PRICING AGREEMENT

PRICING AGREEMENT

 

Barclays Capital Inc.,

Citigroup Global Markets Inc.,

J.P. Morgan Securities LLC, and

Wells Fargo Securities, LLC

As Representatives of the several

Underwriters named in Schedule I hereto

 

November 3, 2014

 

Ladies and Gentlemen:

 

 

 

 

 

 

 

 

Accepted as of the date hereof:

 

Barclays Capital Inc.,

Citigroup Global Markets Inc.,

J.P. Morgan Securities LLC, and

Wells Fargo Securities, LLC

On behalf of each of the

Underwriters

By: Barclays Capital Inc.

 

By: Citigroup Global Markets Inc.

 

By:	/s/ Brian D. Bednarski
	Name:	Brian D. Bednarski
	Title:	Managing Director

By: J.P. Morgan Securities LLC

 

By:	/s/ Robert Bottamedi
	Name:	Robert Bottamedi
	Title:	Vice President

By: Wells Fargo Securities, LLC

 

By:	/s/ Carolyn Hurley
	Name:	Carolyn Hurley
	Title:	Director

 

 

 

Underwriter	Principal Amount of 3.500% Senior Notes due 2024 to be Purchased
Barclays Capital Inc.	$135,000,000
Citigroup Global Markets Inc.	$135,000,000
J.P. Morgan Securities LLC	$135,000,000
Wells Fargo Securities, LLC	$135,000,000
U.S. Bancorp Investments, Inc.	$20,400,000
Credit Suisse Securities (USA) LLC	$20,325,000
Goldman, Sachs & Co.	$20,325,000
Merrill Lynch, Pierce, Fenner & Smith                      Incorporated	$20,325,000
Mitsubishi UFJ Securities (USA) Inc.	$20,325,000
Morgan Stanley & Co. LLC	$20,325,000
RBS Securities Inc.	$20,325,000
SunTrust Robinson Humphrey, Inc.	$20,325,000
UBS Securities LLC	$20,325,000
BNY Mellon Capital Markets, LLC	$6,750,000
Fifth Third Securities, Inc.	$6,750,000
HSBC Securities (USA), Inc.	$6,750,000
PNC Capital Markets LLC	$6,750,000
Total	$750,000,000

 

 

TITLE OF DESIGNATED SECURITIES:

 

3.500% Senior Notes due November 15, 2024 (hereinafter referred to as the “Notes”)

 

AGGREGATE PRINCIPAL AMOUNT:

 

$750,000,000

 

PRICE TO PUBLIC:

 

99.581% of the aggregate principal amount of the Notes, plus accrued interest, if any, from November 10, 2014

 

PURCHASE PRICE BY UNDERWRITERS:

 

98.931% of the aggregate principal amount of the Notes, plus accrued interest, if any, from November 10, 2014

 

SPECIFIED FUNDS FOR PAYMENT OF PURCHASE PRICE:

 

Immediately available funds delivered to the bank account(s) specified in the form of cross-receipt to the Underwriters

 

INDENTURE:

 

Senior Indenture dated as of March 2, 2001, between the Company and U.S. Bank National Association, successor in interest to State Street Bank and Trust Company, as Trustee (the “Base Indenture”), as supplemented by the Supplemental Indenture to be dated on or prior to November 10, 2014, between the Company and the Trustee (as so supplemented, the “Indenture”).

 

MATURITY:

 

November 15, 2024

 

INTEREST RATE:

 

3.500% per annum

 

INTEREST PAYMENT DATES:

 

Each May 15 and November 15, beginning May 15, 2015.

 

 

REDEMPTION PROVISIONS:

 

At any time prior to August 15, 2024 (three (3) months prior to the maturity date of the Notes), the Notes will be redeemable, in whole or in part, at a redemption price equal to the greater of:

 

·

100% of the principal amount of the Notes being redeemed, or

 

·

the sum of the present value of (i) 100% of the principal amount of the Notes being redeemed and (ii) all required remaining scheduled interest payments due on the Notes being redeemed, in each case calculated as if the maturity date of the Notes were August 15, 2024 (three (3) months prior to the maturity date of the Notes), discounted to the redemption date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate (as defined below) plus 20 basis points,

 

plus, in each case, any interest accrued but not paid to the date of redemption.

 

 

 

“Treasury Rate” means, with respect to any redemption date for any portion of the Notes,

 

·

the yield, under the heading which represents the average for the immediately preceding week, appearing in the most recently published statistical release designated “H.15(519)” or any successor publication which is published weekly by the Board of Governors of the Federal Reserve System and which establishes yields on actively traded United States Treasury securities adjusted to constant maturity under the caption “Treasury Constant Maturities,” for the maturity corresponding to the Comparable Treasury Issue (if no maturity is within three months before or after the Remaining Life for the Notes, yields for the two published maturities most closely corresponding to the Comparable Treasury Issue will be determined and the Treasury Rate shall be interpolated or extrapolated from those yields on a straight line basis, rounding to the nearest month), or

 

·

if the release referred to in the previous bullet (or any successor release) is not published during the week preceding the calculation date or does not contain the yields referred to above, the rate per annum equal to the semi-annual equivalent yield to maturity of the Comparable Treasury Issue, calculated using a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for that redemption date.

 

The Treasury Rate will be calculated on the third Business Day preceding the redemption date.

 

 

“Comparable Treasury Price” means, with respect to any redemption date for any Notes, the average of all Reference Treasury Dealer Quotations (as defined below) obtained.

 

“Independent Investment Banker” means one of the Reference Treasury Dealers appointed by the Trustee after consultation with the Company.

 

 

 

 

 

 

 

 

On the Change of Control Payment Date, the Company will be required, to the extent lawful, to:

 

·

accept or cause a third party to accept for payment all Notes or portions of Notes properly tendered pursuant to the Change of Control Offer;

 

·

deposit or cause a third party to deposit with the paying agent an amount equal to the Change of Control Payment in respect of each Note or portion of a Note properly tendered; and

 

·

deliver or cause to be delivered to the Trustee the Notes properly accepted, together with an officer’s certificate stating the aggregate principal amount of Notes or portions of Notes being purchased.

 

“Below Investment Grade Rating Event” means the Notes are rated below an Investment Grade Rating by each of the Rating Agencies on any date from the earlier of (1) the occurrence of a Change of Control and (2) public notice of the Company’s intention to effect a Change of Control, in each case until the end of the 60-day period following the earlier of (1) the occurrence of a Change of Control and (2) public notice of the Company’s intention to effect a Change of Control; provided, however, that if (i) during such 60-day period one or more Rating Agencies has publicly announced that it is considering the possible downgrade of the Notes, and (ii) a downgrade by each of the Rating Agencies that has made such an announcement would result in a Below Investment Grade Rating Event, then such 60-day period shall be extended for such time as the rating of the Notes by any such Rating Agency remains under publicly announced consideration for possible downgrade to a rating below an Investment Grade Rating and a downgrade by such Rating Agency to a rating below an Investment Grade Rating could cause a Below Investment Grade Rating Event. Notwithstanding the foregoing, a rating event otherwise arising by virtue of a particular reduction in rating will not be deemed to have occurred in respect of a particular Change of Control (and thus will not be deemed a Below Investment Grade Rating Event for purposes of the definition of Change of Control Triggering Event) if the

 

 

“Change of Control” means the occurrence of any of the following: (1) direct or indirect sale, transfer, conveyance or other disposition (other than by way of merger or consolidation), in one or a series of related transactions, of all or substantially all of the properties or assets of the Company and its subsidiaries taken as a whole to any “person” (as that term is used in Section 13(d)(3) of the Exchange Act) other than to the Company or one of its subsidiaries; (2) the consummation of any transaction (including, without limitation, any merger or consolidation) the result of which is that any “person” (as that term is used in Section 13(d)(3) of the Exchange Act) other than the Company or one of its subsidiaries becomes the beneficial owner, directly or indirectly, of more than 50% of the then outstanding number of shares of the Company’s voting stock; or (3) the first day on which a majority of the members of the Company’s Board of Directors are not Continuing Directors; provided, however, that a transaction will not be deemed to involve a Change of Control if (A) the Company becomes a wholly owned subsidiary of a holding company and (B)(x) the holders of the voting stock of such holding company immediately following that transaction are substantially the same as the holders of the Company’s voting stock immediately prior to that transaction or (y) immediately following that transaction no “person” (as that term is used in Section 13(d)(3) of the Exchange Act) is the beneficial owner, directly or indirectly, of more than 50% of the voting stock of such holding company. For purposes of this definition, “voting stock” means capital stock of any class or kind the holders of which are ordinarily, in the absence of contingencies, entitled to vote for the election of directors (or persons performing similar functions) of the Company, even if the right to vote has been suspended by the happening of such a contingency.

 

“Change of Control Triggering Event” means the occurrence of both a Change of Control and a Below Investment Grade Rating Event.

 

“Continuing Directors” means, as of any date of determination, any member of the Board of Directors of the Company who (1) was a member of the Board of Directors of the Company on the date of the issuance of the Notes; or (2) was nominated for election or elected to the Board of Directors of the Company with the approval of a majority of the Continuing Directors who were members of such Board of Directors of the Company at the time of such nomination or election (either by specific vote or by approval of the Company’s proxy statement in which such member was named as a nominee for election as a director).

 

“Fitch” means Fitch Ratings Inc.

 

“Investment Grade Rating” means a rating by Moody’s equal to or higher than Baa3 (or the equivalent under any successor rating category of Moody’s), a rating by S&P equal to or higher than BBB- (or the equivalent under any successor rating category of S&P), a rating by Fitch equal to or higher than BBB- (or the equivalent under any successor rating category of Fitch), and the equivalent investment grade credit rating from any replacement rating agency or

 

 

“Moody’s” means Moody’s Investors Service, Inc.

 

“Rating Agencies” means (1) Moody’s, S&P and Fitch; and (2) if any or all of Moody’s, S&P or Fitch ceases to rate the Notes or fails to make a rating of the Notes publicly available for reasons outside of the Company’s control, a “nationally recognized statistical rating organization” within the meaning of Section 3(a)(62) of the Exchange Act that the Company selects (pursuant to a resolution of the Company’s Board of Directors) as a replacement agency for any of Moody’s, S&P or Fitch, or all of them, as the case may be, with respect to the Notes.

 

“S&P” means Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc.

 

SINKING FUND PROVISIONS:

 

No sinking fund provisions

 

TIME OF DELIVERY:

 

9:00 a.m. Eastern time on November 10, 2014

 

CLOSING LOCATION:

 

Sullivan & Cromwell LLP, 125 Broad Street, New York, New York 10004

 

DELAYED DELIVERY:

 

None

 

NAMES AND ADDRESSES OF REPRESENTATIVES:

 

Barclays Capital Inc.,

745 Seventh Avenue

New York, NY 10019

Attention: Syndicate Registration

Facsimile No.: +1 ###-###-####

Citigroup Global Markets Inc.,

388 Greenwich Street

New York, NY 10013

Attention: General Counsel

Facsimile No.: +1 ###-###-####

J.P. Morgan Securities LLC,

383 Madison Avenue

 

New York, NY 10179

Attention: Investment Grade Syndicate Desk – 3rd floor

Facsimile No.: +1 ###-###-####

Wells Fargo Securities, LLC,

550 South Tryon Street, 5th Floor

Charlotte, NC 28202

Attention: Transaction Management

Facsimile No.: +1 ###-###-####

 

OTHER TERMS:

 

The holders of the Notes will not have the benefit of clause (5) of Section 501 of the Base Indenture entitled “Events of Default.”

 

The holders of the Notes will not have the benefit of Section 1005 of the Base Indenture entitled “Limitations on Liens on Common Stock of Principal Subsidiaries.”

 

Delivery of the Notes will be made against payment therefor on the fifth business day following the date of pricing of the Notes (such settlement cycle being herein referred to as “T+5”).

 

 

 

 

 

 

 

 

 

	$750,000,000 3.500% Senior Notes due 2024
Note Type:	Senior Notes
Legal Format:	SEC Registered
Principal Amount:	$750,000,000
Trade Date:	November 3, 2014
Settlement Date (T+5 Days):	November 10, 2014
Maturity Date:	November 15, 2024
Coupon:	3.500%
Interest Payment Frequency:	Semi-annual
Interest Payment Dates:	May 15 and November 15
First Interest Payment Date:	May 15, 2015
Day Count:	30/360
Pricing Benchmark:	2.375% due August 15, 2024
Benchmark Spot:	100-07
Benchmark Yield:	2.350%
Reoffer Spread to Benchmark Treasury:	120 basis points
Reoffer Yield:	3.550%
Price to Public / Reoffer Price:	99.581%
Underwriting Fees:	0.650%
Use of Proceeds:	The net proceeds are expected to be used (i) to redeem all of the Issuer’s outstanding 6.50% Senior Notes due 2018 and (ii) for general corporate purposes.
Optional Redemption:	At any time prior to August 15, 2024, at the greater of 100% of the principal amount of the notes or at a make whole using a discount rate of Treasury plus 20 basis points.   On or after August 15, 2024, redeemable at par.
CUSIP Number:	00817Y AQ1

We expect that delivery of the notes will be made against payment therefor on or about November 10, 2014, which will be the fifth business day following the date of pricing of the notes (such settlement cycle being herein referred to as “T+5”). Under Rule 15c6-1 under the Securities Exchange Act of 1934, as amended, trades in the secondary market generally are required to settle in three business days, unless the parties to any such trade expressly agree otherwise. Accordingly, purchasers who wish to trade notes on the date of pricing or the next succeeding business day will be required, by virtue of the fact that the notes initially will settle T+5, to specify an alternate settlement cycle at the time of any such trade to prevent a failed settlement. Purchasers of notes who wish to trade notes on the date of pricing or the next succeeding business day should consult their own advisor.

The Issuer has filed a registration statement (including a prospectus) with the SEC for the offering to which this communication relates.  Before you invest, you should read the prospectus in that registration statement and other documents the Issuer has filed with the SEC for more complete information about the Issuer and this offering.  You may get these documents for free by visiting EDGAR on the SEC Web site at www.sec.gov.  Alternatively, copies of the prospectus and the prospectus supplement may be obtained from Barclays Capital Inc. by calling ###-###-#### or by emailing ***@***, Citigroup Global Markets Inc. by calling ###-###-####, J.P. Morgan Securities LLC by calling ###-###-#### (collect) or Wells Fargo Securities, LLC by calling ###-###-####.