on the tenth calendar day preceding such Maturity Date. Notwithstanding the foregoing, if such Floating Rate Note is designated as having an Addendum attached as specified on the face thereof, such Floating Rate Note shall bear interest in accordance with the terms described in such Addendum and the applicable Pricing Supplement. See "Other Provisions, Addenda" below. Unless otherwise provided in the applicable Pricing Supplement, each Interest Rate Basis shall be the rate determined in accordance with the applicable provisions below. Except as set forth above or in an applicable Pricing Supplement, the interest rate in effect on each day shall be (a) if such day is an Interest Reset Date, the interest rate determined on the Interest Determination Date (as defined below) immediately preceding such Interest Reset Date or (b) if such day is not an Interest Reset Date, the interest rate determined on the Interest Determination Date immediately preceding the next preceding Interest Reset Date. Interest on Floating Rate Notes will be determined by reference to an "Interest Rate Basis," which may be one or more of (i) the CD Rate, (ii) the Commercial Paper Rate, (iii) the Eleventh District Cost of Funds Rate, (iv) the Federal Funds Rate, (v) LIBOR, (vi) the Prime Rate, (vii) the Treasury Rate, or (viii) such other Interest Rate Basis or interest rate formula as may be set in the applicable Pricing Supplement; PROVIDED, HOWEVER, that with respect to a Floating Rate/Fixed Rate Note, the interest rate commencing on the Fixed Rate Commencement Date and continuing, unless otherwise specified in the applicable Pricing Supplement, until the Maturity Date shall be the Fixed Interest Rate, if such rate is specified in the applicable Pricing Supplement, or if no such Fixed Interest Rate is so specified, the interest rate in effect thereon on the day immediately preceding the Fixed Rate Commencement Date. In addition, if so specified in the applicable Pricing Supplement, a Floating Rate Note may bear interest calculated based upon the lowest of two or more Interest Rate Bases. The "Spread" is the number of basis points to be added to or subtracted from the related Interest Rate Basis or Bases applicable to such Floating Rate Note. The "Spread Multiplier" is the percentage of the related Interest Rate Basis or Bases applicable to such Floating Rate Note by which such Interest Rate Basis or Bases will be multiplied to determine the applicable interest rate on such Floating Rate Note. The "Index Maturity" is the period to maturity of the instrument or obligation with respect to which the Interest Rate Basis or Bases will be calculated. The Spread, Spread Multiplier, Index Maturity and other variable terms of the Floating Rate Notes are subject to change by the Company from time to time, but no such change will affect any Floating Rate Note previously issued or as to which an offer has been accepted by the Company. Each applicable Pricing Supplement will specify whether the rate of interest on the related Floating Rate Note will be reset daily, weekly, monthly, quarterly, semiannually, annually or such other specified period (each, an "Interest Reset Period") and the dates on which such interest rate will S-17 be reset (each, an "Interest Reset Date"). Unless otherwise specified in the applicable Pricing Supplement, the Interest Reset Date will be, in the case of Floating Rate Notes which reset: (i) daily, each Business Day; (ii) weekly, the Wednesday of each week (with the exception of weekly reset Treasury Rate Notes, which will reset the Tuesday of each week except as specified below); (iii) monthly, the third Wednesday of each month (with the exception of Eleventh District Cost of Funds Rate Notes, all of which reset monthly, which will reset on the first calendar day of the month); (iv) quarterly, the third Wednesday of March, June, September and December of each year; (v) semiannually, the third Wednesday of the two months specified in the applicable Pricing Supplement; and (vi) annually, the third Wednesday of the month specified in the applicable Pricing Supplement; PROVIDED, HOWEVER, that, with respect to Floating Rate/Fixed Rate Notes, the fixed rate of interest in effect for the period from the Fixed Rate Commencement Date until the Maturity Date shall be the Fixed Interest Rate or the interest rate in effect on the day immediately preceding the Fixed Rate Commencement Date, as specified in the applicable Pricing Supplement. If any Interest Reset Date for any Floating Rate Note would otherwise be a day that is not a Business Day, such Interest Reset Date will be postponed to the next succeeding day that is a Business Day, except that in the case of a Floating Rate Note as to which LIBOR is an applicable Interest Rate Basis, in which case if such Business Day falls in the next succeeding calendar month, such Interest Reset Date will be the immediately preceding Business Day. As used herein, "Business Day" means, unless otherwise specified in the applicable Pricing Supplement, any day other than a Saturday or Sunday or any other day on which banking institutions are generally authorized or obligated by law or regulation to close in The City of New York or in London, England or (i) with respect to Notes denominated in a Specified Currency other than U.S. dollars, Australian dollars or ECUs, in the principal financial center of the country of the Specified Currency, (ii) with respect to Notes denominated in Australian dollars, in Sydney or (iii) with respect to Notes denominated in ECUs, a day that is a non-ECU clearing day as determined by the ECU Banking Association in Paris. A Floating Rate Note may also have either or both of the following: (i) a maximum numerical limitation, or ceiling, on the rate at which interest may accrue during any interest period and (ii) a minimum numerical limitation, or floor, on the rate at which interest may accrue during any interest period. In addition to any maximum interest rate that may be applicable to any Floating Rate Note pursuant to the above provisions, the interest rate on Floating Rate Notes will in no event be higher than the maximum rate permitted by New York law, as the same may be modified by United States law of general application. Each Floating Rate Note will bear interest from the date of issue at the rates specified therein until the principal thereof is paid or otherwise made available for payment. Except as provided below or in an applicable Pricing Supplement, interest will be payable in the case of Floating Rate Notes which reset: (i) 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 in the applicable Pricing Supplement; (ii) quarterly, on the third Wednesday of March, June, September and December of each year; (iii) semiannually, on the third Wednesday of the two months of each year specified in the applicable Pricing Supplement; and (iv) annually, on the third Wednesday of the month of each year specified in the applicable Pricing Supplement (each, an "Interest Payment Date") and, in each case, on the Maturity Date. If any Interest Payment Date for any Floating Rate Note (other than the Maturity Date) would otherwise be a day that is not a Business Day, such Interest Payment Date will be the next succeeding day that is a Business Day except that if such Note is a LIBOR Note and if such Business Day falls in the next succeeding calendar month, such Interest Payment Date will be the immediately preceding Business Day. If the Maturity Date of a Floating Rate Note falls on a day that is not a Business Day, the payment of principal, premium, if any, and interest, if any, will be made on the next succeeding Business Day, and no interest shall accrue for the period from and after such Maturity Date. All percentages resulting from any calculation on Floating Rate Notes will be to the nearest one hundred-thousandth of a percentage point, with five one millionths of a percentage point rounded S-18 upwards (E.G., 9.876545% (or .09876545) would be rounded to 9.87655% (or .0987655)), and all dollar amounts used in or resulting from such calculation will be rounded to the nearest cent (with one-half cent being rounded upward). Unless otherwise specified in the applicable Pricing Supplement, interest payments on Floating Rate Notes will equal the amount of interest accrued from and including the next preceding Interest Payment Date in respect of which interest has been paid (or from and including the date of issue, if no interest has been paid with respect to such Floating Rate Notes) to but excluding the related Interest Payment Date; PROVIDED, HOWEVER, that in the case of Floating Rate Notes on which the interest rate is reset daily or weekly, each interest payment will include interest accrued from and including the date of issue or from but excluding the last Regular Record Date, in the case of Registered Notes, or the fifteenth calendar day preceding the next preceding Interest Payment Date, in the case of Bearer Notes (whether or not such fifteenth calendar day is a Business Day), to which interest has been paid, as the case may be, through and including the Regular Record Date next preceding the applicable Interest Payment Date, in the case of Registered Notes, or the fifteenth calendar day preceding such Interest Payment Date, in the case of Bearer Notes (whether or not such fifteenth calendar day is a Business Day), unless otherwise specified in the applicable Pricing Supplement; and PROVIDED, FURTHER, that the interest payments on Floating Rate Notes made on the Maturity Date will include interest accrued to but excluding such Maturity Date. With respect to each Floating Rate Note, accrued interest is calculated by multiplying its face amount by an accrued interest factor. Such accrued interest factor is computed by adding the interest factor calculated for each day from and including the later of (i) the date of issue and (ii) the last day to which interest has been paid or duly provided for, to and including the last date for which accrued interest is being calculated as described in the immediately preceding paragraph. Unless otherwise specified in the applicable Pricing Supplement, the interest factor for each such day will be computed by dividing the interest rate applicable to such day by 360, in the case of Notes for which the Interest Rate Basis is the CD Rate, the Commercial Paper Rate, the Eleventh District Cost of Funds Rate, the Federal Funds Rate, LIBOR or the Prime Rate, or by the actual number of days in the year in the case of Notes for which the Interest Rate Basis is the Treasury Rate. The accrued interest factor for Notes for which the interest rate may be calculated with reference to two or more Interest Rate Bases will be calculated in each period by selecting one such Interest Rate Basis for such period in accordance with the provisions of the applicable Pricing Supplement. The interest rate applicable to each Interest Reset Period commencing on the Interest Reset Date with respect to such Interest Reset Period will be the rate determined on the "Interest Determination Date." Unless otherwise specified in the applicable Pricing Supplement, the Interest Determination Date with respect to the CD Rate, the Commercial Paper Rate, the Federal Funds Rate and the Prime Rate will be the second Business Day preceding each Interest Reset Date for the related Note; the Interest Determination Date with respect to the Eleventh District Cost of Funds Rate will be the last working day of the month immediately preceding each Interest Reset Date on which the Federal Home Loan Bank of San Francisco (the "FHLB of San Francisco") publishes the Index (as defined below); and the Interest Determination Date with respect to LIBOR will be the second London Business Day preceding each Interest Reset Date. With respect to the Treasury Rate, unless otherwise specified in an applicable Pricing Supplement, the Interest Determination Date will be the day in the week in which the related Interest Reset Date falls on which day Treasury Bills (as defined below) are normally auctioned (Treasury Bills are normally sold at auction on Monday of each week, unless that day is a legal holiday, in which case the auction is normally held on the following Tuesday, except that such auction may be held on the preceding Friday); PROVIDED, HOWEVER, that if an auction is held on the Friday of the week preceding the related Interest Reset Date, the related Interest Determination Date will be such preceding Friday; and PROVIDED, FURTHER, that if an auction falls on any Interest Reset Date, then the related Interest Reset Date will instead be the first Business Day following such auction. Unless otherwise specified in the applicable Pricing Supplement, the Interest Determination Date pertaining to a Floating Rate Note the interest rate of which is determined with reference to two or S-19 more Interest Rate Bases will be the latest Business Day which is at least two Business Days prior to each Interest Reset Date for such Floating Rate Note. Each Interest Rate Basis will be determined and compared on such date, and the applicable interest rate will take effect on the related Interest Reset Date, as specified in the applicable Pricing Supplement. Unless otherwise provided for in the applicable Pricing Supplement, The Chase Manhattan Bank (National Association) will be the Calculation Agent (the "Calculation Agent," which term includes any successor calculation agent appointed by the Company), and for each Interest Reset Date will determine the interest rate with respect to any Floating Rate Note as described below. The Calculation Agent will notify the Trustee of each determination of the interest rate applicable to any such Floating Rate Note promptly after such determination is made. The Calculation Agent will also notify the Stock Exchange (in the case of Series B Notes) and the Paying Agents, including any Paying Agent located in Luxembourg, of such determination. Such information shall be made available to the holders of Notes by the Paying Agents. The Trustee will, upon the request of the holder of any Floating Rate Note, provide the interest rate then in effect and, if determined, the interest rate which will become effective as a result of a determination made with respect to the most recent Interest Determination Date relating to such Note. Unless otherwise specified in the applicable Pricing Supplement, the "Calculation Date," where applicable, pertaining to any Interest Determination Date will be the earlier of (i) the tenth calendar day after such Interest Determination Date or, if such day is not a Business Day, the next succeeding Business Day or (ii) the Business Day preceding the applicable Interest Payment Date or Maturity Date, as the case may be. Interest rates with respect to Floating Rate Notes will be determined by the Calculation Agent as follows: CD RATE NOTES. CD Rate Notes will bear interest at the interest rate (calculated with reference to the CD Rate and the Spread and/or Spread Multiplier, if any) specified in the CD Rate Notes and in the applicable Pricing Supplement. Unless otherwise specified in the applicable Pricing Supplement, "CD Rate" means, with respect to any Interest Determination Date relating to a CD Rate Note, the rate on such date for negotiable certificates of deposit having the Index Maturity designated in the applicable Pricing Supplement 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 ("H.15(519)") under the heading "CDs (Secondary Market)," or, if not so published by 3:00 p.m., New York City time, on the Calculation Date pertaining to such Interest Determination Date, the CD Rate will be the rate on such Interest Determination Date for negotiable certificates of deposit of the Index Maturity designated in the applicable Pricing Supplement 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 (the "Composite Quotations") under the heading "Certificates of Deposit." If such rate is not yet published in either H.15(519) or the Composite Quotations by 3:00 p.m., New York City time, on the Calculation Date pertaining to such Interest Determination Date, the CD Rate on such Interest Determination Date will be calculated by the Calculation Agent and will be the arithmetic mean of the secondary market offered rates as of 10:00 a.m., New York City time, on such Interest Determination Date, for negotiable certificates of deposit of major United States money market banks with a remaining maturity closest to the Index Maturity designated in the applicable Pricing Supplement in an amount that is representative for a single transaction in that market at that time as quoted by three leading nonbank dealers in negotiable U.S. dollar certificates of deposit in The City of New York selected by the Calculation Agent; PROVIDED, HOWEVER, that if the dealers selected as aforesaid by the Calculation Agent are not quoting as set forth above, the CD Rate with respect to such Interest Determination Date shall be the CD Rate as in effect on such Interest Determination Date. COMMERCIAL PAPER RATE NOTES. Commercial Paper Rate Notes will bear interest at the interest rate (calculated with reference to the Commercial Paper Rate and the Spread and/or Spread Multiplier, if any) specified in the Commercial Paper Rate Notes and in the applicable Pricing Supplement. S-20 Unless otherwise specified in the applicable Pricing Supplement, "Commercial Paper Rate" means, with respect to any Interest Determination Date relating to a Commercial Paper Note, the Money Market Yield (as defined below) of the rate on that date for commercial paper having the Index Maturity designated in the applicable Pricing Supplement, as such rate shall be published in H.15(519), under the heading "Commercial Paper." In the event that such rate is not published prior to 3:00 p.m., New York City time, on the Calculation Date pertaining to such Interest Determination Date, then the Commercial Paper Rate shall be the Money Market Yield of the rate on such Interest Determination Date for commercial paper of the specified Index Maturity as published in Composite Quotations under the heading "Commercial Paper" (with an Index Maturity of one month or three months being deemed to be equivalent to an Index Maturity of 30 days or 90 days, respectively). If by 3:00 p.m., New York City time, on such Calculation Date such rate is not yet available in either H.15(519) or Composite Quotations, then the Commercial Paper Rate on such Interest Determination Date shall be calculated by the Calculation Agent and shall be the Money Market Yield corresponding to the arithmetic mean of the offered rates as of approximately 11:00 a.m., New York City time, on such Interest Determination Date for commercial paper of the specified Index Maturity placed for an industrial issuer whose bond rating is "AA," or the equivalent, from a nationally recognized rating agency as quoted by three leading dealers of commercial paper in The City of New York selected by the Calculation Agent; PROVIDED, HOWEVER, that if the dealers selected as aforesaid by the Calculation Agent are not quoting offered rates as set forth above, the Commercial Paper Rate with respect to such Interest Determination Date shall be the Commercial Paper Rate in effect on such Interest Determination Date. "Money Market Yield" shall be a yield (expressed as a percentage) calculated in accordance with the following formula: D X 360 Money Market Yield = ------------------- X 100 360-(D X M)
where "D" refers to the applicable per annum rate for commercial paper quoted on a bank discount basis and expressed as a decimal, and "M" refers to the actual number of days in the period for which interest is being calculated. ELEVENTH DISTRICT COST OF FUNDS RATE NOTES. Eleventh District Cost of Funds Rate Notes will bear interest at the rates (calculated with reference to the Eleventh District Cost of Funds Rate and the Spread and/or Spread Multiplier, if any) specified in such Eleventh District Cost of Funds Rate Notes and in the applicable Pricing Supplement. Unless otherwise specified in the applicable Pricing Supplement, "Eleventh District Cost of Funds Rate" means, with respect to any Interest Determination Date relating to an Eleventh District Cost of Funds Rate Note, the rate equal to the monthly weighted average cost of funds for the calendar month preceding such Interest Determination Date as set forth under the caption "11th District" on Telerate Page 7058 (or such other page as is specified in the applicable Pricing Supplement) as of 11:00 a.m., San Francisco time, on such Interest Determination Date. If such rate does not appear on Telerate Page 7058 (or such other page as aforesaid) on any such Interest Determination Date, the Eleventh District Cost of Funds Rate for such 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 Interest Determination Date, then the Eleventh District Cost of Funds Rate for such Interest Determination Date will be the Eleventh District Cost of Funds Rate in effect on such Interest Determination Date. FEDERAL FUNDS RATE NOTES. Federal Funds Rate Notes will bear interest at the interest rate (calculated with reference to the Federal Funds Rate and the Spread and/or Spread Multiplier, if any) specified in the Federal Funds Rate Notes and in the applicable Pricing Supplement. S-21 Unless otherwise specified in the applicable Pricing Supplement, the "Federal Funds Rate" means, with respect to any Interest Determination Date relating to a Federal Funds Rate Note, the rate on such date for Federal funds as published in H.15(519) under the heading "Federal Funds (Effective)" or, if not so published by 3:00 p.m., New York City time, on the Calculation Date pertaining to such Interest Determination Date, the Federal Funds Rate will be the rate on such Interest Determination Date as published in Composite Quotations under the heading "Federal Funds/Effective Rate." If such rate is not published in either H.15(519) or the Composite Quotations by 3:00 p.m., New York City time, on the Calculation Date pertaining to such Interest Determination Date, the Federal Funds Rate for such Interest Determination Date will be calculated by the Calculation Agent and will be the arithmetic mean of the rates for the last transaction in overnight United States dollar Federal funds as of 9:00 a.m., New York City time, on such Interest Determination Date 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 set forth above, the Federal Funds Rate with respect to such Interest Determination Date shall be the Federal Funds Rate in effect on such Interest Determination Date. LIBOR NOTES. LIBOR Notes will bear interest at the interest rate (calculated with reference to LIBOR and the Spread and/or Spread Multiplier, if any) specified in the LIBOR Notes and in the applicable Pricing Supplement. Unless otherwise specified in the applicable Pricing Supplement, "LIBOR" for each Interest Reset Date will be determined by the Calculation Agent as follows: (i) With respect to an Interest Determination Date relating to a LIBOR Note, LIBOR will be either: (A) if "LIBOR Telerate" is specified in the applicable Pricing Supplement or if such Pricing Supplement does not specify a source for LIBOR, the rate for deposits in the London interbank market in the Index Currency (as defined below) having the Index Maturity designated in the applicable Pricing Supplement commencing on the second Business Day immediately following such Interest Determination Date that appears on the Designated LIBOR Page (as defined below) as of 11:00 a.m., London time, on such Interest Determination Date, or (B) if "LIBOR Reuters" is specified in the applicable Pricing Supplement, the arithmetic mean of the offered rates (unless the specified Designated LIBOR Page (as defined below) by its terms provides only for a single rate, in which case such single rate shall be used) for deposits in the London interbank market in the Index Currency having the Index Maturity designated in the applicable Pricing Supplement and commencing on the second Business Day immediately following such Interest Determination Date that appear on the Designated LIBOR Page as of 11:00 a.m., London time, on such Interest Determination Date, if at least two such offered rates appear (unless, as aforesaid, only a single rate is required) on such Designated LIBOR Page. If no rate appears on the Designated LIBOR Page (or, in the case of clause (i)(B) above, if the Designated LIBOR Page by its terms provides for more than a single rate but fewer than two offered rates appear on such page), as applicable, LIBOR in respect of such Interest Determination Date will be determined as if the parties had specified the rate described in clause (ii) below. (ii) With respect to an Interest Determination Date relating to a LIBOR Note to which the last sentence of clause (i) above applies, the Calculation Agent will request the principal London offices of each of four major reference banks in the London interbank market, as selected by the Calculation Agent, to provide the Calculation Agent with its offered quotation for deposits in the Index Currency for the period of the Index Maturity designated in the applicable Pricing Supplement commencing on the second Business Day immediately following such Interest Determination Date to prime banks in the London interbank market at approximately 11:00 a.m., London time, on such Interest Determination Date and in a principal amount that is representative for a single transaction in such Index Currency in such market at such time. If at least two such quotations are provided, LIBOR determined on such Interest Determination Date will be the arithmetic mean of such quotations. If fewer than two quotations are provided, LIBOR determined on such Interest Determination Date will be the arithmetic mean of the rates quoted at S-22 approximately 11:00 a.m. (or such other time specified in the applicable Pricing Supplement), in the applicable Principal Financial Center (as defined below), on such Interest Determination Date for loans made on the second Business Day immediately following such Interest Determination Date in the Index Currency to leading European banks having the Index Maturity designated in the applicable Pricing Supplement and in a principal amount that is representative for a single transaction in such Index Currency in such market at such time by three major banks in such Principal Financial Center selected by the Calculation Agent; PROVIDED, HOWEVER, that if the banks so selected by the Calculation Agent are not quoting as mentioned in this sentence, LIBOR with respect to such Interest Determination Date will be LIBOR in effect on such Interest Determination Date. "Index Currency" means the currency (including composite currencies) specified in the applicable Pricing Supplement as the currency with respect to which LIBOR shall be calculated. If no such currency is specified in the applicable Pricing Supplement, the Index Currency shall be U.S. dollars. "Designated LIBOR Page" means the display on Page 3750 (or such other page as is specified in the applicable Pricing Supplement) of the Dow Jones Telerate Service for the purpose of displaying the London interbank offered rates of major banks for the applicable Index Currency (or such other page as may replace that page on that service for the purpose of displaying such rates), unless "LIBOR Reuters" is designated in the applicable Pricing Supplement, in which case the Designated LIBOR Page shall be the display on the Reuters Monitor Money Rates Service for the purpose of displaying the London interbank offered rates of major banks for the applicable Index Currency. Unless provided otherwise in the applicable Pricing Supplement, "Principal Financial Center" will be the capital city of the country of the specified Index Currency, except that with respect to U.S. dollars, Deutschemarks, Australian dollars and ECUs, the Principal Financial Center shall be The City of New York, Frankfurt, Sydney and Luxembourg, respectively. PRIME RATE NOTES. Prime Rate Notes will bear interest at the interest rate (calculated with reference to the Prime Rate and the Spread and/or Spread Multiplier, if any) specified in the Prime Rate Notes and in the applicable Pricing Supplement. Unless otherwise specified in the applicable Pricing Supplement, "Prime Rate" means, with respect to any Interest Determination Date relating to a Prime Rate Note, the arithmetic mean of the prime rates of interest publicly announced by each of three major banks in The City of New York as its United States dollar prime rate or base lending rate as in effect for that day. For purposes of making the foregoing determination, each change in the prime rate or base lending rate of any bank so announced by such bank will be effective as of the effective date of the announcement or, if no effective date is specified, as of the date of the announcement. If fewer than three such quotations are provided, the Prime Rate will be calculated by the Calculation Agent and will be determined as the arithmetic mean on the basis of the prime rates or base lending rates quoted in The City of New York by three substitute banks or trust companies organized and doing business under the laws of the United States or any state thereof, each having total equity capital of at least $500 million and being subject to supervision or examination by a federal or state authority, selected by the Calculation Agent to quote such rate or rates; PROVIDED, HOWEVER, that if the banks or trust companies so selected by the Calculation Agent are not quoting as mentioned in this sentence, the Prime Rate with respect to such Interest Determination Date will be the Prime Rate in effect on such Interest Determination Date. TREASURY RATE NOTES. Treasury Rate Notes will bear interest at the interest rate (calculated with reference to the Treasury Rate and the Spread and/or Spread Multiplier, if any) specified in the Treasury Rate Notes and in the applicable Pricing Supplement. Unless otherwise specified in the applicable Pricing Supplement, the "Treasury Rate" means, with respect to any Interest Determination Date relating to a Treasury Rate Note, the rate applicable to the most recent auction of direct obligations of the United States ("Treasury Bills") having the Index Maturity designated in the applicable Pricing Supplement, 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 S-23 York City time, on the Calculation Date pertaining to such Interest Determination Date, the auction average rate on such Interest Determination Date (expressed as a bond equivalent, on the basis of a year of 365 or 366 days, as applicable, and applied on a daily basis) as otherwise announced by the United States Department of the Treasury. In the event that the results of the auction of Treasury Bills having the Index Maturity designated in the applicable Pricing Supplement are not published or reported as provided above by 3:00 p.m., New York City time, on such Calculation Date or if no such auction is held in the five Business Days preceding such Interest Determination Date, then the Treasury Rate shall be calculated by the Calculation Agent and shall be a yield to maturity (expressed as a bond equivalent, on the basis of a year of 365 or 366 days, as applicable, and applied on a daily basis) calculated using the arithmetic mean of the secondary market bid rates, as of approximately 3:30 p.m., New York City time, on such Interest Determination Date, of three leading primary United States government securities dealers (which may include one or more of the Agents) selected by the Calculation Agent for the issue of Treasury Bills with a remaining maturity closest to the Index Maturity designated in the applicable Pricing Supplement; PROVIDED, HOWEVER, that if the dealers selected as aforesaid by the Calculation Agent are not quoting bid rates as mentioned in this sentence, the Treasury Rate with respect to such Interest Determination Date will be the Treasury Rate in effect on such Interest Determination Date. INDEXED NOTES GENERAL. Notes also may be issued with the principal amount payable at maturity or interest to be paid thereon, or both, to be determined with reference to the price or prices of specified commodities or stocks, the exchange rate of one or more Specified Currencies (including a composite currency such as the ECU) relative to one or more other currencies (including a composite currency such as the ECU), or such other price or exchange rate as may be specified in such Note ("Indexed Notes"), as set forth in a Pricing Supplement relating to such Indexed Notes. Holders of such Indexed Notes may receive a principal amount on the Maturity Date that is greater than or less than the face amount of the Indexed Notes, or an interest rate that is greater than or less than the stated interest rate on the Indexed Notes, or both, depending upon the structure of the Indexed Note and the relative value on the Maturity Date or at the relevant Interest Payment Date, as the case may be, of the specified indexed item. Information as to the method for determining the principal amount payable on the Maturity Date, the manner of determining the interest rate, certain historical information with respect to the specified indexed item and tax considerations associated with an investment in Indexed Notes will be set forth in the applicable Pricing Supplement. Indexed Notes for which payments of principal, or premium and interest, if any, are determined by reference to, or based upon an index including, Deutschemarks will be offered and sold by the Company in compliance with the then-current rules, regulations and policy statements of the Deutsche Bundesbank. See "Special Provisions Relating to Foreign Currency Notes--Notes Denominated in Deutschemarks." RISK FACTORS. An investment in Indexed Notes entails significant risks that are not associated with similar investments in a conventional fixed-rate debt security. If the interest rate of an Indexed Note is indexed, it may result in an interest rate that is less than that payable on a conventional fixed-rate debt security issued by the Company at the same time, including the possibility that no interest will be paid, and, if the principal amount of an Indexed Note is indexed, the principal amount payable at maturity may be less than the original purchase price of such Indexed Note, including the possibility that no principal will be paid (but in no event shall the amount of interest or principal paid with respect to an Indexed Note be less than zero). The secondary market for Indexed Notes will be affected by a number of factors, independent of the creditworthiness of the Company and the value of the applicable currency, commodity or interest rate index, including, but not limited to, the volatility of the applicable currency or interest rate index, the time remaining to the maturity of such Indexed Notes, the amount outstanding of such Indexed Notes and market interest rates. The value of the applicable currency, commodity or interest rate index depends on a number of interrelated factors, including economic, financial and political events, over which the Company has no control. Additionally, if the formula used to determine the principal amount or interest payable with respect to such S-24 Indexed Notes contains a multiple or leverage factor, the effect of any change in the applicable currency, commodity or interest rate index may be increased. The historical experience of the relevant currencies, commodities or interest rate indices should not be taken as an indication of future performance of such currencies, commodities or interest rate indices during the term of any Indexed Note. Accordingly, prospective investors should consult their own financial and legal advisors as to the risks entailed by an investment in Indexed Notes and the suitability of Indexed Notes in light of their particular circumstances. See also "Foreign Currency Risks." DUAL CURRENCY NOTES GENERAL. Dual Currency Notes are Notes as to which the Company has a one time option, exercisable on any Option Election Date in whole, but not in part, with respect to all Dual Currency Notes issued on the same day and having the same terms (a "Tranche"), of making all payments of principal, premium, if any, and interest after the exercise of such option, whether at maturity or otherwise (which payments would otherwise be made in the Face Amount Currency of such Notes specified in the applicable Pricing Supplement), in the Optional Payment Currency specified in the applicable Pricing Supplement. The Pricing Supplement for each issuance of Dual Currency Notes will specify, among other things, the aggregate Face Amount of the Dual Currency Notes of such issuance, the Face Amount Currency and Optional Payment Currency of such issuance and the Designated Exchange Rate for such issuance, which will be a fixed exchange rate used for converting amounts denominated in the Face Amount Currency into amounts denominated in the Optional Payment Currency. Information as to the relative value of the Face Amount Currency compared to the Optional Payment Currency and as to tax considerations associated with an investment in Dual Currency Notes will also be set forth in the applicable Pricing Supplement. The Pricing Supplement will also specify the Option Election Dates and Interest Payment Dates for such issuance of Dual Currency Notes. Each Option Election Date will be approximately ten calendar days before an Interest Payment Date or the stated maturity date. If the Company elects to make scheduled payments in the Optional Payment Currency, the amount payable in such Optional Payment Currency shall be determined using the Designated Exchange Rate specified in the applicable Pricing Supplement. If such election is made, notice of such election shall be given to holders of Registered Notes by mail and shall be given to holders of Bearer Notes by publication, in each case as set forth below under "Notices," within two Business Days of the Option Election Date and shall state (i) the Interest Payment Date or stated maturity date and (ii) the Designated Exchange Rate. Any such notice by the Company, once given, may not be withdrawn. If the Company elects on any Option Election Date specified in the applicable Pricing Supplement to pay in the Optional Payment Currency instead of the Face Amount Currency, payments of interest, premium, if any, and principal made after such Option Election Date may be worth less, at the then-current exchange rate, than if the Company had made such payment in the Face Amount Currency. For further information regarding certain risks inherent in Notes denominated in currencies other than U.S. dollars, see "Foreign Currency Risks." Dual Currency Notes for which either the Face Amount Currency or the Optional Payment Currency is Deutschemarks will be offered and sold by the Company in compliance with the then-current rules, regulations and policy statements of the Deutsche Bundesbank. See "Special Provisions Relating to Foreign Currency Notes--Notes Denominated in Deutschemarks." EXTENSION OF MATURITY The Pricing Supplement relating to each Fixed Rate Note (other than an Amortizing Note) will indicate whether the Company has the option to extend the maturity of such Fixed Rate Note for one or more periods of one or more whole years (each an "Extension Period") up to but not beyond the S-25 date (the "Final Maturity Date") set forth in such Pricing Supplement. If the Company has such option with respect to any such Fixed Rate Note (an "Extendible Note"), the following procedures will apply, unless modified as set forth in the applicable Pricing Supplement. The Company may exercise such option with respect to an Extendible Note by notifying the Principal Paying Agent of such exercise at least 45 but not more than 60 calendar days prior to the stated maturity date originally in effect with respect to such Note (the "Original Maturity Date") or, if the stated maturity date of such Note has already been extended, prior to the stated maturity date then in effect (an "Extended Maturity Date"). No later than 38 calendar days prior to the Original Maturity Date or an Extended Maturity Date, as the case may be (each, a "Maturity Date"), the Principal Paying Agent will mail to the holders of such Extendible Notes holding in registered form a notice (the "Extension Notice") relating to such Extension Period as described in "Notices" below and will notify holders of such Extendible Notes holding in bearer form of such Extension Period by publishing such notice as described under "Notices" below, in each case setting forth (a) the election of the Company to extend the maturity of such Extendible Note; (b) the new Extended Maturity Date; (c) the interest rate applicable to the Extension Period; and (d) the provisions, if any, for redemption during the Extension Period, including the date or dates on which, the period or periods during which and the price or prices at which such redemption may occur during the Extension Period. Upon such mailing and publication by the Principal Paying Agent of an Extension Notice, the maturity of such Extendible Notes shall be extended automatically, and, except as modified by the Extension Notice and as described in the next paragraph, such Extendible Notes will have the same terms they had prior to the delivery of such Extension Notice. Notwithstanding the foregoing, not later than 10:00 a.m., New York City time, on the twentieth calendar day prior to the Maturity Date then in effect for an Extendible Note (or, if such day is not a Business Day, not later than 10:00 a.m., New York City time, on the immediately succeeding Business Day), the Company may, at is option, revoke the interest rate provided for in the Extension Notice and establish a higher interest rate for the Extension Period by causing the Principal Paying Agent to send and publish notice of such higher interest rate to the holders of such Extendible Notes as described above or by such other means as shall be agreed between the Company and the Principal Paying Agent. Such notice shall be irrevocable. All Extendible Notes with respect to which the Maturity Date is extended in accordance with an Extension Notice will bear such higher interest rate for the Extension Period, whether or not tendered for repayment. If the Company elects to extend the maturity of an Extendible Note, the holder of such Note will have the option to require the Company to repay such Note on the Maturity Date then in effect at a price equal to the principal amount thereof plus any accrued and unpaid interest to such date. In order for an Extendible Note to be so repaid on such Maturity Date, the holder thereof must follow the procedures set forth above under "Repayment at the Noteholders' Option; Repurchase" for optional repayment, except that the period for delivery of such Note or notification to a Paying Agent shall be at least 25 but not more than 35 calendar days prior to the Maturity Date then in effect and except that a holder who has tendered an Extendible Note for repayment pursuant to an Extension Notice may, by written notice to the same Paying Agent, revoke any such tender for repayment until 3:00 p.m., local time, on the twentieth calendar day prior to the Maturity Date then in effect (or, if such day is not a Business Day, until 3:00 p.m., local time, on the immediately succeeding Business Day). AMORTIZING NOTES Amortizing Notes are Fixed Rate Notes for which payments combining principal and interest are made in installments over the life of the Note ("Amortizing Notes"). Unless otherwise specified in the applicable Pricing Supplement, interest on each Amortizing Note will be computed on the basis of a 360-day year of twelve 30-day months. Payments with respect to Amortizing Notes will be applied first to interest due and payable thereon and then to the reduction of the unpaid principal amount thereof. Further information concerning additional terms and conditions of any issue of Amortizing Notes will S-26 be provided in the applicable Pricing Supplement. A table setting forth repayment information in respect of each Amortizing Note will be included in the applicable Pricing Supplement and set forth on such Notes. ORIGINAL ISSUE DISCOUNT NOTES Original Issue Discount Notes are Notes issued at a discount from the principal amount payable at maturity and which are considered to be issued with original issue discount which must be included in income for United States federal income tax purposes at a constant rate ("Original Issue Discount Notes"). See "United States Tax Considerations." Certain additional considerations relating to Original Issue Discount Notes may be described in the Pricing Supplement relating thereto. ADDITIONAL NOTES The Company may issue Notes from time to time having terms identical to a prior issue of Notes but for the original issue date and the public offering price ("Additional Notes"). Any such Additional Notes will be issued in the form of a temporary Global Note which will be exchangeable for definitive Notes on or after the Exchange Date specified in the applicable Pricing Supplement. Additional Notes may be issued prior to or after the Exchange Date relating to such prior issue of Notes. In the event Additional Notes are issued prior to the Exchange Date for the prior issue, the Exchange Date relating to such prior issue will be moved to a date not earlier than 40 calendar days after the original issue date of the related Additional Notes. Once any Additional Notes have been issued in definitive form on or after the Exchange Date, such Additional Notes will be considered fungible with such earlier Notes. The Pricing Supplement relating to any Additional Notes will set forth matters related to the issuance, exchange and transfer of Additional Notes, including identifying the prior issue of Notes, their original issue date and aggregate principal amount. OTHER PROVISIONS, ADDENDA Any provisions with respect to Notes, including the determination of an Interest Rate Basis, the specification of Interest Rates Basis, calculation of the interest rate applicable to a Floating Rate Note, its Interest Payment Dates or any other matter relating thereto may be modified by the terms specified under "Other Provisions" on the face thereof or in an Addendum relating thereto, if so specified on the face thereof and in the applicable Pricing Supplement. REPLACEMENT OF NOTES AND COUPONS Any Notes or coupons that become mutilated, destroyed, lost or stolen or are apparently destroyed, lost or stolen will be replaced by the Company at the expense of the holder upon delivery of the Notes or coupons or satisfactory evidence of the destruction, loss or theft thereof to the Company and a Paying Agent or, in the case of Registered Notes, the Principal Paying Agent or the Registrar. In each case, an indemnity satisfactory to the Company and the Principal Paying Agent or, in the case of Registered Notes, the Principal Paying Agent or the Registrar may be required at the expense of the holder of such Note or coupon before a replacement Note or coupon will be issued. NOTICES Notices to holders of the Notes will be given by publication in an Authorized Newspaper in the English language of general circulation in the Borough of Manhattan, The City of New York, London and, so long as the Series B Notes are listed on the Luxembourg Stock Exchange, in an Authorized Newspaper in Luxembourg or, if publication in either London or Luxembourg is not practical, elsewhere in Western Europe. Such publication is expected to be made in THE WALL STREET JOURNAL, the FINANCIAL TIMES and the LUXEMBURGER WORT. Such notices will be deemed to have been given on the date of such publication or if published in such newspapers on different dates, on the date of the first such publication. Notices to holders of Registered Notes will also be given by mailing such notices to each holder by first class mail, postage prepaid, at the respective address of each holder as that address appears upon the books of the Company. S-27 SPECIAL PROVISIONS RELATING TO FOREIGN CURRENCY NOTES GENERAL Unless otherwise specified in the applicable Pricing Supplement, the following provisions shall apply to Foreign Currency Notes which are in addition to, and to the extent inconsistent therewith replace, the description of general terms and provisions of the Notes set forth elsewhere in this Prospectus. PAYMENTS ON FOREIGN CURRENCY NOTES Purchasers are required to pay for the Notes in the currency specified in the applicable Pricing Supplement. Currently, there are limited facilities in various countries for conversion of home currencies into foreign currencies, and vice versa. In addition, many banks do not offer foreign currency denominated checking or savings account facilities. Payment of principal, premium, if any, and interest, if any, on each Note will be made in immediately available funds in the Specified Currency (see "Description of the Notes -- General" in this Prospectus Supplement) unless otherwise specified in the applicable Pricing Supplement. Except as set forth below or in the applicable Pricing Supplement, if payment on a Note is required to be made in a currency other than U.S. dollars and such currency is unavailable on any payment date due to the imposition of exchange controls or other circumstances beyond the Company's control, or is no longer used by the government of the country issuing such currency or for the settlement of transactions by public institutions in that country or within the international banking community, then all payments due on that due date, and all subsequent due dates until such currency is again available or so used as determined by the Company, with respect to such Note shall be made in U.S. dollars. The amount so payable on any date in such foreign currency shall be converted into U.S. dollars at a rate determined by the Exchange Rate Agent (as hereinafter defined) on the basis of the most recently available Market Exchange Rate or as otherwise indicated in an applicable Pricing Supplement. The initial Exchange Rate Agent will be the Chase Manhattan Bank (National Association). Any payment required to be made on Notes denominated in a Specified Currency other than U.S. dollars which is instead made in U.S. dollars under the circumstances described above will not constitute a default of any obligation under the Indenture under which such Notes shall have been issued. Unless otherwise specified in the applicable Pricing Supplement, a holder of the equivalent of U.S.$1,000,000 or more aggregate principal amount of a definitive Registered Note denominated in a Specified Currency other than U.S. dollars may elect subsequent to the issuance thereof that future payments be converted, or not be converted, as the case may be, to U.S. dollars by transmitting a written request for such payments to the Paying Agent on or prior to the Regular Record Date or at least 16 days prior to maturity or earlier redemption or repayment, as the case may be. Such request shall include appropriate payment instructions and shall be in writing (mail or hand delivered) or by cable, telex or facsimile transmission. A holder may elect to receive all future payments of principal, premium, if any, and interest in either the Specified Currency or in U.S. dollars, as specified in the written request, and need not file a separate election for each payment. Such election will remain in effect until revoked by a subsequent election made in the manner and at the times prescribed in this paragraph. Owners of beneficial interests in Global Book-Entry Notes or holders of definitive Bearer Notes should contact their broker or nominee to determine whether and how an election to receive payment in either U.S. dollars or the specified currency may be made. The "Market Exchange Rate" with respect to any currency other than U.S. dollars means, for any day, the noon dollar buying rate in The City of New York on such day for cable transfers of such currency as published by the Federal Reserve Bank of New York, or, if such rate is not published for such day, the equivalent rate as determined by the Exchange Rate Agent. All determinations made by the Exchange Rate Agent shall be at its sole discretion and, in the absence of manifest error, shall be conclusive for all purposes and binding on holders of the Notes and the Exchange Rate Agent shall have no liability therefor. S-28 Specific information about the currency or currency units in which a particular Foreign Currency Note is denominated will be set forth in the applicable Pricing Supplement. Any information therein concerning exchange rates is furnished as a matter of information only and should not be regarded as indicative of the range of or trends in fluctuations in currency exchange rates that may occur in the future. MINIMUM DENOMINATIONS, RESTRICTIONS ON MATURITIES, REPAYMENT AND REDEMPTION GENERAL. Notes denominated in Specified Currencies other than U.S. dollars shall have such minimum denominations and be subject to such restrictions on maturities, repayment and redemption as are set forth below or as are set forth in an applicable Pricing Supplement in the event different restrictions on maturities, repayment and redemption may be permitted or required from time to time by any relevant central bank or equivalent governmental body, however designated, or by such laws or regulations as are applicable to the Notes or the Specified Currency. Restrictions related to the distribution of Notes denominated in Specified Currencies other than U.S. dollars are set forth under "Plan of Distribution" in this Prospectus Supplement. Any other restrictions applicable to Notes denominated in Specified Currencies other than U.S. dollars will be set forth in the related Pricing Supplement. MINIMUM DENOMINATIONS. Any Notes denominated in Japanese yen will be issued in denomination of not less than Y1,000,000. Any Notes denominated in Pounds sterling will be issued in denominations of not less than L100,000. Any Notes denominated in Dutch Guilder will be issued in denominations of not less than Dfl.1,000,000. Unless otherwise specified in the applicable Pricing Supplement, Notes denominated in other currencies will be issued in such denominations as are set forth under "Description of the Notes -- Denominations, Exchange and Transfer." RESTRICTIONS ON MATURITIES, REPAYMENT AND REDEMPTION. Any Notes denominated in Deutschemarks will have maturities of not less than two years from their original issue date, and may not be subject to redemption at the option of the Company or repayment at the option of the holder during such two-year period. Any Notes denominated in Pounds sterling will have maturities of more than one year and not more than five years from and including the original issue date, and may not be subject to redemption at the option of the Company or repayment at the option of the holders during the first year following their original issue date, except as permitted by applicable law. Any Notes denominated in Japanese yen will have maturities of one year or more from their original issue date, and may not be subject to redemption at the option of the Company or repayment at the option of the holders during the first year following their original issue date. In addition, any Notes denominated in Dutch Guilder will have maturities of not less than two years. OTHER RESTRICTIONS APPLICABLE TO FOREIGN CURRENCY NOTES. Payments in Japanese yen to a non-resident of Japan may be made only by transfer to a non-resident account maintained by the payee with, or by a check drawn upon, an authorized foreign exchange bank. NOTES DENOMINATED IN ECU VALUATION OF THE ECU. Subject to the provisions under "Payment in a Component Currency" below, the value of the ECU, in which the Notes may be denominated or may be payable, is equal to the value of the ECU used in the European Monetary System and which is at the date hereof valued on the basis of specified amounts of the currencies of member countries of the European Community ("EC") as shown below. S-29 Pursuant to Council Regulation (EEC) No. 3180/78 of December 18, 1978, as amended by Council Regulation (EEC) No. 1971/89 of June 19, 1989, the ECU is at the date hereof defined as the sum of the following amounts of the following components: 0.6242 German mark 0.130 Luxembourg franc 0.08784 Pound sterling 0.1976 Danish krone 1.332 French francs 0.008552 Irish pound 151.8 Italian lire 1.440 Greek drachmas 0.2198 Dutch guilder 6.885 Spanish pesetas 3.301 Belgian francs 1.393 Portuguese escudos
Such amounts and/or components may be changed by the EC, in which event the basis of valuation of the ECU will change accordingly. PAYMENT IN A COMPONENT CURRENCY. With respect to each due date for the payment of principal of, premium, if any, or interest on, the Notes, if, on or prior to such due date, the ECU is not used in the European Monetary System or if, on or prior to such due date, banks in all member countries of the EC shall have ceased to provide ECU accounts, in either case the Company or its agent shall (in the case of an agent, without liability on its part but after consultation with the Company and having regard to the availability to the Company of the relevant currency) choose a substitute currency (the "Chosen Currency"), which shall be a component currency of the ECU or U.S. dollars, in which all payments to be calculated by reference to or made in ECU due on or after such due date with respect to the Notes shall be made. Notice of the Chosen Currency so selected shall be given to holders of Registered Notes by mail, and shall be given to holders of Bearer Notes by publication, in each case as set forth in "Description of Notes -- Notices." The amount of each payment calculated with reference to or made in such Chosen Currency shall be computed on the basis of the equivalent of the ECU in that currency, determined as described below, as of the fourth business day in Luxembourg prior to the date on which such payment is due. On or about the first business day in Luxembourg following the day on which the ECU is not used in the European Monetary System or on which banks in all member countries of the EC shall have ceased to provide ECU accounts, the Company or its agent shall (in the case of an agent, without liability on its part but after consultation with the Company and having regard to the availability to the Company of the relevant currency) choose a Chosen Currency in which all payments to be calculated by reference to or made in ECU with respect to Notes having a due date prior thereto but not yet presented for payment are to be made. The amount of each payment calculated with reference to or made in such Chosen Currency shall be computed on the basis of the equivalent of the ECU in that currency, determined as described below, as of such first business day. The equivalent of the ECU in the relevant Chosen Currency as of any date (the "Day of Valuation") shall be determined by the Exchange Rate Agent on the following basis. The amounts and components composing the ECU for this purpose (the "Components") shall be the amounts and components which composed the ECU (i) as of the last date on which the ECU was used in the European Monetary System (or, if after such last date the ECU was used for the settlement of transactions by public institutions of or within the EC, as of the most recent date when the ECU was so used) or (ii) where the selection of a Chosen Currency shall have been required only because banks in all member countries of the EC shall have ceased to provide ECU accounts, as of the Day of Valuation. The equivalent of the ECU in the Chosen Currency shall be calculated by, first, aggregating the U.S. dollar equivalents of the Components; and then, in the case of a Chosen Currency other than U.S. dollars, using the rate used for determining the U.S. dollar equivalent of the Components in the Chosen Currency as set forth below, calculating the equivalent in the Chosen Currency of such aggregate amount in U.S. dollars. S-30 The U.S. dollar equivalent of each of the Components shall be determined by the Exchange Rate Agent on the basis of the middle spot delivery quotations prevailing at 2:30 p.m., Luxembourg time, on the Day of Valuation, as obtained by the Exchange Rate Agent from one or more major banks, as selected by the Company or its agent, in the country of issue of the component currency in question. If for any reason no direct quotations are available for a Component as of a Day of Valuation from any of the banks selected for this purpose, in computing the U.S. dollar equivalent of such Component, the Exchange Rate Agent shall (except as provided below) use the most recent direct quotations for such Component obtained by it or on its behalf, provided that such quotations were prevailing in the country of issue not more than two Business Days before such Day of Valuation. If such most recent quotations were so prevailing more than two Business Days in the country of issue before such Day of Valuation, the Exchange Rate Agent shall determine the U.S. dollar equivalent of such Component on the basis of cross rates derived from the middle spot delivery quotations for such component currency and for the U.S. dollar prevailing at 2:30 p.m. Luxembourg time on such Day of Valuation, as obtained by, or on behalf of, the Exchange Rate Agent from one or more major banks, as selected by the Company or its agents, in a country other than the country of issue of such component currency. Notwithstanding the foregoing, the Exchange Rate Agent shall determine the U.S. dollar equivalent of such Component on the basis of such cross rates if the Company or such agent judges that the equivalent so calculated is more representative than the U.S. dollar equivalent calculated as provided in the first sentence of this paragraph. Unless otherwise specified by the Company or its agent, if there is more than one market for dealing in any component currency by reason of foreign exchange regulations or for any other reason, the market to be referred to in respect of such currency shall be that upon which a non-resident issuer of notes denominated in such currency would purchase such currency in order to make payments in respect of such notes. 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 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 Components 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 that currency as a Component shall be replaced by amounts of such two or more currencies, each of which shall be equal to the amount of the former component currency divided by the number of units of currency into which that currency was divided. All determinations made by the Company or its agent shall be at its sole discretion and shall, in the absence of manifest error, be conclusive for all purposes and binding on the Company and all holders of Notes. FOREIGN CURRENCY RISKS THIS PROSPECTUS SUPPLEMENT, THE PROSPECTUS AND ANY PRICING SUPPLEMENT DO NOT DESCRIBE ALL THE RISKS OF AN INVESTMENT IN FOREIGN CURRENCY NOTES OR INDEXED NOTES THE PAYMENT OF WHICH IS TO BE MADE IN OR RELATED TO THE VALUE OF A FOREIGN CURRENCY OR A COMPOSITE CURRENCY AND THE COMPANY DISCLAIMS ANY RESPONSIBILITY TO ADVISE PROSPECTIVE PURCHASERS OF SUCH RISKS AS THEY EXIST AT THE DATE OF THIS PROSPECTUS SUPPLEMENT OR AS SUCH RISKS MAY CHANGE FROM TIME TO TIME. PROSPECTIVE INVESTORS SHOULD CONSULT THEIR OWN FINANCIAL AND LEGAL ADVISORS AS TO THE RISKS ENTAILED BY AN INVESTMENT IN SUCH NOTES. SUCH NOTES ARE NOT AN APPROPRIATE INVESTMENT FOR INVESTORS WHO ARE UNSOPHISTICATED WITH RESPECT TO FOREIGN CURRENCY, CURRENCY UNIT OR INDEXED TRANSACTIONS. The information set forth in this Prospectus Supplement with respect to foreign currency risks is general in nature. The Company disclaims any responsibility to advise prospective purchasers of S-31 Foreign Currency Notes with respect to any matters that may affect the purchase, holding or receipt of payments of principal of, premium, if any, and interest on such Notes. Such persons should consult their own counsel with regard to such matters. EXCHANGE RATES AND EXCHANGE CONTROLS An investment in Notes that are denominated in, or the payment of which is to be or may be made in or related to the value of, a Specified Currency other than U.S. dollars entails significant risks that are not associated with a similar investment in a security denominated in U.S. dollars. Such risks include the possibility of significant changes in rates of exchange between the U.S. dollar and the various foreign currencies (or composite currencies) after the issuance of such Note and the possibility of the imposition or modification of foreign exchange controls by either the U.S. or foreign governments. Such risks generally depend on economic and political events over which the Company has no control. In recent years, rates of exchange between U.S. dollars and certain foreign currencies have been highly volatile and such volatility may be expected to continue in the future. Fluctuations in any particular exchange rate that have occurred in the past are not necessarily indicative, however, of fluctuations in such rate that may occur during the term of any Note. Depreciation of the Specified Currency of a Note against the U.S. dollar would result in a decrease in the effective yield of such Note below its coupon rate and, in certain circumstances, could result in a loss to the investor on a U.S. dollar basis. In addition, depending on the specific terms of a currency linked Indexed Note, changes in exchange rates relating to any of the currencies involved may result in a decrease in the effective yield of such currency linked Indexed Note and, in certain circumstances, could result in a loss of all or a substantial portion of the principal of a currency linked Indexed Note to the investor. Foreign exchange rates can either be fixed by sovereign governments or float. Exchange rates of most economically developed nations are permitted to fluctuate in value relative to the U.S. dollar. National governments, however, rarely voluntarily allow their currencies to float freely in response to economic forces. Governments in fact use a variety of techniques, such as intervention by a country's central bank or imposition of regulatory controls or taxes, to affect the exchange rate of their currencies. Governments may also issue a new currency to replace an existing currency or alter the exchange rate or relative exchange characteristics by devaluation or revaluation of a currency. Thus, a special risk in purchasing Foreign Currency Notes or currency linked Indexed Notes is that their U.S. dollar-equivalent yields could be affected by governmental actions, which could change or interfere with theretofore freely determined currency valuation, fluctuations in response to other market forces, and the movement of currencies across borders. There will be no adjustment or change in the terms of such Notes in the event that exchange rates should become fixed, or in the event of any devaluation or revaluation or imposition of exchange or other regulatory controls or taxes, or in the event of other developments affecting the U.S. dollar or any applicable Specified Currency. Governments have imposed from time to time, and may in the future impose, exchange controls which could affect exchange rates as well as the availability of a specified foreign currency at the time of payment of principal of, and premium, if any, or interest, if any, on a Note. Even if there are no actual exchange controls, it is possible that the Specified Currency for any particular Note not denominated in U.S. dollars would not be available at such Note's maturity. In that event, the Company would make required payments in U.S. dollars on the basis of the market exchange rate on the date of such payment, or if such rate of exchange is not then available, on the basis of the market exchange rate as of the most recent practicable date. See "Special Provisions Relating to Foreign Currency Notes--Payment Currency." GOVERNING LAW AND JUDGMENTS The Indenture and Notes will be governed by and construed in accordance with the laws of the State of New York. If an action based on Foreign Currency Notes were commenced in a New York court, such court would render or enter a judgment or decree in the Specified Currency. Such judgment would then be converted into U.S. dollars at the rate of exchange prevailing on the date of S-32 entry of the judgment or decree. In the event an action based on Foreign Currency Notes were commenced in a court in the United States outside New York, it is likely that the judgment currency would be U.S. dollars, but the method of determining the applicable exchange rate may differ. UNITED STATES TAX CONSIDERATIONS The following is a summary of the principal United States federal income and estate tax consequences of the initial purchase, ownership and disposition of the Notes and is based upon the Internal Revenue Code of 1986 (the "Code"), as amended to the date hereof, regulations, rulings and decisions in effect on the date hereof, changes to any of which subsequent to the date of this Prospectus Supplement may affect the tax consequences described herein. The summary is based upon the advice of James M. Kalashian, General Tax Counsel of General Electric Capital Corporation, tax counsel to the Company, which advice is based upon certain of the facts set forth in this Prospectus Supplement and other documents related to the issuance of the Notes and upon compliance with the provisions thereof and the representations and agreements therein. This summary discusses only Notes that are beneficially owned by United States Alien Holders (as defined below) and held as capital assets; it does not discuss all of the tax consequences that may be relevant to a holder in light of its particular circumstances or to holders subject to special rules, such as certain financial institutions, insurance companies, dealers in securities or foreign currencies, persons holding Notes as a hedge against currency risks or as a position in a "straddle" for tax purposes, or holders whose functional currency is not the U.S. dollar. The United States federal income tax consequences to a U.S. Holder (as defined below) in connection with the purchase of any Registered Notes by or on behalf of a United States persons will be set forth in the applicable Pricing Supplement. Persons considering the purchase of Notes should consult their own tax advisors in order to determine the United States, as well as any state, local or foreign tax consequences to them of the purchase, ownership and disposition of the Notes. As used herein, a "U.S. Holder" means a beneficial owner of a Note that is for United States federal income tax purposes (i) a citizen or resident of the United States, (ii) a corporation, partnership or other entity created or organized in or under the laws of the United States or of any political subdivision thereof, or (iii) an estate or trust the income of which is subject to United States federal income taxation regardless of its source; a "United States Alien Holder" means a beneficial owner of a Note that is, for United States federal income tax purposes, a foreign corporation, a nonresident alien individual, a nonresident alien fiduciary of a foreign estate or trust, or a foreign partnership one or more of the members of which is, as to the United States, a foreign corporation, a nonresident alien individual or a nonresident fiduciary of a foreign estate or trust; and the "United States" means the United States of America (including the states and the District of Columbia), its territories, its possessions and other areas subject to its jurisdiction. PRINCIPAL AND INTEREST Payments of principal and interest (including premium or original issue discount ("Discount")), made by the Company or any of its paying agents on a Note to any United States Alien Holder will not be subject to United States federal income or withholding tax, provided that in the case of interest or Discount, (i) the holder does not actually or constructively own 10% or more of the total combined voting power of all classes of stock of the Company entitled to vote, (ii) the holder is not a controlled foreign corporation that is related to the Company through stock ownership, (iii) the holder is not a bank receiving interest described in section 881(c)(3) of the Code and (iv) if the Note is a Registered Note, either (a) the beneficial owner of the Registered Note certifies to the Company or its agent, under penalties of perjury on U.S. Internal Revenue Service Form W-8 or substantially similar form in the year in which a payment occurs, or in either of the two preceding calendar years, that it is not a United States person and provides its name and address in the required manner or (b) a securities clearing organization, bank or other financial institution that holds customers' securities in the ordinary course of its trade or business (a "financial institution") and holds the Registered Note on behalf of the beneficial owner certifies to the Company or its agent, under penalties of perjury, that S-33 such a certification from the beneficial owner has been received by it or by a financial institution between it and the beneficial owner and furnishes the payor with a copy of the Form W-8 or substantially similar form in the manner required. Recently enacted legislation provides that United States federal withholding tax will apply to contingent interest if the amount of such interest is determined with reference to the profitability of the Company. Unless otherwise provided in the applicable Pricing Supplement, the Company does not expect any interest on the Notes to be subject to this provision. A United States Alien Holder will not be subject to United States federal income or withholding tax on gain realized on the sale, exchange or retirement of the Note, unless (i) such Holder is an individual who is present in the United States for 183 days or more in the taxable year of disposition, and either (a) such individual has a "tax home" (as defined in Code section 911(d)(3)) in the United States (unless such gain is attributable to a fixed place of business in a foreign country maintained by such individual and has been subject to foreign tax of at least 10%) or (b) the gain is attributable to an office or other fixed place of business maintained by such individual in the United States or (ii) such gain is effectively connected with the conduct by such Holder of a trade or business in the United States. A Note or Coupon held by an individual, who at the time of death is not a citizen or resident of the United States, will not be subject to United States federal estate tax as a result of such individual's death provided that the individual does not actually or constructively own 10% or more of the total combined voting power of all classes of stock of the Company entitled to vote, and, at the time of such individual's death, payments with respect to such Note would not have been effectively connected to the conduct by such individual of a trade or business in the United States. If a United States Alien Holder is engaged in a trade or business in the United States and interest, Discount, premium (if any) and gain on the Note are effectively connected with the conduct of such trade or business, the United States Alien Holder, although exempt from the withholding tax discussed in the preceding paragraphs, will generally be subject to United States federal income tax on such interest, Discount, premium and gain in the same manner as if it were a U.S. Holder. In lieu of a Form W-8 or similar form described above, such a Holder will be required to provide the Company or its agent a properly executed U.S. Internal Revenue Service Form 4224 in order to claim exemption from withholding tax. In addition, if such a holder is a foreign corporation, it may be subject to a branch profits tax equal to 30% of its effectively connected earnings and profits for the taxable year, subject to adjustments. For this purpose, interest, Discount, premium (if any) and gain on a Note will be included in the effectively connected earnings and profits if such interest and Discount, premium and gain is effectively connected with the conduct by such United States Alien Holder of a trade or business in the United States. BACKUP WITHHOLDING AND INFORMATION REPORTING Under current regulations, information reporting and backup withholding (currently 31%) will not apply to payments of principal, premium or interest made outside the United States by the Company or a paying agent on a Bearer Note or to payments made on a Registered Note, if the certification described in (iv) above is received with respect to a Registered Note, provided in each case that the Company or such paying agent, as the case may be, does not have actual knowledge that the payee is a U.S. person. In addition, if payment is collected outside the United States by a foreign office of a custodian, nominee or other agent acting on behalf of a beneficial owner of a Bearer Note, such custodian, nominee or other agent will not be required to apply backup withholding to payments made to such beneficial owner. However, if such custodian, nominee or other agent is a U.S. person, a controlled foreign corporation for United States federal income tax purposes, or a foreign person 50% or more of whose gross income is from a United States trade or business for a specified three-year period, such custodian, nominee or other agent may be subject to certain information reporting requirements with respect to such payment unless it has in its records documentary evidence that the beneficial owner is not a U.S. person and certain conditions are met or the beneficial owner otherwise establishes an exemption. S-34 Under current regulations, payment of the proceeds of the sale, exchange or retirement of a Note to or through a foreign office of a broker generally will not be subject to backup withholding. However, if such broker is a U.S. person, a controlled foreign corporation for United States federal income tax purposes, or a foreign person 50% or more of whose gross income is from a United States trade or business for a specified three-year period, information reporting will apply unless such broker has in its records documentary evidence that the beneficial owner is not a U.S. person and certain conditions are met or the beneficial owner otherwise establishes an exemption. Payments of the proceeds of a sale to or through the United States office of a broker will be subject to information reporting and backup withholding unless the holder or beneficial owner certifies to its non-United States status or otherwise establishes an exemption. The foregoing is a general discussion of the information reporting and backup withholding rules and may not be applicable to the position of any particular holder or beneficial owner of a Note or Coupon. In addition, the circumstances under which backup withholding and information reporting will be required are currently under review by the United States Treasury Department, and thus the rules discussed above may change with respect to payments on the Notes or Coupons or proceeds from the sale or exchange of the Notes or Coupons. United States Alien Holders of Notes should consult their own tax advisors regarding the application of information reporting and backup withholding in their particular situations, the availability of an exemption therefrom, and the procedure for obtaining such an exemption, if available. Any amounts withheld from a payment to a United States Alien Holder under the backup withholding rules will be allowed as a credit against such Holder's United States federal income tax liability and may entitle such holder to a refund, provided that the required information is furnished to the United States Internal Revenue Service. PLAN OF DISTRIBUTION GENERAL Under the terms of the Amended and Restated Euro Distribution Agreement dated as of August 31, 1993, as amended (the "Euro Distribution Agreement"), the Notes are being offered on a continuing basis by the Company through the Agents, each of which has agreed to use its best efforts to solicit purchases of the Notes. Except as otherwise agreed by the Company and an Agent with respect to a particular Note, the Company will pay each Agent a commission ranging from .050% to .600% of the principal amount of each Note, depending on its maturity, sold through such Agent. The Company will have the sole right to accept offers to purchase Notes and may reject any such offer, in whole or in part. Each Agent shall have the right, in its discretion reasonably exercised, without notice to the Company, to reject any offer to purchase Notes received by it, in whole or in part. The Company also may sell Notes to any Agent, acting as principal, at a discount or concession to be agreed upon at the time of sale, for resale to one or more investors or other purchasers at a fixed offering price or at varying prices related to prevailing market prices at the time of such resale or otherwise, as determined by such Agent and specified in the applicable Pricing Supplement. The Agents may offer the Notes they have purchased as principal to other dealers. The Agents may sell Notes to any dealer at a discount and, unless otherwise specified in the applicable Pricing Supplement, such discount allowed to any dealer will not be in excess of the discount to be received by such Agent from the Company. Unless otherwise indicated in the applicable Pricing Supplement, any Note sold to an Agent as principal will 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 any agency sale of a Note of identical maturity, and may be resold by the Agent to investors and other purchasers from time to time in one or more transactions, including negotiated transactions as described above. After the initial public offering of Notes to be resold to investors and other purchasers, the public offering price, concession and discount may be changed. The Notes may also be sold by the Company directly to investors (other than broker-dealers) in those jurisdictions in which the Company is permitted to do so. No commission will be paid on Notes sold directly by the Company. S-35 The Company may also sell Notes from time to time through one or more additional agents, acting either as agent or principal, on substantially the same terms as those applicable to the Agents. Any such additional agent shall, with respect to any such Notes, be deemed to be included in all references to an "Agent" or the "Agents" hereunder. The Company reserves the right to withdraw, cancel or modify the offer made hereby without notice. Each purchaser of a Note will arrange for payment as instructed by the applicable Agent. The Agents are required to deliver the proceeds of the Notes to the Company in immediately available funds, to a bank designated by the Company in accordance with the terms of the Euro Distribution Agreement, on the date of settlement. In compliance with United States federal income tax laws and regulations, the Company and the Agents have agreed that in connection with the original issuance of, or during the Restricted Period with respect to, any Bearer Note, (a) they will not offer to sell or sell, as principal or agent, directly or indirectly, such Bearer Note (i) inside the United States or (ii) to or for the account of any United States person unless such United States person is a Qualifying Foreign Branch or other person described in United States Treasury Regulations Section 1.163-5(c)(2)(i)(D)(1)(iii)(B) and (C) and (b) they will not deliver any Bearer Note inside the United States. An offer or sale will be considered to be made to a person in the United States if the offeror or seller of such Note has an address within the United States for the offeree or purchaser of such Note with respect to the offer or sale. Each Agent has represented and agreed that it will have in effect, in connection with the offer and sale of the Bearer Notes during the Restricted Period, procedures reasonably designed to ensure that its employees or agents who are directly engaged in selling the Bearer Notes are aware that the Bearer Notes cannot be offered or sold during the Restricted Period to a United States person or a person within the United States. The Notes may not be offered or sold, directly or indirectly, in the United Kingdom, by means of this Prospectus Supplement, the accompanying Prospectus or any other document, other than to persons whose ordinary business it is to buy or sell shares or debentures, whether as principal or agent (except in circumstances which do not constitute an offer to the public within the meaning of the Companies Act 1985 of the United Kingdom). All applicable provisions of the Financial Services Act 1986 of the United Kingdom must be complied with with respect to anything done by the Agents in relation to the Notes in, from or otherwise involving the United Kingdom. Furthermore, each underwriter, dealer, agent and remarketing firm participating in the distribution of the Notes has agreed or will agree that it will only issue or pass on in the United Kingdom any document received by it in connection with the issue of the Notes to a person who is of a kind described in Article 9(3) of the Financial Services Act 1986 (Investment Advertisements) (Exemptions) Order 1988 or is a person to whom the document may otherwise lawfully be issued or passed on. The Agents may be deemed to be "underwriters" within the meaning of the Securities Act of 1933, as amended (the "Act"). The Company has agreed to indemnify the Agents against and contribute toward certain liabilities, including liabilities under the Act. The Company has agreed to reimburse the Agents for certain expenses. Kidder, Peabody & Co. Incorporated ("Kidder"), and each of the other European Agents engage in transactions with and perform services for the Company in the ordinary course of business. General Electric Capital Services, Inc., formerly known as General Electric Financial Services, Inc. ("GE Capital Services"), which owns all of the outstanding common stock of the Company, owns all of the common stock of Kidder, Peabody Group Inc. which in turn owns 100% of Kidder. This Prospectus Supplement and the accompanying Prospectus may also be used by Kidder in connection with offers and sales of Notes related to market-making transactions, by and through Kidder, at negotiated prices related to prevailing market prices at the time of sale or otherwise. Kidder may act as principal or agent in such transactions. S-36 Each of the Agents may from time to time purchase and sell Notes in the secondary market, but is not obligated to do so, and there can be no assurance that there will be a secondary market for the Notes or liquidity in the secondary market if one develops. From time to time, each of the Agents may make a market in the Notes. DISTRIBUTION OF YEN-DENOMINATED NOTES The Notes have not been, and will not be, registered under the Securities and Exchange Law of Japan. The Company and the Agents will agree not to offer or sell any Note directly or indirectly in Japan or to residents of Japan or for the benefit of any Japanese person (which term as used herein means any person resident in Japan, including any corporation or other entity organized under the laws of Japan) or to others for reoffering or resale directly or indirectly in Japan or to any Japanese person during the period of 90 days from the Original Issue Date of such Note, or 180 days from the Original Issue Date of any Dual Currency Note and that thereafter it will not do so except in circumstances that result in compliance with any applicable laws, regulations and ministerial guidelines of Japan taken as a whole. Without limiting the generality of the foregoing, Notes denominated in Japanese yen will not be sold without approval of the Japanese Ministry of Finance, except for single currency Notes repayable at their non-variable principal or redemption amount and bearing interest at a fixed rate or by reference to Yen LIBOR (plus or minus a Spread), and Indexed Notes such as Nikkei-linked and DAX-linked issues, in each case which are already permitted by the Japanese Ministry of Finance. DISTRIBUTION OF DEUTSCHEMARK-DENOMINATED NOTES Issuance of Notes denominated or payable in Deutschemarks will either be sold by the Company through one or more of the German Agents (as defined below) acting as Agent on behalf of the Company or in underwritten transactions lead managed by one or more of the German Agents. Any issuance of Notes denominated or payable in Deutschemarks with respect to which payments of principal, interest or premium, if any, or any combination of the foregoing, are calculated with reference to (i) the relationship between two or more currencies, (ii) one or more specified securities or commodities, (iii) one or more securities or commodities exchange indices or (iv) other indices or by other similar methods or formulae will be offered and sold by the Company in compliance with the then-current rules, regulations and policy statements of the Deutsche Bundesbank. The following Agents are "German Agents" for purposes of Notes denominated or payable in Deutschemarks: CS First Boston Effectbank Aktiegesellschaft, Goldman, Sachs & Co. oHG, Merrill Lynch Bank AG, S.G. Warburg & Co. GmbH, Schweizerische Bankgesellschaft (Deutschland) AG and Schweizerischer Bankverein (Deutschland) AG. Chase Bank AG has agreed with the Company to act as German Arranger with respect to Notes denominated or payable in Deutschemarks. DISTRIBUTION OF DUTCH GUILDER-DENOMINATED NOTES Distribution of Notes denominated in Dutch Guilders will be arranged through a Dutch dealer which is a registered credit institution meeting the requirements of the Dutch Central Bank (DE NEDERLANDSCHE BANK) from time to time. GLOBAL MEDIUM-TERM NOTES, SERIES A In addition to offering Notes through the Agents as described herein, Debt Securities which are medium-term notes (Global Medium-Term Notes, Series A) and may have terms substantially similar to the terms of the Notes offered hereby (but constituting a separate series of Debt Securities for purposes of the Indenture), are being, and may in the future continue to be, offered, concurrently with the offering of the Notes, on a continuing basis outside the United States by the Company pursuant to a distribution agreement (the "U.S. Distribution Agreement") with Kidder, Peabody & Co. Incorporated, J.P. Morgan Securities Inc., Merrill Lynch & Co., Merrill, Lynch, Pierce, Fenner & Smith Incorporated and CS First Boston Corporation (the "Domestic Agents"), as agents for the Company, the terms of which are substantially similar to the terms of the Euro Distribution Agreement, except for certain selling restrictions specified in the Euro Distribution Agreement. Any Global Medium-Term Notes sold pursuant to such U.S. Distribution Agreement, or sold by the Company to any of the S-37 Domestic Agents for resale as contemplated by such U.S. Distribution Agreement, will reduce the remaining principal amount of Notes which may be offered by this Prospectus Supplement, any Pricing Supplement hereto, and the Prospectus. LEGAL OPINIONS The legality of the Notes will be passed upon for the Company by Burton J. Kloster, Jr., a director and Senior Vice President, General Counsel and Secretary of the Company or by Bruce C. Bennett, Associate General Counsel, Treasury Operations and Assistant Secretary of the Company. Certain matters relating to the offering of the Notes will be passed upon for the Agents by Davis Polk & Wardwell, 450 Lexington Avenue, New York, New York 10017. Messrs. Kloster, Bennett and James M. Kalashian (who is referred to under "United States Tax Considerations"), together with members of their families, each owns, has options to purchase and has other interests in shares of common stock of General Electric Company. GENERAL INFORMATION LISTING The Series B Notes issued prior to the date of this Prospectus Supplement have been listed on the Luxembourg Stock Exchange, and application has been made to list subsequently-issued Series B Notes on the Luxembourg Stock Exchange. The Organization Certificate and By-Laws of the Company have been, and prior to listing a legal notice relating to the issuance of the Series B Notes will be, deposited with the GREFFIER EN CHEF DU TRIBUNAL D'ARRONDISSEMENT DE ET A LUXEMBOURG, where such documents may be examined or copies obtained. INFORMATION FOR HOLDERS OF NOTES So long as any of the Series B Notes remain outstanding, copies of the Indenture, the Euro Distribution Agreement and the Registration Statement of which this Prospectus Supplement is a part, and a copy of the Organization Certificate and By-Laws of the Company will be available for inspection at the main office of the paying agent in Luxembourg. In addition, copies of the documents incorporated by reference in this Prospectus Supplement and copies of the annual and quarterly reports hereafter filed by the Company with the United States Securities and Exchange Commission and copies of the Pricing Supplements may be obtained at such office. AUDITORS The independent certified public accountants of the Company are KPMG Peat Marwick. AUTHORIZATIONS The issuance of the Notes was authorized by resolutions adopted by the Board of Directors of the Company on November 21, 1989, October 18, 1990, September 9, 1991, February 25, 1992, March 19, February 17, 1993, March 24, 1993, July 27, 1993, October 27, 1993 and March 23, 1994. STAMP TAXES Purchasers of Notes may be required to pay stamp taxes and other charges in accordance with the laws and practices of the country of purchase in addition to the issue price. LITIGATION AND MATERIAL CHANGE The Company is not a party to any material legal proceeding. There has been no material adverse change in the financial position of the Company and its consolidated affiliates considered as a whole since December 31, 1993. PRINCIPAL OFFICE IN THE STATE OF NEW YORK The Company's principal office in the State of New York, its jurisdiction of incorporation, is located at 570 Lexington Avenue, New York, New York 10022. CLEARANCE The Notes, when issued, will be accepted for clearance through the Euroclear Operator and through Cedel. S-38 DOCUMENTS INCORPORATED BY REFERENCE The Company will provide without charge to each person to whom this Prospectus Supplement is delivered, on the written or oral request of such person, a copy (without exhibits) of any or all of the documents incorporated by reference in the Prospectus. See "Documents Incorporated by Reference" in the Prospectus. Such requests should be directed to Kidder, Peabody International PLC, 20 Finsbury Street, London EC2Y 9AY, England, Attention: Syndicate Department, or to Kredietbank S.A. Luxembourgeoise, 43, Boulevard Royal, L-2955 Luxembourg, Attention: Listing Department. UNDERTAKINGS BY THE COMPANY The Company has given an undertaking in connection with the listing of the Series B Notes on the Luxembourg Stock Exchange to the effect that, so long as any Series B Notes remain outstanding and listed on such Exchange, in the event of any material adverse change in the business or financial position of the Company that is not reflected in the Prospectus as then amended or supplemented, the Company will prepare an amendment or supplement to the Prospectus or publish a new document for use with any subsequent offering and listing by the Company of Series B Notes. S-39 PRINCIPAL EXECUTIVE OFFICES OF THE COMPANY 260 Long Ridge Road Stamford, Connecticut 06927 U.S.A. TRUSTEE REGISTRAR Mercantile-Safe Deposit and The Chase Manhattan Bank Trust Company (National Association) 2 Hopkins Plaza 4 Chase MetroTech Center Baltimore, Maryland 21201 3rd Floor U.S.A. Brooklyn, New York 11245 U.S.A. PRINCIPAL PAYING AGENT The Chase Manhattan Bank (National Association) London Branch Woolgate House, Coleman Street London EC2P 2HD England OTHER PAYING AGENTS Chase Manhattan Banque Bruxelles Lambert S.A. Bank Luxembourg S.A. 24 Avenue Marnix 5, Rue Plaetis B-1050 Brussels L-2338 Luxembourg Belgium LEGAL ADVISOR TO THE COMPANY LEGAL ADVISORS TO THE AGENTS Bruce C. Bennett Davis Polk & Wardwell Associate General Counsel--Treasury Operations 450 Lexington Avenue General Electric Capital Corporation New York, New York 10017 260 Long Ridge Road U.S.A. Stamford, Connecticut 06927 U.S.A. LISTING AGENT AUDITORS Kredietbank S.A. Luxembourgeoise KPMG Peat Marwick 43, Boulevard Royal 3001 Summer Street L-2955 Luxembourg Stamford, Connecticut 06905 U.S.A.
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