<PAGE> 1
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
FORM 10-Q
(mark one)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 1999
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
COMMISSION FILE NUMBER 1-12387
---------------------------
TENNECO AUTOMOTIVE INC.
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C>
DELAWARE 76-0515284
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
500 NORTH FIELD DRIVE, LAKE FOREST,
ILLINOIS 60045
(Address of principal executive
offices) (Zip Code)
</TABLE>
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (847) 482-5000
------------------------
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports) and (2) has been subject to such
filing requirements for the past 90 days. Yes [X] No [ ]
Indicate the number of shares outstanding of each of the issuer's classes
of common stock as of the latest practicable date.
Common Stock, par value $.01 per share: 33,674,559 shares as of November 5,
1999.
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<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
PART I--FINANCIAL INFORMATION
Item 1. Financial Statements (Unaudited)
Tenneco Automotive Inc. and Consolidated Subsidiaries--
Statements of Income (Loss)....................... 2
Statements of Cash Flows.......................... 3
Balance Sheets.................................... 4
Statements of Changes in Shareowners' Equity...... 5
Statements of Comprehensive Income (Loss)......... 6
Notes to Financial Statements..................... 7
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations......... 22
Item 3. Quantitative and Qualitative Disclosures About
Market Risk........................................... 34
PART II--OTHER INFORMATION
Item 1. Legal Proceedings.............................. *
Item 2. Changes in Securities.......................... 35
Item 3. Defaults Upon Senior Securities................ *
Item 4. Submission of Matters to a Vote of Security
Holders............................................... 35
Item 5. Other Information.............................. *
Item 6. Exhibits and Reports on Form 8-K............... 36
</TABLE>
- ------------
* No response to this item is included herein for the reason that it is
inapplicable or the answer to such item is negative.
CAUTIONARY STATEMENT AND "SAFE HARBOR" OF THE
PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
This Quarterly Report on Form 10-Q contains forward-looking statements
regarding among other things: (i) the restructuring and potential supplemental
restructuring plans; (ii) capital resources; (iii) the Year 2000 issue (relating
to potential equipment and computer failures by or at the change in the
century); and (iv) the implementation of the Euro. See "Restructuring and Other
Charges," "Liquidity and Capital Resources -- Capitalization," "Year 2000," and
"Euro Conversion" under "Management's Discussion and Analysis of Financial
Condition and Results of Operations." The words "will," "may," "believes,"
"should," "plans," "expects," "intends," and "estimates," and similar
expressions, identify these forward-looking statements. These forward-looking
statements are based on the current expectations of Tenneco (as defined below).
Because forward-looking statements involve risks and uncertainties, the plans,
actions and actual results could differ materially. Among the factors that could
cause the plans, actions and results to differ materially from current
expectations are: (i) the general economic, political, and competitive
conditions in markets and countries where Tenneco operates, including currency
fluctuations and other risks associated with operating in foreign countries and
changes in distribution channels; (ii) governmental actions, including the
ability to receive regulatory approvals and the timing of such approvals; (iii)
changes in capital availability or costs, including changes in interest rates
and market perceptions of Tenneco; (iv) changes in consumer demand and prices,
including decreases in demand for Tenneco products and its customers' products
and the resulting negative impact on revenues and margins from such products;
(v) the cost of compliance with changes in regulations, including environmental
regulations; (vi) workforce factors such as strikes or labor interruptions;
(vii) material substitutions or increases in the costs of raw materials; (viii)
Tenneco's ability to integrate operations of acquired businesses quickly and in
a cost-effective manner; (ix) new technologies; (x) the ability of Tenneco and
those with whom it conducts business to timely resolve the Year 2000 issue,
unanticipated costs of, problems with or delays in resolving the Year 2000
issue, and the costs and impacts if the Year 2000 issue is not timely resolved;
(xi) changes by the Financial Accounting Standards Board or other accounting
regulatory bodies of authoritative generally accepted accounting principles or
policies; and (xii) the timing and occurrence (or non-occurrence) of
transactions and events which may be subject to circumstances beyond Tenneco's
control.
1
<PAGE> 3
TENNECO AUTOMOTIVE INC. AND CONSOLIDATED SUBSIDIARIES
STATEMENTS OF INCOME (LOSS)
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
----------------------- -----------------------
1999 1998 1999 1998
---------- ---------- ---------- ----------
(MILLIONS EXCEPT SHARE AND PER SHARE AMOUNTS)
<S> <C> <C> <C> <C>
REVENUES
Net sales and operating revenues...................... $ 816 $ 804 $ 2,473 $ 2,468
Other income --
Gain (loss) on sale of businesses and assets,
net............................................ (2) (4) (5) (14)
Other income, net................................ 4 9 15 26
---------- ---------- ---------- ----------
818 809 2,483 2,480
---------- ---------- ---------- ----------
COSTS AND EXPENSES
Cost of sales (exclusive of depreciation shown
below).............................................. 600 570 1,812 1,731
Engineering, research, and development................ 12 5 39 18
Selling, general, and administrative.................. 100 115 303 333
Depreciation and amortization......................... 39 38 110 110
---------- ---------- ---------- ----------
751 728 2,264 2,192
---------- ---------- ---------- ----------
INCOME BEFORE INTEREST EXPENSE, INCOME TAXES, AND MINORITY
INTEREST................................................ 67 81 219 288
Interest expense...................................... 16 19 58 49
Income tax expense (benefit).......................... 16 (7) 60 48
Minority interest..................................... 8 6 21 22
---------- ---------- ---------- ----------
INCOME FROM CONTINUING OPERATIONS......................... 27 63 80 169
Income (loss) from discontinued operations, net of income
tax..................................................... 12 40 (99) 146
---------- ---------- ---------- ----------
Income (loss) before extraordinary loss................... 39 103 (19) 315
Extraordinary loss, net of income tax..................... -- -- (7) --
---------- ---------- ---------- ----------
Income (loss) before cumulative effect of change in
accounting principle.................................... 39 103 (26) 315
Cumulative effect of change in accounting principle, net
of income tax........................................... -- -- (134) --
---------- ---------- ---------- ----------
NET INCOME (LOSS)......................................... $ 39 $ 103 $ (160) $ 315
========== ========== ========== ==========
EARNINGS (LOSS) PER SHARE
Average shares of common stock outstanding --
Basic................................................. 33,491,897 33,597,131 33,423,014 33,785,955
Diluted............................................... 33,545,064 33,656,449 33,491,690 33,876,785
Basic earnings (loss) per share of common stock --
Continuing operations................................. $ .86 $ 1.85 $ 2.40 $ 4.99
Discontinued operations............................... .32 1.24 (2.98) 4.35
Extraordinary loss.................................... -- -- (.20) --
Cumulative effect of change in accounting principle... -- -- (4.00) --
---------- ---------- ---------- ----------
$ 1.18 $ 3.09 $ (4.78) $ 9.34
========== ========== ========== ==========
Diluted earnings (loss) per share of common stock --
Continuing operations................................. $ .86 $ 1.84 $ 2.40 $ 4.97
Discontinued operations............................... .32 1.24 (2.98) 4.34
Extraordinary loss.................................... -- -- (.20) --
Cumulative effect of change in accounting principle... -- -- (4.00) --
---------- ---------- ---------- ----------
$ 1.18 $ 3.08 $ (4.78) $ 9.31
========== ========== ========== ==========
Cash dividends per share of common stock.................. $ 1.50 $ 1.50 $ 4.50 $ 4.50
========== ========== ========== ==========
</TABLE>
The accompanying notes to financial statements are an integral part of these
statements of income (loss).
2
<PAGE> 4
TENNECO AUTOMOTIVE INC. AND CONSOLIDATED SUBSIDIARIES
STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
NINE MONTHS ENDED
SEPTEMBER 30,
------------------
1999 1998
-------- ------
(MILLIONS)
<S> <C> <C>
OPERATING ACTIVITIES
Income from continuing operations........................... $ 80 $ 169
Adjustments to reconcile income from continuing operations
to cash provided (used) by operating activities --
Depreciation and amortization.......................... 110 110
Deferred income taxes.................................. 44 27
(Gain) loss on sale of businesses and assets, net...... 5 14
Changes in components of working capital --
(Increase) decrease in receivables................ (244) (179)
(Increase) decrease in inventories................ (7) (16)
(Increase) decrease in prepayments and other
current assets................................... 15 (7)
Increase (decrease) in payables................... 44 7
Increase (decrease) in taxes accrued.............. (74) (18)
Increase (decrease) in interest accrued........... 39 30
Increase (decrease) in other current
liabilities...................................... (62) (43)
Other.................................................. (50) (61)
------- -----
Cash provided (used) by continuing operations............... (100) 33
Cash provided (used) by discontinued operations............. (66) 332
------- -----
Net cash provided (used) by operating activities............ (166) 365
------- -----
INVESTING ACTIVITIES
Net proceeds related to the sale of discontinued
operations................................................ 342 13
Net proceeds from sale of assets............................ 8 10
Expenditures for plant, property, and equipment............. (104) (121)
Acquisition of businesses................................... (36) --
Expenditures for plant, property, and equipment and business
acquisitions -- discontinued operations................... (1,249) (301)
Investments and other....................................... (29) (70)
------- -----
Net cash provided (used) by investing activities............ (1,068) (469)
------- -----
FINANCING ACTIVITIES
Issuance of common and treasury shares...................... 28 39
Purchase of common stock.................................... (4) (104)
Issuance of long-term debt.................................. 1,761 3
Retirement of long-term debt................................ (30) (18)
Net increase (decrease) in short-term debt excluding current
maturities on long-term debt.............................. (360) 328
Dividends (common).......................................... (151) (152)
------- -----
Net cash provided (used) by financing activities............ 1,244 96
------- -----
Effect of foreign exchange rate changes on cash and
temporary cash investments................................ 3 3
------- -----
Increase (decrease) in cash and temporary cash
investments............................................... 13 (5)
Cash and temporary cash investments, January 1.............. 29 29
------- -----
Cash and temporary cash investments, September 30 (Note).... $ 42 $ 24
======= =====
Cash paid during the period for interest.................... $ 150 $ 162
Cash paid during the period for income taxes (net of
refunds).................................................. $ 77 $ 25
NON-CASH INVESTING AND FINANCING ACTIVITIES
Common equity interest received related to the sale of
containerboard operations................................. $ 194 $ --
Principal amount of long-term debt assumed by buyers of
containerboard operations................................. $(1,760) $ --
</TABLE>
- -------------------------
Note: Cash and temporary cash investments include highly liquid investments with
a maturity of three months or less at the date of purchase.
The accompanying notes to financial statements are an integral part of these
statements of cash flows.
3
<PAGE> 5
TENNECO AUTOMOTIVE INC. AND CONSOLIDATED SUBSIDIARIES
BALANCE SHEETS
(UNAUDITED)
<TABLE>
<CAPTION>
SEPTEMBER 30, DECEMBER 31,
------------- ------------
1999 1998
------------- ------------
(MILLIONS)
<S> <C> <C>
ASSETS
Current assets:
Cash and temporary cash investments..................... $ 42 $ 29
Receivables --
Customer notes and accounts, net................... 657 430
Income taxes....................................... -- 3
Other.............................................. 23 10
Inventories --
Finished goods..................................... 209 221
Work in process.................................... 84 79
Raw materials...................................... 72 73
Materials and supplies............................. 38 41
Deferred income taxes................................... 28 39
Prepayments and other................................... 63 139
------ ------
1,216 1,064
------ ------
Other assets:
Long-term notes receivable, net......................... 30 23
Goodwill and intangibles, net........................... 505 499
Deferred income taxes................................... -- 39
Pension assets.......................................... 99 101
Other................................................... 106 201
------ ------
740 863
------ ------
Plant, property, and equipment, at cost..................... 1,936 1,944
Less -- Reserves for depreciation and amortization...... 881 851
------ ------
1,055 1,093
------ ------
Net assets of discontinued operations....................... 1,483 1,739
------ ------
$4,494 $4,759
====== ======
LIABILITIES AND SHAREOWNERS' EQUITY
Current liabilities:
Short-term debt (including current maturities on
long-term debt)........................................ $ 237 $ 304
Trade payables.......................................... 365 337
Taxes accrued........................................... 46 31
Accrued liabilities..................................... 194 161
Other................................................... 46 76
------ ------
888 909
------ ------
Long-term debt.............................................. 796 671
------ ------
Deferred income taxes....................................... 104 98
------ ------
Postretirement benefits..................................... 136 139
------ ------
Deferred credits and other liabilities...................... 19 31
------ ------
Commitments and contingencies
Minority interest........................................... 411 407
------ ------
Shareowners' equity:
Common stock............................................ -- --
Premium on common stock and other capital surplus....... 2,723 2,712
Accumulated other comprehensive income (loss)........... (174) (91)
Retained earnings (accumulated deficit)................. (168) 142
------ ------
2,381 2,763
Less -- Shares held as treasury stock, at cost.......... 241 259
------ ------
2,140 2,504
------ ------
$4,494 $4,759
====== ======
</TABLE>
The accompanying notes to financial statements are an integral part of these
balance sheets.
4
<PAGE> 6
TENNECO AUTOMOTIVE INC. AND CONSOLIDATED SUBSIDIARIES
STATEMENTS OF CHANGES IN SHAREOWNERS' EQUITY
(UNAUDITED)
<TABLE>
<CAPTION>
NINE MONTHS ENDED SEPTEMBER 30,
-----------------------------------------
1999 1998
------------------- -------------------
SHARES AMOUNT SHARES AMOUNT
---------- ------ ---------- ------
(MILLIONS EXCEPT SHARE AMOUNTS)
<S> <C> <C> <C> <C>
COMMON STOCK
Balance January 1.................................... 34,734,039 $ -- 34,513,978 $ --
Issued pursuant to benefit plans................ 109,004 -- 183,742 --
---------- ------ ---------- ------
Balance September 30................................. 34,843,043 -- 34,697,720 --
========== ------ ========== ------
PREMIUM ON COMMON STOCK AND OTHER CAPITAL SURPLUS
Balance January 1.................................... 2,712 2,681
Premium on common stock issued pursuant to
benefit plans................................. 11 25
------ ------
Balance September 30................................. 2,723 2,706
------ ------
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)
Balance January 1.................................... (91) (122)
Other comprehensive income (loss)............... (83) 38
------ ------
Balance September 30................................. (174) (84)
------ ------
RETAINED EARNINGS (ACCUMULATED DEFICIT)
Balance January 1.................................... 142 89
Net income (loss)............................... (160) 315
Dividends on common stock....................... (150) (151)
------ ------
Balance September 30................................. (168) 253
------ ------
LESS -- COMMON STOCK HELD AS TREASURY STOCK, AT COST
Balance January 1.................................... 1,351,536 259 585,638 120
Shares acquired................................. 34,669 5 553,162 107
Shares issued pursuant to benefit and dividend
reinvestment plans............................ (118,166) (23) (80,584) (16)
---------- ------ ---------- ------
Balance September 30................................. 1,268,039 241 1,058,216 211
========== ------ ========== ------
Total........................................... $2,140 $2,664
====== ======
</TABLE>
The accompanying notes to financial statements are an integral part of these
statements of changes in shareowners' equity.
5
<PAGE> 7
TENNECO AUTOMOTIVE INC. AND CONSOLIDATED SUBSIDIARIES
STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED SEPTEMBER 30,
-------------------------------------------------------------
1999 1998
----------------------------- -----------------------------
ACCUMULATED ACCUMULATED
OTHER OTHER
COMPREHENSIVE COMPREHENSIVE COMPREHENSIVE COMPREHENSIVE
INCOME INCOME INCOME INCOME
------------- ------------- ------------- -------------
(MILLIONS)
<S> <C> <C> <C> <C>
NET INCOME (LOSS)........................ $ 39 $103
----- ----
ACCUMULATED OTHER COMPREHENSIVE INCOME
(LOSS)
CUMULATIVE TRANSLATION ADJUSTMENT
Balance July 1......................... $(185) $(142)
Translation of foreign currency
statements........................ 20 20 58 58
----- -----
Balance September 30................... (165) (84)
----- -----
ADDITIONAL MINIMUM PENSION LIABILITY
ADJUSTMENT
Balance July 1......................... (9) --
Additional minimum pension liability
adjustment........................ -- -- -- --
----- -----
Balance September 30................... (9) --
----- -----
Balance September 30..................... $(174) $ (84)
===== =====
----- ----
Other comprehensive income (loss)........ 20 58
----- ----
COMPREHENSIVE INCOME (LOSS).............. $ 59 $161
===== ====
</TABLE>
<TABLE>
<CAPTION>
NINE MONTHS ENDED SEPTEMBER 30,
-------------------------------------------------------------
1999 1998
----------------------------- -----------------------------
ACCUMULATED ACCUMULATED
OTHER OTHER
COMPREHENSIVE COMPREHENSIVE COMPREHENSIVE COMPREHENSIVE
INCOME INCOME INCOME INCOME
------------- ------------- ------------- -------------
(MILLIONS)
<S> <C> <C> <C> <C>
NET INCOME (LOSS)........................ $(160) $315
----- ----
ACCUMULATED OTHER COMPREHENSIVE INCOME
(LOSS)
CUMULATIVE TRANSLATION ADJUSTMENT
Balance January 1...................... $ (82) $(122)
Translation of foreign currency
statements........................ (83) (83) 38 38
----- -----
Balance September 30................... (165) (84)
----- -----
ADDITIONAL MINIMUM PENSION LIABILITY
ADJUSTMENT
Balance January 1...................... (9) --
Additional minimum pension liability
adjustment........................ -- -- -- --
----- -----
Balance September 30................... (9) --
----- -----
Balance September 30..................... $(174) $ (84)
===== =====
----- ----
Other comprehensive income (loss)........ (83) 38
----- ----
COMPREHENSIVE INCOME (LOSS).............. $(243) $353
===== ====
</TABLE>
The accompanying notes to financial statements are an integral part
of these statements of comprehensive income (loss).
6
<PAGE> 8
TENNECO AUTOMOTIVE INC. AND CONSOLIDATED SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
(1) Tenneco Automotive Inc. was known as Tenneco Inc. before the spin-off
on November 4, 1999 of Tenneco Inc.'s packaging business, as described in Note
2. In these notes, discussions of Tenneco refer to Tenneco Inc. and its
subsidiaries before the spin-off and to Tenneco Automotive Inc. and its
subsidiaries after the spin-off.
In the opinion of Tenneco, the accompanying unaudited financial statements
contain all adjustments (consisting of normal recurring adjustments) necessary
to present fairly the financial position, results of operations, cash flows,
changes in shareowners' equity, and comprehensive income for the periods
indicated. The unaudited interim consolidated financial statements have been
prepared pursuant to the rules and regulations of the Securities and Exchange
Commission. Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles. The consolidated
financial statements of Tenneco include all majority-owned subsidiaries.
Investments in 20% to 50% owned companies where Tenneco has the ability to exert
significant influence over operating and financial policies are carried at cost
plus equity in undistributed earnings and cumulative translation adjustments
since date of acquisition. Tenneco has no investments in 20% to 50% owned
companies where it does not carry the investment at cost plus equity in
undistributed earnings.
Prior year's financial statements have been reclassified where appropriate
to conform to 1999 presentations.
(2) In July 1998, Tenneco's Board of Directors authorized management to
develop a broad range of strategic alternatives to separate the automotive,
paperboard packaging and specialty packaging businesses. Subsequently, Tenneco
completed the following actions:
- In January 1999, Tenneco announced an agreement to contribute its
containerboard business to a new joint venture with an affiliate of
Madison Dearborn Partners. The proceeds from the transaction, including
debt assumed by the new joint venture, were approximately $2 billion. The
transaction closed in April 1999. Tenneco retained a 43% percent interest
in the joint venture.
- In April 1999, Tenneco announced an agreement to sell its folding carton
operations to Caraustar Industries. This transaction closed in June 1999.
The folding carton operations and the containerboard business together
represented Tenneco's paperboard packaging operating segment.
- On November 4, 1999, Tenneco completed the spin-off of Tenneco Packaging
Inc., now known as Pactiv Corporation ("Packaging"). The morning
following the spin-off, Tenneco changed its name from "Tenneco Inc. " to
"Tenneco Automotive Inc." and effected a reverse stock split whereby
every five shares of Tenneco common stock were converted into one share
of Tenneco's new common stock.
The separation of the automotive and packaging businesses was accomplished
by the spin-off of the common stock of Packaging to Tenneco shareowners. At the
time of the spin-off, Packaging included Tenneco's specialty packaging business,
the remaining interest in the containerboard joint venture and Tenneco's
administrative services operations. In August 1999, Tenneco received a letter
ruling from the Internal Revenue Service that the spin-off would be tax-free for
U.S. federal income tax purposes to Tenneco and its shareowners.
Before the spin-off, Tenneco realigned substantially all of its existing
debt through a combination of tender offers, exchange offers, and other
refinancings. The company's debt realignment was financed by borrowings by
Tenneco under new credit facilities, the issuance by Tenneco of subordinated
debt, and borrowings by Packaging under new credit facilities, and the issuance
by Packaging of its new publicly-traded debt in exchange for certain series of
the publicly-traded debt of Tenneco that was outstanding before the spin-off and
debt realignment. The debt of Packaging was rated investment grade and the debt
of Tenneco was rated non-investment grade by both Standard & Poor's and Moodys
debt rating agencies.
7
<PAGE> 9
TENNECO AUTOMOTIVE INC. AND CONSOLIDATED SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
(UNAUDITED)
As a result of these transactions, Tenneco's former specialty and
paperboard packaging operating segments are presented as discontinued operations
in the accompanying financial statements. Tenneco's sole continuing operation is
its automotive segment. Refer to Note 3 for further information related to
discontinued operations.
(3) Revenues and income for the paperboard packaging discontinued
operations are shown in the following table:
<TABLE>
<CAPTION>
THREE MONTHS NINE MONTHS
ENDED ENDED
SEPTEMBER 30, SEPTEMBER 30,
------------- --------------
1999 1998 1999 1998
----- ----- ----- ------
(MILLIONS)
<S> <C> <C> <C> <C>
Net sales and operating revenues....................... $-- $415 $ 445 $1,185
=== ==== ===== ======
Income before income taxes and interest allocation..... $ 8 $ 35 $ 30 $ 101
Income tax (expense) benefit........................... -- (12) (11) (38)
--- ---- ----- ------
Income before interest allocation...................... 8 23 19 63
Allocated interest expense, net of income tax.......... -- (8) (5) (20)
--- ---- ----- ------
Income from discontinued operations before
disposition.......................................... 8 15 14 43
Gain (loss) on disposition, net of income tax.......... -- 10 (169) 19
--- ---- ----- ------
Income (loss) from discontinued operations............. $ 8 $ 25 $(155) $ 62
=== ==== ===== ======
</TABLE>
Revenues and income for the specialty packaging discontinued operations are
shown in the following table:
<TABLE>
<CAPTION>
THREE MONTHS NINE MONTHS
ENDED ENDED
SEPTEMBER 30, SEPTEMBER 30,
------------- ---------------
1999 1998 1999 1998
----- ----- ------ ------
(MILLIONS)
<S> <C> <C> <C> <C>
Net sales and operating revenues...................... $754 $696 $2,158 $2,067
==== ==== ====== ======
Income before income taxes and interest allocation.... $ 69 $ 74 $ 213 $ 247
Income tax (expense) benefit.......................... (39) (36) (87) (96)
---- ---- ------ ------
Income before interest allocation..................... 30 38 126 151
Allocated interest expense, net of income tax......... (26) (23) (70) (67)
---- ---- ------ ------
Income (loss) from discontinued operations............ $ 4 $ 15 $ 56 $ 84
==== ==== ====== ======
</TABLE>
Net assets of discontinued operations includes $1,985 million and $2,456
million of debt allocated to discontinued operations as of September 30, 1999,
and December 31, 1998, respectively.
(4) In the fourth quarter of 1998, Tenneco's Board of Directors approved an
extensive restructuring plan designed to reduce administrative and operational
overhead costs. Tenneco recorded a pre-tax charge to income from continuing
operations of $53 million, $34 million after-tax, or $1.02 per diluted common
share. Of the pre-tax charge, for operational restructuring plans, $36 million
related to the consolidation of the manufacturing and distribution operations of
the North American automotive aftermarket business. A staff and related cost
reduction plan, which covers employees in both the operating units and corporate
operations, is expected to cost $17 million.
8
<PAGE> 10
TENNECO AUTOMOTIVE INC. AND CONSOLIDATED SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
(UNAUDITED)
The automotive aftermarket restructuring involves closing two plant
locations and five distribution centers, resulting in the elimination of 302
positions. The staff and related cost reduction plan involves the elimination of
454 administrative positions.
The fixed assets at the locations to be closed were written down to their
fair value, less costs to sell, in the fourth quarter of 1998. As a result of
the single-purpose nature of the assets, fair value was estimated at scrap value
less cost to dispose. No significant net cash proceeds are expected to be
received from the ultimate disposal of these assets, which should be complete by
the fourth quarter of 2000. The effect of suspending depreciation for these
impaired assets is a reduction in depreciation and amortization of approximately
$2 million on an annual basis.
As of September 30, 1999, approximately 670 employees have been terminated.
To address customer service and production transfer issues, the closure of one
plant location and one aftermarket distribution center has been delayed until
the first and second quarters of 2000, respectively. All other restructuring
actions, with the exception of the final disposal of certain assets, are being
executed according to the initial plan and are expected to be complete by the
fourth quarter of 1999. During the nine months ended September 30, 1999, the
automotive aftermarket business closed one plant location and four distribution
centers.
Amounts related to the restructuring plan are shown in the following table:
<TABLE>
<CAPTION>
CASH
PAYMENTS
NINE MONTHS
DECEMBER 31, 1998 ENDED BALANCE AT
RESTRUCTURING SEPTEMBER 30, SEPTEMBER 30,
CHARGE BALANCE 1999 1999
----------------- ------------- -------------
(MILLIONS)
<S> <C> <C> <C>
Severance........................................... $15 $ 6 $ 9
Facility exit costs................................. 1 1 --
--- --- ---
$16 $ 7 $ 9
=== === ===
</TABLE>
(5) Tenneco is a party to various legal proceedings arising from its
operations. Tenneco believes that the outcome of these proceedings, individually
and in the aggregate, will not have a material adverse effect on its financial
position or results of operations.
(6) Tenneco is subject to a variety of environmental and pollution control
laws and regulations in all jurisdictions in which it operates. Tenneco has
provided reserves for compliance with these laws and regulations where it is
probable that a liability exists and where Tenneco can make a reasonable
estimate of the liability. The estimated liabilities recorded are subject to
change as more information becomes available regarding the magnitude of possible
cleanup costs and the timing, varying costs, and effectiveness of alternative
cleanup technologies. However, Tenneco believes that any additional costs which
may arise as more information becomes available will not have a material adverse
effect on its financial position or results of operations.
(7) In the first quarter of 1999, Tenneco recorded an extraordinary loss
for extinguishment of debt of $7 million (net of a $3 million income tax
benefit), or $.20 per diluted common share. The loss related to early retirement
of debt in connection with the sale of the containerboard assets.
(8) In June 1998, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standards ("FAS") No. 133, "Accounting for
Derivative Instruments and Hedging Activities." This statement establishes new
accounting and reporting standards requiring that all derivative instruments
(including certain derivative instruments embedded in other contracts) be
recorded in the balance sheet as
9
<PAGE> 11
TENNECO AUTOMOTIVE INC. AND CONSOLIDATED SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
(UNAUDITED)
either an asset or liability measured at its fair value. The statement requires
that changes in the derivative's fair value be recognized currently in earnings
unless specific hedge accounting criteria are met. Special accounting for
qualifying hedges allows a derivative's gains and losses to offset related
results on the hedged item in the income statement and requires that a company
must formally document, designate, and assess the effectiveness of transactions
that receive hedge accounting treatment. This statement cannot be applied
retroactively and is effective for all fiscal years beginning after June 15,
2000. Tenneco is currently evaluating the new standard but has not yet
determined the impact it will have on its financial position or results of
operations.
In April 1998, the American Institute of Certified Public Accountants
("AICPA") issued Statement of Position ("SOP") 98-5, "Reporting on the Costs of
Start-Up Activities," which requires costs of start-up activities to be expensed
as incurred. This statement is effective for fiscal years beginning after
December 15, 1998. The statement requires previously capitalized costs related
to start-up activities to be expensed as a cumulative effect of a change in
accounting principle when the statement is adopted. Prior to January 1, 1999,
Tenneco capitalized certain costs related to start-up activities, primarily
engineering costs for new automobile original equipment platforms. Tenneco
adopted SOP 98-5 on January 1, 1999, and recorded an after-tax charge for the
cumulative effect of this change in accounting principle of $102 million (net of
a $50 million tax benefit), or $3.05 per diluted common share. The change in
accounting principle decreased income from continuing operations by $11 million
(net of a $8 million tax benefit), or $.33 per diluted common share for the nine
months ended September 30, 1999. If the new accounting method had been applied
retroactively, income from continuing operations for the nine months ended
September 30, 1998, would have been lower by $10 million (net of a $7 million
tax benefit), or $.30 per diluted common share. For the three months ended
September 30, 1999, the change in accounting principle decreased income from
continuing operations by $6 million (net of a $4 million tax benefit), or $.18
per diluted common share. If the new accounting method had been applied
retroactively, income from continuing operations for the three months ended
September 30, 1998, would have been lower by $5 million (net of a $3 million tax
benefit), or $.15 per diluted common share.
In March 1998, the AICPA issued SOP 98-1, "Accounting for the Costs of
Computer Software Developed or Obtained for Internal Use," which establishes new
accounting and reporting standards for the costs of computer software developed
or obtained for internal use. This statement requires prospective application
for fiscal years beginning after December 15, 1998. Tenneco adopted SOP 98-1 on
January 1, 1999. The impact of this new standard did not have a significant
effect on Tenneco's financial position or results of operations.
Effective January 1, 1999, Tenneco changed its method of accounting for
customer acquisition costs from a deferral method to an expense-as-incurred
method. In connection with Tenneco's decision to separate its automotive and
specialty packaging businesses into independent public companies, Tenneco
determined that a change to an expense-as-incurred method of accounting for
automotive aftermarket customer acquisition costs was preferable in order to
permit improved comparability of stand-alone financial results with its
aftermarket industry competitors. Tenneco recorded an after-tax charge for the
cumulative effect of this change in accounting principle of $32 million (net of
a $22 million tax benefit), or $.95 per diluted common share. The change in
accounting principle increased income from continuing operations by $8 million
(net of $5 million in income tax expense), or $.24 per diluted common share for
the nine months ended September 30, 1999. If the new accounting principle had
been applied retroactively, income from continuing operations for the nine
months ended September 30, 1998, would have been higher by $1 million (net of $1
million in income tax expense), or $.03 per diluted common share. For the three
months ended September 30, 1999, the change in accounting principle increased
income from continuing operations by $3 million (net of $1 million in income tax
expense), or $.09 per diluted common share. If the new accounting principle had
been applied
10
<PAGE> 12
TENNECO AUTOMOTIVE INC. AND CONSOLIDATED SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
(UNAUDITED)
retroactively, income from continuing operations for the three months ended
September 30, 1998, would have been higher by $3 million (net of $2 million in
income tax expense), or $.09 per diluted common share.
(9) In October 1999, Tenneco's shareowners approved an amendment to the
Certificate of Incorporation providing for a one-for-five reverse stock split of
Tenneco's common stock. The reverse stock split is reflected for all periods
presented in the accompanying financial statements, other footnotes, and this
computation of earnings from continuing operations per share of common stock
outstanding.
<TABLE>
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
----------------------- -----------------------
1999 1998 1999 1998
---------- ---------- ---------- ----------
(MILLIONS EXCEPT SHARE AND PER SHARE AMOUNTS)
<S> <C> <C> <C> <C>
Basic Earnings Per Share --
Income from continuing
operations..................... $ 27 $ 63 $ 80 $ 169
========== ========== ========== ==========
Average shares of common stock
outstanding.................... 33,491,897 33,597,131 33,423,014 33,785,955
========== ========== ========== ==========
Earnings from continuing
operations per average share of
common stock................... $ .86 $ 1.85 $ 2.40 $ 4.99
========== ========== ========== ==========
Diluted Earnings Per Share --
Income from continuing
operations..................... $ 27 $ 63 $ 80 $ 169
========== ========== ========== ==========
Average shares of common stock
outstanding.................... 33,491,897 33,597,131 33,423,014 33,785,955
Effect of dilutive securities:
Restricted stock............ 4,633 8,140 9,973 8,888
Stock options............... -- 6,090 -- 32,984
Performance shares.......... 48,534 45,088 58,703 48,958
---------- ---------- ---------- ----------
Average shares of common stock
outstanding including dilutive
securities..................... 33,545,064 33,656,449 33,491,690 33,876,785
========== ========== ========== ==========
Earnings from continuing
operations per average share of
common stock................... $ .86 $ 1.84 $ 2.40 $ 4.97
========== ========== ========== ==========
</TABLE>
(10) Tenneco is a global manufacturer with a single operating segment:
Automotive -- Manufacture and sale of exhaust and ride control systems
for both the original equipment market and the aftermarket.
Tenneco evaluates business segment operating performance based primarily on
income before interest expense, income taxes, and minority interest, exclusive
of restructuring charges and other unusual items. Individual operating segments
have not been aggregated within this reportable segment.
11
<PAGE> 13
TENNECO AUTOMOTIVE INC. AND CONSOLIDATED SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
(UNAUDITED)
The following table summarizes certain Tenneco segment information:
<TABLE>
<CAPTION>
SEGMENT
------------------- RECLASS
AUTOMOTIVE OTHER & ELIMS CONSOLIDATED
---------- ------ ------- ------------
(MILLIONS)
<S> <C> <C> <C> <C>
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1999
Revenues from external customers...................... $ 816 $ -- $ -- $ 816
Income (loss) before interest, income taxes, and
minority interest................................... 67 -- -- 67
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1998
Revenues from external customers...................... $ 804 $ -- $ -- $ 804
Income (loss) before interest, income taxes, and
minority interest................................... 86 (5) -- 81
AT SEPTEMBER 30, 1999, AND FOR THE NINE MONTHS THEN
ENDED
Revenues from external customers...................... $2,473 $ -- $ -- $2,473
Income (loss) before interest, income taxes, and
minority interest................................... 223 (4) -- 219
Extraordinary loss.................................... -- (7) -- (7)
Cumulative effect of change in accounting principle... (33) (101) -- (134)
Total assets (Note)................................... 2,977 1,548 (31) 4,494
Net assets of discontinued operations................. -- 1,483 -- 1,483
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1998
Revenues from external customers...................... $2,468 $ -- $ -- $2,468
Income (loss) before interest, income taxes, and
minority interest................................... 305 (17) -- 288
</TABLE>
- ---------------
Note: The Other segment's total assets include the net assets of discontinued
operations.
12
<PAGE> 14
TENNECO AUTOMOTIVE INC. AND CONSOLIDATED SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
(UNAUDITED)
(11) Some of Tenneco's subsidiaries have guaranteed Tenneco debt.
Supplemental guarantor condensed consolidating financial statements are
presented below.
Basis of Presentation
On October 14, 1999, Tenneco issued $500,000,000 in aggregate principal
amount of Senior Subordinated Notes Due 2009 ("the Notes") as a component of a
plan to realign its debt prior to the spin-off. See Note 2 for further
discussion of the spin-off and debt realignment. Effective upon the spin-off,
all of Tenneco's then existing and future material domestic wholly owned
subsidiaries (the Guarantor Subsidiaries) fully and unconditionally guaranteed
the Notes on a joint and several basis. Additionally, the Guarantor Subsidiaries
fully and unconditionally guarantee Tenneco's senior secured credit facility.
Separate financial statements of the Guarantor Subsidiaries are not presented
because the Guarantor Subsidiaries are jointly, severally, and unconditionally
liable under the guarantees, and Tenneco believes the condensed consolidating
financial statements presented are more meaningful in understanding the
financial position of the Guarantor Subsidiaries.
These condensed consolidating financial statements are presented on the
equity method. Under this method, investments are recorded at cost and adjusted
for a company's ownership share of a subsidiary's cumulative results of
operations, capital contributions and distributions, and other equity changes.
The balance sheet caption "Investment in affiliated companies" includes
investments in continuing and discontinued subsidiaries. The condensed
consolidating financial statements of the Guarantor Subsidiaries should be read
in connection with the financial statements of Tenneco Automotive Inc. and
Consolidated Subsidiaries and notes thereto of which this note is an integral
part.
Distributions
There are no significant restrictions on the ability of the Guarantor
Subsidiaries to make distributions to Tenneco Automotive Inc.
13
<PAGE> 15
TENNECO AUTOMOTIVE INC. AND CONSOLIDATED SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
(UNAUDITED)
STATEMENT OF INCOME
<TABLE>
<CAPTION>
THREE MONTHS ENDED SEPTEMBER 30, 1999
----------------------------------------------------------------------
TENNECO
AUTOMOTIVE INC.
GUARANTOR NONGUARANTOR (PARENT RECLASS
SUBSIDIARIES SUBSIDIARIES COMPANY) & ELIMS CONSOLIDATED
------------ ------------ --------------- ------- ------------
(MILLIONS)
<S> <C> <C> <C> <C> <C>
REVENUES
Net sales and operating revenues --
External.......................... $359 $456 $ 1 $ -- $816
Affiliated companies.............. 19 16 -- (35) --
Other income, net.................... 4 (1) -- (1) 2
---- ---- ---- ---- ----
382 471 1 (36) 818
---- ---- ---- ---- ----
COSTS AND EXPENSES
Cost of sales (exclusive of
depreciation shown below)......... 271 364 1 (36) 600
Engineering, research, and
development....................... 8 4 -- -- 12
Selling, general, and
administrative.................... 56 44 -- -- 100
Depreciation and amortization........ 19 20 -- -- 39
---- ---- ---- ---- ----
354 432 1 (36) 751
---- ---- ---- ---- ----
INCOME FROM CONTINUING OPERATIONS
BEFORE INTEREST EXPENSE, INCOME
TAXES, MINORITY INTEREST, AND EQUITY
IN NET INCOME FROM CONTINUING
OPERATIONS OF AFFILIATED COMPANIES... 28 39 -- -- 67
Interest expense --
External (net of interest
capitalized)................. 1 3 11 1 16
Affiliated companies (net of
interest income)............. 20 5 (25) -- --
Income tax expense (benefit)...... 18 -- 2 (4) 16
Minority interest................. -- 1 -- 7 8
---- ---- ---- ---- ----
(11) 30 12 (4) 27
Equity in net income from
continuing operations of
affiliated companies............ 12 -- 15 (27) --
---- ---- ---- ---- ----
INCOME FROM CONTINUING OPERATIONS...... 1 30 27 (31) 27
Income (loss) from discontinued
operations, net of income tax........ -- 39 12 (39) 12
---- ---- ---- ---- ----
Income (loss) before extraordinary
loss................................. 1 69 39 (70) 39
Extraordinary loss, net of income
tax.................................. -- -- -- -- --
---- ---- ---- ---- ----
Income (loss) before cumulative effect
of change in accounting principle.... 1 69 39 (70) 39
Cumulative effect of change in
accounting principle, net of income
tax.................................. -- -- -- -- --
---- ---- ---- ---- ----
NET INCOME (LOSS)...................... 1 69 39 (70) 39
Preferred stock dividends.............. 7 -- -- (7) --
---- ---- ---- ---- ----
NET INCOME (LOSS) TO COMMON STOCK...... $ (6) $ 69 $ 39 $(63) $ 39
==== ==== ==== ==== ====
</TABLE>
14
<PAGE> 16
TENNECO AUTOMOTIVE INC. AND CONSOLIDATED SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
(UNAUDITED)
STATEMENT OF INCOME
<TABLE>
<CAPTION>
THREE MONTHS ENDED SEPTEMBER 30, 1998
----------------------------------------------------------------------
TENNECO
AUTOMOTIVE INC.
GUARANTOR NONGUARANTOR (PARENT RECLASS
SUBSIDIARIES SUBSIDIARIES COMPANY) & ELIMS CONSOLIDATED
------------ ------------ --------------- ------- ------------
<S> <C> <C> <C> <C> <C>
REVENUES
Net sales and operating revenues --
External.......................... $348 $456 $ -- $ -- $804
Affiliated companies.............. 23 16 -- (39) --
Other income, net.................... 5 -- -- -- 5
---- ---- ---- ----- ----
376 472 -- (39) 809
---- ---- ---- ----- ----
COSTS AND EXPENSES
Cost of sales (exclusive of
depreciation shown below)......... 258 351 -- (39) 570
Engineering, research, and
development....................... 4 1 -- -- 5
Selling, general, and
administrative.................... 72 43 -- -- 115
Depreciation and amortization........ 21 17 -- -- 38
---- ---- ---- ----- ----
355 412 -- (39) 728
---- ---- ---- ----- ----
INCOME FROM CONTINUING OPERATIONS
BEFORE INTEREST EXPENSE, INCOME
TAXES, MINORITY INTEREST, AND EQUITY
IN NET INCOME FROM CONTINUING
OPERATIONS OF AFFILIATED COMPANIES... 21 60 -- -- 81
Interest expense --
External (net of interest
capitalized)................. 1 5 13 -- 19
Affiliated companies (net of
interest income)............. 22 1 (23) -- --
Income tax expense (benefit)...... (16) 7 (53) 55 (7)
Minority interest................. -- -- -- 6 6
---- ---- ---- ----- ----
14 47 63 (61) 63
Equity in net income from
continuing operations of
affiliated companies............ 37 -- -- (37) --
---- ---- ---- ----- ----
INCOME FROM CONTINUING OPERATIONS...... 51 47 63 (98) 63
Income from discontinued operations,
net of income tax.................... 7 53 40 (60) 40
---- ---- ---- ----- ----
Income before extraordinary loss....... 58 100 103 (158) 103
Extraordinary loss, net of income
tax.................................. -- -- -- -- --
---- ---- ---- ----- ----
Income before cumulative effect of
change in accounting principle....... 58 100 103 (158) 103
Cumulative effect of change in
accounting principle, net of income
tax.................................. -- -- -- -- --
---- ---- ---- ----- ----
NET INCOME............................. 58 100 103 (158) 103
Preferred stock dividends.............. 6 -- -- (6) --
---- ---- ---- ----- ----
NET INCOME TO COMMON STOCK............. $ 52 $100 $103 $(152) $103
==== ==== ==== ===== ====
</TABLE>
15
<PAGE> 17
TENNECO AUTOMOTIVE INC. AND CONSOLIDATED SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
(UNAUDITED)
STATEMENT OF INCOME
<TABLE>
<CAPTION>
NINE MONTHS ENDED SEPTEMBER 30, 1999
----------------------------------------------------------------------
TENNECO
AUTOMOTIVE INC.
GUARANTOR NONGUARANTOR (PARENT RECLASS
SUBSIDIARIES SUBSIDIARIES COMPANY) & ELIMS CONSOLIDATED
------------ ------------ --------------- ------- ------------
(MILLIONS)
<S> <C> <C> <C> <C> <C>
REVENUES
Net sales and operating revenues --
External.......................... $1,089 $1,383 $ 1 $ -- $2,473
Affiliated companies.............. 61 52 -- (113) --
Other income, net.................... 9 2 -- (1) 10
------ ------ ----- ----- ------
1,159 1,437 1 (114) 2,483
------ ------ ----- ----- ------
COSTS AND EXPENSES
Cost of sales (exclusive of
depreciation shown below)......... 821 1,104 1 (114) 1,812
Engineering, research, and
development....................... 21 18 -- -- 39
Selling, general, and
administrative.................... 160 142 1 -- 303
Depreciation and amortization........ 54 56 -- -- 110
------ ------ ----- ----- ------
1,056 1,320 2 (114) 2,264
------ ------ ----- ----- ------
INCOME FROM CONTINUING OPERATIONS
BEFORE INTEREST EXPENSE, INCOME
TAXES, MINORITY INTEREST, AND EQUITY
IN NET INCOME FROM CONTINUING
OPERATIONS OF AFFILIATED COMPANIES... 103 117 (1) -- 219
Interest expense --
External (net of interest
capitalized)................. 2 13 42 1 58
Affiliated companies (net of
interest income)............. 56 6 (62) -- --
Income tax expense (benefit)...... 45 14 12 (11) 60
Minority interest................. -- 1 -- 20 21
------ ------ ----- ----- ------
-- 83 7 (10) 80
Equity in net income from
continuing operations of
affiliated companies............ 52 -- 73 (125) --
------ ------ ----- ----- ------
INCOME FROM CONTINUING OPERATIONS...... 52 83 80 (135) 80
Income (loss) from discontinued
operations, net of income tax........ 1 9 (99) (10) (99)
------ ------ ----- ----- ------
Income (loss) before extraordinary
loss................................. 53 92 (19) (145) (19)
Extraordinary loss, net of income
tax.................................. -- (7) (7) 7 (7)
------ ------ ----- ----- ------
Income (loss) before cumulative effect
of change in accounting principle.... 53 85 (26) (138) (26)
Cumulative effect of change in
accounting principle, net of income
tax.................................. (64) (70) (134) 134 (134)
------ ------ ----- ----- ------
NET INCOME (LOSS)...................... (11) 15 (160) (4) (160)
Preferred stock dividends.............. 20 -- -- (20) --
------ ------ ----- ----- ------
NET INCOME (LOSS) TO COMMON STOCK...... $ (31) $ 15 $(160) $ 16 $ (160)
====== ====== ===== ===== ======
</TABLE>
16
<PAGE> 18
TENNECO AUTOMOTIVE INC. AND CONSOLIDATED SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
(UNAUDITED)
STATEMENT OF INCOME
<TABLE>
<CAPTION>
NINE MONTHS ENDED SEPTEMBER 30, 1998
----------------------------------------------------------------------
TENNECO
AUTOMOTIVE INC.
GUARANTOR NONGUARANTOR (PARENT RECLASS
SUBSIDIARIES SUBSIDIARIES COMPANY) & ELIMS CONSOLIDATED
------------ ------------ --------------- ------- ------------
<S> <C> <C> <C> <C> <C>
REVENUES
Net sales and operating revenues --
External.......................... $1,099 $1,366 $ 3 $ -- $2,468
Affiliated companies.............. 70 57 -- (127) --
Other income, net.................... 21 (9) -- -- 12
------ ------ ---- ----- ------
1,190 1,414 3 (127) 2,480
------ ------ ---- ----- ------
COSTS AND EXPENSES
Cost of sales (exclusive of
depreciation shown below)......... 812 1,044 2 (127) 1,731
Engineering, research, and
development....................... 11 7 -- -- 18
Selling, general, and
administrative.................... 198 134 1 -- 333
Depreciation and amortization........ 58 52 -- -- 110
------ ------ ---- ----- ------
1,079 1,237 3 (127) 2,192
------ ------ ---- ----- ------
INCOME FROM CONTINUING OPERATIONS
BEFORE INTEREST EXPENSE, INCOME
TAXES, MINORITY INTEREST, AND EQUITY
IN NET INCOME FROM CONTINUING
OPERATIONS OF AFFILIATED COMPANIES... 111 177 -- -- 288
Interest expense --
External (net of interest
capitalized)................. 2 11 36 -- 49
Affiliated companies (net of
interest income)............. 37 4 (41) -- --
Income tax expense (benefit)...... 5 46 14 (17) 48
Minority interest................. -- 1 -- 21 22
------ ------ ---- ----- ------
67 115 (9) (4) 169
Equity in net income from
continuing operations of
affiliated companies............ 84 -- 178 (262) --
------ ------ ---- ----- ------
INCOME FROM CONTINUING OPERATIONS...... 151 115 169 (266) 169
Income from discontinued operations,
net of income tax.................... 18 220 146 (238) 146
------ ------ ---- ----- ------
Income before extraordinary loss....... 169 335 315 (504) 315
Extraordinary loss, net of income
tax.................................. -- -- -- -- --
------ ------ ---- ----- ------
Income before cumulative effect of
change in accounting principle....... 169 335 315 (504) 315
Cumulative effect of change in
accounting principle, net of income
tax.................................. -- -- -- -- --
------ ------ ---- ----- ------
NET INCOME............................. 169 335 315 (504) 315
Preferred stock dividends.............. 21 -- -- (21) --
------ ------ ---- ----- ------
NET INCOME TO COMMON STOCK............. $ 148 $ 335 $315 $(483) $ 315
====== ====== ==== ===== ======
</TABLE>
17
<PAGE> 19
TENNECO AUTOMOTIVE INC. AND CONSOLIDATED SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
(UNAUDITED)
STATEMENT OF CASH FLOWS
<TABLE>
<CAPTION>
NINE MONTHS ENDED SEPTEMBER 30, 1999
----------------------------------------------------------------------
TENNECO
AUTOMOTIVE INC.
GUARANTOR NONGUARANTOR (PARENT RECLASS
SUBSIDIARIES SUBSIDIARIES COMPANY) & ELIMS CONSOLIDATED
------------ ------------ --------------- ------- ------------
(MILLIONS)
<S> <C> <C> <C> <C> <C>
OPERATING ACTIVITIES
Net cash provided (used) by operating
activities............................. $(148) $ 85 $ (83) $(20) $ (166)
----- ------- ----- ---- -------
INVESTING ACTIVITIES
Net proceeds related to the sale of
discontinued operations................ -- 342 -- -- 342
Net proceeds from sale of businesses and
assets................................. 6 2 -- -- 8
Expenditures for plant, property, and
equipment.............................. (39) (65) -- -- (104)
Acquisitions of businesses............... (2) (34) -- -- (36)
Expenditures for plant, property, and
equipment and business acquisitions --
discontinued operations................ -- (1,249) -- -- (1,249)
Investments and other.................... (8) (24) 3 -- (29)
----- ------- ----- ---- -------
Net cash provided (used) by investing
activities............................. (43) (1,028) 3 -- (1,068)
----- ------- ----- ---- -------
FINANCING ACTIVITIES
Issuance of common and treasury shares... -- -- 28 -- 28
Purchase of common stock................. -- -- (4) -- (4)
Issuance of long-term debt............... -- 1,761 -- -- 1,761
Retirement of long-term debt............. (1) (35) 6 -- (30)
Net increase (decrease) in short-term
debt excluding current maturities on
long-term debt......................... (25) (48) (287) -- (360)
Intercompany dividends and net increase
(decrease) in intercompany
obligations............................ 236 (742) 506 -- --
Dividends (common and preferred)......... (20) -- (151) 20 (151)
----- ------- ----- ---- -------
Net cash provided (used) by financing
activities............................. 190 936 98 20 1,244
----- ------- ----- ---- -------
Effect of foreign exchange rate changes
on cash and temporary cash
investments............................ -- 3 -- -- 3
----- ------- ----- ---- -------
Increase (decrease) in cash and temporary
cash investments....................... (1) (4) 18 -- 13
Cash and temporary cash investments,
January 1.............................. 3 26 -- -- 29
----- ------- ----- ---- -------
Cash and temporary cash investments,
September 30 (Note).................... $ 2 $ 22 $ 18 $ -- $ 42
===== ======= ===== ==== =======
NON-CASH INVESTING AND FINANCING
ACTIVITIES
Common equity interest received related
to the sale of containerboard
operations............................. $ -- $ 194 $ -- $ -- $ 194
Principal amount of long-term debt
assumed by buyers of containerboard
operations............................. $ -- $(1,760) $ -- $ -- $(1,760)
</TABLE>
- ---------------
Note: Cash and temporary cash investments include highly liquid investments with
a maturity of three months or less at the date of purchase.
18
<PAGE> 20
TENNECO AUTOMOTIVE INC. AND CONSOLIDATED SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
(UNAUDITED)
STATEMENT OF CASH FLOWS
<TABLE>
<CAPTION>
NINE MONTHS ENDED SEPTEMBER 30, 1998
----------------------------------------------------------------------
TENNECO
AUTOMOTIVE INC.
GUARANTOR NONGUARANTOR (PARENT RECLASS
SUBSIDIARIES SUBSIDIARIES COMPANY) & ELIMS CONSOLIDATED
------------ ------------ --------------- ------- ------------
(MILLIONS)
<S> <C> <C> <C> <C> <C>
OPERATING ACTIVITIES
Net cash provided (used) by operating
activities.......................... $ 54 $ 428 $ (97) $(20) $ 365
---- ----- ----- ---- -----
INVESTING ACTIVITIES
Net proceeds related to the sale of
discontinued operations............. -- 13 -- -- 13
Net proceeds from sale of businesses
and assets.......................... 6 4 -- -- 10
Expenditures for plant, property, and
equipment........................... (52) (69) -- -- (121)
Acquisitions of businesses............ -- -- -- -- --
Expenditures for plant, property, and
equipment and business
acquisitions -- discontinued
operations.......................... -- (301) -- -- (301)
Investments and other................. (33) (38) 1 -- (70)
---- ----- ----- ---- -----
Net cash provided (used) by investing
activities.......................... (79) (391) 1 -- (469)
---- ----- ----- ---- -----
FINANCING ACTIVITIES
Issuance of common and treasury
shares.............................. -- -- 39 -- 39
Purchase of common stock.............. -- -- (104) -- (104)
Issuance of long-term debt............ -- 3 -- -- 3
Retirement of long-term debt.......... (1) (17) -- -- (18)
Net increase (decrease) in short-term
debt excluding current maturities on
long-term debt...................... -- 57 271 -- 328
Intercompany dividends and net
increase (decrease) in intercompany
obligations......................... 44 (91) 47 -- --
Dividends (common and preferred)...... (20) -- (152) 20 (152)
---- ----- ----- ---- -----
Net cash provided (used) by financing
activities.......................... 23 (48) 101 20 96
---- ----- ----- ---- -----
Effect of foreign exchange rate
changes on cash and temporary cash
investments......................... -- 3 -- -- 3
---- ----- ----- ---- -----
Increase (decrease) in cash and
temporary cash investments.......... (2) (8) 5 -- (5)
Cash and temporary cash investments,
January 1........................... 3 26 -- -- 29
---- ----- ----- ---- -----
Cash and temporary cash investments,
September 30 (Note)................. $ 1 $ 18 $ 5 $ -- $ 24
==== ===== ===== ==== =====
</TABLE>
- ---------------
Note: Cash and temporary cash investments include highly liquid investments with
a maturity of three months or less at the date of purchase.
19
<PAGE> 21
TENNECO AUTOMOTIVE INC. AND CONSOLIDATED SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
(UNAUDITED)
BALANCE SHEET
<TABLE>
<CAPTION>
SEPTEMBER 30, 1999
-----------------------------------------------------------------------
TENNECO
AUTOMOTIVE INC.
GUARANTOR NONGUARANTOR (PARENT RECLASS
SUBSIDIARIES SUBSIDIARIES COMPANY) & ELIMS CONSOLIDATED
------------ ------------ --------------- -------- ------------
(MILLIONS)
<S> <C> <C> <C> <C> <C>
ASSETS
Current assets:
Cash and temporary cash investments..... $ 2 $ 22 $ 18 $ -- $ 42
Receivables............................. 363 374 28 (85) 680
Inventories............................. 151 252 -- -- 403
Deferred income taxes................... 39 (11) -- -- 28
Prepayments and other................... 27 36 -- -- 63
------ ------ ------- -------- ------
582 673 46 (85) 1,216
------ ------ ------- -------- ------
Other assets:
Investment in affiliated companies...... 351 -- 4,935 (5,286) --
Notes and advances receivable from
affiliates............................ 2,417 9 3,334 (5,760) --
Long-term notes receivable, net......... 13 17 -- -- 30
Goodwill and intangibles, net........... 334 171 -- -- 505
Pension assets.......................... 92 7 -- -- 99
Other................................... 43 54 9 -- 106
------ ------ ------- -------- ------
3,250 258 8,278 (11,046) 740
------ ------ ------- -------- ------
Plant, property, and equipment, at cost..... 888 1,047 1 -- 1,936
Less -- Reserves for depreciation and
amortization.......................... 433 448 -- -- 881
------ ------ ------- -------- ------
455 599 1 -- 1,055
------ ------ ------- -------- ------
Net assets of discontinued operations....... 27 2,812 (1,356) -- 1,483
------ ------ ------- -------- ------
$4,314 $4,342 $ 6,969 $(11,131) $4,494
====== ====== ======= ======== ======
LIABILITIES AND SHAREOWNERS'
EQUITY
Current liabilities:
Short-term debt (including current
maturities on long-term debt)......... $ 1 $ 537 $ 420 $ (721) $ 237
Trade payables.......................... 160 276 11 (82) 365
Taxes accrued........................... (1) 28 130 (111) 46
Other................................... 100 67 73 -- 240
------ ------ ------- -------- ------
260 908 634 (914) 888
Long-term debt.............................. 1,558 24 4,262 (5,048) 796
Deferred income taxes....................... (27) 18 (67) 180 104
Postretirement benefits and other
liabilities............................... 132 23 -- -- 155
Commitments and contingencies
Minority interest........................... -- 16 -- 395 411
Preferred stock with mandatory redemption
provisions................................ 395 -- -- (395) --
Shareowners' equity......................... 1,996 3,353 2,140 (5,349) 2,140
------ ------ ------- -------- ------
$4,314 $4,342 $ 6,969 $(11,131) $4,494
====== ====== ======= ======== ======
</TABLE>
20
<PAGE> 22
TENNECO AUTOMOTIVE INC. AND CONSOLIDATED SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
(UNAUDITED)
BALANCE SHEETS
<TABLE>
<CAPTION>
DECEMBER 31, 1998
----------------------------------------------------------------------
TENNECO
AUTOMOTIVE INC.
GUARANTOR NONGUARANTOR (PARENT RECLASS
SUBSIDIARIES SUBSIDIARIES COMPANY) & ELIMS CONSOLIDATED
------------ ------------ --------------- ------- ------------
(MILLIONS)
<S> <C> <C> <C> <C> <C>
ASSETS
Current assets:
Cash and temporary cash investments...... $ 1 $ 25 $ 3 $ -- $ 29
Receivables.............................. 277 307 32 (173) 443
Inventories.............................. 149 265 -- -- 414
Deferred income taxes.................... 48 (9) -- -- 39
Prepayments and other.................... 94 45 -- -- 139
------ ------ ------- ------- ------
569 633 35 (173) 1,064
------ ------ ------- ------- ------
Other assets:
Investment in affiliated companies....... 733 -- 5,387 (6,120) --
Notes and advances receivable from
affiliates............................. 635 -- 2,772 (3,407) --
Long-term notes receivable, net.......... 12 9 2 -- 23
Goodwill and intangibles, net............ 348 151 -- -- 499
Deferred income taxes.................... -- 39 -- -- 39
Pension assets........................... 83 18 -- -- 101
Other.................................... 89 106 6 -- 201
------ ------ ------- ------- ------
1,900 323 8,167 (9,527) 863
------ ------ ------- ------- ------
Plant, property, and equipment, at cost...... 875 1,069 -- -- 1,944
Less -- Reserves for depreciation and
amortization........................... 419 432 -- -- 851
------ ------ ------- ------- ------
456 637 -- -- 1,093
------ ------ ------- ------- ------
Net assets of discontinued operations........ 1,649 3,119 (3,029) -- 1,739
------ ------ ------- ------- ------
$4,574 $4,712 $ 5,173 $(9,700) $4,759
====== ====== ======= ======= ======
LIABILITIES AND SHAREOWNERS' EQUITY
Current liabilities:
Short-term debt (including current
maturities on long-term debt).......... $ 26 $ 124 $ 229 $ (75) $ 304
Trade payables........................... 148 258 10 (79) 337
Taxes accrued............................ (3) 34 -- -- 31
Other.................................... 130 71 36 -- 237
------ ------ ------- ------- ------
301 487 275 (154) 909
Long-term debt............................... 1,571 25 2,480 (3,405) 671
Deferred income taxes........................ 137 47 (86) -- 98
Postretirement benefits and other
liabilities................................ 126 44 -- -- 170
Commitments and contingencies
Minority interest............................ -- 13 -- 394 407
Preferred stock with mandatory redemption
provisions................................. 394 -- -- (394) --
Shareowners' equity.......................... 2,045 4,096 2,504 (6,141) 2,504
------ ------ ------- ------- ------
$4,574 $4,712 $ 5,173 $(9,700) $4,759
====== ====== ======= ======= ======
</TABLE>
21
<PAGE> 23
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
SPIN-OFF OF PACKAGING OPERATIONS
Tenneco Automotive Inc. was known as Tenneco Inc. before the spin-off on
November 4, 1999, of Tenneco Inc.'s packaging business, as described below. In
this Management's Discussion and Analysis, discussions of Tenneco refer to
Tenneco Inc. and its subsidiaries before the spin-off and to Tenneco Automotive
Inc. and its subsidiaries after the spin-off.
In July 1998, Tenneco's Board of Directors authorized management to develop
a broad range of strategic alternatives to separate the automotive, paperboard
packaging and specialty packaging businesses. Subsequently, Tenneco completed
the following actions:
- In January 1999, Tenneco announced an agreement to contribute its
containerboard business to a new joint venture with an affiliate of
Madison Dearborn Partners. The proceeds from the transaction, including
debt assumed by the new joint venture, were approximately $2 billion. The
transaction closed in April 1999. Tenneco retained a 43% percent interest
in the joint venture.
- In April 1999, Tenneco announced an agreement to sell its folding carton
operations to Caraustar Industries. This transaction closed in June 1999.
The folding carton operations and the containerboard business together
represented Tenneco's paperboard packaging operating segment.
- On November 4, 1999, Tenneco completed the spin-off of Tenneco Packaging
Inc., now known as Pactiv Corporation ("Packaging"). The morning
following the spin-off, Tenneco changed its name from "Tenneco Inc." to
"Tenneco Automotive Inc." and effected a reverse stock split whereby
every five shares of Tenneco common stock were converted into one share
of Tenneco's new common stock.
The separation of the automotive and packaging businesses was accomplished
by the spin-off of the common stock of Packaging to Tenneco shareowners. At the
time of the spin-off, Packaging included Tenneco's specialty packaging business,
the remaining interest in the containerboard joint venture and Tenneco's
administrative services operations. In August 1999, Tenneco received a letter
ruling from the Internal Revenue Service that the spin-off would be tax-free for
U.S. federal income tax purposes to Tenneco and its shareowners.
Before the spin-off, Tenneco realigned substantially all of its existing
debt through a combination of tender offers, exchange offers, and other
refinancings. The company's debt realignment was financed by borrowings by
Tenneco under new credit facilities, the issuance by Tenneco of subordinated
debt, and borrowings by Packaging under new credit facilities and the issuance
by Packaging of its new publicly-traded debt in exchange for certain series of
the publicly-traded debt of Tenneco that was outstanding before the spin-off and
debt realignment. The debt of Packaging was rated investment grade and the debt
of Tenneco was rated non-investment grade by both Standard & Poor's and Moodys
debt rating agencies.
As a result of these transactions, Tenneco's former specialty and
paperboard packaging operating segments are presented as discontinued operations
in the accompanying financial statements. Tenneco's sole continuing operation is
its automotive segment ("Automotive"). Refer to Notes 2 and 3 to the financial
statements for further information related to discontinued operations.
RESULTS OF CONTINUING OPERATIONS FOR THE QUARTERS ENDED SEPTEMBER 30, 1999 AND
1998
NET SALES AND OPERATING REVENUES
<TABLE>
<CAPTION>
THIRD QUARTER
------------------------
1999 1998 % CHANGE
---- ---- --------
<S> <C> <C> <C>
North America...................................... $434 $408 6%
Europe............................................. 307 316 (3)
Rest Of World...................................... 75 80 (6)
---- ----
$816 $804 1%
==== ====
</TABLE>
22
<PAGE> 24
Revenues for Automotive's North American operations were $434 million, a 6
percent increase over the same period in 1998. Aftermarket revenues decreased
$24 million in the third quarter of 1999 from the comparable period in 1998.
Weaker industry conditions in the North American aftermarket were more than
offset by the $50 million increase in sales to North American original equipment
manufacturers. This increase is primarily attributable to Automotive's strong
position in the North American light duty truck market where vehicle production
has increased by 500,000 units from the third quarter in 1998 to the comparable
period in 1999, and otherwise generally higher North American vehicle production
levels.
Automotive's European revenues were $307 million, a decrease of 3 percent
from the same period a year earlier. The reduction in sales was primarily
attributable to weak European aftermarket industry conditions. European
aftermarket revenues decreased $11 million in the third quarter of 1999 from the
comparable period in 1998. This reduction was partially offset by new program
launches to support European original equipment manufacturers in the third
quarter of 1999 compared to the same period in 1999.
Automotive's revenues from operations in the rest of the world decreased 6
percent to $75 million compared to $80 million in the third quarter of 1998.
Difficult economic conditions in South America and currency devaluation in
Brazil resulted in a $10 million decrease in revenues from the third quarter of
1998 to the comparable period in 1999. This was partially offset by solid
Australian and improving Asian results which increased $5 million in third
quarter of 1999 from the comparable period in 1998.
INCOME BEFORE INTEREST EXPENSE, INCOME TAXES AND MINORITY INTEREST
("OPERATING INCOME")
<TABLE>
<CAPTION>
THIRD QUARTER
------------------------
1999 1998 % CHANGE
---- ---- --------
<S> <C> <C> <C>
North America....................................... $41 $30 37%
Europe.............................................. 23 46 (50)
Rest of World....................................... 3 10 (70)
Other............................................... -- (5) --
--- ---
$67 $81 (17)%
=== ===
</TABLE>
North American operating income was $41 million, a 37 percent improvement
over the prior year. A strong position in the solid selling light truck market
and otherwise generally higher North American vehicle production levels
increased operating income by $10 million. Additionally, improved operating
efficiencies, including results from earlier restructuring initiatives,
contributed $8 million to this improvement. Lower aftermarket sales volumes in
North America, combined with the change in accounting principles with respect to
the capitalization of start-up activities, partially offset these improvements.
Operating income in Europe fell 50 percent from $46 million to $23 million.
The change in accounting for platform start-up costs negatively impacted results
by $7 million from the third quarter of 1998 to the comparable period in 1999.
Lower aftermarket sales volumes in Europe contributed an additional $3 million
to the decrease. The remainder of the decrease was primarily due to a shift in
the mix of original equipment revenues from higher to lower margin business.
Operating income from operations in the rest of the world declined 70
percent to $3 million from $10 million. Difficult economic conditions in South
America and currency devaluation in Brazil resulted in $6 million of this
decline.
23
<PAGE> 25
OPERATING INCOME AS A PERCENTAGE OF REVENUE
<TABLE>
<CAPTION>
THIRD QUARTER
------------------------
1999 1998 % CHANGE
---- ---- --------
<S> <C> <C> <C>
North America..................................... 9.4% 7.4% 27%
Europe............................................ 7.5 14.6 (49)
Rest of World..................................... 4.0 12.5 (68)
Tenneco Automotive.............................. 8.2% 10.1% (19)%
</TABLE>
Since revenue was essentially flat, operating income as a percentage of
revenue declined primarily as a result of the factors cited in the discussion of
operating income above.
INTEREST EXPENSE
For the quarter ended September 30, 1998, Tenneco allocated $42 million in
interest expense to the discontinued specialty packaging operations. For the
comparable period in 1999, $39 million in interest expense was allocated to
discontinued operations. Adjusting for this allocation, interest expense was $6
million lower in the third quarter of 1999 than the comparable period in 1998.
The lower interest expense is primarily attributable to debt reduction from the
proceeds of the sale of Tenneco's containerboard interest early in the second
quarter of 1999.
INCOME TAXES
Tenneco's effective tax rate for the third quarter of 1999 was 31% compared
to a negative 11% in the third quarter last year. The 1998 rate was lower as a
result of certain non-recurring foreign tax benefits in that quarter. The 1999
rate was unfavorably impacted by the tax effect of the recapitalization of
Automotive's foreign subsidiaries.
EARNINGS PER SHARE
Income from continuing operations was $.86 per diluted common share for the
third quarter of 1999, compared to $1.84 per diluted common share for last
year's quarter. Discontinued operations generated income of $.32 per diluted
common share during this year's quarter compared to income of $1.24 per diluted
common share for the prior year's quarter. Net income was $1.18 per diluted
common share for the third quarter of 1999, compared to $3.08 per diluted common
share in last year's quarter.
RESULTS OF CONTINUING OPERATIONS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1999
AND 1998
NET SALES AND OPERATING REVENUES
<TABLE>
<CAPTION>
NINE MONTHS ENDED SEPTEMBER 30,
-------------------------------
1999 1998 % CHANGE
------- ------- ---------
<S> <C> <C> <C>
North America................................. $1,321 $1,287 3 %
Europe........................................ 945 949 --
Rest of World................................. 207 232 (11)
------ ------
$2,473 $2,468 --
====== ======
</TABLE>
Revenues for Automotive's North American operations were $1.3 billion, a 3
percent increase over the same period in 1998. Aftermarket revenues decreased
$82 million in the nine months ended September 30, 1999 from the comparable
period in 1998. Weaker industry conditions in the North American aftermarket
were more than offset by the $116 million increase in sales to North American
original equipment manufacturers. This increase is primarily attributable to
Tenneco Automotive's strong presence in the light duty truck market, where North
American light duty truck production has increased by one million units from the
nine months ended September 30, 1998 to the comparable period in 1999, and
otherwise generally higher North American vehicle production levels.
24
<PAGE> 26
Automotive's European revenues were $945 million, essentially flat from the
same period a year earlier. European aftermarket revenues decreased $36 million
in the nine months ended September 30, 1999 from the comparable period in 1998.
This reduction was offset by increased sales to European original equipment
manufacturers of $32 million for the nine months ended September 30, 1999
compared to the same period in 1998 resulting primarily from new program
launches.
Automotive's revenues from operations in the rest of the world decreased 11
percent to $207 million compared to $232 million in the nine months ended
September 30, 1998. Difficult economic conditions in South America and currency
devaluation in Brazil led to a $38 million decrease in revenues. This was
partially offset by an increase of $13 million in revenues from solid Australian
and improving Asian results.
INCOME BEFORE INTEREST EXPENSE, INCOME TAXES AND MINORITY INTEREST ("OPERATING
INCOME")
<TABLE>
<CAPTION>
NINE MONTHS ENDED
SEPTEMBER 30,
------------------------
1999 1998 % CHANGE
---- ---- --------
<S> <C> <C> <C>
North America.................................... $143 $129 11 %
Europe........................................... 74 147 (50)
Rest Of World.................................... 6 29 (79)
Other............................................ (4) (17) NM
---- ----
$219 $288 (24)%
==== ====
</TABLE>
North American operating income was $143 million for the nine months ended
September 30, an 11 percent improvement over the same period in the prior year.
Improved operating efficiencies in manufacturing and other cost reduction
actions including results from earlier period restructuring initiatives
contributed $26 million to these results. Additionally, Automotive's strong
position in the solid selling light truck market and otherwise generally higher
North American vehicle production levels increased operating income by $18
million. Lower North American aftermarket volumes and the change in accounting
principles with respect to the capitalization of start-up activities somewhat
offset this improvement in operating income for the nine months ended September
30, 1999 compared to the same period in 1998.
European operating income decreased 50 percent from $147 million to $74
million. The lower operating income in Europe is primarily attributable to the
change in accounting for platform start-up costs, lower aftermarket volumes and
a shift in the mix of original equipment revenues from higher to lower margin
business.
Operating income from operations in the rest of the world declined 79
percent to $6 million from $29 million, as difficult economic conditions in
South America and currency devaluation in Brazil reduced operating income by $16
million.
OPERATING INCOME AS A PERCENTAGE OF REVENUE
<TABLE>
<CAPTION>
NINE MONTHS ENDED
SEPTEMBER 30,
------------------------
1999 1998 % CHANGE
---- ---- --------
<S> <C> <C> <C>
North America..................................... 10.8% 10.0% 8 %
Europe............................................ 7.8 15.5 (50)
Rest of World..................................... 2.9 12.5 (77)
Tenneco Automotive................................ 8.9% 11.7% (24)%
</TABLE>
Since revenue was essentially flat, operating income as a percentage of
revenue declined primarily as a result of the factors cited in the discussion of
operating income above.
25
<PAGE> 27
INTEREST EXPENSE
For the nine months ended September 30, 1998, Tenneco allocated $129
million in interest expense to discontinued specialty packaging operations. For
the comparable period in 1999, $115 million in interest expense was allocated to
discontinued operations. Adjusting for this allocation, interest expense was $5
million lower in the first three quarters of 1999 than the comparable period in
1998. The lower interest expense is primarily attributable to debt reduction
from the proceeds of the sale of Tenneco's containerboard interest early in the
second quarter of 1999.
INCOME TAXES
Tenneco's effective tax rate for the nine months ended September 30, 1999
was 37% compared to 20% in the third quarter last year. The 1998 rate was lower
as a result of certain non-recurring foreign tax benefits in that quarter. The
1999 rate was unfavorably impacted by the tax effect of the recapitalization of
Automotive's foreign subsidiaries.
EARNINGS PER SHARE
Income from continuing operations was $2.40 per diluted common share for
the nine months ended September 30, 1999, compared to $4.97 per diluted common
share in the comparable period of 1998. Discontinued operations generated a loss
of $2.98 per diluted common share during 1999 compared to income of $4.35 per
diluted common share for the prior year. The current year period also included a
$.20 per diluted common share extraordinary loss on early retirement of debt in
connection with the sale of the containerboard assets, and $4.00 per diluted
common share of charges related to the cumulative effect of changes in
accounting principles noted above. Net loss was $4.78 per diluted common share
for the nine months ended September 30, 1999, compared to $9.31 net income per
diluted common share in the comparable period of 1998.
RESTRUCTURING AND OTHER CHARGES
In the fourth quarter of 1998, Tenneco's Board of Directors approved an
extensive restructuring plan designed to reduce administrative and operational
overhead costs. Tenneco recorded a pre-tax charge to income from continuing
operations of $53 million, $34 million after-tax, or $1.02 per diluted common
share. Of the pre-tax charge, for operational restructuring plans, $36 million
related to the consolidation of the manufacturing and distribution operations of
Automotive's North American aftermarket business. A staff and related cost
reduction plan, which covers employees in Automotive's operating units and
corporate operations, is expected to cost $17 million.
The Automotive aftermarket restructuring involves closing two plant
locations and five distribution centers, resulting in the elimination of 302
positions. The staff and related cost reduction plan involves the elimination of
454 administrative positions in Automotive's business units and its corporate
operations.
The fixed assets at the locations to be closed were written down to their
fair value, less costs to sell, in the fourth quarter of 1998. As a result of
the single-purpose nature of the assets, fair value was estimated at scrap value
less cost to dispose. No significant net cash proceeds are expected to be
received from the ultimate disposal of these assets, which should be complete by
the fourth quarter of 2000. The effect of suspending depreciation for these
impaired assets is a reduction in depreciation and amortization expense of
approximately $2 million on an annual basis.
As of September 30, 1999, approximately 670 employees have been terminated.
To address customer service and production transfer issues, the closure of one
plant location and one Automotive aftermarket distribution center has been
delayed until the first and second quarters of 2000, respectively. All other
restructuring actions, with the exception of the final disposal of certain
assets, are being executed according to the initial plan and are expected to be
complete by the fourth quarter of 1999. During the nine months ended September
30, 1999, the Automotive aftermarket business closed one plant location and four
distribution centers.
26
<PAGE> 28
Amounts related to the restructuring plan are shown in the following table:
<TABLE>
<CAPTION>
CASH
PAYMENTS
NINE MONTHS
DECEMBER 31, 1998 ENDED BALANCE AT
RESTRUCTURING SEPTEMBER 30, SEPTEMBER 30,
CHARGE BALANCE 1999 1999
----------------- ------------- -------------
(MILLIONS)
<S> <C> <C> <C>
Severance........................................... $15 $6 $ 9
Facility exit costs................................. 1 1 --
--- -- ---
$16 $7 $ 9
=== == ===
</TABLE>
Automotive expects to realize annual savings of $27 million as a result of
these restructuring initiatives, primarily from a reduction in salary and
related employee expenses. Reduced depreciation charges comprise $2 million of
the balance. Tenneco expects these savings will be fully realized beginning in
the second quarter of 2000.
To further reduce its cost structure, Tenneco is also evaluating a
supplemental restructuring plan which could involve the closure of additional
manufacturing and distribution facilities in North America and Europe. If this
supplemental plan is approved by the Board of Directors and implemented, it
could result in an additional charge in the fourth quarter of 1999 of between
$45 million and $55 million before taxes, of which approximately 50 to 60
percent could be cash.
DISCONTINUED OPERATIONS AND EXTRAORDINARY LOSS
On November 5, 1999, Tenneco spun-off its specialty packaging businesses
into a separate, independent company. The specialty packaging company also owns
the remaining interest in the containerboard joint venture and the
administrative services operations. The specialty and paperboard packaging
businesses, and the administrative services operations, have been reflected as
discontinued operations in the accompanying financial statements.
Revenues and income for the paperboard packaging discontinued operations
are shown in the following table.
<TABLE>
<CAPTION>
THREE MONTHS NINE MONTHS
ENDED ENDED
SEPTEMBER 30, SEPTEMBER 30,
-------------- --------------
1999 1998 1999 1998
----- ----- ----- ------
<S> <C> <C> <C> <C>
Net sales and operating revenues............................ $-- $415 $ 445 $1,185
=== ==== ===== ======
Income before income taxes and interest allocation.......... $ 8 $ 35 $ 30 $ 101
Income tax (expense) benefit................................ -- (12) (11) (38)
--- ---- ----- ------
Income before interest allocation........................... 8 23 19 63
Allocated interest expense, net of income tax............... -- (8) (5) (20)
--- ---- ----- ------
Income from discontinued operations before disposition...... 8 15 14 43
Gain (loss) on disposition, net of income tax............... -- 10 (169) 19
--- ---- ----- ------
Income (loss) from discontinued operations.................. $ 8 $ 25 $(155) $ 62
=== ==== ===== ======
</TABLE>
27
<PAGE> 29
Revenues and income for the specialty packaging business and administrative
services operations are shown in the following table:
<TABLE>
<CAPTION>
THREE MONTHS NINE MONTHS
ENDED ENDED
SEPTEMBER 30, SEPTEMBER 30,
-------------- ---------------
1999 1998 1999 1998
----- ----- ------ ------
<S> <C> <C> <C> <C>
Net sales and operating revenues............................ $754 $696 $2,158 $2,067
==== ==== ====== ======
Income before income taxes and interest allocation.......... 69 74 213 247
Income tax (expense) benefit................................ (39) (36) (87) (96)
---- ---- ------ ------
Income before interest allocation........................... 30 38 126 151
Allocated interest expense, net of income tax............... (26) (23) (70) (67)
---- ---- ------ ------
Income (loss) from discontinued operations.................. $ 4 $ 15 $ 56 $ 84
==== ==== ====== ======
</TABLE>
The current year period also included a $7 million extraordinary loss on
early retirement of debt in connection with the sale of the containerboard
assets.
Nine months ended September 30, 1999 results from discontinued operations
for the specialty packaging segment includes a pre-tax charge of $29 million
relating to a plan to realign its headquarters functions. This plan involves the
severance of approximately 40 employees and the closing of the Greenwich,
Connecticut headquarters facility.
CHANGES IN ACCOUNTING PRINCIPLES
In March 1998, the American Institute of Certified Public Accountants
("AICPA") issued Statement of Position ("SOP") 98-1, "Accounting for the Costs
of Computer Software Developed or Obtained for Internal Use," which establishes
new accounting and reporting standards for the costs of computer software
developed or obtained for internal use. This statement requires prospective
application for fiscal years beginning after December 15, 1998. Tenneco adopted
SOP 98-1 on January 1, 1999. The impact of this new standard did not have a
significant effect on Tenneco's financial position or results of operations.
In April 1998, the American Institute of Certified Public Accountants
("AICPA") issued Statement of Position ("SOP") 98-5, "Reporting on the Costs of
Start-Up Activities," which requires costs of start-up activities to be expensed
as incurred. This statement is effective for fiscal years beginning after
December 15, 1998. The statement requires previously capitalized costs related
to start-up activities to be expensed as a cumulative effect of a change in
accounting principle when the statement is adopted. Prior to January 1, 1999,
Tenneco capitalized certain costs related to start-up activities, primarily
engineering costs for new automobile original equipment platforms. Tenneco
adopted SOP 98-5 on January 1, 1999, and recorded an after-tax charge for the
cumulative effect of this change in accounting principle of $102 million (net of
a $50 million tax benefit), or $3.05 per diluted common share. The change in
accounting principle decreased income from continuing operations by $11 million
(net of a $8 million tax benefit), or $.33 per diluted common share for the nine
months ended September 30, 1999. If the new accounting method had been applied
retroactively, income from continuing operations for the nine months ended
September 30, 1998, would have been lower by $10 million (net of a $7 million
tax benefit), or $.30 per diluted common share. For the three months ended
September 30, 1999, the change in accounting principle decreased income from
continuing operations by $6 million (net of a $4 million tax benefit), or $.18
per diluted common share. If the new accounting method had been applied
retroactively, income from continuing operations for the three months ended
September 30, 1998, would have been lower by $5 million (net of a $3 million tax
benefit), or $.15 per diluted common share.
In June 1998, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standards ("SFAS") No. 133, "Accounting for
Derivative Instruments and Hedging Activities." This statement establishes new
accounting and reporting standards requiring that all derivative instruments,
including derivative instruments embedded in other contracts, be recorded in the
balance sheet as either an asset or liability measured at its fair value. The
statement requires that changes in the derivative's fair value be
28
<PAGE> 30
recognized currently in earnings unless specific hedge accounting criteria are
met. Special accounting for qualifying hedges allows a derivative's gains and
losses to offset related results on the hedged item in the income statement and
requires that a company must formally document, designate and assess the
effectiveness of transactions that receive hedge accounting treatment. This
statement cannot be applied retroactively and is effective for all fiscal years
beginning after June 15, 2000. Tenneco is currently evaluating the new standard
but has not yet determined the impact it will have on its financial position or
results of operations.
Effective January 1, 1999, Tenneco changed its method of accounting for
customer acquisition costs from a deferral method to an expense-as-incurred
method. In connection with Tenneco's decision to separate its automotive and
specialty packaging businesses into independent public companies, Tenneco
determined that a change to an expense-as-incurred method of accounting for
automotive aftermarket customer acquisition costs was preferable in order to
permit improved comparability of stand-alone financial results with its
aftermarket industry competitors. Tenneco recorded an after-tax charge for the
cumulative effect of this change in accounting principle of $32 million (net of
a $22 million tax benefit), or $.95 per diluted common share. The change in
accounting principle increased income from continuing operations by $8 million
(net of $5 million in income tax expense), or $.24 per diluted common share for
the nine months ended September 30, 1999. If the new accounting principle had
been applied retroactively, income from continuing operations for the nine
months ended September 30, 1998, would have been higher by $1 million (net of $1
million in income tax expense), or $.03 per diluted common share. For the three
months ended September 30, 1999, the change in accounting principle increased
income from continuing operations by $3 million (net of $1 million in income tax
expense), or $.09 per diluted common share. If the new accounting principle had
been applied retroactively, income from continuing operations for the three
months ended September 30, 1998, would have been higher by $3 million (net of $2
million in income tax expense), or $.09 per diluted common share.
LIQUIDITY AND CAPITAL RESOURCES
CAPITALIZATION
<TABLE>
<CAPTION>
SEPTEMBER 30, DECEMBER 31,
1999 1998 % CHANGE
------------- ------------ --------
<S> <C> <C> <C>
Short term debt and current maturities.................... $ 237 $ 304 (22%)
Long-term debt............................................ 796 671 19
Debt allocated to discontinued operations................. 1,985 2,456 (19)
------ ------
Total debt................................................ 3,018 3,431 (12)
------ ------
Minority interest of continuing operations................ 411 407 1
Minority interest of discontinued operations.............. 21 14 50
------ ------
Total minority interest................................... 432 421 3
------ ------
Common shareowners' equity................................ 2,140 2,504 (15)
------ ------
Total capitalization...................................... $5,590 $6,356 (12%)
====== ======
</TABLE>
Tenneco's ratio of debt to total capitalization was 54 percent at September
30, 1999 and at December 31, 1998. This ratio was calculated before giving
effect to the debt realignment and spin-off, described below, which were
completed after September 30, 1999. Tenneco expects its debt to total
capitalization ratio to increase significantly as a result of these
transactions.
Prior to the spin-off, Tenneco realigned substantially all of its existing
debt. To accomplish this, Tenneco initiated an offer to exchange Packaging debt
securities for Tenneco debt securities having a book value of $1,166 million.
Tenneco also initiated a cash tender offer to purchase debt securities having a
book value of $1,374 million and repaid substantially all of its short-term
borrowings. Finally, Tenneco retired approximately $400 million of subsidiary
preferred stock. These transactions were financed by borrowings by Tenneco under
a new credit facility, senior subordinated debt issued by Tenneco, and
borrowings by Packaging under new credit facilities. The debt of Packaging was
rated investment grade and the debt of Tenneco was rated non-investment grade by
debt rating agencies.
29
<PAGE> 31
As part of the debt realignment, on September 30, 1999 Tenneco entered into
a $1.55 billion committed senior secured financing arrangement with a syndicate
of banks and other financial institutions consisting of: (i) a $500 million,
six-year revolving credit facility; (ii) a $450 million six-year term loan;
(iii) a $300 million eight-year term loan and; (iv) a $300 million eight and
one-half year term loan. A portion of each term loan is payable in quarterly
installments beginning September 30, 2001. Borrowings under this facility bear
interest at an annual rate equal to, at the borrower's option, either (i) the
London Interbank Offering Rate plus a margin of 275 basis points for the
six-year revolving credit facility and the six-year term loan, 325 basis points
for the eight-year term loan and 350 basis points for the eight and one-half
year term loan; or (ii) a rate consisting of the greater of The Chase Manhattan
Bank's prime rate or the Federal Funds rate plus 50 basis points, plus a margin
of 175 basis points for the six-year revolving credit facility and the six-year
term loan, 225 basis points for the eight-year term loan and 250 basis points
for the eight and one-half year term loan. Under the provisions of the senior
credit facility agreement, the interest margins for borrowings under the
revolving credit facility and the six-year term loan may be adjusted based on
the consolidated leverage ratio (total debt divided by consolidated earnings
before interest, taxes, depreciation and amortization ("EBITDA") as defined in
the senior credit facility agreement) measured at the end of each quarter
starting with the fiscal quarter ending December 31, 2000.
The senior credit facility agreement requires that Tenneco initially
maintain: (i) a consolidated leverage ratio (consolidated indebtedness divided
by consolidated EBITDA) not greater than 4.75; (ii) a consolidated interest
coverage ratio (consolidated EBITDA divided by consolidated interest expense)
not less than 2.00; and (iii) a consolidated fixed charge coverage ratio
(consolidated EBITDA less consolidated capital expenditures, divided by
consolidated interest expense) not less than 1.00. Under the terms of the senior
credit facility agreement, the maximum permitted consolidated leverage ratio
will decrease beginning in the year 2001, the minimum permitted consolidated
interest coverage ratio will increase beginning in the year 2001 and the minimum
permitted consolidated fixed charge coverage ratio will increase beginning in
the year 2002. The senior credit facility agreement also contains restrictions
on Tenneco's operations that are customary for similar facilities, including
limitations on: (a) incurring additional liens; (b) sale and leaseback
transactions; (c) liquidations and dissolutions (d) incurring additional
indebtedness or guarantees; (e) capital expenditures; (f) dividends; (g) mergers
and consolidations; and (h) prepayments and modifications of subordinated and
other debt instruments. Compliance with these requirements and restrictions is a
condition for any incremental borrowings under the senior credit facility
agreement and failure to meet these requirements enables the lenders to require
repayment of any outstanding loans.
The senior subordinated debt indenture requires that Tenneco Automotive, as
a condition to incurring certain types of indebtedness not otherwise permitted,
initially maintain an interest coverage ratio of not less than 2.00. Under the
terms of the indenture, the minimum interest coverage ratio will increase
beginning in 2001. The indenture also contains restrictions on Tenneco's
operations, including limitations on: (1) incurring additional indebtedness or
liens; (2) dividends; (3) distributions and stock repurchases; (4) investments;
and (5) mergers and consolidations.
Upon completion of the debt realignment and spin-off, Tenneco's total
indebtedness was approximately $1.7 billion, including $22 million which was
borrowed under the revolving credit facility, leaving $478 million available
under that facility on the date of the spin-off. Tenneco believes that cash
flows from operations, combined with available borrowing capacity described
above, will generally be sufficient to meet its future capital requirements for
the following year.
CASH FLOWS
<TABLE>
<CAPTION>
NINE MONTHS ENDED
SEPTEMBER 30,
-------------------------
1999 1998 % CHANGE
------ ----- --------
<S> <C> <C> <C>
Cash provided (used) by:
Operating activities -- continuing operations... $ (100) $ 33 (403)%
Investing activities -- continuing operations... $ (161) $(181) 11 %
Financing activities............................ $1,244 $ 96 1,195 %
</TABLE>
30
<PAGE> 32
OPERATING ACTIVITIES
Cash provided by continuing operating activities declined by $133 million
for the nine months ended September 30, 1999 compared to the comparable 1998
period. Income from continuing operations was $89 million lower and investments
in working capital were $63 million more for the nine months ended September 30,
1999 compared to the 1998 period. The increase in working capital was primarily
attributable to the one-time impact of terminating Automotive's accounts
receivable factoring program in connection with the spin-off, which increased
receivables by $67 million.
Cash provided by Tenneco's discontinued operations declined by $398 million
in the first nine months ended 1999 compared to the 1998 period. The paperboard
operations were responsible for $213 million which is primarily attributable to
the purchase of containerboard business accounts receivable in contemplation of
the sale of the containerboard business in April. Additionally, containerboard
results are reflected for the first four months in 1999 and for the first nine
months in 1998 due to the sale of this business. Investment in working capital
within the specialty packaging business increased by $139 million in the nine
months ended 1999 compared to the 1998 period.
INVESTING ACTIVITIES
Cash used by investing activities from continuing operations was $20
million lower in the nine months ended September 30, 1999 compared to the same
period in 1998. Capital expenditures were $17 million lower in the nine months
ended September 30, 1999 compared to the same period in 1998 due to more
effective capital management. This was offset by the acquisition of Kinetic Ltd.
for $36 million. Kinetic, an Australian suspension engineering company with
advanced roll-control technology, provides enhanced on-road handling while
improving off-road performance.
Cash used by investments in discontinued operations increased by $619
million in the nine months ended September 30, 1999 compared to the 1998 period.
During the second quarter of 1999, Tenneco acquired for approximately $1.1
billion certain assets previously used by the containerboard business under
operating leases and timber cutting rights. This was required in order to
complete the April containerboard sale. The source of the funds for these
capital expenditures was borrowings by Packaging prior to the containerboard
sale. See "Financing Activities" below. Tenneco also received approximately $300
million in proceeds related to the containerboard and folding carton sale
transactions.
FINANCING ACTIVITIES
Excluding borrowings required to complete the containerboard sale
transaction, cash used by financing activities was $517 million for the nine
months ended September 30, 1999. This primarily reflected the use of the net
proceeds of the containerboard sale transaction to reduce Tenneco's short-term
debt.
Before the containerboard sale transaction, Packaging borrowed
approximately $1.8 billion. These borrowings were used to acquire the assets
used under operating leases and timber cutting rights described under "Investing
Activities" above, and to purchase the containerboard business accounts
receivable described under "Operating Activities" above. Packaging remitted the
balance of the borrowings to Tenneco to retire short-term debt. Packaging
contributed the containerboard business to the new joint venture subject to the
approximately $1.8 billion in new debt. The debt reduction, which resulted from
this contribution, is shown on the Statements of Cash Flows as a non-cash
financing activity.
31
<PAGE> 33
YEAR 2000
Many computer software systems, as well as some hardware and equipment
utilizing date-sensitive data, were designed to use a two-digit date field.
Consequently, these systems will not be able to properly recognize dates beyond
the year 1999 ("the Year 2000 issue"). Tenneco's significant technology
transformation projects have addressed the Year 2000 issue in those areas where
replacement systems are being installed for other business reasons. Where
existing systems and equipment are expected to remain in place beyond 1999,
Tenneco has a detailed process in place to identify and assess Year 2000 issues
and to remediate, replace or establish alternative procedures addressing
non-Year 2000 compliant systems, hardware, and equipment.
Tenneco has substantially completed inventorying its systems and equipment,
including computer systems and business applications, as well as date-sensitive
technology embedded in its equipment and facilities. Tenneco continues to plan
for and undertake remediation, replacement, or establishment of alternative
procedures for non-compliant Year 2000 systems and equipment; and test
remediated, replaced or alternative procedures for systems and equipment.
Tenneco believes that approximately 99 percent of Automotive's major
business applications systems and approximately 99 percent of Automotive's
manufacturing equipment had achieved Year 2000 compliance as of September 30,
1999. Tenneco has confirmed that none of its Automotive products are
date-sensitive. Remediation, replacement, or establishment of alternative
procedures for systems and equipment have been and are being undertaken on a
business priority basis.
Tenneco has also contacted Automotive's major suppliers, financial
institutions, and others with whom Automotive conducts business to determine
whether they will be able to resolve in a timely manner Year 2000 problems
possibly affecting Automotive. A majority of these entities, including critical
suppliers, have responded by advising as to the status of their efforts and by
stating that they expect to become Year 2000 compliant in a timely manner. Based
on these responses, critical suppliers have been assigned a risk rating. This
process is ongoing. Tenneco intends to continue corresponding with critical high
risk third parties to obtain information and updates on their Year 2000 efforts,
and to assess new suppliers, financial institutions and others with whom
Automotive begins to conduct business.
Based upon current estimates, Tenneco believes that costs to address
Automotive's Year 2000 issues and implement necessary changes to its existing
systems and equipment including costs incurred to date, will range from $15 to
$17 million. As of September 30, 1999, approximately $13 million of the costs
had been incurred. These costs are being expensed as they are incurred, except
that in some instances Tenneco may determine that replacing existing computer
systems or equipment may be more effective and efficient, particularly where
additional functionality is available. These replacements would be capitalized
and would reduce the estimated expense associated with Year 2000 issues.
If Tenneco is unable to complete on a timely and cost-effective basis the
remediation or replacement of critical systems or equipment not yet in
compliance, or develop alternative procedures, or if those with whom Automotive
conducts business are unsuccessful in implementing timely solutions, Year 2000
issues could have a material adverse effect on Tenneco's financial condition or
results of operations. Possible worst case scenarios include interruptions in
Automotive's ability to manufacture its products, process and ship orders, and
bill and collect accounts receivable due to internal systems failures or the
systems failures of its suppliers or customers. Tenneco believes it will be able
to timely resolve Automotive's own Year 2000 issues.
As part of its planning and readiness activities, Tenneco is developing
Year 2000 contingency plans for critical business processes such as banking,
data center operations and just-in-time manufacturing operations. Contingency
plans are being developed on a business unit basis, where needed, to respond to
previously undetected Year 2000 problems and business interruption from
suppliers. Contingency plans will include alternative suppliers, as necessary,
and assuring the availability of key personnel at year end to address unforeseen
Year 2000 problems.
32
<PAGE> 34
]EURO CONVERSION
The European Monetary Union resulted in the adoption of a common currency,
the "Euro," among eleven European nations. The Euro is being adopted over a
three-year transition period beginning January 1, 1999. In October 1997, Tenneco
established a cross-functional Euro Committee, comprised of representatives of
its operational divisions as well as its corporate offices. That Committee had
two principal objectives: (i) to determine the impact of the Euro on Tenneco's
business operations, and (ii) to recommend and facilitate implementation of
those steps necessary to ensure that Tenneco would be fully prepared for the
Euro's introduction. As of January 1, 1999, Tenneco implemented those Euro
conversion procedures that it had determined to be necessary and prudent to
adopt by that date, and is on track to becoming fully "Euro ready" on or before
the conclusion of the three-year Euro transition period. Tenneco believes that
the costs associated with transitioning to the Euro will not be material to its
consolidated financial position or the results of its operations.
33
<PAGE> 35
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Subsequent to September 30, 1999, Tenneco realigned substantially all of
its debt in connection with the spin-off of Packaging. Substantially all of
Tenneco's existing fixed rate debt was retired through cash tender offers or
offers to exchange Packaging debt securities for Tenneco debt securities.
Tenneco financed this debt realignment by issuing new debt securities, a portion
of which carry interest rates that change with market rates of interest. See
Item 2., Management's Discussion and Analysis of Financial Condition and Results
of Operations for further information.
34
<PAGE> 36
PART II
OTHER INFORMATION
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS.
On October 5, 1999, Tenneco commenced a cash tender offer and debt exchange
offer for all series of its then-outstanding publicly registered debt securities
(the "Public Debt Securities"). These securities were issued under an Indenture,
dated as of November 1, 1996, as amended (the "Indenture"), between Tenneco and
The Chase Manhattan Bank, as trustee. In connection with the tender and exchange
offers, Tenneco solicited consents from the holders of these securities to
amendments to the Indenture. The required consents were received and the
Indenture was amended to eliminate the restrictions on Tenneco's operations
previously included in the Indenture. The eliminated restrictions include prior
limitations on (1) the ability of Tenneco and specified subsidiaries to incur
secured debt and enter into sale-leaseback transactions and (2) the ability of
Tenneco to merge, consolidate or transfer all or substantially all of its
assets. The supplemental indenture pursuant to which the amendments were
effected is filed as an exhibit to this report and is incorporated herein by
reference.
In connection with the realignment of its debt as part of its spin-off of
Packaging, Tenneco (1) entered into a new senior secured credit facility on
September 30, 1999 and made initial borrowings of $1,072 under this facility on
November 4, 1999 and (2) issued $500 million of senior subordinated notes due
October 15, 2009 on October 14, 1999. The senior secured credit facility is
secured by substantially all of the tangible and intangible domestic assets of
Tenneco and its subsidiaries and is collateralized by a perfected security
interest in all of the capital stock of Tenneco's material domestic subsidiaries
and in up to 66% of the capital stock of Tenneco's first-tier foreign
subsidiaries. In addition, the senior secured credit facility is guaranteed on a
joint and several basis by all of Tenneco's material domestic subsidiaries and
the senior subordinated notes are guaranteed on a joint and several basis by all
of Tenneco's material domestic wholly owned subsidiaries. Because the senior
secured credit facility and senior subordinated notes are secured and/or
guaranteed, the Public Debt Securities that remain outstanding after the tender
and exchange offers described above have become structurally subordinated to the
rights of the lenders for these new borrowings. This is because the remaining
Public Debt Securities are not and will not be supported by similar security
and/or guarantees.
In addition, the senior secured credit facility and senior subordinated
notes contain provisions which limit the ability of Tenneco and its subsidiaries
to take a number of actions relating to their capital stock and debt securities.
These restrictions include, among other things, limitations on their ability to:
(1) pay dividends or make distributions to holders of capital stock; (2)
repurchase or redeem capital stock; and (3) prepay or modify other debt
securities.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
Tenneco held a special stockholders' meeting on October 25, 1999 to
consider and vote on two separate proposals: (i) a proposal to amend Tenneco's
certificate of incorporation to phase-out Tenneco's existing three-class
staggered Board of Directors system, and provide instead for the annual election
of directors (the "Elimination of Staggered Board Proposal"), and (ii) a
proposal to amend Tenneco's certificate of incorporation whereby every five
shares of Tenneco's then-issued common stock would be converted automatically
into one share of Tenneco's new common stock (the "Reverse Stock Split
Proposal"). The meeting proceeded and both the Elimination of Staggered Board
Proposal and Reverse Stock Split Proposal were approved by holders of a majority
of the Tenneco's outstanding common stock. The following sets forth the number
of votes cast for, against and abstain with respect to these proposals at the
meeting:
ELIMINATION OF STAGGERED BOARD PROPOSAL
<TABLE>
<CAPTION>
VOTES FOR VOTES AGAINST VOTES ABSTAIN
--------- ------------- -------------
<S> <C> <C>
127,396,690 2,378,548 1,051,113
</TABLE>
35
<PAGE> 37
REVERSE STOCK SPLIT PROPOSAL
<TABLE>
<CAPTION>
VOTES FOR VOTES AGAINST VOTES ABSTAIN
--------- ------------- -------------
<S> <C> <C>
138,533,392 8,254,821 1,175,919
</TABLE>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibits. The exhibits filed with this report are listed on the Exhibit
Index following the signature page of this report, which is incorporated herein
by reference.
(b) Reports on Form 8-K. Since the beginning of the third quarter of 1999,
Tenneco filed the following Current Reports on Form 8-K:
- Form 8-K dated July 14, 1999, including pursuant to item 5 financial and
other information that superseded comparable information included in
Tenneco's Annual Report on From 10-K for the year ended December 31, 1998
and Quarterly Report on Form 10-Q for the quarter ended March 31, 1999
(including the following financial statements: (1) Tenneco Inc. and
consolidated subsidiaries financial statements for the three months ended
March 31, 1999 and 1998; and (2) Tenneco Inc. and consolidated
subsidiaries financial statements for the three years in the period ended
December 31, 1998);
- Form 8-K dated August 20, 1999, including pursuant to item 5 financial
and other information that superseded comparable information included in
Tenneco's Annual Report on Form 10-K for the year ended December 31,
1998, Quarterly Report on Form 10-Q for the quarter ended March 31, 1999,
Quarterly Report on Form 10-Q for the quarter ended June 30, 1999 and
Current Report on Form 8-K dated July 14, 1999 (including the following
financial statements: (1) Tenneco Inc. and consolidated subsidiaries
financial statements for the three months ended March 31, 1999 and 1998;
(2) Tenneco Inc. and consolidated subsidiaries financial statements for
the three months and six months ended June 30, 1999 and 1998; and (3)
Tenneco Inc. and consolidated subsidiaries financial statements for the
three years in the period ended December 31, 1998);
- Form 8-K dated September 27, 1999, including pursuant to item 5 certain
information regarding the offering of senior subordinated notes by
Tenneco;
- Form 8-K dated October 4, 1999, as amended, including pursuant to item 5
certain financial information;
- Form 8-K dated October 4, 1999, including pursuant to item 5 certain
information regarding Packaging;
- Form 8-K dated October 7, 1999, including pursuant to item 5 certain
financial information and certain information regarding the offering of
senior subordinated notes by Tenneco;
- Form 8-K dated October 12, 1999, including pursuant to item 5 certain
information regarding the spin-off of Packaging and certain information
regarding the offering of senior subordinated notes by Tenneco;
- Form 8-K dated October 25, 1999, including pursuant to item 5 certain
information regarding Tenneco's special stockholders' meeting held on
October 25, 1999, certain information regarding Packaging and certain
financial information; and
- Form 8-K dated November 4, 1999, including pursuant to items 2 and 7
financial and other information regarding the spin-off of Packaging
(including an Unaudited Pro Forma Consolidated Balance Sheet of Tenneco
at June 30, 1999 and Unaudited Pro Forma Consolidated Statements of
Income for Tenneco for the six months ended June 30, 1999 and the year
ended December 31, 1998).
36
<PAGE> 38
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
Tenneco Automotive Inc. has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
TENNECO AUTOMOTIVE INC.
By: /s/ MARK A. MCCOLLUM
------------------------------------
Mark A. McCollum
Senior Vice President and
Chief Financial Officer
November 15, 1999
37
<PAGE> 39
EXHIBIT INDEX
TO
QUARTERLY ON FORM 10-Q
FOR QUARTER ENDED SEPTEMBER 30, 1999
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
- ----------- -----------
<C> <S>
2 Distribution Agreement by and between Tenneco Inc. and
Tenneco Packaging Inc. dated November 3, 1999 (incorporated
herein by reference to Exhibit 2 to the registrant's Current
Report on Form 8-K dated November 4, 1999, File No.
1-12387).
3.1(a) Restated Certificate of Incorporation of the registrant
dated December 11, 1996 (incorporated herein by reference
from Exhibit 3.1(a) of the registrant's Annual Report on
Form 10-K for the year ended December 31, 1997, File No.
1-12387).
3.1(b) Certificate of Amendment, dated December 11, 1996
(incorporated herein by reference from Exhibit 3.1(c) of the
registrant's Annual Report on Form 10-K for the year ended
December 31, 1997, File No. 1-12387).
3.1(c) Certificate of Ownership and Merger, dated July 8, 1997
(incorporated herein by reference from Exhibit 3.1(d) of the
registrant's Annual Report on Form 10-K for the year ended
December 31, 1997, File No. 1-12387).
3.1(d) Certificate of Designation of Series B Junior Participating
Preferred Stock dated September 9, 1998 (incorporated herein
by reference from Exhibit 3.1(d) of the registrant's
Quarterly Report on Form 10-Q for the quarter ended
September 30, 1998, File No. 1-12387).
3.1(e) Certificate of Elimination of the Series A Participating
Junior Preferred Stock of the registrant dated September 11,
1998 (incorporated herein by reference from Exhibit 3.1(e)
of the registrant's Quarterly Report on Form 10-Q for the
quarter ended September 30, 1998, File No. 1-12387).
3.1(f) Certificate of Amendment to Restated Certificate of
Incorporation of the registrant dated November 5, 1999.
3.1(g) Certificate of Amendment to Restated Certificate of
Incorporation of the registrant dated November 5, 1999.
3.1(h) Certificate of Ownership and Merger merging Tenneco
Automotive Merger Sub Inc. with and into the registrant,
dated November 5, 1999.
3.2(a) Amended By-Laws of the registrant (incorporated herein by
reference from Exhibit 3.2 of the registrant's Annual Report
on Form 10-K for the year ended December 31, 1998, File No.
1-12387).
3.2(b) Amendments to the By-Laws of the registrant effected October
12, 1999.
4.1 Qualified Offer Plan Rights Agreement dated as of September
8, 1998, by and between the registrant and First Chicago
Trust Company of New York, as Rights Agent (incorporated
herein by reference from Exhibit 4.1 of the registrant's
Current Report on Form 8-K dated September 24, 1998, File
No. 1-12387).
4.2(a) Indenture, dated as of November 1, 1996, between the
registrant and The Chase Manhattan Bank, as Trustee
(incorporated herein by reference from Exhibit 4.1 of the
registrant's Form S-4, Registration No. 333-14003).
4.2(b) First Supplemental Indenture dated as of December 11, 1996
to Indenture dated as of November 1, 1996 between the
registrant and The Chase Manhattan Bank, as Trustee
(incorporated herein by reference from Exhibit 4.3(b) of the
registrant's Annual Report on Form 10-K for the year ended
December 31, 1996, File No. 1-12387).
</TABLE>
<PAGE> 40
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
- ----------- -----------
<C> <S>
4.2(c) Second Supplemental Indenture dated as of December 11, 1996
to Indenture dated as of November 1, 1996 between the
registrant and The Chase Manhattan Bank, as Trustee
(incorporated herein by reference from Exhibit 4.3(c) of the
registrant's Annual Report on Form 10-K for the year ended
December 31, 1996, File No. 1-12387).
4.2(d) Third Supplemental Indenture dated as of December 11, 1996
to Indenture dated as of November 1, 1996 between the
registrant and The Chase Manhattan Bank, as Trustee
(incorporated herein by reference from Exhibit 4.3(d) of the
registrant's Annual Report on Form 10-K for the year ended
December 31, 1996, File No. 1-12387).
4.2(e) Fourth Supplemental Indenture dated as of December 11, 1996
to Indenture dated as of November 1, 1996 between the
registrant and The Chase Manhattan Bank, as Trustee
(incorporated herein by reference from Exhibit 4.3(e) of the
registrant's Annual Report on Form 10-K for the year ended
December 31, 1996, File No. 1-12387).
4.2(f) Fifth Supplemental Indenture dated as of December 11, 1996
to Indenture dated as of November 1, 1996 between the
registrant and The Chase Manhattan Bank, as Trustee
(incorporated herein by reference from Exhibit 4.3(f) of the
registrant's Annual Report on Form 10-K for the year ended
December 31, 1996, File No. 1-12387).
4.2(g) Sixth Supplemental Indenture dated as of December 11, 1996
to Indenture dated as of November 1, 1996 between the
registrant and The Chase Manhattan Bank, as Trustee
(incorporated herein by reference from Exhibit 4.3(g) of the
registrant's Annual Report on Form 10-K for the year ended
December 31, 1996, File No. 1-12387).
4.2(h) Seventh Supplemental Indenture dated as of December 11, 1996
to Indenture dated as of November 1, 1996 between the
registrant and The Chase Manhattan Bank, as Trustee
(incorporated herein by reference from Exhibit 4.3(h) of the
registrant's Annual Report on Form 10-K for the year ended
December 31, 1996, File No. 1-12387).
4.2(i) Eighth Supplemental Indenture, dated as of April 28, 1997,
to Indenture, dated as of November 1, 1996 between the
registrant and The Chase Manhattan Bank, as Trustee
(incorporated herein by reference from Exhibit 4.1 of the
registrant's Current Report on Form 8-K dated April 23,
1997, File No. 1-12387).
4.2(j) Ninth Supplemental Indenture, dated as of April 28, 1997, to
Indenture, dated as of November 1, 1996, between the
registrant and The Chase Manhattan Bank, as Trustee
(incorporated herein by reference from Exhibit 4.2 of the
registrant's Current Report on Form 8-K dated April 23,
1997, File No. 1-12387).
4.2(k) Tenth Supplemental Indenture, dated as of July 16, 1997, to
Indenture, dated as of November 1, 1996, between the
registrant and The Chase Manhattan Bank, as Trustee
(incorporated herein by reference from Exhibit 4.1 of the
registrant's Current Report on Form 8-K dated June 11, 1997,
File No. 1-12387).
4.2(l) Eleventh Supplemental Indenture, dated October 21, 1999, to
Indenture dated November 1, 1996 between The Chase Manhattan
Bank, as Trustee, and the registrant.
4.3 Specimen stock certificate for Tenneco Automotive Inc.
common stock.
4.4(a) Indenture dated October 14, 1999 by and between the
registrant and The Bank of New York, as trustee.
4.4(b) Supplemental Indenture dated November 4, 1999 among Tenneco
Automotive Operating Subsidiary Inc. (formerly Tenneco
Automotive Inc.), Tenneco International Holding Corp.,
Tenneco Global Holdings Inc., The Pullman Company and
Clevite Industries Inc. in favor of The Bank of New York, as
trustee.
4.5(a) Credit Agreement, dated as of September 30, 1999, among the
registrant, the Lenders named therein, Commerzbank and Bank
of America, N.A., Citicorp USA, Inc. and The Chase Manhattan
Bank.
</TABLE>
<PAGE> 41
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
- ----------- -----------
<C> <S>
9 None
10.1 Distribution Agreement, dated November 1, 1996, by and among
El Paso Tennessee Pipeline Co. (formerly Tenneco Inc.) the
registrant, and Newport News Shipbuilding Inc. (incorporated
herein by reference from Exhibit 2 of the registrant's Form
10, File No. 1-12387).
10.2 Amendment No. 1 to Distribution Agreement, dated as of
December 11, 1996, by and among El Paso Tennessee Pipeline
Co. (formerly Tenneco Inc.), the registrant, and Newport
News Shipbuilding Inc. (incorporated herein by reference
from Exhibit 10.2 of the registrant's Annual Report on Form
10-K for the year ended December 31, 1996, File No.
1-12387).
10.3 Debt and Cash Allocation Agreement, dated December 11, 1996,
by and among El Paso Tennessee Pipeline Co. (formerly
Tenneco Inc.), the registrant, and Newport News Shipbuilding
Inc. (incorporated herein by reference from Exhibit 10.3 of
the registrant's Annual Report on Form 10-K for the year
ended December 31, 1996, File No. 1-123387).
10.4 Benefits Agreement, dated December 11, 1996, by and among El
Paso Tennessee Pipeline Co. (formerly Tenneco Inc.), the
registrant, and Newport News Shipbuilding Inc. (incorporated
herein by reference from Exhibit 10.4 of the registrant's
Annual Report on Form 10-K for the year ended December 31,
1996, File No. 1-12387).
10.5 Insurance Agreement, dated December 11, 1996, by and among
El Paso Tennessee Pipeline Co. (formerly Tenneco Inc.), the
registrant, and Newport News Shipbuilding Inc. (incorporated
herein by reference from Exhibit 10.5 of the registrant's
Annual Report on Form 10-K for the year ended December 31,
1996, File No. 1-12387).
10.6 Tax Sharing Agreement, dated December 11, 1996, by and among
El Paso Tennessee Pipeline Co. (formerly Tenneco Inc.),
Newport News Shipbuilding Inc., the registrant, and El Paso
Natural Gas Company (incorporated herein by reference from
Exhibit 10.6 of the registrant's Annual Report on Form 10-K
for the year ended December 31, 1996, File No. 1-12387).
10.7 First Amendment to Tax Sharing Agreement, dated as of
December 11, 1996, among El Paso Tennessee Pipeline Co.
(formerly Tenneco Inc.), the registrant and Newport News
Shipbuilding Inc. (incorporated herein by reference from
Exhibit 10.7 of the registrant's Annual Report on Form 10-K
for the year ended December 31, 1996, File No. 1-12387).
10.8 Tenneco Automotive Inc. Executive Incentive Compensation
Plan.
10.9 Agreement, dated September 9, 1992 between Theodore R.
Tetzlaff and the registrant (incorporated herein by
reference from Exhibit 10.21 of the registrant's Form 10,
File No. 1-12387).
10.10 Letter Agreement dated September 24, 1998 between Robert T.
Blakely and the registrant. (incorporated herein by
reference from Exhibit 10.23 of the registrant's Quarterly
Report on Form 10-Q for the quarter ended September 30,
1998, File No. 1-12387).
</TABLE>
<PAGE> 42
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
- ----------- -----------
<C> <S>
10.11 Letter Agreement dated September 24, 1998 between John J.
Castellani and the registrant (incorporated herein by
reference from Exhibit 10.28 of the registrant's Annual
Report on Form 10-K for the year ended December 31, 1998,
File No. 1-12387).
10.12 Agreement, dated as of April 12, 1999, among the registrant
Tenneco Management Company, Tenneco Packaging Inc., and Paul
T. Stecko. (incorporated herein by reference from Exhibit
10.30 of the registrant's Quarterly Report on Form 10-Q for
the quarter ended March 31, 1999, File No. 1-12387).
10.13 Tenneco Automotive Inc. Change of Control Severance Benefits
Plan for Key Executives.
10.14 Tenneco Automotive Inc. Stock Ownership Plan.
10.15 Tenneco Automotive Inc. Key Executive Pension Plan.
10.16 Tenneco Automotive Inc. Deferred Compensation Plan.
10.17 Tenneco Automotive Inc. Supplemental Executive Retirement
Plan.
10.18 Release Agreement dated as of October 18, 1999 by and
between Dana G. Mead and Tenneco Management Company and
Modification of Release Agreement dated as of October 18,
1999 among Dana G. Mead, Tenneco Inc. and Tenneco Management
Company.
10.19 Human Resources Agreement by and between Tenneco Inc. and
Tenneco Packaging Inc. dated November 4, 1999 (incorporated
herein by reference to Exhibit 99.1 to the registrant's
Current Report on Form 8-K dated November 4, 1999, File No.
1-12387).
10.20 Tax Sharing Agreement by and between Tenneco Inc. and
Tenneco Packaging Inc. dated November 3, 1999 (incorporated
herein by reference to Exhibit 99.2 to the registrant's
Current Report on Form 8-K dated November 4, 1999, File No.
1-12387).
10.21 Amended and Restated Transition Services Agreement by and
between Tenneco Inc. and Tenneco Packaging Inc. dated as of
November 4, 1999.
11 None
12 Computation of Ratio of Earnings to Fixed Charges.
18 None
22 None
23 None
24 None
27.1 Financial Data Schedule - Period ended September 30, 1999.
27.2 Financial Data Schedule - Period ended September 30, 1998.
28 None
99 None
</TABLE>
<PAGE> 1
EXHIBIT 3.1(f)
CERTIFICATE OF AMENDMENT
TO THE RESTATED CERTIFICATE OF INCORPORATION
OF TENNECO INC.
Tenneco Inc. (the "Corporation"), a corporation organized and existing
under and by virtue of the General Corporation Law of the State of Delaware (the
"DGCL"), does hereby amend the Restated Certificate of Incorporation, as
amended, of the Corporation.
The undersigned hereby certifies that this amendment to the Restated
Certificate of Incorporation of the Corporation, as amended, has been duly
adopted in accordance with Section 242 of the DGCL.
Article FIFTH of the Corporation's current Restated Certificate of
Incorporation, as amended, is hereby amended to read in its entirely as follows:
FIFTH: A. The business and affairs of the corporation shall be
managed by or under the direction of a Board of Directors consisting of
not less than eight nor more than sixteen directors to be determined from
time to time by resolution adopted by the affirmative vote of a majority
of the entire Board of Directors. For purposes of this Restated
Certificate of Incorporation, the "entire Board of Directors" shall mean
the number of directors that would be in office if there were no vacancies
nor any unfilled newly created directorships. Until the third annual
meeting of stockholders following effectiveness of this Certificate of
Amendment under the General Corporation Law of the State of Delaware, the
directors shall be divided into three classes, consisting initially of
two, three and three directors and designated Class I, Class II and Class
III, respectively. Each director elected or appointed prior to the
effectiveness of this Certificate of Amendment under the General
Corporation Law of the State of Delaware, shall serve for their full term,
such that the term of each Class I director shall end at the first
succeeding annual meeting of stockholders, the term of each Class II
director shall end at the second succeeding annual meeting of
stockholders, and the term of each Class III director shall end at the
third succeeding annual meeting of stockholders. The term of each director
elected after the effectiveness of this Certificate of Amendment under the
General Corporation Law of the State of Delaware whether at an annual
meeting or to fill a vacancy in the Board of Directors arising for any
reason, including an increase in the size of the Board of Directors, shall
end at the first annual meeting following his or her election. Commencing
with the third annual meeting of stockholders following effectiveness of
this Certificate of Amendment under the General Corporation Law of the
State of Delaware, the foregoing classification of the Board of Directors
shall cease, and all directors shall be one class and serve for a term
ending at the annual meeting following the annual meeting at which the
director was elected. In no case shall a decrease in the number of
directors shorten the term of any incumbent director. Each director shall
hold office after the annual meeting at which his or her term is scheduled
to end until his or her successor shall be elected and shall qualify,
subject, however, to prior death, resignation, disqualification or removal
from office in accordance with the General Corporation Law of the State of
Delaware. Any newly created directorship resulting from an increase in the
number of directors may be filed by a majority of the Board of Directors
then in office, provided that a quorum is present, and any other vacancy
on the Board of Directors may be filled by a majority of the directors
then in office, even if less than a quorum, or by a sole remaining
director.
B. Notwithstanding the provisions of Section A of Article FIFTH,
whenever the holders of any one or more classes or series of Preferred
Stock issued by the corporation shall have the right, voting separately by
class or series, to elect directors at an annual or special meeting of
stockholders, the election, term of office, filling of vacancies and other
features of such directorships shall be governed by the terms of this
Restated Certificate of Incorporation applicable thereto or the resolution
or resolutions adopted by the Board of Directors applicable thereto.
C. The Board of Directors shall be authorized to adopt, make, amend,
alter, change, add to or repeal the By-Laws of the corporation, subject to
the power of the stockholders to amend, alter, change, add to or repeal
the By-Laws made by the Board of Directors.
D. Unless and except to the extent that the By-Laws of the
corporation shall so require, the election of directors of the corporation
need not be by written ballot.
This Certificate of Amendment, and the amendment effected hereby, shall
become effective at 7:58 a.m., Eastern Standard Time, on November 5, 1999.
1
<PAGE> 2
THE UNDERSIGNED, being the Vice President and Secretary of the Corporation,
for the purpose of amending the Restated Certificate of Incorporation, as
amended, of the Corporation pursuant to the DGCL, does make this amendment to
the Restated Certificate of Incorporation of the Corporation, as amended, hereby
delcaring and certifying that this is my act and deed and the facts herein
stated are true and accordingly have hereunto set my hand as of this 5th day of
November, 1999.
TENNECO INC
By: /s/ Karl A. Stewart
-------------------------------
Name: Karl A. Stewart
Title: Vice President and Secretary
2
<PAGE> 1
EXHIBIT 3.1(g)
CERTIFICATE OF AMENDMENT
TO THE RESTATED CERTIFICATE OF INCORPORATION
OF TENNECO INC.
Tenneco Inc. (the "Corporation"), a corporation organized and existing
under and by virtue of the General Corporation Law of the State of Delaware (the
"DGCL"), does hereby amend the Restated Certificate of Incorporation, as
amended, of the Corporation.
The undersigned hereby certifies that this amendment to the Restated
Certificate of Incorporation, as amended, of the Corporation has been duly
adopted in accordance with Section 242 of the DGCL.
Article FOURTH of the Corporation's current Restated Certificate of
Incorporation, as amended, is hereby amended to include the following text as
Subsection G to the FOURTH Article:
"G. Upon this Certificate of Amendment to the Restated Certificate of
Incorporation of the corporation becoming effective in accordance with the
General Corporation Law of the State of Delaware (the "Effective Time"),
each five (5) shares of Common Stock, par value $.01 per share, of the
corporation ("Old Common Stock") issued immediately prior to the Effective
Time shall be automatically reclassified as and converted into one (1)
share of Common Stock par value $.01 per share, of the corporation ("New
Common Stock").
Notwithstanding the immediately preceding sentence, no fractional
shares of New Common Stock shall be issued to the holders of record of Old
Common Stock in connection with the foregoing reclassification of shares
of Old Common Stock. In lieu thereof, the aggregate of all fractional
shares otherwise issuable to the holders of record of Old Common Stock
shall be issued to First Chicago Trust Company of New York, the transfer
agent, as agent for the accounts of all holders of record of Old Common
Stock otherwise entitled to have a fraction of a share issued to them. The
sale of all of the fractional interests will be effected by the transfer
agent as soon as practicable after the Effective Time on the basis of
prevailing market prices of the New Common Stock on the New York Stock
Exchange at the time of sale. After such sale and upon the surrender of
the stockholders' stock certificates, the transfer agent will pay to such
holders of record their pro rata share of the net proceeds derived from
the sale of the fractional interests.
Each stock certificate that, immediately prior to the Effective Time,
represented shares of Old Common Stock shall, from and after the Effective
Time, automatically and without the necessity of presenting the same for
exchange, represent that number of whole shares of New Common Stock into
which the shares of Old Common Stock represented by such certificate shall
have been reclassified (as well as the right to receive cash in lieu of
any fractional shares of New Common Stock), provided, however, that each
holder of record of a certificate that represented shares of Old Common
Stock shall receive, upon surrender of such certificate, a new certificate
representing the number of whole shares of New Common Stock into which the
shares of Old Common Stock represented by such certificate shall have been
reclassified, as well as any cash in lieu of fractional shares of New
Common Stock to which such holder may be entitled pursuant to the
immediately preceding paragraph."
This Certificate of Amendment, and the amendment effected hereby, shall
become effective at 7:58 a.m., Eastern Standard Time, on November 5, 1999.
1
<PAGE> 2
THE UNDERSIGNED, being the Vice President and Secretary of the
Corporation, for the purpose of amending the Restated Certificate of
Incorporation, as amended, of the Corporation pursuant to the DGCL, does make
this amendment to the Restated Certificate of Incorporation, as amended, of the
Corporation, hereby declaring and certifying that this is my act and deed and
the facts herein stated are true and accordingly have hereunto set my hand as of
this 5th day of November, 1999.
TENNECO INC
By: /s/ Karl A. Stewart
-------------------------------
Name: Karl A. Stewart
Title: Vice President and Secretary
2
<PAGE> 1
EXHIBIT 3.1(h)
CERTIFICATE OF OWNERSHIP AND MERGER
MERGING
TENNECO AUTOMOTIVE MERGER SUB INC.
WITH AND INTO
TENNECO INC.
- -----------------------------------------------------------------------------
Pursuant to Section 253 of the
General Corporation of Law of the State of Delaware
- -----------------------------------------------------------------------------
TENNECO INC., a Delaware corporation (the "Company"), does hereby certify
to the following facts relating to the merger (the "Merger") of TENNECO
AUTOMOTIVE MERGER SUB INC., a Delaware corporation (the "Subsidiary"), with and
into the Company, with the Company remaining as the surviving corporation:
FIRST: The Company is incorporated pursuant to the General Corporation Law
of the State of Delaware (the "DGCL"). The Subsidiary is incorporated pursuant
to the DGCL.
SECOND: The Company owns all of the outstanding shares of each class of
capital stock of the Subsidiary.
THIRD: The Board of Directors of the Company, by the following resolutions
duly adopted on October 12, 1999, determined to merge the Subsidiary with and
into the Company pursuant to Section 253 of the DGCL:
<PAGE> 2
WHEREAS, the Company owns all of the outstanding shares of the capital
stock of Tenneco Automotive Merger Sub Inc. ("Subsidiary"); and
WHEREAS, the Board of Directors of the Company has deemed it advisable
that the Subsidiary be merged with and into the Company pursuant to Section 253
of the General Corporation Law of the State of Delaware;
NOW, THEREFORE, BE IT AND IT HEREBY IS
RESOLVED, that the Subsidiary be merged with and into the Company (the
"Merger"); and it is further
RESOLVED, that by virtue of the Merger and without any action on the part
of the holder thereof, each then outstanding share of common stock of the
Company shall remain unchanged and continue to remain outstanding as one share
of common stock of the Company, held by the person who was the holder of such
share of common stock of the Company immediately prior to the Merger; and it is
further
RESOLVED, that by virtue of the Merger and without any action on the part
of the holder thereof, each then outstanding share of common stock of the
Subsidiary shall be canceled and no consideration shall be issued in respect
thereof; and it is further
RESOLVED, that pursuant to and at the effective time of the Merger, the
name of the Company shall be changed to "Tenneco Automotive Inc." by deleting
Article First of the Certificate of Incorporation of the Company and inserting
in lieu thereof a new Article First to read as follows:
FIRST: The name of the corporation is Tenneco Automotive Inc.
RESOLVED, that the proper officers of the Company be and they hereby are
authorized and directed to make, execute and acknowledge, in the name and under
the corporate seal of the Company, a certificate of ownership and merger for the
purpose of effecting the Merger and to file the same in the office of the
Secretary of State of the State of Delaware, and to do all other acts and things
that may be necessary to
-2-
<PAGE> 3
carry out and affectuate the purpose and intent of the resolutions
relating to the Merger.
FOURTH: The Company shall be the surviving corporation of the Merger. The
name of the surviving corporation shall be amended in the Merger to be "Tenneco
Automotive Inc."
FIFTH: The restated certificate of incorporation of the Company as in
effect immediately prior to the effective time of the Merger shall be amended by
deleting Article First and inserting in lieu thereof a new Article First to read
"FIRST: The name of the corporation is Tenneco Automotive Inc.", and, as so
amended, shall be the restated certificate of incorporation of the surviving
corporation.
-3-
<PAGE> 4
IN WITNESS WHEREOF, the Company has caused this Certificate of Ownership
and Merger to be executed by its duly authorized officer this 5th day of
November, 1999.
TENNECO INC.
By: /s/ Mark P. Frissora
-----------------------------
Mark P. Frissora
Chief Executive Officer
-4-
<PAGE> 1
EXHIBIT 3.2(b)
BYLAW AMENDMENTS
RESOLVED, that Section 1 of Article III of the Bylaws of the Company
(the "Bylaws") be, and hereby is, amended to read in its entirety as
follows:
"Section 1. The Board shall elect from the directors an Executive
Committee, an Audit Committee and any other Committee which the Board
may by resolution prescribe. Any such other Committee shall be
comprised of such persons and shall possess such authority as shall
be set forth in such resolution."
; and it is further
RESOLVED, that Section 3 of Article III of the Bylaws be, and hereby
is, amended to read in its entirety as follows:
"Section 3. All completed actions by the Audit Committee shall be
reported to the Board at the next succeeding Board meeting and shall
be subject to revision or alteration by the Board, provided, that no
acts or rights of third parties shall be affected by any such
revision or alteration."
; and it is further
RESOLVED, that Section 5 of Article III of the Bylaws, including the
heading thereto, be, and hereby is, deleted in its entirety; and it is
further
RESOLVED, that Section 6 of Article III of the Bylaws, regarding the
Audit Committee, be, and hereby is, renumbered as Section 5 of Article III
of the
<PAGE> 2
Bylaws; and it is further
RESOLVED, that Section 7 of Article III of the Bylaws, including the
heading thereto, be, and hereby is, deleted in its entirety; and it is
further
RESOLVED, that, notwithstanding anything herein to the contrary, the
foregoing amendments to the Bylaws shall be effective as of the spin off.
* * *
2
<PAGE> 1
EXHIBIT ______
================================================================================
TENNECO INC.
AND
THE CHASE MANHATTAN BANK,
AS TRUSTEE
-----------------
ELEVENTH SUPPLEMENTAL INDENTURE
DATED AS OF OCTOBER 21, 1999
TO
INDENTURE
DATED AS OF NOVEMBER 1, 1996
-----------------
PROVIDING FOR AMENDMENTS
TO THE INDENTURE
================================================================================
<PAGE> 2
ELEVENTH SUPPLEMENTAL INDENTURE dated as of October 21, 1999 between
TENNECO INC., a corporation duly organized and existing under the laws of the
State of Delaware (hereinafter "Tenneco"), and THE CHASE MANHATTAN BANK, a New
York banking corporation, as trustee (hereinafter called the "Trustee").
WHEREAS, Tenneco has heretofore executed and delivered to the Trustee
an indenture dated as of November 1, 1996 (as amended through the date hereof,
hereinafter called the "Original Indenture"), to provide for the issuance of an
unlimited amount of debentures, notes and/or other debt obligations of Tenneco
(hereinafter referred to as the "Securities"), the terms of which are to be
determined as set forth in Article 2 of the Original Indenture; and
WHEREAS, section 8.2 of the Original Indenture provides that Tenneco
and the Trustee may enter into indentures supplemental to the Original Indenture
for, among other things, the purpose of amending the Indenture with the consent
of the holders of at least a majority in aggregate principal amount of the
Securities then outstanding; and
WHEREAS, the holders of at least a majority in aggregate principal
amount of the outstanding Securities have consented to the amendments to the
Original Indenture hereinafter set forth and the execution of this Eleventh
Supplemental Indenture; and
WHEREAS, Tenneco and the Trustee desire to enter into this Eleventh
Supplemental Indenture to effect the amendments to the Original Indenture;
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants herein contained, and of the acceptance of this trust by the Trustee,
and of the sum of one dollar to Tenneco duly paid by the Trustee at the
execution and delivery of these presents, and of other valuable consideration of
the receipt whereof is hereby acknowledged,
IT IS HEREBY COVENANTED, DECLARED AND AGREED by and between the
parties hereto, for the benefit of holders of the Securities issued under the
Original Indenture, as follows:
SECTION 1.
DEFINITIONS
As used herein, the following terms shall have the meanings set forth
below.
"Cash Tender Offers" means Tenneco's offers to purchase for cash
certain series of Securities issued under the Original Indenture pursuant to the
Offer to Purchase and Consent Solicitation of Tenneco dated October 5, 1999, as
amended from time to time.
"Consent Solicitation" means Tenneco's solicitation of consents to
amendments to the Original Indenture and the execution of this Eleventh
Supplemental Indenture pursuant to the Exchange Offers and Cash Tender Offers.
-2-
<PAGE> 3
"Debt Realignment" means the realignment, prior to the Spin-off, of
Tenneco's debt through some combination of tender offers, exchange offers,
prepayments and other refinancings.
"Exchange Offers" means Tenneco's offers to exchange notes and
debentures issued by Tenneco Packaging Inc. for certain Securities issued under
the Original Indenture pursuant to the Prospectus and Consent Solicitation of
Packaging and Tenneco dated October 5, 1999, as amended from time to time.
"Exchange Securities" means the series of Securities subject to the
Exchange Offers.
"Original Indenture" means the Indenture, dated November 1, 1996,
between Tenneco Inc. (formerly New Tenneco Inc.) and The Chase Manhattan Bank,
as trustee, as amended.
"Packaging" means Tenneco Packaging Inc., a Delaware corporation.
"Spin-off" means the distribution of all Packaging common stock to the
holders of Tenneco common stock at a ratio of one share of Packaging common
stock for each share of Tenneco common stock.
"Tender Securities" means the series of Securities subject to the Cash
Tender Offers.
"Tenneco" means Tenneco Inc., a Delaware corporation.
"Trustee" means The Chase Manhattan Bank, as trustee under the Original
Indenture.
SECTION 2.
WAIVER
Subject to Section 3.2 of this Eleventh Supplemental Indenture, the
application of the covenants contained in Sections 3.6, 9.1, 9.2 and 9.3 of the
Original Indenture is hereby waived to the extent required to effect the
Spin-off, including, without limitation, to effect the Debt Realignment (the
"Waiver").
SECTION 3.
OPERATION OF AMENDMENTS AND WAIVER
SECTION 3.1. Upon the execution and delivery of this Eleventh
Supplemental Indenture by Tenneco and the Trustee, the Original Indenture shall
be amended and supplemented in accordance herewith, and this Eleventh
Supplemental Indenture shall form a part of the Original Indenture for all
purposes, and every holder of Securities heretofore or hereafter authenticated
and delivered under the Original Indenture shall be bound hereby, as hereby
amended and supplemented; provided, however, that the provisions of the Eleventh
Supplemental Indenture,
-3-
<PAGE> 4
except as described in Section 3.2 with respect to the Waiver, shall not become
operative until Tenneco has notified the Trustee that it has accepted for
exchange or payment the Exchange Securities and/or Tender Securities, as the
case may be, tendered pursuant to the Exchange Offers and/or Tender Offers which
represent at least a majority of all Securities outstanding under the Original
Indenture (and at such time the provisions of this Eleventh Supplemental
Indenture shall automatically become operative without the requirement of any
further action by or notice to Tenneco, the Trustee or any holder of Exchange
Securities or Tender Securities).
SECTION 3.2. The Waiver shall become operative immediately upon the
execution and delivery of this Eleventh Supplemental Indenture by Tenneco and
the Trustee. However, if Exchange Securities and/or Tender Securities which
represent at least a majority of all Securities outstanding under the Original
Indenture are not accepted for exchange or purchase, as the case may be, because
the related Exchange Offers, Cash Tender Offers or Consent Solicitation are
terminated or withdrawn, the Waiver will cease to be operative.
SECTION 4.
AMENDMENTS TO THE ORIGINAL INDENTURE
SECTION 4.1. Section 1.1 of the Original Indenture is hereby amended to
eliminate the following provisions:
"Attributable Debt" means, as to any particular lease under which any
Person is at the time liable, at any date as of which the amount thereof is to
be determined, the total net amount of rent required to be paid by such Person
under such lease during the remaining term thereof, discounted from the
respective due dates thereof to such date at the Composite Rate. The net amount
of rent required to be paid under any such lease for any such period shall be
the aggregate amount of the rent payable by the lessee with respect to such
period after excluding amounts required to be paid on account of maintenance and
repairs, financing services, insurance, taxes, assessments, water or electrical
rates, contingent rents (such as those based on sales) and similar charges. In
the case of any lease which is terminable by the lessee upon the payment of a
penalty, such net amount shall also include the amount of such penalty, but no
rent shall be considered as required to be paid under such lease subsequent to
the first date upon which it may be so terminated.
"Consolidated Net Tangible Assets" shall mean, at any date, the total
assets appearing on the consolidated balance sheet of the Issuer and its
consolidated Subsidiaries for the Issuer's most recently completed fiscal
quarter, prepared in accordance with generally accepted accounting principles,
less (a) all current liabilities shown on such balance sheet and (b) Intangible
Assets. "Intangible Assets" means the value (net of applicable reserves), as
shown on or reflected in such balance sheet, of: (i) all trade names,
trademarks, licenses, patents, copyrights and goodwill; (ii) organizational or
development costs; (iii) deferred charges (other than prepaid items such as
insurance, taxes, interest, commissions, rents and similar items and tangible
assets being amortized); and (iv) unamortized debt discount and expense, less
premium.
-4-
<PAGE> 5
"Debt" of any Person shall mean any debt for money borrowed which is
issued, assumed, incurred or guaranteed in any manner by such Person.
"Exempted Debt" shall mean the sum of (a) Debt of the Issuer and its
Subsidiaries incurred after the date as of which this Indenture is dated and
secured by liens created, assumed or permitted to exist pursuant to Section
3.6(b) and (b) Attributable Debt of the Issuer and its Subsidiaries in respect
of all sale and leaseback transactions entered into pursuant to Section 3.6(d).
"Mortgage" shall have the meaning set forth in Section 3.6(a).
"Principal Manufacturing Property" shall mean any manufacturing plant
or any testing or research and development facility of the Issuer or a
Subsidiary located in the United States of America (other than its territories
and possessions) unless, in the opinion of the Board of Directors, such plant or
facility is not of material importance to the total business conducted by the
Issuer and its consolidated Subsidiaries. Principal Manufacturing Property shall
include, without limitation, additions, improvements, replacements, repairs,
fixtures, appurtenances or component parts of any such plant or facility
attaching to or required to be attached to property or assets pursuant to the
terms of any Mortgage (including, without limitation, pursuant to any
"after-acquired property" clause or similar term thereof).
"Restricted Subsidiary" shall mean any Subsidiary that owns or is the
lessee of any Principal Manufacturing Property; provided, however, that the term
"Restricted Subsidiary" does not include any Subsidiary acquired or organized
for the purpose of acquiring the stock or business or assets of any Person other
than the Issuer or any Restricted Subsidiary, whether by merger, consolidation,
acquisition of stock or assets or similar transaction, so long as such
Subsidiary does not acquire all or any substantial part of the business or
assets of the Issuer or any other Restricted Subsidiary.
SECTION 4.2. Section 3.6 of the Original Indenture is hereby amended
and restated in its entirety to read as follows:
"SECTION 3.6. Negative Pledge; Limitation on Sale and Leaseback
Transactions.
Intentionally Deleted by Amendment."
SECTION 4.3. Section 9.1 of the Original Indenture is hereby amended
and restated in its entirety to read as follows:
"SECTION 9.1. Covenant Not to Merge Consolidate, Sell or Convey
Property Except Under Certain Conditions.
Intentionally Deleted by Amendment."
-5-
<PAGE> 6
SECTION 4.4. Section 9.2 of the Original Indenture is hereby amended
and restated in its entirety to read as follows:
"SECTION 9.2. Successor Corporation Substituted.
Intentionally Deleted by Amendment."
SECTION 4.5. Section 9.3 of the Original Indenture is hereby amended
and restated in its entirety to read as follows:
"SECTION 9.3. Opinion of Counsel Delivered to Trustee.
Intentionally Deleted by Amendment."
SECTION 5.
MISCELLANEOUS
SECTION 5.1. EXECUTION AS SUPPLEMENTAL INDENTURE. This Eleventh
Supplemental Indenture is executed and shall be construed as an indenture
supplemental to the Original Indenture and, as provided in the Original
Indenture, this Eleventh Supplemental Indenture forms a part thereof. Except as
herein expressly otherwise defined, the use of the terms and expressions herein
is in accordance with the definitions, uses and constructions contained in the
Original Indenture.
SECTION 5.2. RESPONSIBILITY FOR RECITALS, ETC. The recitals herein
shall be taken as the statements of Tenneco, and the Trustee assumes no
responsibility for the correctness thereof. The Trustee makes no representations
as to the validity or sufficiency of this Eleventh Supplemental Indenture.
SECTION 5.3. PROVISIONS BINDING ON TENNECO'S SUCCESSORS. All the
covenants, stipulations, promises and agreements contained in this Eleventh
Supplemental Indenture made by Tenneco shall bind its successors and assigns
whether so expressed or not.
SECTION 5.4. NEW YORK CONTRACT. This Eleventh Supplemental Indenture
shall be deemed to be a contract made under the laws of the State of New York,
and for all purposes shall be construed in accordance with the laws of said
State without regard to principles of conflicts of laws.
SECTION 5.5. EXECUTION AND COUNTERPARTS. This Eleventh Supplemental
Indenture may be executed in any number of counterparts, each of which shall be
an original but such counterparts shall together constitute but one and the same
instrument.
-6-
<PAGE> 7
IN WITNESS WHEREOF, said TENNECO INC. has caused this Eleventh
Supplemental Indenture to be executed in its corporate name by its Chairman of
the Board or its President or one of its Vice Presidents, and said THE CHASE
MANHATTAN BANK has caused this Eleventh Supplemental Indenture to be executed in
its corporate name by one of its Vice Presidents, as of October 21, 1999.
TENNECO INC.
By: /s/ Robert T. Blakely
---------------------------------------
Robert T. Blakely
Executive Vice President and
Chief Financial Officer
THE CHASE MANHATTAN BANK
By: /s/ Ronald J. Halleran
---------------------------------------
Ronald J. Halleran
Assistant Vice President
-7-
<PAGE> 1
Exhibit
--------------
063842
TEMPORARY CERTIFICATE-EXCHANGEABLE FOR DEFINITIVE ENGRAVED CERTIFICATE
WHEN READY FOR DELIVERY
NUMBER [TENNECO AUTOMOTIVE LOGO] SHARES
C COMMON STOCK
PAR VALUE $0.1 EACH
[TENNECO AUTOMOTIVE LOGO] TENNECO AUTOMOTIVE INC. CUSIP 880349 10 5
THIS CERTIFICATE IS INCORPORATED UNDER SEE REVERSE FOR
TRANSFERABLE IN NEW YORK, THE LAWS OF THE CERTAIN RESTRICTIONS ON
NEW YORK AND CHICAGO, ILLINOIS STATE OF DELAWARE PREEMPTIVE, TRANSFER AND
OTHER RIGHTS.
THIS IS TO CERTIFY THAT
IS THE OWNER OF
FULLY PAID AND NON-ASSESSABLE SHARES OF THE COMMON STOCK OF
Tenneco automotive Inc. transferable on the books of the Corporation by the
holder hereof, in person or by duly authorized attorney, upon surrender of this
Certificate properly endorsed.
This Certificate is not value until countersigned by the Transfer Agent and
registered by the Registrar.
Witness, the facsimile seal of the Corporation and the signatures of its duly
authorized officers.
CERTIFICATE OF STOCK
[Signature] Dated:
CHIEF EXECUTIVE OFFICER COUNTERSIGNED AND REGISTERED
FIRST CHICAGO TRUST COMPANY
OF NEW YORK
TRANSFER AGENT
AND REGISTRAR
TENNECO AUTOMOTIVE INC.
1996 CORPORATE
SEAL
DELAWARE BY
[Signature] [Signature]
CORPORATE SECRETARY AUTHORIZED SIGNATURE
<PAGE> 2
TENNECO AUTOMOTIVE INC.
The following abbreviations, when used in the inscription on the face of
this certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:
<TABLE>
<C> <C>
TEN COM -- as tenants in common UNIF GIFT MIN ACT-__________Custodian__________
TEN ENT -- as tenants by the entireties (Cust) (Minor)
JT TEN -- as joint tenants with right of under Uniform Gifts to Minors
survivorship and not as tenants Act__________________________
in common (State)
</TABLE>
Additional abbreviations may also be used though not in the above list.
THE CORPORATION WILL FURNISH WITHOUT CHARGE TO EACH STOCKHOLDERS WHO SO
REQUESTS, THE DESIGNATIONS, POWERS, PREFERENCES AND RELATIVE, PARTICIPATING,
OPTIONAL OR OTHER SPECIAL RIGHTS OF EACH CLASS OF STOCK OR SERIES THEREOF OF THE
CORPORATION, AND THE QUALIFICATIONS, LIMITATIONS OR RESTRICTIONS OF SUCH
PREFERENCES AND/OR RIGHTS. SUCH REQUEST MAY BE MADE TO THE CORPORATION OR THE
TRANSFER AGENT.
For value received,_____________________hereby sell, assign and transfer unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
________________________________________________________________________________
________________________________________________________________________________
PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS INCLUDING POSTAL ZIP CODE OF ASSIGNEE
________________________________________________________________________________
________________________________________________________________________________
_________________________________________________________________________ Shares
of the capital stock represented by the within Certificate, and do hereby
irrevocably constitute and appoint______________________________________________
________________________________________________________________________________
Attorney to transfer the said stock on the books of the within-named Corporation
with full power of substitution in the premises.
Dated___________________________
________________________________________________
This certificate also evidences and entitles the holder hereof to certain
rights as set forth in a Qualified Offer Plan Rights Agreement between Tenneco
Automotive Inc., formerly known as Tenneco Inc. (the "Company") and First
Chicago Trust Company of New York, as Rights Agent, dated as of September 9,
1998 and as amended from time to time (the "Rights Agreement"), the terms of
which are hereby incorporated herein by reference and a copy of which is on file
at the principal executive offices of the Company. Under certain circumstances,
as set forth in the Rights Agreement, such Rights will be evidenced by separate
certificates and will no longer be evidenced by this certificate. The Company
will mail to the holder of this certificate a copy of the Rights Agreement
without charge after receipt of a written request therefor. Under certain
circumstances, as set forth in the Rights Agreement. Rights owned by or
transferred to any Person who is or becomes an Acquiring Person (as defined in
the Rights Agreement) and certain transferees thereof will become null and void
and will no longer be transferable.
NOTICE: THE SIGNATURE OF THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS
WRITTEN UPON THE FACE OF THIS CERTIFICATE IN EVERY PARTICULAR, WITHOUT
ALTERATION OR ENLARGEMENT, OR ANY CHANGE WHATEVER.
<PAGE> 1
Exhibit 4.3
INDENTURE
Dated as of October 14, 1999
among
TENNECO INC.,
as Issuer,
Certain subsidiaries of the Issuer,
as Guarantors
and
THE BANK OF NEW YORK,
as Trustee
----------------
up to $750,000,000
11 5/8% Senior Subordinated Notes due 2009, Series A
11 5/8% Senior Subordinated Notes due 2009, Series B
<PAGE> 2
CROSS-REFERENCE TABLE
---------------------
TIA Indenture
Section Section
- ------- ---------
310(a)(1).......................................... 7.10
(a)(2).......................................... 7.10
(a)(3).......................................... N.A.
(a)(4).......................................... N.A.
(a)(5).......................................... 7.10
(b)............................................. 7.08; 7.10
(c)............................................. N.A.
311(a)............................................. 7.11
(b)............................................. 7.11
312(a)............................................. 2.05
(b)............................................. 11.03
(c)............................................. 11.03
313(a)............................................. 7.06
(b)(1).......................................... 7.06
(b)(2).......................................... 7.06; 7.07
(c)............................................. 7.05; 7.06; 11.02
(d)............................................. 7.06
314(a)............................................. 4.08; 4.10; 11.02
(b)............................................. N.A.
(c)(1).......................................... 4.08; 11.04
(c)(2).......................................... 11.04
(c)(3........................................... 4.08; 11.04
(d)............................................. N.A.
(e)............................................. 11.05
(f)............................................. N.A.
315(a)............................................. 7.01(b)
(b)............................................. 7.05; 11.02
(c)............................................. 7.01(a)
(d)............................................. 7.01(c)
(e)............................................. 6.11
316(a)(last sentence).............................. 2.09
(a)(1)(A)....................................... 6.05
(a)(1)(B)....................................... 6.04
(a)(2).......................................... N.A.
(b)............................................. 6.07; 9.04
(c)............................................. 9.04
317(a)(1).......................................... 6.08
(a)(2).......................................... 6.09
(b)............................................. 2.04
<PAGE> 3
318(a)............................................. 11.01
(c)............................................. 11.01
- ---------------
"N.A." means Not Applicable.
NOTE: This Cross-Reference Table shall not, for any purpose,
be deemed to be a part of the Indenture.
<PAGE> 4
TABLE OF CONTENTS
Page
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions.................................................1
SECTION 1.02. Incorporation by Reference of TIA..........................49
SECTION 1.03. Rules of Construction......................................50
ARTICLE TWO
THE SECURITIES
SECTION 2.01. Form and Dating............................................50
SECTION 2.02. Execution and Authentication...............................52
SECTION 2.03. Registrar and Paying Agent.................................53
SECTION 2.04. Paying Agent To Hold Assets in
Trust....................................................54
SECTION 2.05. Securityholder Lists.......................................54
SECTION 2.06. Transfer and Exchange......................................54
SECTION 2.07. Replacement Securities.....................................55
SECTION 2.08. Outstanding Securities.....................................56
SECTION 2.09. Treasury Securities........................................56
SECTION 2.10. Temporary Securities.......................................57
SECTION 2.11. Cancellation...............................................57
SECTION 2.12. Defaulted Interest.........................................58
SECTION 2.13. CUSIP Number...............................................58
SECTION 2.14. Deposit of Moneys..........................................58
SECTION 2.15. Book-Entry Provisions for Global
Securities...............................................58
SECTION 2.16. Registration of Transfers and
Exchanges................................................60
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Page
----
ARTICLE THREE
REDEMPTION
SECTION 3.01. Notices to Trustee.........................................66
SECTION 3.02. Selection of Securities To Be
Redeemed.................................................67
SECTION 3.03. Notice of Redemption.......................................67
SECTION 3.04. Effect of Notice of Redemption.............................69
SECTION 3.05. Deposit of Redemption Price................................69
SECTION 3.06. Securities Redeemed in Part................................69
ARTICLE FOUR
COVENANTS
SECTION 4.01. Payment of Securities......................................70
SECTION 4.02. Maintenance of Office or Agency............................70
SECTION 4.03. Limitation on Incurrence of
Additional Indebtedness..................................71
SECTION 4.04. Limitation on Restricted Payments..........................72
SECTION 4.05. Corporate Existence........................................75
SECTION 4.06. Payment of Taxes and Other Claims..........................76
SECTION 4.07. Maintenance of Properties and
Insurance................................................76
SECTION 4.08. Compliance Certificate; Notice of
Default..................................................77
SECTION 4.09. Compliance with Laws.......................................78
SECTION 4.10. Reports to Holders.........................................78
SECTION 4.11. Waiver of Stay, Extension or Usury
Laws.....................................................79
SECTION 4.12. Limitation on Asset Sales..................................80
SECTION 4.13. Limitation on Dividend and Other
Payment Restrictions Affecting
Restricted Subsidiaries..................................84
SECTION 4.14. Limitation on Issuances of Capital
Stock of Restricted Subsidiaries.........................85
SECTION 4.15. Limitation on Liens........................................85
SECTION 4.16. Prohibition on Incurrence of Senior
Subordinated Debt........................................86
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<PAGE> 6
SECTION 4.17. Limitation on Transactions with
Affiliates..............................................86
SECTION 4.18. Issuance of Subsidiary Guarantees..........................88
SECTION 4.19. Payments for Consent.......................................88
SECTION 4.20. Limitation on Designations of
Unrestricted Subsidiaries................................89
SECTION 4.21. Change of Control..........................................90
SECTION 4.22. Deposit of Funds with Trustee
Pending Consummation of the Spin-
Off Transactions.........................................93
ARTICLE FIVE
SUCCESSOR CORPORATION
SECTION 5.01. Merger, Consolidation and Sale of
Assets...................................................96
SECTION 5.02. Successor Corporation Substituted..........................98
ARTICLE SIX
DEFAULT AND REMEDIES
SECTION 6.01. Events of Default..........................................99
SECTION 6.02. Acceleration..............................................101
SECTION 6.03. Other Remedies............................................103
SECTION 6.04. Waiver of Past Defaults...................................103
SECTION 6.05. Control by Majority.......................................103
SECTION 6.06. Limitation on Suits.......................................104
SECTION 6.07. Rights of Holders to Receive
Payment.................................................105
SECTION 6.08. Collection Suit by Trustee................................105
SECTION 6.09. Trustee May File Proofs of Claim..........................105
SECTION 6.10. Priorities................................................106
SECTION 6.11. Payment of Interest; Interest Rights
Preserved...............................................107
SECTION 6.12. Undertaking for Costs.....................................108
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<PAGE> 7
Page
----
ARTICLE SEVEN
TRUSTEE
SECTION 7.01. Duties of Trustee.........................................109
SECTION 7.02. Rights of Trustee.........................................111
SECTION 7.03. Individual Rights of Trustee..............................113
SECTION 7.04. Trustee's Disclaimer......................................113
SECTION 7.05. Notice of Default.........................................113
SECTION 7.06. Reports by Trustee to Holders.............................114
SECTION 7.07. Compensation and Indemnity................................114
SECTION 7.08. Replacement of Trustee....................................116
SECTION 7.09. Successor Trustee by Merger, Etc..........................117
SECTION 7.10. Eligibility; Disqualification.............................118
SECTION 7.11. Preferential Collection of Claims
Against Company.........................................118
ARTICLE EIGHT
SATISFACTION AND DISCHARGE OF INDENTURE
SECTION 8.01. Legal Defeasance and Covenant
Defeasance..............................................118
SECTION 8.02. Satisfaction and Discharge............................... 123
SECTION 8.03. Survival of Certain Obligations...........................125
SECTION 8.04. Acknowledgment of Discharge by
Trustee.................................................125
SECTION 8.05. Application of Trust Assets...............................125
SECTION 8.06. Repayment to the Company or
Guarantors; Unclaimed Money.............................126
SECTION 8.07. Reinstatement.............................................127
ARTICLE NINE
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 9.01. Without Consent of Holders................................127
SECTION 9.02. With Consent of Holders...................................128
SECTION 9.03. Compliance with TIA.......................................130
SECTION 9.04. Revocation and Effect of Consents.........................130
-iv-
<PAGE> 8
Page
----
SECTION 9.05. Notation on or Exchange of Securities.....................131
SECTION 9.06. Trustee to Sign Amendments, Etc...........................132
ARTICLE TEN
GUARANTEE
SECTION 10.01. Unconditional Guarantee...................................132
SECTION 10.02. Severability..............................................134
SECTION 10.03. Release of a Guarantor....................................134
SECTION 10.04. Limitation of a Guarantor's
Liability...............................................134
SECTION 10.05. Contribution..............................................135
SECTION 10.06. Waiver of Subrogation.....................................136
SECTION 10.07. Execution of Guarantees...................................136
SECTION 10.08. Waiver of Stay, Extension or Usury
Laws....................................................137
ARTICLE ELEVEN
MISCELLANEOUS
SECTION 11.01. TIA Controls..............................................138
SECTION 11.02. Notices...................................................138
SECTION 11.03. Communications by Holders with Other
Holders................................................139
SECTION 11.04. Certificate and Opinion as to
Conditions Precedent....................................139
SECTION 11.05. Statements Required in Certificate
or Opinion..............................................140
SECTION 11.06. Rules by Trustee, Paying Agent,
Registrar...............................................140
SECTION 11.07. Legal Holidays............................................141
SECTION 11.08. Governing Law.............................................141
SECTION 11.09. No Adverse Interpretation of Other
Agreements..............................................141
SECTION 11.10. No Recourse Against Others................................141
SECTION 11.11. Successors................................................142
SECTION 11.12. Duplicate Originals.......................................142
-v-
<PAGE> 9
Page
----
SECTION 11.13. Severability..............................................142
SECTION 11.14. Table of Contents, Headings, Etc..........................142
ARTICLE TWELVE
SUBORDINATION
SECTION 12.01. Securities Subordinated to Senior
Debt; Guarantees Subordinated to
Guarantor Senior Debt...................................143
SECTION 12.02. No Payment on Securities in Certain
Circumstances...........................................143
SECTION 12.03. Payment Over of Proceeds upon
Dissolution, Etc........................................146
SECTION 12.04. Payments May Be Paid Prior to
Dissolution.............................................148
SECTION 12.05. Subrogation...............................................149
SECTION 12.06. Obligations of the Company
Unconditional...........................................149
SECTION 12.07. Notice to Trustee.........................................150
SECTION 12.08. Reliance on Judicial Order or
Certificate of Liquidating Agent........................151
SECTION 12.09. Trustee's Relation to Senior Debt or
Guarantor Senior Debt...................................151
SECTION 12.10. Subordination Rights Not Impaired by
Acts or Omissions of the Company or
a Guarantor or Holders of Senior
Debt....................................................152
SECTION 12.11. Holders Authorize Trustee To
Effectuate Subordination of
Securities..............................................153
SECTION 12.12. This Article Twelve Not To Prevent
Events of Default.......................................154
SECTION 12.13. Trustee's Compensation Not
Prejudiced..............................................154
Exhibit A - Form of Series A Security
Exhibit B - Form of Series B Security
Exhibit C - Form of Legend for Global Securities
-vi-
<PAGE> 10
Exhibit D - Transfer Certificate
Exhibit E - Transferee Certificate for Institutional Accredited Investors
Exhibit F - Transferee Certificate for Regulation S Transfers
Exhibit G - Form of Guarantee
Exhibit H - Form of Opinion of Counsel to the Guarantors
Exhibit I - Form of Guarantor Secretary Certificate
Exhibit J - Officers' Certificate Regarding Release Conditions
Exhibit K - Form of Supplemental Indenture
Note: This Table of Contents shall not, for any purpose, be deemed to be a part
of the Indenture.
-vii-
<PAGE> 11
INDENTURE dated as of October 14, 1999, among TENNECO INC., a
Delaware corporation (the "Company"), as Issuer, such subsidiaries of the
Issuer, as shall from time to time execute a Guarantee (as defined), and THE
BANK OF NEW YORK, a New York banking corporation, as Trustee (the "Trustee").
The Company has duly authorized the issue of 11 5/8% Senior
Subordinated Notes due 2009, Series A, and 11 5/8% Senior Subordinated Notes due
2009, Series B, and to provide therefor, the Company has duly authorized the
execution and delivery of this Indenture. All things necessary to make the
Securities, when duly issued and executed by the Company and authenticated and
delivered hereunder, the valid and binding obligations of the Company, and to
make this Indenture a valid and binding agreement of the Company, have been
done.
Each party hereto agrees as follows for the benefit of each
other party and for the equal and ratable benefit of the Holders of the
Securities:
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions.
"Accounts Receivable Entity" means a Person, including,
without limitation, a Subsidiary of the Company, whose operations consist solely
of owning and/or selling accounts receivable of the Company and its Subsidiaries
and engaging in other activities in connection with transactions that are
Permitted Receivables Financings.
"Acquired Indebtedness" means Indebtedness of a Person or any
of its Subsidiaries existing at the time such Person becomes a Restricted
Subsidiary or at the time it merges or consolidates with the Company or any of
the Restricted Subsidiaries or assumed by the Company or any Restricted
Subsidiary in connection with the acquisition of assets from such Person and
<PAGE> 12
-2-
in each case not incurred by such Person in connection with, or in anticipation
or contemplation of, such Person becoming a Restricted Subsidiary or such
acquisition, merger or consolidation.
"Acquired Subsidiary" means a Person which becomes a
Restricted Subsidiary after the Spin-Off Date; provided that such Person has
outstanding voting Capital Stock prior to becoming a Subsidiary of the Company
and a majority of such voting Capital Stock was owned by Persons other than the
Company and its Restricted Subsidiaries.
"Adjusted Net Assets" has the meaning provided in
Section 10.05.
"Affiliate" means, with respect to any specified Person, any
other Person who directly or indirectly through one or more intermediaries
controls, or is controlled by, or is under common control with, such specified
Person. The term "control" means the possession, directly or indirectly, of the
power to direct or cause the direction of the management and policies of a
Person, whether through the ownership of voting securities, by contract or
otherwise; and the terms "controlling" and "controlled" have meanings
correlative of the foregoing.
"Affiliate Transaction" has the meaning provided in
Section 4.17.
"Agent" means any Registrar, Paying Agent or co-Registrar.
"Asset Acquisition" means (1) an Investment by the Company or
any Restricted Subsidiary in any other Person pursuant to which such Person
shall become a Restricted Subsidiary, or shall be merged with or into the
Company or any Restricted Subsidiary, or (2) the acquisition by the Company or
any Restricted Subsidiary of the assets of any Person (other than a Restricted
Subsidiary) which constitute all or substantially all of the assets of such
Person or comprise any division or line of business of such Person or any other
properties or as-
<PAGE> 13
-3-
sets of such Person other than in the ordinary course of
business.
"Asset Sale" means any direct or indirect sale, issuance,
conveyance, lease (other than operating leases entered into in the ordinary
course of business), assignment or other transfer (other than the granting of a
Lien in accordance with this Indenture) for value by the Company or any of the
Restricted Subsidiaries (including any Sale and Leaseback Transaction) to any
Person other than the Company or a Restricted Subsidiary of (a) any Capital
Stock of any Restricted Subsidiary; or (b) any other property or assets of the
Company or any Restricted Subsidiary other than in the ordinary course of
business; provided, however, that Asset Sales shall not include:
(1) a transaction or series of related transactions for
which the Company or the Restricted Subsidiaries receive
aggregate consideration of less than $5 million;
(2) the sale, lease, conveyance, disposition or other
transfer of all or substantially all of the assets of the Company
as permitted by Section 5.01;
(3) any Restricted Payment made in accordance with
Section 4.04;
(4) sales of accounts receivable pursuant to a Permitted
Receivables Financing made in accordance with Section 4.03; or
(5) transactions consummated on the Spin-Off Date in
connection with the Spin-Off Transactions.
"Assumption Agreement" means the assumption agreement in the
form attached as Exhibit C to the Purchase Agreement.
"Bankruptcy Law" means Title 11, U.S. Code or any similar
Federal, state or foreign law for the relief of debtors.
<PAGE> 14
-4-
"Blockage Period" has the meaning provided in Section 12.02.
"Board of Directors" means, as to any Person, the board of
directors of such Person or any duly authorized committee thereof.
"Board Resolution" means, with respect to any Person, a copy
of a resolution certified by the Secretary or an Assistant Secretary of such
Person to have been duly adopted by the Board of Directors of such Person and to
be in full force and effect on the date of such certification, and delivered to
the Trustee.
"Business Day" means any day other than a Saturday, Sunday or
any other day on which banking institutions in The City of New York or in the
city in which the principal corporate trust office of the Trustee is located,
are required or authorized by law or other governmental action to be closed.
"Capitalized Lease Obligation" means, as to any Person, the
obligations of such Person under a lease that are required to be classified and
accounted for as capital lease obligations under GAAP and, for purposes of this
definition, the amount of such obligations at any date shall be the capitalized
amount of such obligations at such date, determined in accordance with GAAP.
"Capital Stock" means (1) with respect to any Person that is
a corporation, any and all shares, interests, participations or other
equivalents (however designated and whether or not voting) of corporate stock,
including each class of Common Stock and Preferred Stock of such Person and (2)
with respect to any Person that is not a corporation, any and all partnership or
other equity interests of such Person.
"Cash Equivalents" means:
(1) marketable direct obligations issued by, or
unconditionally guaranteed by, the United States Government or issued by any
agency thereof and backed by the full
<PAGE> 15
-5-
faith and credit of the United States, in each case maturing within
one year from the date of acquisition thereof;
(2) marketable direct obligations issued by any state of the United
States of America or any political subdivision of any such state or any
public instrumentality thereof maturing within one year from the date of
acquisition thereof and, at the time of acquisition, having one of the two
highest ratings obtainable from either Standard & Poor's Corporation
("S&P") or Moody's Investors Service, Inc. ("Moody's");
(3) commercial paper maturing no more than one year from the date of
creation thereof and, at the time of acquisition, having a rating of at
least A-1 from S&P or at least P-1 from Moody's;
(4) certificates of deposit or bankers' acceptances maturing within
one year from the date of acquisition thereof issued by any bank organized
under the laws of the United States of America or any state thereof or the
District of Columbia or any U.S. branch of a foreign bank having at the
date of acquisition thereof combined capital and surplus of not less than
$250 million;
(5) repurchase obligations with a term of not more than seven days for
underlying securities of the types described in clause (1) above entered
into with any bank meeting the qualifications specified in clause (4)
above; and
(6) investments in money market funds which invest substantially all
their assets in securities of the types described in clauses (1) through
(5) above.
"Change of Control" means the occurrence of one or more of the
following events:
(1) any sale, lease, exchange or other transfer (in one transaction or
a series of related transactions) of all or substantially all of the assets
of the Company to
<PAGE> 16
-6-
any Person or group of related Persons for purposes of Section 13(d) of the
Exchange Act (a "Group"), together with any Affiliates thereof (whether or
not otherwise in compliance with the provisions of this Indenture);
(2) the approval by the holders of Capital Stock of the Company of any
plan or proposal for the liquidation or dissolution of the Company (whether
or not otherwise in compliance with the provisions of this Indenture);
(3) any Person or Group shall become the beneficial owner, directly or
indirectly, of shares representing more than 35% of the aggregate ordinary
voting power represented by the issued and outstanding Capital Stock of the
Company; or
(4) during any period of two consecutive years, individuals who at the
beginning of such period constituted the Board of Directors (together with
any new directors whose election by such Board of Directors or whose
nomination for election by the stockholders of the Company was approved
pursuant to a vote of a majority of the directors then still in office who
were either directors at the beginning of such period or whose election or
nomination for election was previously so approved) cease for any reason to
constitute a majority of the Board of Directors then in office.
"Change of Control Offer" has the meaning provided in Section 4.21.
"Change of Control Payment Date" has the meaning provided in Section
4.21.
"Collateral" means (i) the Collateral Account and the Money Market
Account, (ii) the Special Redemption Amount and all other cash or Cash
Equivalents deposited in the Collateral Account and the Money Market Account
from time to time pursuant to Section 4.22 hereof, (iii) all rights and
privileges of the Company with respect to the Collateral Account, the Money
Mar-
<PAGE> 17
-7-
ket Account and such cash and Cash Equivalents, (iv) all dividends, interest
and other payments and distributions made on or with respect to such Cash
Equivalents, the Collateral Account or the Money Market Account and (v) all
proceeds of any of the foregoing.
"Collateral Account" has the meaning set forth in Section 4.22.
"Collateral Funds" has the meaning set forth in Section 4.22.
"Combined EBITDA" means, with respect to the Restricted Subsidiaries
that are not Guarantors (and are not a Finance Subsidiary or an Accounts
Receivable Entity that is a Domestic Restricted Subsidiary), for any period, the
sum (without duplication) of:
(1) Combined Net Income; and
(2) to the extent Combined Net Income has been reduced thereby:
(A) all income taxes of the Restricted Subsidiaries that are not
Guarantors (and are not a Finance Subsidiary or an Accounts
Receivable Entity that is a Domestic Restricted Subsidiary) paid
or accrued in accordance with GAAP for such period;
(B) Combined Interest Expense; and
(C) Combined Non-cash Charges;
less any non-cash items increasing Combined Net Income for such period, all as
determined on a combined basis for the Restricted Subsidiaries that are not
Guarantors (and are not a Finance Subsidiary or an Accounts Receivable Entity
that is a Domestic Restricted Subsidiary) in accordance with GAAP.
"Combined Fixed Charge Coverage Ratio" means, with respect to the
Restricted Subsidiaries that are not Guarantors
<PAGE> 18
-8-
(and are not a Finance Subsidiary or an Accounts Receivable Entity that is a
Domestic Restricted Subsidiary), the ratio of Combined EBITDA during the four
full fiscal quarters (the "Four Quarter Period") ending on or prior to the date
of the transaction giving rise to the need to calculate the Combined Fixed
Charge Coverage Ratio (the "Transaction Date") to Combined Fixed Charges for the
Four Quarter Period. In addition to and without limitation of the foregoing, for
purposes of this definition, "Combined EBITDA" and "Combined Fixed Charges"
shall be calculated after giving effect on a pro forma basis for the period of
such calculation to:
(1) the incurrence or repayment of any Indebtedness of any of the
Restricted Subsidiaries that are not Guarantors (and are not a Finance
Subsidiary or an Accounts Receivable Entity that is a Domestic Restricted
Subsidiary) (and the application of the proceeds thereof) giving rise to
the need to make such calculation and any incurrence or repayment of other
Indebtedness (and the application of the proceeds thereof), other than the
incurrence or repayment of Indebtedness in the ordinary course of business
for working capital purposes pursuant to working capital facilities,
occurring during the Four Quarter Period or at any time subsequent to the
last day of the Four Quarter Period and on or prior to the Transaction
Date, as if such incurrence or repayment, as the case may be, (and the
application of the proceeds thereof) occurred on the first day of the Four
Quarter Period; and
(2) any Asset Sales or other disposition or Asset Acquisitions
(including, without limitation, any Asset Acquisition giving rise to the
need to make such calculation as a result of one of the Restricted
Subsidiaries that are not Guarantors (and are not a Finance Subsidiary or
an Accounts Receivable Entity that is a Domestic Restricted Subsidiary)
(including any Person who becomes such a Restricted Subsidiary as a result
of the Asset Acquisition) incurring, assuming or otherwise being liable for
Acquired Indebtedness and also including any Combined EBITDA (provided that
such Combined EBITDA shall be included only to
<PAGE> 19
-9-
the extent includable pursuant to the definition of "Combined Net Income")
attributable to the assets which are the subject of the Asset Acquisition
or Asset Sale or other disposition during the Four Quarter Period)
occurring during the Four Quarter Period or at any time subsequent to the
last day of the Four Quarter Period and on or prior to the Transaction Date
as if such Asset Sale or Asset Acquisition or other disposition (including
the incurrence, assumption or liability for any such Acquired Indebtedness)
occurred on the first day of the Four Quarter Period.
If any of the Restricted Subsidiaries that are not Guarantors (and are
not a Finance Subsidiary or an Accounts Receivable Entity that is a Domestic
Restricted Subsidiary) directly or indirectly guarantee Indebtedness of a third
Person, the preceding sentence shall give effect to the incurrence of such
guaranteed Indebtedness as if the Restricted Subsidiary had directly incurred or
otherwise assumed such guaranteed Indebtedness. Furthermore, in calculating
"Combined Fixed Charges" for purposes of determining the denominator (but not
the numerator) of this "Combined Fixed Charge Coverage Ratio":
(1) interest on outstanding Indebtedness determined on a fluctuating
basis as of the Transaction Date and which will continue to be so
determined thereafter shall be deemed to have accrued at a fixed rate per
annum equal to the rate of interest on such Indebtedness in effect on the
Transaction Date;
(2) if interest on any Indebtedness actually incurred on the
Transaction Date may optionally be determined at an interest rate based
upon a factor of a prime or similar rate, a eurocurrency interbank offered
rate, or other rates, then the interest rate in effect on the Transaction
Date will be deemed to have been in effect during the Four Quarter Period;
and
(3) notwithstanding clause (1) above, interest on Indebtedness
determined on a fluctuating basis, to the ex-
<PAGE> 20
-10-
tent such interest is covered by agreements relating to Interest Swap
Obligations, shall be deemed to accrue at the rate per annum in effect on
the Transaction Date resulting after giving effect to the operation of such
agreements on such date.
"Combined Fixed Charges" means, with respect to the Restricted
Subsidiaries that are not Guarantors (and are not a Finance Subsidiary or an
Accounts Receivable Entity that is a Domestic Restricted Subsidiary) for any
period, the sum, without duplication, of:
(1) Combined Interest Expense, plus
(2) the product of (x) the amount of all dividend payments on any
series of Preferred Stock of the Restricted Subsidiaries that are not
Guarantors (and are not Finance Subsidiaries or an Accounts Receivable
Entity that is a Domestic Restricted Subsidiary) paid, accrued and/or
scheduled to be paid or accrued during such period times (y) a fraction,
the numerator of which is one and the denominator of which is one minus the
then current effective consolidated federal, state and local income tax
rate of the Company, expressed as a decimal.
"Combined Interest Expense" means, with respect to the Restricted
Subsidiaries that are not Guarantors (and are not a Finance Subsidiary or
Accounts Receivable Entity that is a Domestic Restricted Subsidiary) for any
period, the sum of, without duplication:
(1) the aggregate of the interest expense of the Restricted
Subsidiaries that are not Guarantors (and are not a Finance Subsidiary or
an Accounts Receivable Entity that is a Domestic Restricted Subsidiary) for
such period determined on a combined basis in accordance with GAAP,
including without limitation,
(A) any amortization of debt discount,
<PAGE> 21
-11-
(B) the net costs under Interest Swap Obligations,
(C) all capitalized interest, and
(D) the interest portion of any deferred payment obligation;
(2) the interest component of Capitalized Lease Obligations paid,
accrued and/or scheduled to be paid or accrued by the Restricted
Subsidiaries that are not Guarantors (and are not a Finance Subsidiary or
Accounts Receivable Entity that is a Domestic Restricted Subsidiary) during
such period as determined on a consolidated basis in accordance with GAAP;
and
(3) net losses relating to sales of accounts receivable pursuant to
Permitted Receivables Financings during such period as determined on a
combined basis in accordance with GAAP;
provided that Combined Interest Expense shall not include any of the foregoing
to the extent owing to the Company or any Restricted Subsidiary or to the extent
owed by a Finance Subsidiary or an Accounts Receivable Entity that is a Domestic
Restricted Subsidiary.
"Combined Net Income" means, with respect to the Restricted
Subsidiaries that are not Guarantors (and are not Finance Subsidiaries or
Accounts Receivable Entities that are Domestic Restricted Subsidiaries), for any
period, the aggregate net income (or loss) of the Restricted Subsidiaries that
are not Guarantors (and are not Finance Subsidiaries or Accounts Receivable
Entities that are Domestic Restricted Subsidiaries) for such period as
determined on a combined basis in accordance with GAAP; provided that there
shall be excluded therefrom:
(1) after-tax gains and losses from Asset Sales or abandonments or
reserves relating thereto;
<PAGE> 22
-12-
(2) extraordinary or non-recurring gains or losses (determined on an
after-tax basis);
(3) the net income of any Person acquired in a "pooling of interests"
transaction accrued prior to the date it becomes a Restricted Subsidiary or
is merged or consolidated with any Restricted Subsidiary that is not a
Guarantor (and are not Finance Subsidiaries or Accounts Receivable Entities
that are Domestic Restricted Subsidiaries);
(4) the net income of any Person, other than a Restricted Subsidiary,
except to the extent of cash dividends or distributions paid to the
Restricted Subsidiaries that are not Guarantors (and are not Finance
Subsidiaries or Accounts Receivable Entities that are Domestic Restricted
Subsidiaries) by such Person;
(5) any restoration to income of any contingency reserve, except to
the extent that (x) provision for such reserve was made out of Combined Net
Income accrued at any time following the Issue Date or (y) the restoration
is with respect to a charge or reserve contemplated by clause (7) below;
(6) income or loss attributable to discontinued operations (including,
without limitation, operations disposed of during such period whether or
not such operations were classified as discontinued);
(7) restructuring charges of not more than $55.0 million to the extent
incurred in the quarter ending December 31, 1999 by Restricted Subsidiaries
that are not Guarantors (and are not Finance Subsidiaries or Accounts
Receivable Entities that are Domestic Restricted Subsidiaries); and
(8) any fees or expenses incurred in connection with the Spin-Off
Transactions.
<PAGE> 23
-13-
"Combined Non-cash Charges" means, with respect to the Restricted
Subsidiaries that are not Guarantors (and are not Finance Subsidiaries or
Accounts Receivable Entities that are Domestic Restricted Subsidiaries), for any
period, the aggregate depreciation, amortization and other non-cash expenses of
the Restricted Subsidiaries that are not Guarantors (and are not Finance
Subsidiaries or Accounts Receivable Entities that are Domestic Restricted
Subsidiaries) reducing Combined Net Income for such period, determined on a
combined basis in accordance with GAAP (excluding any such charge which requires
an accrual of or a reserve for cash charges for any future period).
"Commission" means the Securities and Exchange Commission, as from
time to time constituted, or if at any time after the execution of this
Indenture such Commission is not existing and performing the applicable duties
now assigned to it, then the body or bodies performing such duties at such time.
"Common Stock" of any Person means any and all shares, interests or
other participations in, and other equivalents (however designated and whether
voting or non-voting) of such Person's common stock, whether outstanding on the
Spin-Off Date or issued after the Spin-Off Date, and includes, without
limitation, all series and classes of such common stock.
"Company" means the party named as such in this Indenture until a
successor replaces it pursuant to this Indenture and thereafter means such
successor.
"Consolidated EBITDA" means, with respect to the Company, for any
period, the sum (without duplication) of:
(1) Consolidated Net Income; and
(2) to the extent Consolidated Net Income has been reduced thereby:
<PAGE> 24
-14-
(A) all income taxes of the Company and the Restricted
Subsidiaries paid or accrued in accordance with GAAP for such period;
(B) Consolidated Interest Expense; and
(C) Consolidated Non-cash Charges,
less any non-cash items increasing Consolidated Net Income for such period, all
as determined on a consolidated basis for the Company and the Restricted
Subsidiaries in accordance with GAAP.
"Consolidated Fixed Charge Coverage Ratio" means, with respect to the
Company, the ratio of Consolidated EBITDA of the Company during the Four Quarter
Period ending on or prior to the Transaction Date to Consolidated Fixed Charges
of the Company for the Four Quarter Period. In addition to and without
limitation of the foregoing, for purposes of this definition, "Consolidated
EBITDA" and "Consolidated Fixed Charges" shall be calculated after giving effect
on a pro forma basis for the period of such calculation to:
(1) the incurrence or repayment of any Indebtedness of the Company or
any of the Restricted Subsidiaries (and the application of the proceeds
thereof) giving rise to the need to make such calculation and any
incurrence or repayment of other Indebtedness (and the application of the
proceeds thereof), other than the incurrence or repayment of Indebtedness
in the ordinary course of business for working capital purposes pursuant to
working capital facilities, occurring during the Four Quarter Period or at
any time subsequent to the last day of the Four Quarter Period and on or
prior to the Transaction Date, as if such incurrence or repayment, as the
case may be, (and the application of the proceeds thereof) occurred on the
first day of the Four Quarter Period; and
(2) any Asset Sales or other disposition or Asset Acquisitions
(including, without limitation, any Asset Ac-
<PAGE> 25
-15-
quisition giving rise to the need to make such calculation as a result of
the Company or one of the Restricted Subsidiaries (including any Person who
becomes a Restricted Subsidiary as a result of the Asset Acquisition)
incurring, assuming or otherwise being liable for Acquired Indebtedness and
also including any Consolidated EBITDA (provided that such Consolidated
EBITDA shall be included only to the extent includable pursuant to the
definition of "Consolidated Net Income") attributable to the assets which
are the subject of the Asset Acquisition or Asset Sale or other disposition
during the Four Quarter Period) occurring during the Four Quarter Period or
at any time subsequent to the last day of the Four Quarter Period and on or
prior to the Transaction Date as if such Asset Sale or Asset Acquisition or
other disposition (including the incurrence, assumption or liability for
any such Acquired Indebtedness) occurred on the first day of the Four
Quarter Period.
If the Company or any of the Restricted Subsidiaries directly or
indirectly guarantees Indebtedness of a third Person, the preceding sentence
shall give effect to the incurrence of such guaranteed Indebtedness as if the
Company or any Restricted Subsidiary had directly incurred or otherwise assumed
such guaranteed Indebtedness. Furthermore, in calculating "Consolidated Fixed
Charges" for purposes of determining the denominator (but not the numerator) of
this "Consolidated Fixed Charge Coverage Ratio":
(1) interest on outstanding Indebtedness determined on a fluctuating
basis as of the Transaction Date and which will continue to be so
determined thereafter shall be deemed to have accrued at a fixed rate per
annum equal to the rate of interest on such Indebtedness in effect on the
Transaction Date;
(2) if interest on any Indebtedness actually incurred on the
Transaction Date may optionally be determined at an interest rate based
upon a factor of a prime or similar rate, a eurocurrency interbank offered
rate, or
<PAGE> 26
-16-
other rates, then the interest rate in effect on the Transaction Date will
be deemed to have been in effect during the Four Quarter Period; and
(3) notwithstanding clause (1) above, interest on Indebtedness
determined on a fluctuating basis, to the extent such interest is covered
by agreements relating to Interest Swap Obligations, shall be deemed to
accrue at the rate per annum in effect on the Transaction Date resulting
after giving effect to the operation of such agreements on such date.
"Consolidated Fixed Charges" means, with respect to the Company for
any period, the sum, without duplication, of:
(1) Consolidated Interest Expense, plus
(2) the product of (x) the amount of all dividend payments on any
series of Preferred Stock of the Company (other than dividends paid in
Qualified Capital Stock) or any Restricted Subsidiary paid, accrued and/or
scheduled to be paid or accrued during such period times (y) a fraction,
the numerator of which is one and the denominator of which is one minus the
then current effective consolidated federal, state and local income tax
rate of the Company, expressed as a decimal.
"Consolidated Interest Expense" means, with respect to the Company for any
period, the sum of, without duplication:
(1) the aggregate of the interest expense of the Company and the
Restricted Subsidiaries for such period determined on a consolidated basis
in accordance with GAAP, including without limitation,
(A) any amortization of debt discount,
(B) the net costs under Interest Swap Obligations,
(C) all capitalized interest, and
<PAGE> 27
-17-
(D) the interest portion of any deferred payment obligation;
(2) the interest component of Capitalized Lease Obligations paid,
accrued and/or scheduled to be paid or accrued by the Company and the
Restricted Subsidiaries during such period as determined on a consolidated
basis in accordance with GAAP; and
(3) net losses relating to sales of accounts receivable pursuant to
Permitted Receivables Financings during such period as determined on a
consolidated basis in accordance with GAAP.
"Consolidated Net Income" means, with respect to the Company, for any
period, the aggregate net income (or loss) of the Company and the Restricted
Subsidiaries for such period as determined on a consolidated basis in accordance
with GAAP; provided that there shall be excluded therefrom:
(1) after-tax gains and losses from Asset Sales or abandonments or
reserves relating thereto;
(2) extraordinary or non-recurring gains or losses (determined on an
after-tax basis);
(3) the net income of any Person acquired in a "pooling of interests"
transaction accrued prior to the date it becomes a Restricted Subsidiary or
is merged or consolidated with the Company or any Restricted Subsidiary;
(4) the net income (but not loss) of any Restricted Subsidiary to the
extent that the declaration of dividends or similar distributions by that
Restricted Subsidiary of that income is restricted by a contract, operation
of law or otherwise;
(5) the net income of any Person, other than a Restricted Subsidiary,
except to the extent of cash divi-
<PAGE> 28
-18-
dends or distributions paid to the Company or to a Restricted Subsidiary by
such Person;
(6) any restoration to income of any contingency reserve, except to
the extent that (x) provision for such reserve was made out of Consolidated
Net Income accrued at any time following the Spin-Off Date or (y) the
restoration is with respect to a charge or reserve contemplated by clause
(9) below;
(7) income or loss attributable to discontinued operations (including,
without limitation, operations disposed of during such period whether or
not such operations were classified as discontinued);
(8) in the case of a successor to the Company by consolidation or
merger or as a transferee of the Company's assets, any earnings of the
successor corporation prior to such consolidation, merger or transfer of
assets;
(9) restructuring charges of not more than $55.0 million to the extent
incurred in the fiscal quarter ending December 31, 1999; and
(10) any fees or expenses incurred in connection with the Spin-Off
Transactions.
"Consolidated Net Tangible Assets" means, as of any date of
determination, the total assets, less goodwill and other intangibles (other than
patents, trademarks, copyrights, licenses and other intellectual property),
shown on the balance sheet of the Company and its Restricted Subsidiaries for
the most recently ended fiscal quarter for which financial statements are
available, determined on a consolidated basis in accordance with GAAP.
"Consolidated Non-cash Charges" means, with respect to the Company,
for any period, the aggregate depreciation, amortization and other non-cash
expenses of the Company and the Restricted Subsidiaries reducing Consolidated
Net Income of the Company for such period, determined on a consolidated basis in
<PAGE> 29
-19-
accordance with GAAP (excluding any such charge which requires an accrual of or
a reserve for cash charges for any future period).
"Corporate Restructuring" means the restructuring by the Company of
the assets, liabilities and operations of (x) its packaging business and
administrative services operations, so that such assets, liabilities and
operations are owned directly and indirectly by Packaging and its Subsidiaries,
and (y) its automotive business, so that such assets, liabilities and operations
are owned directly or indirectly by the Company and its Subsidiaries, in each
case in a manner consistent, in all material respects, with the description
thereof in the Offering Memorandum.
"Corporate Trust Department" means the office of the Trustee in The
City of New York at which at any particular time its corporate trust business
shall be principally administered.
"Covenant Defeasance" has the meaning provided in Section 8.01.
"Credit Agreement" means the Credit Agreement dated as of September
30, 1999 among the Company, the Guarantors, the lenders party thereto in their
capacities as lenders thereunder and Commerzbank AG and Bank of America, as
co-documentation agents, Citibank, N.A., as syndication agent and The Chase
Manhattan Bank, as administrative agent, together with the documents related
thereto (including, without limitation, any guarantee agreements and security
documents), in each case as such agreements may be amended (including any
amendment and restatement thereof), supplemented or otherwise modified from time
to time, including any agreement extending the maturity of, refinancing,
replacing or otherwise restructuring (including increasing the amount of
available borrowings thereunder (provided that such increase in borrowings is
permitted by Section 4.03 (including the definition of Permitted Indebtedness))
or adding Subsidiaries as additional borrowers or guarantors thereunder) all or
any portion of the Indebtedness under such
<PAGE> 30
-20-
agreement or any successor or replacement agreement and whether by the same or
any other agent, lender or group of lenders.
"Currency Agreement" means any foreign exchange contract, currency
swap agreement or other similar agreement or arrangement designed to protect the
Company or any Restricted Subsidiary against fluctuations in currency values.
"Custodian" means any receiver, trustee, assignee, liquidator,
sequestrator or similar official under any Bankruptcy Law.
"Debt Realignment" means the realignment of all of the Company's
Indebtedness through a combination of tender offers, exchange offers,
prepayments and/or other refinancings, the purpose of which is to allocate
Indebtedness between the Company and Packaging before the separation of the
Company and Packaging effected by means of the Corporate Restructuring and the
Packaging Distribution and consistent in all material respects with the
description thereof in the Offering Memorandum insofar as such matters relate to
the Company.
"Default" means an event or condition the occurrence of which is, or
with the lapse of time or the giving of notice or both would be, an Event of
Default.
"Default Notice" has the meaning provided in Section 12.02.
"Depository" means, with respect to the Securities issued in the form
of one or more Global Securities, The Depository Trust Company or another Person
designated as Depository by the Company, which must be a clearing agency
registered under the Exchange Act.
"Designated Senior Debt" means (1) Indebtedness under or in respect of
the Credit Agreement and (2) any other Indebtedness constituting Senior Debt
which, at the time of determination, has an aggregate principal amount of at
least $50 million and is specifically designated in the instrument evidenc-
<PAGE> 31
-21-
ing such Senior Debt as "Designated Senior Debt" by the Company.
"Designation" has the meaning provided in Section 4.20.
"Designation Amount" has the meaning provided in Section 4.20.
"Disqualified Capital Stock" means that portion of any Capital Stock
which, by its terms (or by the terms of any security into which it is
convertible or for which it is exchangeable), or upon the happening of any
event, matures or is mandatorily redeemable, pursuant to a sinking fund
obligation or otherwise, or is mandatorily exchangeable for Indebtedness, or is
redeemable or exchangeable for Indebtedness, at the sole option of the holder
thereof on or prior to the final maturity date of the Securities.
"Domestic Restricted Subsidiary" means a Restricted Subsidiary
incorporated or otherwise organized under the laws of the United States or any
state thereof or the District of Columbia.
"Event of Default" has the meaning provided in Section 6.01.
"Exchange Act" means the Securities Exchange Act of 1934, as amended,
or any successor statute or statutes thereto, and the rules and regulations of
the Commission promulgated thereunder.
"Existing Indenture" means the indenture dated November 1, 1996 by and
between the Company and The Chase Manhattan Bank.
"Fair Market Value" means, with respect to any asset or property, the
price which could be negotiated in an arm's-length, free market transaction, for
cash, between a willing seller and a willing and able buyer, neither of whom is
under undue pressure or compulsion to complete the transaction. Fair
<PAGE> 32
-22-
Market Value shall be determined by the Board of Directors of the Company acting
reasonably and in good faith and shall be evidenced by a Board Resolution of the
Board of Directors of the Company.
"Final Maturity Date" means October 15, 2009.
"Finance Subsidiary" means a Restricted Subsidiary that is organized
solely for the purpose of owning Indebtedness of the Company and/or other
Restricted Subsidiaries and issuing securities the proceeds of which are
utilized by the Company and/or other Restricted Subsidiaries, and which engages
only in such activities and activities incident thereto.
"Foreign Restricted Subsidiary" means any Restricted Subsidiary that
is organized and existing under the laws of a jurisdiction other than the United
States, any State thereof or the District of Columbia.
"Four Quarter Period" has the meaning provided in the definition of
"Combined Fixed Charge Coverage Ratio" above.
"Fund" has the meaning set forth in Section 4.22.
"Funding Guarantor" has the meaning provided in Section 10.05.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accounts and statements and pronouncements of the
Financial Accounting Standards Board or in such other statements by such other
entity as may be approved by a significant segment of the accounting profession
of the United States, which are in effect as of the Issue Date.
"Global Security" means a security evidencing all or a part of the
Securities issued to the Depository in accordance with Section 2.01 and bearing
the legend prescribed in Exhibit C.
<PAGE> 33
-23-
"Guarantee" has the meaning provided in Section 4.18.
"Guarantor" means (1) each Wholly Owned Domestic Restricted Subsidiary
of the Company (other than any Immaterial Domestic Subsidiaries) as of the
Spin-Off Date (after giving effect to the Spin-Off Transactions) and (2) each
other Restricted Subsidiary that in the future executes a Guarantee pursuant to
Section 4.18 or otherwise; provided that any Person constituting a Guarantor as
described above shall cease to constitute a Guarantor when its Guarantee is
released in accordance with the terms of this Indenture.
"Guarantor Senior Debt" means, with respect to any Guarantor, the
principal of, premium, if any, and interest (including any interest accruing
subsequent to the filing of a petition of bankruptcy at the rate provided for in
the documentation with respect thereto, whether or not such interest is an
allowed claim under applicable law) on any Indebtedness of such Guarantor,
whether outstanding on the Spin-Off Date (after giving effect to the Spin-Off
Transactions) or thereafter created, incurred or assumed, unless, in the case of
any particular Indebtedness, the instrument creating or evidencing the same or
pursuant to which the same is outstanding expressly provides that such
Indebtedness shall not be senior in right of payment to the Guarantee of such
Guarantor. Without limiting the generality of the foregoing, "Guarantor Senior
Debt" shall also include the principal of, premium, if any, interest (including
any interest accruing subsequent to the filing of a petition of bankruptcy at
the rate provided for in the documentation with respect thereto, whether or not
such interest is an allowed claim under applicable law) on, and all other
amounts owing in respect of:
(x) all monetary obligations of every nature of the Company or any
Guarantor with respect to the Credit Agreement, including, without
limitation, obligations to pay principal and interest, reimbursement
obligations under letters of credit, fees, expenses and indemnities;
(y) all Interest Swap Obligations; and
<PAGE> 34
-24-
(z) all obligations under Currency Agreements.
Notwithstanding the foregoing, "Guarantor Senior Debt" shall not
include:
(1) any Indebtedness of such Guarantor owing to a Subsidiary of such
Guarantor or any Affiliate of such Guarantor or any of such Affiliate's
Subsidiaries;
(2) Indebtedness to, or guaranteed on behalf of, any shareholder,
director, officer or employee of such Guarantor or any Subsidiary of such
Guarantor (including, without limitation, amounts owed for compensation);
(3) Indebtedness to trade creditors and other amounts incurred (other
than under the Credit Agreement) in connection with obtaining goods,
materials or services;
(4) Indebtedness represented by Disqualified Capital Stock;
(5) any liability for federal, state, local or other taxes owed or
owing by such Guarantor;
(6) Indebtedness incurred in violation of Section 4.03;
(7) Indebtedness which, when incurred and without respect to any
election under Section 1111(b) of Title 11, United States Code, is without
recourse to such Guarantor; and
(8) any Indebtedness which is, by its express terms, subordinated in
right of payment to any other Indebtedness of such Guarantor.
"Holder" or "Securityholder" means a Person in whose name a Security
is registered on the Registrar's books.
"Immaterial Domestic Subsidiaries" means at any time, any Domestic
Restricted Subsidiary of the Company having total
<PAGE> 35
-25-
assets (as determined in accordance with GAAP) in an amount of less than 1% of
the consolidated total assets of the Company and its Domestic Restricted
Subsidiaries (as determined in accordance with GAAP); provided, however, that
the total assets (as so determined) of all Immaterial Domestic Subsidiaries
shall not exceed 5% of consolidated total assets of the Company and its Domestic
Subsidiaries (as so determined). In the event that the total assets of all
Immaterial Domestic Subsidiaries exceeds 5% of consolidated total assets of the
Company and its Domestic Restricted Subsidiaries, the Company will designate
Domestic Restricted Subsidiaries that would otherwise be Immaterial Domestic
Subsidiaries to be excluded as Immaterial Domestic Subsidiaries until such 5%
threshold is met. Notwithstanding the foregoing, no Domestic Restricted
Subsidiary that guarantees the Credit Agreement shall be deemed an Immaterial
Domestic Subsidiary.
"incur" has the meaning provided in Section 4.03.
"Indebtedness" means, with respect to any Person, without duplication:
(1) all Obligations of such Person for borrowed money;
(2) all Obligations of such Person evidenced by bonds, debentures,
notes or other similar instruments;
(3) all Capitalized Lease Obligations of such Person;
(4) all Obligations of such Person issued or assumed as the deferred
purchase price of property, all conditional sale obligations and all
Obligations under any title retention agreement (but excluding trade
accounts payable and other accrued liabilities arising in the ordinary
course of business that are not overdue by 90 days or more or are being
contested in good faith by appropriate proceedings promptly instituted and
diligently conducted);
<PAGE> 36
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(5) all Obligations for the reimbursement of any obligor on any letter
of credit, banker's acceptance or similar credit transaction;
(6) guarantees and other contingent obligations in respect of
Indebtedness of any other Person referred to in clauses (1) through (5)
above and clauses (8) and (10) below;
(7) all Obligations of any other Person of the type referred to in
clauses (1) through (6) which are secured by any Lien on any property or
asset of such Person, the amount of such Obligation being deemed to be the
lesser of the Fair Market Value of such property or asset or the amount of
the Obligation so secured;
(8) all Obligations under currency agreements and interest swap
agreements of such Person;
(9) all Disqualified Capital Stock of the Company and all Preferred
Stock of a Restricted Subsidiary with the amount of Indebtedness
represented by such Disqualified Capital Stock or Preferred Stock being
equal to the greater of its voluntary or involuntary liquidation preference
and its maximum fixed repurchase price, but excluding accrued and unpaid
dividends, if any; and
(10) all Outstanding Permitted Receivables Financings.
For purposes hereof, the "maximum fixed repurchase price" of any
Disqualified Capital Stock or Preferred Stock which does not have a fixed
repurchase price shall be calculated in accordance with the terms of such
Disqualified Capital Stock or Preferred Stock as if such Disqualified Capital
Stock or Preferred Stock were purchased on any date on which Indebtedness shall
be required to be determined pursuant to the Indenture, and if such price is
based upon, or measured by, the Fair Market Value of such Disqualified Capital
Stock or Preferred Stock, such Fair Market Value shall be determined rea-
<PAGE> 37
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sonably and in good faith by the Board of Directors of the issuer of such
Disqualified Capital Stock or Preferred Stock.
"Indenture" means this Indenture, as amended or supplemented from time
to time in accordance with the terms hereof.
"Independent" when used with respect to any specified Person means
such a Person who (a) is in fact independent; (b) does not have any direct
financial interest or any material indirect financial interest in the Company or
any of its Subsidiaries, or in any Affiliate of the Company or any of its
Subsidiaries; and (c) is not an officer, employee, promoter, underwriter,
trustee, partner, director or Person performing similar functions for the
Company or any of its Subsidiaries. Whenever it is provided in this Indenture
that any Independent Person's opinion or certificate shall be furnished to the
Trustee, such Person shall be appointed by the Company, and such opinion or
certificate shall state that the signer has read this definition and that the
signer is Independent within the meaning hereof.
"Independent Financial Advisor" means a firm (1) which does not, and
whose directors, officers and employees and Affiliates do not, have a direct or
indirect material financial interest in the Company and (2) which, in the
judgment of the Board of Directors of the Company, is otherwise independent and
qualified to perform the task for which it is to be engaged.
"Initial Purchasers" means Salomon Smith Barney Inc., Banc of America
Securities LLC, Bear, Stearns & Co. Inc., Chase Securities Inc., Credit Suisse
First Boston Corporation, Morgan Stanley & Co. Incorporated, Banc One Capital
Markets, Inc., BNY Capital Markets, Inc., Commerzbank Capital Markets
Corporation, First Union Securities, Inc., ING Barings LLC, Nesbitt Burns
Securities Inc., Scotia Capital Markets (USA) Inc., SG Cowen Securities
Corporation and TD Securities (USA) Inc.
<PAGE> 38
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"Institutional Accredited Investor" means an institution that is an
"accredited investor" as that term is defined in Rule 501(a)(1), (2), (3) or (7)
under the Securities Act.
"Interest Payment Date" means the stated maturity of an installment of
interest on the Securities.
"Interest Swap Obligations" means the obligations of the Company and
the Restricted Subsidiaries pursuant to any arrangement with any other Person,
whereby, directly or indirectly, the Company or any Restricted Subsidiary is
entitled to receive from time to time periodic payments calculated by applying
either a floating or a fixed rate of interest on a stated notional amount in
exchange for periodic payments made by such other Person calculated by applying
a fixed or a floating rate of interest on the same notional amount and shall
include, without limitation, interest rate swaps, caps, floors, collars and
similar agreements.
"Investment" means, with respect to any Person, any direct or indirect
loan or other extension of credit (including, without limitation, a guarantee)
or capital contribution to (by means of any transfer of cash or other property
to others or any payment for property or services for the account or use of
others), or any purchase or acquisition by such Person of any Capital Stock,
bonds, notes, debentures or other securities or evidences of Indebtedness issued
by, any Person. "Investment" shall exclude extensions of trade credit by the
Company and the Restricted Subsidiaries on commercially reasonable terms in
accordance with normal trade practices of the Company or such Restricted
Subsidiaries, as the case may be. If the Company or any Restricted Subsidiary
sells or otherwise disposes of any Capital Stock of any Restricted Subsidiary
(the "Referent Subsidiary") such that, after giving effect to any such sale or
disposition, the Referent Subsidiary shall cease to be a Restricted Subsidiary,
the Company shall be deemed to have made an Investment on the date of any such
sale or disposition equal to the Fair Market Value of the Capital Stock of the
Referent Subsidiary not sold or disposed of.
<PAGE> 39
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"Issue Date" means the date of original issuance of the Securities.
"Legal Defeasance" has the meaning provided in Section 8.01.
"Lien" means any lien, mortgage, deed of trust, pledge, security
interest, charge or encumbrance of any kind (including any conditional sale or
other title retention agreement, any lease in the nature thereof and any
agreement to give any security interest).
"Make-Whole Amount" means, with respect to each $1,000 principal
amount of Securities on the redemption date, the excess, if any, of (a) the
present value of the sum of $1,000 and all remaining interest payments (not
including any portion of such payments of interest accrued as of the redemption
date) to and including the Final Maturity Date discounted on a semi-annual bond
equivalent basis from such Final Maturity Date to the redemption date at a per
annum interest rate equal to the sum of the Treasury Yield (determined on the
Business Day immediately preceding the date of such redemption), plus 50 basis
points, over (b) $1,010.
"Money Market Account" has the meaning set forth in Section 4.22.
"Net Cash Proceeds" means, with respect to any Asset Sale, the
proceeds in the form of cash or Cash Equivalents, including payments in respect
of deferred payment obligations when received in the form of cash or Cash
Equivalents (other than the portion of any such deferred payment constituting
interest), received by the Company or any of the Restricted Subsidiaries from
such Asset Sale net of:
(1) reasonable out-of-pocket expenses and fees relating to such Asset
Sale (including, without limitation, legal, accounting and investment
banking fees, sales commissions and relocation expenses);
<PAGE> 40
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(2) taxes paid or payable after taking into account any reduction in
consolidated tax liability due to available tax credits or deductions and
any tax sharing arrangements;
(3) repayments of Indebtedness secured by the property or assets
subject to such Asset Sale that is required to be repaid in connection with
such Asset Sale; and
(4) appropriate amounts to be determined by the Company or any
Restricted Subsidiary, as the case may be, as a reserve, in accordance with
GAAP, against any liabilities associated with such Asset Sale and retained
by the Company or any Restricted Subsidiary, as the case may be, after such
Asset Sale, including, without limitation, pension and other
post-employment benefit liabilities, liabilities related to environmental
matters and liabilities under any indemnification obligations associated
with such Asset Sale.
"Net Proceeds Offer" has the meaning provided in Section 4.12.
"Net Proceeds Offer Amount" has the meaning provided in Section 4.12.
"Net Proceeds Offer Payment Date" has the meaning provided in Section
4.12.
"Net Proceeds Offer Trigger Date" has the meaning provided in Section
4.12.
"Obligations" means all obligations for principal, premium, interest,
penalties, fees, indemnifications, reimbursements, damages and other liabilities
payable under the documentation governing any Indebtedness.
"Offering Memorandum" means the offering memorandum of the Company
dated October 8, 1999 related to the Securities.
<PAGE> 41
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"Officer" means, with respect to any Person, the Chairman of the
Board, the Chief Executive Officer, the President, any Vice President, the Chief
Financial Officer, the Controller, or the Secretary of such Person.
"Officers' Certificate" means a certificate signed by two Officers of
the Company.
"Offshore Physical Securities" has the meaning provided in Section
2.01.
"Opinion of Counsel" means a written opinion from legal counsel which
is and who are acceptable to the Trustee.
"Outstanding Permitted Receivables Financings" means the aggregate
amount of the receivables sold or financed pursuant to a Permitted Receivables
Financing that remain uncollected at any one time.
"Packaging" refers to Tenneco Packaging Inc., a Delaware corporation,
and those companies that will be its subsidiaries when the Spin-Off Transactions
are completed.
"Packaging Distribution" means the distribution by the Company of all
of the issued and outstanding common stock of Packaging to the holders of the
Company's common stock consistent in all material respects with the description
thereof in the Offering Memorandum.
"Packaging Form S-4" means the Form S-4 Registration Statement filed
with the Commission in connection with the Debt Realignment, and declared
effective on October 5, 1999.
"Participants" has the meaning provided in Section 2.15.
"Paying Agent" has the meaning provided in Section 2.03.
"Payment Default" has the meaning provided in Section 6.01.
<PAGE> 42
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"Permitted Indebtedness" means, without duplication, each of the
following:
(1) Indebtedness under the Securities, this Indenture and any
Guarantees not to exceed $500.0 million in aggregate principal amount;
(2) Indebtedness incurred pursuant to the Credit Agreement in an
aggregate principal amount at any time outstanding not to exceed the
greater of:
(x) $1,550 million (reduced by any required permanent repayments
with the proceeds of Asset Sales (which are accompanied by a
corresponding permanent commitment reduction) thereunder); and
(y) the sum of (A) 85% of the net book value of the accounts
receivable of the Company and the Restricted Subsidiaries and (B) 50%
of the net book value of the inventory of the Company and the
Restricted Subsidiaries;
(3) other Indebtedness of the Company and the Restricted Subsidiaries
outstanding on the Spin-Off Date reduced by the amount of any scheduled
amortization payments or mandatory prepayments when actually paid or
permanent reductions thereon;
(4) Interest Swap Obligations of the Company covering Indebtedness of
the Company or any Guarantor and Interest Swap Obligations of any
Restricted Subsidiary covering Indebtedness of such Restricted Subsidiary;
provided, however, that such Interest Swap Obligations are entered into to
protect the Company and the Restricted Subsidiaries from fluctuations in
interest rates on Indebtedness incurred in accordance with this Indenture
to the extent the notional principal amount of such Interest Swap
Obligations does not exceed the principal amount of the Indebtedness to
which such Interest Swap Obligations relate;
<PAGE> 43
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(5) Indebtedness under Currency Agreements; provided that in the case
of Currency Agreements which relate to Indebtedness, such Currency
Agreements do not increase the Indebtedness of the Company and the
Restricted Subsidiaries outstanding other than as a result of fluctuations
in foreign currency exchange rates or by reason of fees, indemnities and
compensation payable thereunder;
(6) Indebtedness of a Restricted Subsidiary to the Company or another
Restricted Subsidiary for so long as such Indebtedness is held by the
Company or a Restricted Subsidiary, in each case subject to no Lien held by
a Person other than the Company or a Restricted Subsidiary; provided that
if as of any date any Person other than the Company or a Restricted
Subsidiary owns or holds any such Indebtedness or holds a Lien in respect
of such Indebtedness, such date shall be deemed the incurrence of
Indebtedness not constituting Permitted Indebtedness by the issuer of such
Indebtedness;
(7) Indebtedness of the Company to a Restricted Subsidiary for so long
as such Indebtedness is held by a Restricted Subsidiary, in each case
subject to no Lien; provided that (A) any Indebtedness of the Company to
any Restricted Subsidiary is unsecured and (B) if as of any date any Person
other than a Restricted Subsidiary owns or holds any such Indebtedness or
any Person holds a Lien in respect of such Indebtedness, such date shall be
deemed the incurrence of Indebtedness not constituting Permitted
Indebtedness by the Company;
(8) Indebtedness arising from the honoring by a bank or other
financial institution of a check, draft or similar instrument inadvertently
(except in the case of daylight overdrafts) drawn against insufficient
funds in the ordinary course of business; provided, however, that such
Indebtedness is extinguished within five Business Days after incurrence;
<PAGE> 44
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(9) Indebtedness of the Company or any of the Restricted Subsidiaries
represented by letters of credit for the account of the Company or any such
Restricted Subsidiary, as the case may be, in order to provide security for
workers' compensation claims, payment obligations in connection with
self-insurance or similar requirements in the ordinary course of business;
(10) Refinancing Indebtedness;
(11) additional Indebtedness of the Company and the Restricted
Subsidiaries in an aggregate principal amount not to exceed $75.0 million
at any one time outstanding;
(12) Purchase Money Indebtedness and Capitalized Lease Obligations
(and any Indebtedness incurred to Refinance such Purchase Money
Indebtedness or Capitalized Lease Obligations) not to exceed 5% of
Consolidated Net Tangible Assets at any one time outstanding; and
(13) Outstanding Permitted Receivables Financings not to exceed $150.0
million at any one time outstanding.
If any Indebtedness incurred by the Company or any Restricted
Subsidiary would qualify in more than one of the categories of Permitted
Indebtedness as set forth in clauses (1) through (13) of this definition, the
Company may designate under which category such incurrence shall be deemed to
have been made.
"Permitted Investments" means:
(1) Investments by the Company or any Restricted Subsidiary in any
Person that is or will become immediately after such Investment a
Restricted Subsidiary or that will merge or consolidate into the Company or
a Restricted Subsidiary;
(2) Investments in the Company by any Restricted Subsidiary; provided
that any Indebtedness evidencing such Investment is unsecured;
<PAGE> 45
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(3) Investments in cash and Cash Equivalents;
(4) loans and advances to employees, officers and directors of the
Company and the Restricted Subsidiaries in the ordinary course of business
for bona fide business purposes not in excess of an aggregate of $15.0
million at any one time outstanding;
(5) Currency Agreements and Interest Swap Obligations entered into in
the ordinary course of the Company's or a Restricted Subsidiary's
businesses and otherwise in compliance with this Indenture;
(6) Investments in securities of trade creditors or customers received
pursuant to any plan of reorganization or similar arrangement upon the
bankruptcy or insolvency of such trade creditors or customers;
(7) Investments made by the Company or the Restricted Subsidiaries as
a result of consideration received in connection with an Asset Sale made in
compliance with Section 4.12;
(8) Investments in Persons, including, without limitation,
Unrestricted Subsidiaries and joint ventures, engaged in a business similar
or related to or logical extensions of the businesses in which the Company
and the Restricted Subsidiaries are engaged on the Spin-Off Date, not to
exceed 5% of Consolidated Net Tangible Assets at any one time outstanding;
(9) Investments in the Securities; and
(10) Investments in an Accounts Receivables Entity.
"Permitted Liens" means the following types of Liens:
(1) Liens for taxes, assessments or governmental charges or claims
either (A) not delinquent or (B) contested in good faith by appropriate
proceedings and, in each case, as to which the Company or any Restricted
Sub-
<PAGE> 46
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sidiary shall have set aside on its books such reserves as may be required
pursuant to GAAP;
(2) statutory Liens of landlords and Liens of carriers, warehousemen,
mechanics, suppliers, materialmen, repairmen and other Liens imposed by law
incurred in the ordinary course of business for sums not yet delinquent or
being contested in good faith, if such reserve or other appropriate
provision, if any, as shall be required by GAAP shall have been made in
respect thereof;
(3) Liens incurred or deposits made in the ordinary course of business
in connection with workers' compensation, unemployment insurance and other
types of social security, including any Lien securing letters of credit
issued in the ordinary course of business consistent with past practice in
connection therewith, or to secure the performance of tenders, statutory
obligations, surety and appeal bonds, bids, leases, contracts, performance
and return-of-money bonds and other similar obligations (exclusive of
obligations for the payment of borrowed money);
(4) judgment Liens not giving rise to an Event of Default so long as
such Lien is adequately bonded and any appropriate legal proceedings which
may have been duly initiated for the review of such judgment shall not have
been finally terminated or the period within which such proceedings may be
initiated shall not have expired;
(5) easements, rights-of-way, zoning restrictions and other similar
charges or encumbrances in respect of real property not impairing in any
material respect the ordinary conduct of the business of the Company or any
of the Restricted Subsidiaries;
(6) any interest or title of a lessor under any Capitalized Lease
Obligation; provided that such Liens do not extend to any property or asset
which is not leased property subject to such Capitalized Lease Obligation;
<PAGE> 47
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(7) purchase money Liens securing Indebtedness incurred to finance
property or assets of the Company or any Restricted Subsidiary acquired in
the ordinary course of business, and Liens securing Indebtedness which
Refinances any such Indebtedness; provided, however, that (A) the related
purchase money Indebtedness (or Refinancing Indebtedness) shall not exceed
the cost of such property or assets and shall not be secured by any
property or assets of the Company or any Restricted Subsidiary other than
the property and assets so acquired and (B) the Lien securing the purchase
money Indebtedness shall be created within 90 days after such acquisition;
(8) Liens upon specific items of inventory or other goods and proceeds
of any Person securing such Person's obligations in respect of bankers'
acceptances issued or created for the account of such Person to facilitate
the purchase, shipment or storage of such inventory or other goods;
(9) Liens securing reimbursement obligations with respect to
commercial letters of credit which encumber documents and other property
relating to such letters of credit and products and proceeds thereof;
(10) Liens encumbering deposits made to secure obligations arising
from statutory, regulatory, contractual or warranty requirements of the
Company or any of the Restricted Subsidiaries, including rights of offset
and set-off;
(11) Liens securing Interest Swap Obligations which Interest Swap
Obligations relate to Indebtedness that is otherwise permitted under this
Indenture;
(12) Liens securing Indebtedness under Currency Agreements;
(13) Liens securing Acquired Indebtedness (and any Indebtedness which
Refinances such Acquired Indebtedness)
<PAGE> 48
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incurred in accordance with Section 4.03; provided that (A) such Liens
secured the Acquired Indebtedness at the time of and prior to the
incurrence of such Acquired Indebtedness by the Company or a Restricted
Subsidiary and were not granted in connection with, or in anticipation of
the incurrence of such Acquired Indebtedness by the Company or a Restricted
Subsidiary and (B) such Liens do not extend to or cover any property or
assets of the Company or of any of the Restricted Subsidiaries other than
the property or assets that secured the Acquired Indebtedness prior to the
time such Indebtedness became Acquired Indebtedness of the Company or a
Restricted Subsidiary;
(14) Liens securing Indebtedness of Foreign Restricted Subsidiaries
incurred in accordance with this Indenture; provided that such Liens do not
extend to any property or assets other than property or assets of Foreign
Restricted Subsidiaries; and
(15) Liens incurred in connection with a Permitted Receivables
Financing.
"Permitted Receivables Financing" means any sale by the Company or a
Restricted Subsidiary of accounts receivable intended to be (and which shall be
treated for purposes of this Indenture as) a true sale transaction with
customary limited recourse based upon the collectibility of the receivables sold
and the corresponding sale or pledge of such accounts receivable (or an interest
therein) in each case without any guarantee by the Company or any Restricted
Subsidiary other than an Accounts Receivable Entity.
"Person" means an individual, partnership, corporation, unincorporated
organization, trust or joint venture, or a governmental agency or political
subdivision thereof.
"Physical Securities" has the meaning provided in Section 2.01.
<PAGE> 49
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"Preferred Stock" of any Person means any Capital Stock of such Person
that has preferential rights to any other Capital Stock of such Person with
respect to dividends or redemptions or upon liquidation.
"Private Placement Legend" means the legend initially set forth on the
Securities in the form set forth on Exhibit A.
"pro forma" means, with respect to any calculation made or required to
be made pursuant to the terms of this Indenture, a calculation in accordance
with Article 11 of Regulation S-X under the Securities Act as interpreted by the
Company's Board of Directors in consultation with its Independent certified
public accountants.
"Public Equity Offering" has the meaning provided in Paragraph 6 of
the Securities.
"Purchase Agreement" means the purchase agreement dated as of October
8, 1999, by and among the Company and the Initial Purchasers.
"Purchase Money Indebtedness" means Indebtedness of the Company or any
Restricted Subsidiary incurred for the purpose of financing all or any part of
the purchase price or the cost of an Asset Acquisition or construction or
improvement of any property; provided that the aggregate principal amount of
such Indebtedness does not exceed such purchase price or cost.
"Qualified Capital Stock" means any Capital Stock that is not
Disqualified Capital Stock.
"Qualified Institutional Buyer" or "QIB" shall have the meaning
specified in Rule 144A under the Securities Act.
"Record Date" means the Record Dates specified in the Securities;
provided that if any such date is not a Business Day, the Record Date shall be
the first day immediately preceding such specified day that is a Business Day.
<PAGE> 50
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"Redemption Date," when used with respect to any Security to be
redeemed, means the date fixed for such redemption pursuant to this Indenture
and the Securities.
"Redemption Price," when used with respect to any Security to be
redeemed, means the price fixed for such redemption, payable in immediately
available funds, pursuant to this Indenture and the Securities.
"Reference Date" has the meaning provided in Section 4.04.
"Refinance" means in respect of any security or Indebtedness, to
refinance, extend, renew, refund, repay, prepay, redeem, defease or retire, or
to issue a security or Indebtedness in exchange or replacement for, such
security or Indebtedness in whole or in part. "Refinanced" and "Refinancing"
shall have correlative meanings.
"Refinancing Indebtedness" means any Refinancing by the Company or any
Restricted Subsidiary of Indebtedness incurred in accordance with Section 4.03
(other than pursuant to clause (2), (4), (5), (6), (7), (8), (9), (11), (12) or
(13) of the definition of Permitted Indebtedness), in each case that does not:
(1) result in an increase in the aggregate principal amount of any
Indebtedness of such Person as of the date of such proposed Refinancing
(plus the amount of any premium reasonably necessary to Refinance such
Indebtedness and plus the amount of reasonable expenses incurred by the
Company in connection with such Refinancing); or
(2) create Indebtedness with (A) a Weighted Average Life to Maturity
that is less than the Weighted Average Life to Maturity of the Indebtedness
being Refinanced or (B) a final maturity earlier than the final maturity of
the Indebtedness being Refinanced;
provided that if such Indebtedness being Refinanced is Indebtedness of the
Company and/or a Guarantor, then such Refinancing
<PAGE> 51
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Indebtedness shall be Indebtedness solely of the Company and/or such Guarantor.
"Registrar" has the meaning provided in Section 2.03.
"Registration Rights Agreement" means the Registration Rights
Agreement dated the Issue Date among the Company, the Guarantors and the Initial
Purchasers.
"Regulation S" means Regulation S under the Securities Act.
"Release Conditions" means the following conditions (which may not be
amended or modified without the consent of the Holders of at least a majority of
the aggregate principal amount of Securities outstanding) to the release of the
Trust Funds:
(1) the Spin-Off Transactions shall be consummated within one Business
Day after the date of delivery to the Trustee of an Officers' Certificate,
substantially in the form of Exhibit J, and such Spin-Off Transactions
shall be consummated in a manner consistent in all material respects with
the description of such transactions contained in the Offering Memorandum;
(2) the requisite consents to effect the proposed amendments to the
Existing Indenture set forth in the Packaging S-4 under the Existing
Indenture of the Company shall have been received such that the Existing
Indenture may be amended in the manner set forth in the Packaging Form S-4;
(3) the Company shall have satisfied all material conditions (other
than the release of the Collateral) or such conditions shall have been
waived by the lenders to the borrowing under the Credit Agreement of an
amount equal to at least $1.0 billion less the amount of any Stub Debt;
<PAGE> 52
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(4) the aggregate consolidated Indebtedness of the Company as of the
Spin-Off Date after giving effect to the Spin-Off Transactions shall not
exceed the sum of (x) $1.725 billion plus (y) the amount of any additional
Working Capital Borrowings not to exceed $100.0 million;
(5) the allocations of assets and liabilities to the Company and its
Subsidiaries (other than Packaging and its Subsidiaries), on the one hand,
and Packaging and its Subsidiaries, on the other hand, after giving effect
to the Spin-Off Transactions are not materially less favorable in the
aggregate to the Company and its Subsidiaries than the description of such
allocations contained in the Offering Memorandum;
(6) there shall have been no downgrade since the Issue Date to the
date of the Officers' Certificate described in (1) above in the ratings
assigned to the Securities by S&P or Moody's;
(7) each of the Wholly Owned Domestic Restricted Subsidiaries (other
than Immaterial Domestic Subsidiaries) of the Company shall have executed a
supplemental indenture substantially in the form of Exhibit K hereto (a
"Supplemental Indenture") and a Guarantee substantially in the form of
Exhibit G hereto and delivered such Supplemental Indenture and Guarantee to
the Trustee;
(8) each of the Wholly Owned Domestic Restricted Subsidiaries (other
than Immaterial Domestic Subsidiaries) shall have delivered to the Trustee
an Opinion of Counsel substantially in the form of Exhibit H hereto;
(9) each Wholly Owned Domestic Restricted Subsidiary (other than
Immaterial Domestic Subsidiaries) shall have executed an Assumption
Agreement pursuant to which each such Wholly Owned Domestic Restricted
Subsidiary becomes a party to the Purchase Agreement and Registration
Rights Agreement; and
<PAGE> 53
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(10) the Trustee shall have received an Officers' Certificate
substantially in the form of Exhibit J hereto and such other documentation
with respect to the Guarantees as is required by this Indenture or as may
otherwise be required by the Trustee.
"Replacement Assets" means assets and property that will be used in
the business of the Company and/or its Restricted Subsidiaries as existing on
the Spin-Off Date (after consummation of the Spin-Off Transactions) or in a
business the same, similar or reasonably related thereto (including Capital
Stock of a Person which becomes a Restricted Subsidiary).
"Representative" means the indenture trustee or other trustee, agent
or representative in respect of any Designated Senior Debt; provided that if,
and for so long as, any Designated Senior Debt lacks such a representative, then
the Representative for such Designated Senior Debt shall at all times constitute
the holders of a majority in outstanding principal amount of such Designated
Senior Debt in respect of any Designated Senior Debt.
"Responsible Officer" shall mean, when used with respect to the
Trustee, any officer in the Corporate Trust Department of the Trustee including
any vice president, assistant vice president or any other officer of the Trustee
who customarily performs functions similar to those performed by the Persons who
at the time shall be such officers, respectively, and to whom any corporate
trust matter is referred because of such officer's knowledge of and familiarity
with the particular subject.
"Restricted Payment" has the meaning provided in Section 4.04.
"Restricted Security" has the meaning set forth in Rule 144(a)(3)
under the Securities Act; provided that the Trustee shall be entitled to request
and conclusively rely upon an Opinion of Counsel with respect to whether any
Security is a Restricted Security.
<PAGE> 54
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"Restricted Subsidiary" means any Subsidiary of the Company that has
not been designated by the Board of Directors of the Company, by a Board
Resolution delivered to the Trustee, as an Unrestricted Subsidiary pursuant to
and in compliance with Section 4.20. Any such Designation may be revoked by a
Board Resolution of the Company delivered to the Trustee, subject to the
provisions of such covenant.
"Revocation" has the meaning provided in Section 4.20.
"Rule 144A" means Rule 144A under the Securities Act.
"Sale and Leaseback Transaction" means any direct or indirect
arrangement with any Person or to which any such Person is a party, providing
for the leasing to the Company or a Restricted Subsidiary of any property,
whether owned by the Company or any Restricted Subsidiary at the Spin-Off Date
(after consummation of the Spin-Off Transactions) or later acquired, which has
been or is to be sold or transferred by the Company or such Restricted
Subsidiary to such Person or to any other Person from whom funds have been or
are to be advanced on the security of such Property.
"Securities" means the Series A Securities and the Series B Securities
treated as a single class of securities, as amended or supplemented from time to
time in accordance with the terms hereof, that are issued pursuant to this
Indenture.
"Securities Act" means the Securities Act of 1933, as amended, or any
successor statute or statutes thereto, and the rules and regulations of the
Commission promulgated thereunder.
"Senior Debt" means the principal of, premium, if any, and interest
(including any interest accruing subsequent to the filing of a petition of
bankruptcy at the rate provided for in the documentation with respect thereto,
whether or not such interest is an allowed claim under applicable law) on any
Indebtedness of the Company, whether outstanding on the Spin-Off Date (after
consummation of the Spin-Off Transactions) or
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thereafter created, incurred or assumed, unless, in the case of any particular
Indebtedness, the instrument creating or evidencing the same or pursuant to
which the same is outstanding expressly provides that such Indebtedness shall
not be senior in right of payment to the Securities. Without limiting the
generality of the foregoing, "Senior Debt" shall also include the principal of,
premium, if any, interest (including any interest accruing subsequent to the
filing of a petition of bankruptcy at the rate provided for in the documentation
with respect thereto, whether or not such interest is an allowed claim under
applicable law) on, and all other amounts owing in respect of:
(x) all monetary obligations of every nature of the Company under the
Credit Agreement, including, without limitation, obligations to pay
principal and interest, reimbursement obligations under letters of credit,
fees, expenses and indemnities;
(y) all Interest Swap Obligations; and
(z) all obligations under Currency Agreements.
Notwithstanding the foregoing, "Senior Debt" shall not include:
(1) any Indebtedness of the Company to a Restricted Subsidiary or any
Affiliate of the Company or any of such Affiliate's Subsidiaries;
(2) Indebtedness to, or guaranteed on behalf of, any shareholder,
director, officer or employee of the Company or any Restricted Subsidiary
(including without limitation, amounts owed for compensation);
(3) Indebtedness to trade creditors and other amounts incurred (other
than under the Credit Agreement) in connection with obtaining goods,
materials or services;
(4) Indebtedness represented by Disqualified Capital Stock;
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(5) any liability for federal, state, local or other taxes owed by the
Company;
(6) Indebtedness incurred in violation of Section 4.03;
(7) Indebtedness which, when incurred and without respect to any
election under Section 1111(b) of Title 11, United States Code, is without
recourse to the Company; and
(8) any Indebtedness which is, by its express terms, subordinated in
right of payment to any other Indebtedness of the Company.
"Series A Securities" means the 11 5/8% Senior Subordinated Notes due
2009, Series A, of the Company issued pursuant to this Indenture and sold
pursuant to the Purchase Agreement.
"Series B Securities" means the 11 5/8% Senior Subordinated Notes due
2009, Series B, of the Company to be issued in exchange for the Series A
Securities pursuant to this Indenture.
"Significant Subsidiary" means, with respect to any Person, any
Restricted Subsidiary of such Person that satisfies the criteria for a
"significant subsidiary" set forth in Rule 1.02(w) of Regulation S-X under the
Securities Act.
"Special Redemption" has the meaning set forth in paragraph 7 of
Exhibit A hereto.
"Special Redemption Amount" has the meaning set forth in Section 4.22.
"Spin-Off Date" means the date on which all of the Spin-Off
Transactions shall have been consummated.
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"Spin-Off Transactions" means each of (1) the Corporate Restructuring,
(2) the Debt Realignment, and (3) the Packaging Distribution.
"Spin-Off Transaction Agreements" means the Distribution Agreement,
Human Resources Agreement, Tax Sharing Agreement, Transition Services Agreement,
Insurance Agreement and Trademark Transition License Agreement, each as entered
into in connection with the Spin-Off Transactions and consistent in all material
respects with the description thereof in the Offering Memorandum.
"Stub Debt" means any Indebtedness outstanding under the Existing
Indenture, after the Company has consummated the Debt Realignment.
"Subsidiary," with respect to any Person, means (1) any corporation of
which the outstanding Capital Stock having at least a majority of the votes
entitled to be cast in the election of directors under ordinary circumstances
shall at the time be owned, directly or indirectly, by such Person or (2) any
other Person of which at least a majority of the voting interest under ordinary
circumstances is at the time, directly or indirectly, owned by such Person.
"Supplemental Indenture" has the meaning provided in the definition of
Release Conditions in this Section 1.01.
"Surviving Entity" has the meaning provided in Section 5.01.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. Sections
77aaa-77bbbb), as amended, as in effect on the date of the execution of this
Indenture until such time as this Indenture is qualified under the TIA, and
thereafter as in effect on the date on which this Indenture is qualified under
the TIA, except as otherwise provided in Section 9.03.
"Transaction Date" has the meaning set forth in the definition of
Combined Fixed Charge Coverage Ratio.
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"Treasury Yield" means the yield to maturity at the time of
computation of United States Treasury securities with a constant maturity (as
compiled by and published in the most recent Federal Reserve Statistical Release
H.15 (519) which has become publicly available at least two business days prior
to the date fixed for redemption (or, if such Statistical Release is no longer
published, any publicly available source of similar data)) most nearly equal to
the then remaining average life of the Securities, provided that if the average
life of the Securities is not equal to the constant maturity of a United States
Treasury security for which a weekly average yield is given, the Treasury Yield
shall be obtained by linear interpolation (calculated to the nearest one-twelfth
of a year) from the weekly average yields of United States Treasury securities
for which such yields are given, except that if the average life of the
Securities is less than one year, the weekly average yield on actually traded
United States Treasury securities adjusted to a constant maturity of one year
shall be used.
"Trustee" means the party named as such in this Indenture until a
successor replaces it in accordance with the provisions of this Indenture and
thereafter means such successor.
"Unrestricted Subsidiary" means any Subsidiary of the Company
designated as such pursuant to and in compliance with Section 4.20. Any such
designation may be revoked by a Board Resolution of the Company delivered to the
Trustee, subject to the provisions of such covenant.
"U.S. Government Obligations" shall have the meaning provided in
Section 8.01.
"U.S. Legal Tender" means such coin or currency in immediately
available funds of the United States of America as at the time of payment shall
be legal tender for the payment of public and private debts.
"U.S. Physical Securities" shall have the meaning set forth in Section
2.01.
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"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing (A) the then
outstanding aggregate principal amount of such Indebtedness into (B) the sum of
the total of the products obtained by multiplying (I) the amount of each then
remaining installment, sinking fund, serial maturity or other required payment
of principal, including payment at final maturity, in respect thereof, by (II)
the number of years (calculated to the nearest one-twelfth) which will elapse
between such date and the making of such payment.
"Wholly Owned Domestic Restricted Subsidiary" means a Wholly
Owned Restricted Subsidiary that is also a Domestic Restricted Subsidiary.
"Wholly Owned Restricted Subsidiary" of the Company means any
Restricted Subsidiary of which all the outstanding voting securities (other than
in the case of a Foreign Restricted Subsidiary, directors' qualifying shares or
an immaterial amount of shares required to be owned by other Persons pursuant to
applicable law) are owned by the Company or any other Wholly Owned Restricted
Subsidiary.
"Working Capital Borrowings" means Indebtedness incurred by
the Company or the Restricted Subsidiaries prior to the consummation of the
Spin-Off Transactions incurred on a short-term basis to fund working capital
requirements.
SECTION 1.02. Incorporation by Reference of TIA.
Whenever this Indenture refers to a provision of the TIA, such
provision is incorporated by reference in, and made a part of, this Indenture.
The following TIA terms used in this Indenture have the following meanings:
"indenture securities" means the Securities.
"indenture security holder" means a Holder or a
Securityholder.
"indenture to be qualified" means this Indenture.
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"indenture trustee" or "institutional trustee" means the
Trustee.
"obligor" on the indenture securities means the Company, any
Guarantor and any other obligor on the Securities.
All other TIA terms used in this Indenture that are defined by
the TIA, defined by TIA reference to another statute or defined by Commission
rule and not otherwise defined herein have the meanings assigned to them
therein.
SECTION 1.03. Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the
meaning assigned to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and words in
the plural include the singular;
(5) provisions apply to successive events and transactions;
and
(6) "herein," "hereof" and other words of similar import
refer to this Indenture as a whole and not to any particular Article,
Section or other subdivision.
ARTICLE TWO
THE SECURITIES
SECTION 2.01. Form and Dating.
The Series A Securities and the Trustee's certificate of
authentication thereof shall be substantially in the form of
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Exhibit A annexed hereto, which is hereby incorporated in and expressly made a
part of this Indenture. The Series B Securities and the Trustee's certificate of
authentication thereof shall be substantially in the form of Exhibit B annexed
hereto, which is hereby incorporated in and expressly made a part of this
Indenture. The Securities may have notations, legends or endorsements (including
notations relating to any Guarantees, stock exchange rule or usage). The Company
and the Trustee shall approve the form of the Securities and any notation,
legend or endorsement (including notations relating to any Guarantees) on them
any such approval to be evidenced by the execution or authentication thereof.
Each Security shall be dated the date of its issuance and shall be authenticated
by the Trustee.
Securities offered and sold in reliance on Rule 144A shall be
issued initially in the form of one or more permanent Global Securities in
registered form, substantially in the form set forth in Exhibit A, deposited
with the Trustee, as custodian for the Depository, and shall bear the legend set
forth in Exhibit C. The aggregate principal amount of any Global Security may
from time to time be increased or decreased by adjustments made on the records
of the Trustee, as custodian for the Depository, as hereinafter provided.
Securities offered and sold in offshore transactions in
reliance on Regulation S shall be issued in the form of certificated Securities
in registered form in substantially the form set forth in Exhibit A (the
"Offshore Physical Securities"). Securities offered and sold in reliance on any
other exemption from registration under the Securities Act other than as
described in the preceding paragraph shall be issued, and Securities offered and
sold in reliance on Rule 144A may be issued, in the form of certificated
Securities in registered form in substantially the form set forth in Exhibit A
(the "U.S. Physical Securities"). The Offshore Physical Securities and the U.S.
Physical Securities are sometimes collectively herein referred to as the
"Physical Securities."
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SECTION 2.02. Execution and Authentication.
Two Officers, or an Officer and an Assistant Secretary, shall
sign, or one Officer shall sign and one Officer or an Assistant Secretary (each
of whom shall, in each case, have been duly authorized by all requisite
corporate actions) shall attest to, the Securities for the Company by manual or
facsimile signature.
If an Officer or Assistant Secretary whose signature is on a
Security was an Officer or Assistant Secretary at the time of such execution but
no longer holds that office at the time the Trustee authenticates the Security,
the Security shall be valid nevertheless. Each Guarantor shall execute its
Guarantee in the manner set forth in Section 10.07.
A Security shall not be valid until an authorized signatory of
the Trustee manually signs the certificate of authentication on the Security.
The signature shall be conclusive evidence that the Security has been
authenticated under this Indenture.
The Trustee shall authenticate Securities for original issue
on the Issue Date in the aggregate principal amount of $500,000,000 upon a
written order of the Company in the form of an Officers' Certificate. Each such
Officers' Certificate shall specify the amount of Securities to be
authenticated, the series of Securities and the date on which the Securities are
to be authenticated. The aggregate principal amount of Securities outstanding at
any time may not exceed $750,000,000, except as provided in Section 2.07. Except
as provided in Section 2.07, Additional Securities may be issued only in
compliance with Section 4.03. Upon receipt of a written order of the Company in
the form of an Officers' Certificate, the Trustee shall authenticate Securities
in substitution for Securities originally issued to reflect any name change of
the Company.
The Trustee may appoint an authenticating agent reasonably
acceptable to the Company to authenticate Securities. Unless otherwise provided
in the appointment, an authenticating
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agent may authenticate Securities whenever the Trustee may do so. Each reference
in this Indenture to authentication by the Trustee includes authentication by
such agent. An authenticating agent has the same rights as an Agent to deal with
the Company and Affiliates of the Company.
The Securities shall be issuable only in registered form
without coupons in denominations of $1,000 and any integral multiple thereof.
SECTION 2.03. Registrar and Paying Agent.
The Company shall maintain an office or agency in the Borough
of Manhattan, The City of New York, (the "New York Presenting Agent") where (a)
Securities may be presented or surrendered in New York City for registration of
transfer or for exchange, (b) Securities may be presented or surrendered for
payment in New York City and (c) notices and demands upon the Company in respect
of the Securities and this Indenture may be served in New York City. The Trustee
shall initially act as Registrar ("Registrar") and Paying Agent ("Paying Agent")
for the Securities. The Registrar shall keep a register of the Securities and of
their transfer and exchange. The Company, upon written notice to the Trustee,
may have one or more co-Registrars and one or more additional Paying Agents
reasonably acceptable to the Trustee. The term "Paying Agent" includes any
additional Paying Agent. The Company initially appoints the Trustee as
Registrar, Paying Agent and New York Presenting Agent until such time as the
Trustee has resigned or a successor has been appointed. Notices and demands upon
the Company in respect of the Securities and this Indenture may be served at the
Corporate Trust Department of the Trustee located as of the date hereof at 101
Barclay Street, Floor 21W, New York, New York 10286. Neither the Company nor any
Affiliate of the Company may act as Paying Agent except as otherwise expressly
provided in the form of the Security.
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SECTION 2.04. Paying Agent To Hold Assets in Trust.
The Company shall require each Paying Agent other than the
Trustee to agree in writing that each Paying Agent shall hold in trust for the
benefit of Holders or the Trustee all assets held by the Paying Agent for the
payment of principal of, premium, if any, or interest on the Securities, and
shall notify the Trustee in writing of any Default by the Company in making any
such payment. The Company at any time may require a Paying Agent to distribute
all assets held by it to the Trustee and account for any assets disbursed and
the Trustee may at any time, but shall be under no obligation to, during the
continuance of any payment Default, upon written request to a Paying Agent,
require such Paying Agent to distribute all assets held by it to the Trustee and
to account for any assets distributed. Upon distribution to the Trustee of all
assets that shall have been delivered by the Company to the Paying Agent, the
Paying Agent shall have no further liability for such assets.
SECTION 2.05. Securityholder Lists.
The Trustee shall preserve in as current a form as is
reasonably practicable the most recent list available to it of the names and
addresses of Holders. If the Trustee is not the Registrar, the Company shall
furnish to the Trustee before each Record Date and at such other times as the
Trustee may request in writing a list as of such date and in such form as the
Trustee may reasonably require of the names and addresses of Holders, which list
may be conclusively relied upon by the Trustee.
SECTION 2.06. Transfer and Exchange.
Subject to the provisions of Sections 2.15 and 2.16, when
Securities are presented to the Registrar or a co-Registrar (through the New
York Presenting Agent or otherwise) with a request to register the transfer of
such Securities or to exchange such Securities for an equal principal amount of
Securities of other authorized denominations of the same series, the Registrar
or co-Registrar shall register the transfer
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or make the exchange as requested if its requirements for such transaction are
met; provided, however, that the Securities surrendered for transfer or exchange
shall be duly endorsed or accompanied by a written instrument of transfer in
form satisfactory to the Company and the Registrar or co-Registrar, duly
executed by the Holder thereof or his attorney duly authorized in writing. To
permit registrations of transfers and exchanges, the Company shall execute and
the Trustee shall authenticate Securities at the Registrar's or co-Registrar's
written request. No service charge shall be made for any registration of
transfer or exchange, but the Company may require payment of a sum sufficient to
cover any transfer tax or similar governmental charge payable in connection
therewith (other than any such transfer taxes or other governmental charge
payable upon exchanges or transfers pursuant to Section 2.02, 2.10, 3.06, 3.07,
4.12, 4.21 or 9.05). The Registrar or co-Registrar shall not be required to
register the transfer of or exchange of any Security (i) during a period
beginning at the opening of business 15 days before the mailing of a notice of
redemption of Securities and ending at the close of business on the day of such
mailing and (ii) selected for redemption in whole or in part pursuant to Article
Three, except the unredeemed portion of any Security being redeemed in part.
Any Holder of a Global Security shall, by acceptance of such
Global Security, agree that transfers of beneficial interests in such Global
Security may be effected only through a book-entry system maintained by the
Depository (or its agent), and that ownership of a beneficial interest in a
Global Security shall be required to be reflected in a book entry system.
SECTION 2.07. Replacement Securities.
If a mutilated Security is surrendered to the Registrar or if
the Holder of a Security claims that the Security has been lost, destroyed or
wrongfully taken, the Company shall issue and the Trustee shall authenticate
upon written notice from the Company a replacement Security if the Trustee's
requirements are met. If required by the Trustee or the Company, such Holder
must provide an indemnity bond or other indemnity,
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sufficient in the judgment of both the Company and the Trustee, to protect the
Company, the Trustee and any Agent from any loss which any of them may suffer if
a Security is replaced. The Company and the Trustee may charge such Holder for
their respective reasonable out-of-pocket expenses in replacing a Security,
including reasonable fees and expenses of counsel. Every replacement Security is
an additional obligation of the Company.
SECTION 2.08. Outstanding Securities.
Securities outstanding at any time are all the Securities that
have been authenticated by the Trustee except those canceled by it, those
delivered to it for cancellation and those described in this Section as not
outstanding. Subject to Section 2.09, a Security does not cease to be
outstanding because the Company or any of its Affiliates holds the Security.
If a Security is replaced pursuant to Section 2.07 (other than
a mutilated Security surrendered for replacement), it ceases to be outstanding
unless the Trustee receives proof satisfactory to it that the replaced Security
is held by a bona fide purchaser. A mutilated Security ceases to be outstanding
upon surrender of such Security and replacement thereof pursuant to Section
2.07.
If on a Redemption Date or the Final Maturity Date the Paying
Agent holds U.S. Legal Tender or U.S. Government Obligations sufficient to pay
all of the principal and interest due on the Securities payable on that date,
then on and after that date such Securities cease to be outstanding and interest
on them ceases to accrue.
SECTION 2.09. Treasury Securities.
In determining whether the Holders of the required principal
amount of Securities have concurred in any direction, waiver or consent,
Securities owned by the Company, any Guarantor or any of their respective
Affiliates shall be disregarded, except that, for the purposes of determining
whether the Trus-
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tee shall be protected in relying on any such direction, waiver or consent, only
Securities that a Responsible Officer of the Trustee actually knows are so owned
shall be disregarded.
The Trustee may require an Officers' Certificate listing
Securities owned by the Company, any Guarantor or any of their respective
Affiliates.
SECTION 2.10. Temporary Securities.
Until definitive Securities are ready for delivery, the
Company may prepare and the Trustee shall authenticate temporary Securities upon
receipt of a written order of the Company in the form of an Officers'
Certificate. The Officers' Certificate shall specify the amount of temporary
Securities to be authenticated and the date on which the temporary Securities
are to be authenticated. Temporary Securities shall be substantially in the form
of definitive Securities but may have variations that the Company considers
appropriate for temporary Securities. Without unreasonable delay, the Company
shall prepare and the Trustee shall authenticate upon receipt of a written order
of the Company pursuant to Section 2.02 definitive Securities in exchange for
temporary Securities.
SECTION 2.11. Cancellation.
The Company at any time may deliver Securities to the Trustee
for cancellation. The Registrar and the Paying Agent shall forward to the
Trustee any Securities surrendered to them for transfer, exchange or payment.
The Trustee, or at the direction of the Trustee, the Registrar or the Paying
Agent, and no one else, shall cancel and, at the written direction of the
Company, shall dispose of all Securities surrendered for transfer, exchange,
payment or cancellation; provided, however, that in no event shall the Trustee
be required to destroy any cancelled Securities. Subject to Section 2.07, the
Company may not issue new Securities to replace Securities that it has paid or
delivered to the Trustee for cancellation. If the Company or any Guarantor shall
acquire any of the Securities, such acquisition shall not operate as a
redemption or satisfaction of
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the Indebtedness represented by such Securities unless and until the same are
surrendered to the Trustee for cancellation pursuant to this Section 2.11.
SECTION 2.12. Defaulted Interest.
If the Company defaults in a payment of interest on the
Securities, it shall pay interest on overdue principal and on overdue
installments of interest (without grace periods) from time to time on demand at
the rate of 2% per annum in excess of the rate shown on the Security.
SECTION 2.13. CUSIP Number.
The Company in issuing the Securities will use a "CUSIP"
number, and if so, the Trustee shall use the CUSIP number in notices of
redemption or exchange as a convenience to Holders; provided that any such
notice may state that no representation is made as to the correctness or
accuracy of the CUSIP number printed in the notice or on the Securities, and
that reliance may be placed only on the other identification numbers printed on
the Securities.
SECTION 2.14. Deposit of Moneys.
Prior to the close of business of the Paying Agent on the
Business Day next prior to each Interest Payment Date and the Final Maturity
Date, the Company shall deliver by wire transfer to the Paying Agent in
immediately available funds money sufficient to make cash payments due on such
Interest Payment Date or the Final Maturity Date, as the case may be, in a
timely manner which permits the Paying Agent to remit payment to the Holders on
such Interest Payment Date or the Final Maturity Date, as the case may be.
SECTION 2.15. Book-Entry Provisions for Global Securities.
(a) The Global Securities initially shall (i) be registered
in the name of the Depository or the nominee of such Depository, (ii) be
delivered to the Trustee as custodian for
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such Depository and (iii) bear legends as set forth in Exhibit C.
Members of, or participants in, the Depository
("Participants") shall have no rights under this Indenture with respect to any
Global Security held on their behalf by the Depository, or the Trustee as its
custodian, or under the Global Security, and the Depository may be treated by
the Company, the Trustee and any agent of the Company or the Trustee as the
absolute owner of the Global Security for all purposes whatsoever.
Notwithstanding the foregoing, nothing herein shall prevent the Company, the
Trustee or any agent of the Company or the Trustee from giving effect to any
written certification, proxy or other authorization furnished by the Depository
or impair, as between the Depository and Participants, the operation of
customary practices governing the exercise of the rights of a Holder of any
Security.
(b) Transfers of Global Securities shall be limited to
transfers in whole, but not in part, to the Depository, its successors or their
respective nominees. Interests of beneficial owners in the Global Securities may
be transferred or exchanged for Physical Securities in accordance with the rules
and procedures of the Depository and the provisions of Section 2.16. In
addition, Physical Securities shall be transferred to all beneficial owners in
exchange for their beneficial interests in Global Securities if (i) the
Depository notifies the Company that it is unwilling or unable to continue as
Depository for any Global Security and a successor depositary is not appointed
by the Company within 90 days of such notice or (ii) an Event of Default has
occurred and is continuing and the Registrar has received a request from the
Depository to issue Physical Securities.
(c) In connection with the transfer of Global Securities as
an entirety to beneficial owners pursuant to paragraph (b) of this Section 2.15,
the Global Securities shall be deemed to be surrendered to the Trustee for
cancellation, and the Company shall execute, and the Trustee shall upon written
instructions from the Company authenticate and deliver, to each
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beneficial owner identified by the Depository in exchange for its beneficial
interest in the Global Securities, an equal aggregate principal amount of
Physical Securities of authorized denominations.
(d) Any Physical Security constituting a Restricted Security
delivered in exchange for an interest in a Global Security pursuant to paragraph
(b) or (c) of this Section 2.15 shall, except as otherwise provided by Section
2.16, bear the Private Placement Legend.
(e) The Holder of any Global Security may grant proxies and
otherwise authorize any Person, including Participants and Persons that may hold
interests through Participants, to take any action which a Holder is entitled to
take under this Indenture or the Securities.
SECTION 2.16. Registration of Transfers and Exchanges.
(a) Transfer and Exchange of Physical Securities. When
Physical Securities are presented to the Registrar with a request:
(i) to register the transfer of the Physical Securities; or
(ii) to exchange such Physical Securities for an equal number
of Physical Securities of other authorized denominations,
the Registrar shall register the transfer or make the exchange as requested if
the requirements under this Indenture as set forth in this Section 2.16 for such
transactions are met; provided, however, that the Physical Securities presented
or surrendered for registration of transfer or exchange:
(I) shall be duly endorsed or accompanied by a written
instrument of transfer in form satisfactory to the Registrar or
co-Registrar, duly executed by the Holder thereof or his attorney duly
authorized in writing and ac-
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companied by reasonable assurance that each necessary endorsement or instrument
is genuine and authorized; and
(II) in the case of Physical Securities the offer and sale
of which have not been registered under the Securities Act, such
Physical Securities shall be accompanied by an Opinion of Counsel
addressed to the Registrar to the effect that such transfer and
exchange is in compliance with applicable securities law and, in the
sole discretion of the Company, by the following additional information
and documents, as applicable:
(A) if such Physical Security is being delivered to
the Registrar by a holder for registration in the name of such
holder, without transfer, a certification from such holder to
that effect (in substantially the form of Exhibit D hereto);
or
(B) if such Physical Security is being transferred
to a Qualified Institutional Buyer in accordance with Rule
144A under the Securities Act, a certification to that effect
(in substantially the form of Exhibit D hereto); or
(C) if such Physical Security is being transferred
to an Institutional Accredited Investor, delivery of a
certification to that effect (in substantially the form of
Exhibit D hereto) and a Transferee Certificate for
Institutional Accredited Investors in substantially the form
of Exhibit E hereto; or
(D) if such Physical Security is being transferred
in reliance on Regulation S, delivery of a certification to
that effect (in substantially the form of Exhibit D hereto)
and a Transferee Certificate for Regulation S Transfers in
substantially the form of Exhibit F hereto and an Opinion of
Counsel reasonably satisfactory to the Company to the effect
that such transfer is in compliance with the Securities Act;
or
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(E) if such Physical Security is being transferred in
reliance on Rule 144 under the Securities Act, delivery of a
certification to that effect (in substantially the form of
Exhibit D hereto) and an Opinion of Counsel reasonably
satisfactory to the Company to the effect that such transfer
is in compliance with the Securities Act; or
(F) if such Physical Security is being transferred in
reliance on another exemption from the registration
requirements of the Securities Act, a certification to that
effect (in substantially the form of Exhibit D hereto) and an
Opinion of Counsel reasonably satisfactory to the Company to
the effect that such transfer is in compliance with the
Securities Act.
(b) Restrictions on Transfer of a Physical Security for a
Beneficial Interest in a Global Security. A Physical Security may not be
exchanged for a beneficial interest in a Global Security except upon
satisfaction of the requirements set forth below. Upon receipt by the Registrar
of a Physical Security, duly endorsed or accompanied by appropriate instruments
of transfer, in form satisfactory to the Registrar, together with:
(A) a certification, in substantially the form of Exhibit D
hereto, that such Physical Security is being transferred to a Qualified
Institutional Buyer; and
(B) written instructions directing the Registrar to make, or
to direct the Depository to make, an endorsement on the Global Security
to reflect an increase in the aggregate amount of the Securities
represented by the Global Security,
then the Registrar shall cancel such Physical Security and cause, or direct the
Depository to cause, in accordance with the standing instructions and procedures
existing between the Depository and the Registrar, the number of Securities
repre-
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sented by the Global Security to be increased accordingly. If no Global Security
is then outstanding, the Company shall issue and the Trustee shall upon written
instructions from the Company authenticate a new Global Security in the
appropriate amount.
(c) Transfer and Exchange of Global Securities. The transfer
and exchange of Global Securities or beneficial interests therein shall be
effected through the Depository, in accordance with this Indenture (including
the restrictions on transfer set forth herein) and the procedures of the
Depository therefor.
(d) Transfer of a Beneficial Interest in a Global Security
for a Physical Security.
(i) Any Person having a beneficial interest in a Global
Security may upon request exchange such beneficial interest for a
Physical Security. Upon receipt by the Registrar of written
instructions or such other form of instructions as is customary for the
Depository from the Depository or its nominee on behalf of any Person
having a beneficial interest in a Global Security and upon receipt by
the Trustee of a written order or such other form of instructions as is
customary for the Depository or the Person designated by the Depository
as having such a beneficial interest containing registration
instructions and, in the case of any such transfer or exchange of a
beneficial interest in Securities the offer and sale of which have not
been registered under the Securities Act, the following additional
information and documents:
(A) if such beneficial interest is being transferred
to the Person designated by the Depository as being the
beneficial owner, a certification from such Person to that
effect (in substantially the form of Exhibit D hereto); or
(B) if such beneficial interest is being transferred
to a Qualified Institutional Buyer in accor-
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dance with Rule 144A under the Securities Act, a certification
to that effect (in substantially the form of Exhibit D
hereto); or
(C) if such beneficial interest is being transferred
to an Institutional Accredited Investor, delivery of a
certification to that effect (in substantially the form of
Exhibit D hereto) and a Certificate for Institutional
Accredited Investors in substantially the form of Exhibit E
hereto; or
(D) if such beneficial interest is being transferred
in reliance on Regulation S, delivery of a certification to
that effect (in substantially the form of Exhibit D hereto)
and a Transferee Certificate for Regulation S Transfers in
substantially the form of Exhibit F hereto and an Opinion of
Counsel reasonably satisfactory to the Company to the effect
that such transfer is in compliance with the Securities Act;
or
(E) if such beneficial interest is being transferred
in reliance on Rule 144 under the Securities Act, delivery of
a certification to that effect (in substantially the form of
Exhibit D hereto) and an Opinion of Counsel reasonably
satisfactory to the Company to the effect that such transfer
is in compliance with the Securities Act; or
(F) if such beneficial interest is being transferred
in reliance on another exemption from the registration
requirements of the Securities Act, a certification to that
effect (in substantially the form of Exhibit D hereto) and an
Opinion of Counsel reasonably satisfactory to the Company to
the effect that such transfer is in compliance with the
Securities Act,
then the Registrar will cause, in accordance with the standing
instructions and procedures existing between the
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Depository and the Registrar, the aggregate amount of the Global
Security to be reduced and, following such reduction, the Company will
execute and, upon receipt of an authentication order in the form of an
Officers' Certificate, the Trustee will authenticate and deliver to the
transferee a Physical Security.
(ii) Securities issued in exchange for a beneficial interest
in a Global Security pursuant to this Section 2.16(d) shall be
registered in such names and in such authorized denominations as the
Depository, pursuant to instructions from its direct or indirect
participants or otherwise, shall instruct the Registrar in writing. The
Registrar shall make such Physical Securities available for delivery to
the Persons in whose names such Physical Securities are so registered.
(e) Restrictions on Transfer and Exchange of Global
Securities. Notwithstanding any other provisions of this Indenture, a Global
Security may not be transferred as a whole except by the Depository to a nominee
of the Depository or by a nominee of the Depository to the Depository or another
nominee of the Depository or by the Depository or any such nominee to a
successor Depository or a nominee of such successor Depository.
(f) Private Placement Legend. Upon the transfer, exchange or
replacement of Securities not bearing the Private Placement Legend, the
Registrar shall deliver Securities that do not bear the Private Placement
Legend. Upon the transfer, exchange or replacement of Securities bearing the
Private Placement Legend, the Registrar shall deliver only Securities that bear
the Private Placement Legend unless, and the Trustee is hereby authorized to
deliver Securities without the Private Placement Legend if, (i) there is
delivered to the Trustee an Opinion of Counsel reasonably satisfactory to the
Company and the Trustee to the effect that neither such legend nor the related
restrictions on transfer are required in order to maintain compliance with the
provisions of the Securities Act or (ii) such Security has been sold pursuant to
an effective registration statement under the Securities Act.
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(g) General. By its acceptance of any Security bearing the
Private Placement Legend, each Holder of such a Security acknowledges the
restrictions on transfer of such Security set forth in this Indenture and in the
Private Placement Legend and agrees that it will transfer such Security only as
provided in this Indenture.
The Registrar shall retain copies of all letters, notices and
other written communications received pursuant to Section 2.15 or this Section
2.16 in accordance with its customary procedures. The Company shall have the
right to inspect and make copies of all such letters, notices or other written
communications at any reasonable time upon the giving of reasonable written
notice to the Registrar.
The Registrar and the Trustee shall have no obligation or duty
to monitor, determine or inquire as to compliance with any restrictions on
transfer imposed under this Indenture or under applicable law with respect to
any transfer of any interest in any Security (including any transfers between or
among Participants or beneficial owners of interests in any Global Security)
other than to require delivery of such certificates and other documentation or
evidence as are expressly required by, and to do so if and when expressly
required by the terms of, this Indenture, and to examine the same to determine
substantial compliance as to form with the express requirements hereof.
ARTICLE THREE
REDEMPTION
SECTION 3.01. Notices to Trustee.
If the Company elects to redeem Securities pursuant to
Paragraph 5 or Paragraph 6 of the Securities, it shall notify the Trustee in
writing of the Redemption Date, the Redemption Price and the principal amount of
Securities to be redeemed. The Company shall give notice of redemption to the
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Trustee at least 45 days (except in connection with a Special Redemption) but
not more than 60 days before the Redemption Date (unless a shorter notice shall
be agreed to by the Trustee in writing), together with an Officers' Certificate
stating that such redemption will comply with the conditions contained herein.
SECTION 3.02. Selection of Securities To Be Redeemed.
If fewer than all of the Securities are to be redeemed at any
time, the Trustee shall select the Securities to be redeemed, on a pro rata
basis, by lot or by such method as the Trustee shall deem fair and appropriate;
provided, however, that if the Securities are redeemed pursuant to Paragraph 6
of the Securities, the Securities shall be redeemed solely on a pro rata basis
or on as nearly a pro rata basis as is practicable (subject to the procedures of
the Depository) unless the securities exchange, if any, on which the Securities
are listed requires a different method. If the Securities are listed on any
national securities exchange, the Company shall notify the Trustee in writing of
the requirements of such exchange in respect of any redemption. The Trustee
shall make the selection from the Securities outstanding and not previously
called for redemption and shall promptly notify the Company in writing of the
Securities selected for redemption and, in the case of any Security selected for
partial redemption, the principal amount thereof to be redeemed. The Trustee may
select for redemption portions (equal to $1,000 or any integral multiple
thereof) of the principal of Securities that have denominations larger than
$1,000. Provisions of this Indenture that apply to Securities called for
redemption also apply to portions of Securities called for redemption.
SECTION 3.03. Notice of Redemption.
At least 30 days but not more than 60 days before a Redemption
Date, the Company shall mail or cause to be mailed a notice of redemption by
first-class mail, postage prepaid, to each Holder whose Securities are to be
redeemed. At the Company's written request delivered at least 15 days prior to
the
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proposed date of such mailing (unless a shorter notice shall be acceptable
to the Trustee), the Trustee shall give the notice of redemption in the
Company's name and at the Company's expense. Each notice for redemption shall
identify the Securities to be redeemed (including CUSIP numbers, if any) and
shall state:
(1) the Redemption Date;
(2) the Redemption Price and the amount of accrued
interest, if any, to be paid;
(3) the name and address of the Paying Agent;
(4) that Securities called for redemption must be
surrendered to the Paying Agent to collect the Redemption Price plus
accrued interest, if any;
(5) that, unless the Company defaults in making the
redemption payment, interest on Securities called for redemption ceases
to accrue on and after the Redemption Date, and the only remaining
right of the Holders of such Securities is to receive payment of the
Redemption Price and accrued interest, if any, to the Redemption Date
upon surrender to the Paying Agent of the Securities redeemed;
(6) if any Security is being redeemed in part, the
portion of the principal amount of such Security to be redeemed and
that, after the Redemption Date, and upon surrender of such Security, a
new Security or Securities in aggregate principal amount equal to the
unredeemed portion thereof will be issued;
(7) if fewer than all the Securities are to be redeemed,
the identification of the particular Securities (or portion thereof) to
be redeemed, as well as the aggregate principal amount of Securities to
be redeemed and the aggregate principal amount of Securities to be
outstanding after such partial redemption; and
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(8) the paragraph of the Securities pursuant to which the
Securities are to be redeemed.
SECTION 3.04. Effect of Notice of Redemption.
Once notice of redemption is mailed in accordance with Section
3.03, Securities called for redemption become due and payable on the Redemption
Date and at the Redemption Price plus accrued interest, if any. Upon surrender
to the Paying Agent, such Securities called for redemption shall be paid at the
Redemption Price (which shall include accrued interest thereon to the Redemption
Date), but installments of interest, the maturity of which is on or prior to the
Redemption Date, shall be payable to Holders of record at the close of business
on the relevant Record Dates.
SECTION 3.05. Deposit of Redemption Price.
Prior to 11:00 a.m. New York City time on the Redemption Date,
the Company shall deposit with the Paying Agent U.S. Legal Tender sufficient to
pay the Redemption Price plus accrued interest, if any, of all Securities to be
redeemed on that date.
If the Company complies with the preceding paragraph, then,
unless the Company defaults in the payment of such Redemption Price plus accrued
interest, if any, interest on the Securities to be redeemed will cease to accrue
on and after the applicable Redemption Date, whether or not such Securities are
presented for payment.
SECTION 3.06. Securities Redeemed in Part.
Upon surrender of a Security that is to be redeemed in part,
the Trustee shall authenticate for the Holder a new Security or Securities equal
in principal amount to the unredeemed portion of the Security surrendered.
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ARTICLE FOUR
COVENANTS
SECTION 4.01. Payment of Securities.
The Company shall pay the principal of and interest on the
Securities in the manner provided in the Securities. An installment of principal
of or interest on the Securities shall be considered paid on the date it is due
if the Trustee or Paying Agent holds on that date U.S. Legal Tender designated
for and sufficient to pay the installment.
The Company shall pay, to the extent such payments are lawful,
interest on overdue principal and it shall pay interest on overdue installments
of interest (without regard to any applicable grace periods) from time to time
on demand at the rate borne by the Securities plus 2% per annum. Interest will
be computed on the basis of a 360-day year comprised of twelve 30-day months.
SECTION 4.02. Maintenance of Office or Agency.
The Company shall maintain in the Borough of Manhattan, The
City of New York, the office or agency required under Section 2.03. The Company
shall give prompt written notice to the Trustee of the location, and any change
in the location, of such office or agency. If at any time the Company shall fail
to maintain any such required office or agency or shall fail to furnish the
Trustee with the address thereof, such presentations, surrenders, notices and
demands may be made or served at the address of the Trustee set forth in Section
11.02. The Company hereby initially designates the Corporate Trust Department of
the Trustee as its office or agency in the Borough of Manhattan, The City of New
York.
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SECTION 4.03. Limitation on Incurrence of Additional Indebtedness.
On the Spin-Off Date (after giving effect to the Spin-Off
Transactions) and after the Spin-Off Date, the Company will not, and will not
permit any of the Restricted Subsidiaries to, directly or indirectly, create,
incur, issue, assume, guarantee, acquire, become liable, contingently or
otherwise, with respect to, or otherwise become responsible for payment of
(collectively, "incur") any Indebtedness (other than Permitted Indebtedness);
provided, however, that if no Default or Event of Default shall have occurred
and be continuing at the time of or as a consequence of the incurrence of any
such Indebtedness: (a) the Company, any Guarantor, any Finance Subsidiary that
is a Domestic Restricted Subsidiary and any Accounts Receivable Entity that is a
Domestic Restricted Subsidiary may incur Indebtedness (including, without
limitation, Acquired Indebtedness) if on the date of the incurrence of such
Indebtedness, after giving effect to the incurrence thereof, the Consolidated
Fixed Charge Coverage Ratio of the Company would be greater than:
(i) (x) 2.0 to 1.0, if the incurrence were to occur on or
prior to October 15, 2001; or
(y) 2.25 to 1.0, if the incurrence were to occur after
October 15, 2001; and
(ii) any Restricted Subsidiary that is not a Guarantor (and
is not a Finance Subsidiary or an Accounts Receivable Entity that is a
Domestic Restricted Subsidiary) may incur Indebtedness (including,
without limitation, Acquired Indebtedness) if, on the date of the
incurrence of such Indebtedness, after giving effect to the incurrence
thereof:
(x) the Consolidated Fixed Charge Coverage Ratio of
the Company would be greater than:
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(A) 2.0 to 1.0, if the incurrence were to occur
on or prior to October 15, 2001; or
(B) 2.25 to 1.0, if the incurrence were to occur
after October 15, 2001; and
(y) if the agreements governing such Indebtedness
contain an encumbrance or restriction on the ability of the
applicable Restricted Subsidiary that is not a Guarantor (and
is not a Finance Subsidiary or an Accounts Receivable Entity
that is a Domestic Restricted Subsidiary) to pay dividends or
make distributions on or in respect of its Capital Stock, the
Combined Fixed Charge Coverage Ratio of the Restricted
Subsidiaries that are not Guarantors would be greater than 2.5
to 1.0.
No Indebtedness incurred pursuant to the Consolidated Fixed
Charge Coverage Ratio test of the preceding paragraph (including, without
limitation, Indebtedness under the Credit Agreement) shall reduce the amount of
Indebtedness which may be incurred pursuant to any clause of the definition of
Permitted Indebtedness (including, without limitation, Indebtedness under the
Credit Agreement pursuant to clause (2) of the definition of Permitted
Indebtedness).
Indebtedness of a Person existing at the time such Person
becomes a Restricted Subsidiary or which is secured by a Lien on an asset
acquired by the Company or a Restricted Subsidiary (whether or not such
Indebtedness is assumed by the acquiring Person) shall be deemed incurred at the
time the Person becomes a Restricted Subsidiary or at the time of the asset
acquisition, as the case may be.
SECTION 4.04. Limitation on Restricted Payments.
On the Spin-Off Date (after giving effect to the Spin-Off
Transactions) and after the Spin-Off Date, the Company will not, and will not
cause or permit any of the Restricted Subsidiaries to, directly or indirectly:
(a) declare or pay
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any dividend or make any distribution (other than dividends or distributions
payable in Qualified Capital Stock of the Company) on or in respect of shares of
its Capital Stock to holders of such Capital Stock (including by means of a
Person (including an Unrestricted Subsidiary) making such a payment with the
proceeds of an Investment made by the Company or any Restricted Subsidiary); (b)
purchase, redeem or otherwise acquire or retire for value any Capital Stock of
the Company or any warrants, rights or options to purchase or acquire shares of
any class of such Capital Stock (including by means of a Person (including an
Unrestricted Subsidiary) making such a payment with the proceeds of an
Investment made by the Company or any Restricted Subsidiary); or (c) make any
Investment (other than Permitted Investments); (each of the foregoing actions
set forth in clauses (a), (b) and (c) being referred to as a "Restricted
Payment"), if at the time of such Restricted Payment or immediately after giving
effect thereto:
(i) a Default or an Event of Default shall have occurred and
be continuing; (ii) the Company is not able to incur at least $1.00 of
additional Indebtedness (other than Permitted Indebtedness) in compliance with
Section 4.03; or (iii) the aggregate amount of Restricted Payments (including
such proposed Restricted Payment) made after the Spin-Off Date (the amount
expended for such purpose, if other than in cash, being the Fair Market Value of
such property as determined reasonably and in good faith by the Board of
Directors of the Company) shall exceed the sum of: (v) $30.0 million; plus (w)
50% of the cumulative Consolidated Net Income (or if cumulative Consolidated Net
Income shall be a loss, minus 100% of such loss) of the Company earned during
the period beginning on the first day of the fiscal quarter during which the
Spin-Off Date occurs and through the end of the most recent fiscal quarter for
which financial statements are available prior to the date such Restricted
Payment occurs (the "Reference Date") (treating such period as a single
accounting period); plus (x) 100% of the Fair Market Value of the net proceeds
received by the Company from any Person (other than a Subsidiary of the Company)
from the issuance and sale subsequent to the Spin-Off Date and on or prior to
the Reference Date of Qualified Capital Stock of the
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Company (excluding any net proceeds from a Public Equity Offering to the extent
used to redeem Securities); plus (y) without duplication of any amounts included
in clause (iii)(x) above, 100% of the Fair Market Value of the net proceeds of
any contribution to the common equity capital of the Company received by the
Company from a holder of the Company's Capital Stock (excluding any net proceeds
from a Public Equity Offering to the extent used to redeem the Securities)
subsequent to the Spin-Off Date; plus (z) an amount equal to the lesser of (A)
the sum of the Fair Market Value of the Capital Stock of an Unrestricted
Subsidiary owned by the Company and/or the Restricted Subsidiaries and the
aggregate amount of all Indebtedness of such Unrestricted Subsidiary owed to the
Company and each Restricted Subsidiary on the date of Revocation of such
Unrestricted Subsidiary as an Unrestricted Subsidiary in accordance with Section
4.20 or (B) the Designation Amount with respect to such Unrestricted Subsidiary
on the date of the Designation of such Subsidiary as an Unrestricted Subsidiary
in accordance with Section 4.20.
Notwithstanding the foregoing, the provisions set forth in
the immediately preceding paragraph do not prohibit:
(1) the payment of any dividend within 60 days after the
date of declaration of such dividend if the dividend would have been
permitted on the date of declaration;
(2) the acquisition of any shares of Capital Stock of the
Company, either (A) solely in exchange for shares of Qualified Capital
Stock of the Company or (B) through the application of net proceeds of
a substantially concurrent sale for cash (other than to a Subsidiary of
the Company) of shares of Qualified Capital Stock of the Company;
(3) so long as no Default or Event of Default shall have
occurred and be continuing, repurchases of Capital Stock (or rights or
options therefor) of the Company from officers, directors, employees or
consultants pursuant to equity ownership or compensation plans or
stockholders agreements not to exceed $15.0 million in the aggregate;
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(4) dividends and distributions paid on Common Stock of a
Restricted Subsidiary on a pro rata basis;
(5) the distribution of the Capital Stock of Packaging to the
Company's Shareholders pursuant to the Spin-Off Transactions; and
(6) repurchases on the Spin-Off Date in connection with the
Spin-Off Transactions, of any of the Variable Rate Voting Participating
Preferred Stock, par value $.01, of Tenneco International Holding Corp.
outstanding on the Issue Date.
In determining the aggregate amount of Restricted Payments
made subsequent to the Spin-Off Date in accordance with clause (3) of the first
paragraph of this Section 4.04, amounts expended pursuant to clauses (1), (2)
and (3) above shall be included in such calculation.
SECTION 4.05. Corporate Existence.
Except as otherwise permitted by Article Five, the Company
shall do or cause to be done all things necessary to preserve and keep in full
force and effect its corporate existence and the corporate, partnership or other
existence of each of the Restricted Subsidiaries in accordance with the
respective organizational documents of each Restricted Subsidiary and the rights
(charter and statutory) and material franchises of the Company and each of its
Restricted Subsidiaries; provided, however, that the Company shall not be
required to preserve any such right or franchise, or the corporate existence of
any Restricted Subsidiary, if the Board of Directors of the Company shall
determine that the preservation thereof is no longer desirable in the conduct of
the business of the Company and its Restricted Subsidiaries, taken as a whole,
and that the loss thereof is not, and will not be, adverse in any material
respect to the Holders.
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SECTION 4.06. Payment of Taxes and Other Claims.
The Company shall pay or discharge or cause to be paid or
discharged, before the same shall become delinquent, (i) all material taxes,
assessments and governmental charges levied or imposed upon it or any of the
Restricted Subsidiaries or upon the income, profits or property of it or any of
the Restricted Subsidiaries and (ii) all lawful claims for labor, materials and
supplies which, in each case, if unpaid, might by law become a material
liability or Lien upon the property of it or any of the Restricted Subsidiaries;
provided, however, that the Company shall not be required to pay or discharge or
cause to be paid or discharged any such tax, assessment, charge or claim whose
amount, applicability or validity is being contested in good faith by
appropriate proceedings and for which appropriate provision has been made.
SECTION 4.07. Maintenance of Properties and Insurance.
(1) The Company shall cause all material properties owned by
or leased by it or any of the Restricted Subsidiaries used in the conduct of its
business or the business of any of the Restricted Subsidiaries to be improved or
maintained and kept in normal condition, repair and working order (reasonable
wear and tear excepted) and supplied with all necessary equipment and shall
cause to be made all necessary repairs, renewals, replacements, betterments and
improvements thereof, all as in its judgment may be necessary, so that the
business carried on in connection therewith may be properly and advantageously
conducted at all times; provided, however, that nothing in this Section 4.07
shall prevent the Company or any of the Restricted Subsidiaries from
discontinuing the use, operation or maintenance of any of such properties, or
disposing of any of them, if such discontinuance or disposal is, in the judgment
of the Board of Directors of the Company or of the Board of Directors of any
Restricted Subsidiary, or of an officer (or other agent employed by the Company
or of any of the Restricted Subsidiaries) of the Company or any of its
Restricted Subsidiaries having managerial responsibility for any such property,
desirable in the conduct of the business of the Company or any Restricted
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Subsidiary, and if such discontinuance or disposal is not adverse in any
material respect to the Holders.
(2) The Company shall maintain, and shall cause the
Restricted Subsidiaries to maintain, insurance with responsible carriers against
such risks and in such amounts, and with such deductibles, retentions,
self-insured amounts and co-insurance provisions, as are customarily carried by
similar businesses of similar size, including property and casualty loss,
workers' compensation and interruption of business insurance.
SECTION 4.08. Compliance Certificate; Notice of Default.
(1) The Company shall deliver to the Trustee, within 100 days
after the close of each fiscal year, an Officers' Certificate stating that a
review of the activities of the Company has been made under the supervision of
the signing officers with a view to determining whether it has kept, observed,
performed and fulfilled its obligations under this Indenture and further
stating, as to each such Officer signing such certificate, that to the best of
his knowledge the Company during such preceding fiscal year has kept, observed,
performed and fulfilled each and every such covenant and no Default or Event of
Default occurred during such year and at the date of such certificate no Default
or Event of Default has occurred and is continuing or, if such signers do know
of such Default or Event of Default, the certificate shall describe its status
with particularity. The Officers' Certificate shall also notify the Trustee
should the Company elect to change the manner in which it fixes its fiscal year
end.
(2) The annual financial statements delivered pursuant to
Section 4.10 shall be accompanied by a written report of the Company's
independent accountants (who shall be a firm of established national reputation)
that in conducting their audit of such financial statements nothing has come to
their attention that would lead them to believe that the Company has violated
any provisions of Article Four, Five or Six of this Indenture insofar as they
relate to accounting matters or, if any such violation has occurred, specifying
the nature and period
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of existence thereof, it being understood that such accountants shall not be
liable directly or indirectly to any Person for any failure to obtain knowledge
of any such violation.
(3) The Company shall deliver to the Trustee, within ten days
after becoming aware of any Default or Event of Default in the performance of
any covenant, agreement or condition contained in this Indenture, an Officers'
Certificate specifying the Default or Event of Default and describing its status
with particularity.
SECTION 4.09. Compliance with Laws.
The Company shall comply, and shall cause each of the
Restricted Subsidiaries to comply, with all applicable statutes, rules,
regulations, orders and restrictions of the United States of America, all states
and municipalities thereof, and of any governmental department, commission,
board, regulatory authority, bureau, agency and instrumentality of the
foregoing, in respect of the conduct of their respective businesses and the
ownership of their respective properties, except for such noncompliances as
would not in the aggregate have a material adverse effect on the financial
condition or results of operations of the Company and the Restricted
Subsidiaries taken as a whole.
SECTION 4.10. Reports to Holders.
(1) The Company will file with the Commission all
information, documents and reports to be filed with the Commission pursuant to
Section 13 or 15(d) of the Exchange Act, whether or not the Company is subject
to such filing requirements so long as the Commission will accept such filings.
The Company (at its own expense) will deliver to the Trustee within 15 days
after it files them with the Commission, copies of the quarterly and annual
reports and the information, documents and other reports, if any, which the
Company is required to file with the Commission pursuant to Section 13 or 15(d)
of the Exchange Act. The Company shall also comply with the provisions of TIA
Section 314(a).
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(2) At the Company's expense, regardless of whether the
Company is required to furnish such reports to its stockholders pursuant to the
Exchange Act, the Company shall cause its consolidated financial statements,
comparable to those which would have been required to appear in annual or
quarterly reports, to be delivered to the Trustee. The Company will also make
such reports available to prospective purchasers of the Securities, securities
analysts and broker-dealers upon their request.
(3) For so long as any of the Securities remain outstanding
the Company will make available to any prospective purchaser of the Securities
or beneficial owner of the Securities in connection with any sale thereof the
information required by Rule 144A(d)(4) under the Securities Act during any
period when the Company is not subject to Section 13 or 15(d) under the Exchange
Act.
Delivery of such reports, information and documents to the
Trustee pursuant to this Section 4.10 is for informational purposes only and the
Trustee's receipt of such shall not constitute constructive notice of any
information contained therein or determinable from information contained
therein, including the Company's compliance with any of its covenants hereunder
(as to which the Trustee is entitled to rely exclusively on Officers'
Certificates).
SECTION 4.11. Waiver of Stay, Extension or Usury Laws.
The Company covenants (to the extent that it may lawfully do
so) that it shall not at any time insist upon, plead, or in any manner
whatsoever claim or take the benefit or advantage of, any stay or extension law
or any usury law or other law that would prohibit or forgive the Company from
paying all or any portion of the principal of and/or interest on the Securities
as contemplated herein, wherever enacted, now or at any time hereafter in force,
or which may affect the covenants or the performance of this Indenture, and (to
the extent that it may lawfully do so) the Company hereby expressly waives all
benefit or advantage of any such law, and covenants that it
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will not hinder, delay or impede the execution of any power herein granted to
the Trustee, but will suffer and permit the execution of every such power as
though no such law had been enacted.
SECTION 4.12. Limitation on Asset Sales.
After the Spin-Off Date the Company will not, and will not
permit any of the Restricted Subsidiaries to, consummate an Asset Sale unless:
(i) the Company or the applicable Restricted Subsidiary, as the case may be,
receives consideration at the time of such Asset Sale at least equal to the Fair
Market Value of the assets sold or otherwise disposed of; (ii) at least 75% of
the consideration received by the Company or the Restricted Subsidiary, as the
case may be, from such Asset Sale shall be in the form of cash or Cash
Equivalents and is received at the time of such disposition; and (iii) upon the
consummation of an Asset Sale, the Company shall apply, or cause such Restricted
Subsidiary to apply, the Net Cash Proceeds relating to such Asset Sale within
365 days after receipt thereof either (A) to repay any Senior Debt, Guarantor
Senior Debt or Indebtedness of a Restricted Subsidiary that is not a Guarantor,
(B) to acquire Replacement Assets, or (C) a combination of prepayment and
investment permitted by the foregoing clauses (iii)(A) and (iii)(B).
On the 366th day after an Asset Sale or such earlier date, if
any, as the Board of Directors of the Company or of such Restricted Subsidiary
determines not to apply the Net Cash Proceeds relating to such Asset Sale as set
forth in clauses (iii)(A), (iii)(B) and (iii)(C) of the preceding paragraph
(each, a "Net Proceeds Offer Trigger Date"), such aggregate amount of Net Cash
Proceeds which have not been applied on or before such Net Proceeds Offer
Trigger Date as permitted in clauses (iii)(A), (iii)(B) and (iii)(C) of the
preceding paragraph (each a "Net Proceeds Offer Amount") shall be applied by the
Company to make an offer to purchase (the "Net Proceeds Offer") on a date (the
"Net Proceeds Offer Payment Date") not less than 30 nor more than 60 days
following the applicable Net Proceeds Offer Trigger Date, from all Holders on a
pro rata ba-
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sis, that principal amount of Securities equal to the Net Proceeds Offer Amount
at a price equal to 100% of the principal amount of the Securities to be
purchased, plus accrued and unpaid interest, if any, thereon to the date of
purchase; provided, however, that if at any time any non-cash consideration
received by the Company or any Restricted Subsidiary, as the case may be, in
connection with any Asset Sale is converted into or sold or otherwise disposed
of for cash (other than interest received with respect to any such non-cash
consideration) or Cash Equivalents, then such conversion or disposition shall be
deemed to constitute an Asset Sale hereunder and the Net Cash Proceeds thereof
shall be applied in accordance with this Section 4.12.
The Company may defer the Net Proceeds Offer until there is an
aggregate unutilized Net Proceeds Offer Amount equal to or in excess of $35.0
million resulting from one or more Asset Sales or deemed Asset Sales (at which
time, the entire unutilized Net Proceeds Offer Amount, and not just the amount
in excess of $35.0 million, shall be applied as required pursuant to this
paragraph). The first such date the aggregate unutilized Net Proceeds Offer
Amount is equal to or in excess of $35.0 million shall be treated for this
purpose as the Net Proceeds Offer Trigger Date.
In the event of the transfer of substantially all (but not
all) of the property and assets of the Company and the Restricted Subsidiaries
after the Spin-Off Date as an entirety to a Person in a transaction permitted
under Section 5.01, the successor corporation shall be deemed to have sold the
properties and assets of the Company and the Restricted Subsidiaries not so
transferred for purposes of this Section 4.12, and shall comply with the
provisions of this Section 4.12 with respect to such deemed sale as if it were
an Asset Sale. In addition, the Fair Market Value of such properties and assets
of the Company or the Restricted Subsidiaries deemed to be sold shall be deemed
to be Net Cash Proceeds for purposes of this Section 4.12.
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Each Net Proceeds Offer will be mailed or caused to be
mailed, by first class mail, by the Company within 30 days following the Net
Proceeds Offer Trigger Date to all record Holders as shown on the register of
Holders, with a copy to the Trustee. The notice shall contain all instructions
and materials necessary to enable such Holders to tender Securities pursuant to
the Net Proceeds Offer and shall state the following terms:
(1) that the Net Proceeds Offer is being made pursuant to
this Section 4.12 and that the Holders may elect to tender their
Securities in whole or in part in integral multiples of $1,000 in
exchange for cash; provided, however, that if the aggregate principal
amount of Securities properly tendered in a Net Proceeds Offer exceeds
the Net Proceeds Offer Amount, Securities of tendering Holders will be
purchased on a pro rata basis (based on amounts tendered);
(2) the purchase price (including the amount of accrued
interest, if any) and the Net Proceeds Offer Payment Date (which shall
be at least 20 Business Days from the date of mailing of notice of such
Net Proceeds Offer, or such longer period as required by law);
(3) that any Security not tendered will continue to accrue
interest;
(4) that, unless the Company defaults in making payment
therefor, any Security accepted for payment pursuant to the Net
Proceeds Offer shall cease to accrue interest after the Net Proceeds
Offer Payment Date;
(5) that Holders electing to have a Security purchased
pursuant to a Net Proceeds Offer will be required to surrender the
Security, with the form entitled "Option of Holder to Elect Purchase"
on the reverse of the Security completed, to the Paying Agent at the
address specified in the notice prior to the close of business on the
Net Proceeds Offer Payment Date;
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(6) that Holders will be entitled to withdraw their election
if the Paying Agent receives, not later than the Business Day prior to
the Net Proceeds Offer Payment Date, a facsimile transmission or letter
setting forth the name of the Holder, the principal amount of the
Security the Holder delivered for purchase and a statement that such
Holder is withdrawing his election to have such Security purchased; and
(7) that Holders whose Securities are purchased only in part
will be issued new Securities in a principal amount equal to the
unpurchased portion of the Securities surrendered.
On or before the Net Proceeds Offer Payment Date, the Company
shall (i) accept for payment Securities or portions thereof tendered pursuant to
the Net Proceeds Offer which are to be purchased in accordance with item (1)
above, (ii) deposit with the Paying Agent in accordance with Section 2.14 U.S.
Legal Tender sufficient to pay the purchase price plus accrued interest, if any,
of all Securities to be purchased and (iii) deliver to the Trustee Securities so
accepted together with an Officers' Certificate stating the Securities or
portions thereof being purchased by the Company. The Paying Agent shall promptly
mail to the Holders of Securities so accepted payment in an amount equal to the
purchase price plus accrued interest, if any. For purposes of this Section 4.12,
the Trustee shall act as the Paying Agent.
The Company will comply with all tender offer rules under
state and Federal securities laws and regulations, including, but not limited
to, Section 14(e) under the Exchange Act and Rule 14e-1 thereunder, to the
extent applicable to such offer. To the extent that the provisions of any
securities laws or regulations conflict with the foregoing "Asset Sale"
provisions of this Indenture, the Company shall comply with the applicable
securities laws and regulations and shall not be deemed to have breached its
obligations under the foregoing provisions of this Indenture by virtue thereof.
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SECTION 4.13. Limitation on Dividend and Other Payment Restrictions
Affecting Restricted Subsidiaries.
The Company will not, and will not cause or permit any of the
Restricted Subsidiaries to, directly or indirectly, create or otherwise cause or
permit to exist after the Spin-Off Date or become effective after the Spin-Off
Date, any encumbrance or restriction on the ability of any Restricted Subsidiary
to: (a) pay dividends or make any other distributions on or in respect of its
Capital Stock; (b) make loans or advances or to pay any Indebtedness or other
obligation owed to the Company or any other Restricted Subsidiary; or (c)
transfer any of its property or assets to the Company or any other Restricted
Subsidiary, except for such encumbrances or restrictions existing under or by
reasons of: (1) applicable law; (2) this Indenture; (3) the Credit Agreement;
(4) customary non-assignment provisions of any contract or any lease governing a
leasehold interest of any Restricted Subsidiary; (5) any instrument governing
Acquired Indebtedness, which encumbrance or restriction is not applicable to any
Person, or the properties or assets of any Person, other than the Person or the
properties or assets of the Person so acquired; (6) agreements existing on the
Spin-Off Date to the extent and in the manner such agreements are in effect on
the Spin-Off Date; (7) any other agreement entered into after the Spin-Off Date
which contains encumbrances and restrictions which are not materially more
restrictive with respect to any Restricted Subsidiary than those in effect with
respect to such Restricted Subsidiary pursuant to agreements as in effect on the
Spin-Off Date; (8) any instrument governing Indebtedness of a Foreign Restricted
Subsidiary; (9) customary restrictions on the transfer of any property or assets
arising under a security agreement governing a Lien permitted under Section 4.15
hereof; (10) any agreement governing Refinancing Indebtedness incurred to
Refinance the Indebtedness issued, assumed or incurred pursuant to an agreement
referred to in clause (2), (5), (6) or (8) above; provided, however, that the
provisions relating to such encum-
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brance or restriction contained in any such Refinancing Indebtedness are not
materially more restrictive than the provisions relating to such encumbrance or
restriction contained in agreements referred to in such clause (2), (5), (6) or
(8);(11) any agreement governing the sale or disposition of any Restricted
Subsidiary which restricts dividends and distributions pending such sale or
disposition; and (12) any agreement, instrument or Lien placing encumbrances or
restrictions applicable only to a Finance Subsidiary or Accounts Receivable
Entity.
SECTION 4.14. Limitation on Issuances of Capital Stock of
Restricted Subsidiaries.
The Company will not permit any of the Restricted Subsidiaries
(other than a Finance Subsidiary or an Accounts Receivable Entity) to issue any
Preferred Stock after the Spin-Off Date (other than to the Company or to a
Restricted Subsidiary) or permit any Person (other than the Company or a
Restricted Subsidiary) to own after the Spin-Off Date any Preferred Stock of any
Restricted Subsidiary (other than a Finance Subsidiary or an Accounts Receivable
Entity). The Company will not, and will not permit any Restricted Subsidiary to,
issue, sell, transfer or dispose of on or after the Spin-Off Date any Capital
Stock of any Restricted Subsidiary (other than a Finance Subsidiary or an
Accounts Receivable Entity) that is not a Guarantor (other than the granting of
Liens permitted by Section 4.15) unless such issuance, sale, transfer or
disposition results in the issuer of such Capital Stock no longer being a
Restricted Subsidiary.
SECTION 4.15. Limitation on Liens.
The Company will not, and will not cause or permit any of the
Restricted Subsidiaries to, directly or indirectly, create, incur, assume or
permit or suffer to exist after the Spin-Off Date, any Liens of any kind against
or upon any property or assets of the Company or any of the Guarantors whether
owned on the Spin-Off Date or acquired after the Spin-Off Date, or any proceeds
therefrom, or assign or otherwise convey any right to receive income or profits
therefrom unless: (i) in the case of Liens securing Indebtedness that is
expressly subordinate or junior in right of payment to the Securities or a
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Guarantee, the Securities or such Guarantee are secured by a Lien on such
property, assets or proceeds that is senior in priority to such Liens; and (ii)
in all other cases, the Securities are equally and ratably secured, except for:
(A) Liens existing as of the Spin-Off Date to the extent and in the manner such
Liens are in effect on the Spin-Off Date; (B) Liens securing Senior Debt and
Liens securing Guarantor Senior Debt; (C) Liens securing the Securities and any
Guarantees; (D) Liens in favor of the Company or a Guarantor; (E) Liens securing
Refinancing Indebtedness which is incurred to Refinance any Indebtedness secured
by a Lien permitted under this Section 4.15; provided, however, that such Liens
do not extend to or cover any property or assets of the Company or any of the
Restricted Subsidiaries not securing the Indebtedness so Refinanced; and (F)
Permitted Liens.
SECTION 4.16. Prohibition on Incurrence of Senior Subordinated Debt.
The Company will not, and will not permit any Guarantor to,
incur or suffer to exist after the Spin-Off Date Indebtedness that is senior in
right of payment to the Securities or the Guarantee of such Guarantor, as the
case may be, and subordinate in right of payment to any other Indebtedness of
the Company or such Guarantor, as the case may be.
SECTION 4.17. Limitation on Transactions with Affiliates.
(a) The Company will not, and will not permit any of the
Restricted Subsidiaries to, directly or indirectly, enter into or permit to
exist after the Spin-Off Date any transaction or series of related transactions
(including, without limitation, the purchase, sale, lease or exchange of any
property or the rendering of any service) with, or for the benefit of, any of
its Affiliates (each, an "Affiliate Transaction"), other than: (x) Affiliate
Transactions permitted under paragraph (b) below; and (y) Affiliate Transactions
on terms that are not materially less favorable than those that would have
reasonably been expected in a comparable transaction at such time on an
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arm's-length basis from a Person that is not an Affiliate of the Company or such
Restricted Subsidiary. All Affiliate Transactions (and each series of related
Affiliate Transactions which are similar or part of a common plan) on or after
the Spin-Off Date involving aggregate payments or other property with a Fair
Market Value in excess of $10.0 million shall be approved by the Board of
Directors of the Company or such Restricted Subsidiary, as the case may be, such
approval to be evidenced by a Board Resolution stating that such Board of
Directors has determined that such transaction complies with the foregoing
provisions. If the Company or any Restricted Subsidiary enters into an Affiliate
Transaction (or series of related Affiliate Transactions related to a common
plan) on or after the Spin-Off Date that involves an aggregate Fair Market Value
of more than $50.0 million, the Company or such Restricted Subsidiary, as the
case may be, shall, prior to the consummation thereof, obtain a favorable
opinion as to the fairness of such transaction or series of related transactions
to the Company or the relevant Restricted Subsidiary, as the case may be, from a
financial point of view, from an Independent Financial Advisor and file the same
with the Trustee.
(b) The restrictions set forth in paragraph (a) above shall
not apply to: (i) employment, consulting and compensation arrangements and
agreements of the Company or any Restricted Subsidiary consistent with past
practice or approved by a majority of the disinterested members of the Board of
Directors (or a committee comprised of disinterested directors); (ii) reasonable
fees and compensation paid to and indemnity provided on behalf of, officers,
directors, employees, consultants or agents of the Company or any Restricted
Subsidiary as determined in good faith by the Company's Board of Directors or
senior management; (iii) transactions exclusively between or among the Company
and any of the Restricted Subsidiaries or exclusively between or among such
Restricted Subsidiaries; provided that such transactions are not otherwise
prohibited by this Indenture; (iv) Restricted Payments, Permitted Investments or
Permitted Liens permitted by this Indenture; and (v) the Spin-Off Transaction
Agreements.
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SECTION 4.18. Issuance of Subsidiary Guarantees.
If, on or after the Spin-Off Date after giving effect to the
Spin-Off Transactions, the Company forms or acquires any Domestic Restricted
Subsidiary (other than (w) an Acquired Subsidiary for so long as it is not a
Wholly Owned Domestic Restricted Subsidiary, (x) a Finance Subsidiary, (y) an
Accounts Receivable Entity, or (z) an Immaterial Domestic Subsidiary) that
incurs any Indebtedness (other than Indebtedness owing to the Company or a
Restricted Subsidiary), or if, on or after the Spin-Off Date, any Restricted
Subsidiary that is not a Guarantor guarantees any Indebtedness of the Company or
a Guarantor (other than Indebtedness owing to the Company or a Restricted
Subsidiary), then the Company shall cause such Domestic Restricted Subsidiary or
Restricted Subsidiary that is not a Guarantor, as the case may be, to: (i)
execute and deliver to the Trustee a supplemental indenture in form reasonably
satisfactory to the Trustee pursuant to which such Domestic Restricted
Subsidiary or Restricted Subsidiary that is not a Guarantor, as the case may be,
shall unconditionally guarantee (each, a "Guarantee") all of the Company's
obligations under the Securities and this Indenture on the terms set forth in
Article Ten; and (ii) deliver to the Trustee an Opinion of Counsel (which may
contain customary exceptions) that such supplemental indenture has been duly
authorized, executed and delivered by such Domestic Restricted Subsidiary or
Restricted Subsidiary that is not a Guarantor, as the case may be, and
constitutes a legal, valid, binding and enforceable obligation of such Domestic
Restricted Subsidiary or Restricted Subsidiary that is not a Guarantor, as the
case may be. Thereafter, such Domestic Restricted Subsidiary or Restricted
Subsidiary that was not a Guarantor, as the case may be, shall be a Guarantor
for all purposes of this Indenture. The Company may cause any other Restricted
Subsidiary of the Company to issue a Guarantee and become a Guarantor.
SECTION 4.19. Payments for Consent.
The Company will not, and will not cause or permit any of its
Subsidiaries to, directly or indirectly, pay or
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cause to be paid any consideration, whether by way of interest, fee or
otherwise, to any Holder of any Securities for or as an inducement to any
consent, waiver or amendment of any of the terms or provisions of this
Indenture, the Securities or the Guarantees unless such consideration is offered
to be paid to all Holders who so consent, waive or agree to amend in the time
frame set forth in solicitation documents relating to such consent, waiver or
amendment.
SECTION 4.20. Limitation on Designations of Unrestricted Subsidiaries.
The Company may, on or after the Spin-Off Date, designate any
Subsidiary of the Company (other than a Subsidiary of the Company which owns
Capital Stock of a Restricted Subsidiary) as an "Unrestricted Subsidiary" under
this Indenture (a "Designation") only if:
(a) no Default or Event of Default shall have occurred and be
continuing at the time of or after giving effect to such Designation;
(b) the Company would be permitted under this Indenture to
make an Investment at the time of Designation (assuming the
effectiveness of such Designation) in an amount (the "Designation
Amount") equal to the sum of (i) the Fair Market Value of the Capital
Stock of such Subsidiary owned by the Company and/or any of the
Restricted Subsidiaries on such date and (ii) the aggregate amount of
Indebtedness of such Subsidiary owed to the Company and the Restricted
Subsidiaries on such date; and
(c) the Company would be permitted to incur $1.00 of
additional Indebtedness (other than Permitted Indebtedness) pursuant to
Section 4.03 at the time of Designation (assuming the effectiveness of
such Designation).
In the event of any such Designation, the Company shall be
deemed to have made an Investment constituting a Re-
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stricted Payment in the Designation Amount pursuant to Section 4.04 for all
purposes of this Indenture.
The Company shall not, and shall not permit any Restricted
Subsidiary to, at any time: (x) provide direct or indirect credit support for or
a guarantee of any Indebtedness of any Unrestricted Subsidiary (including any
undertaking agreement or instrument evidencing such Indebtedness); (y) be
directly or indirectly liable for any Indebtedness of any Unrestricted
Subsidiary; or (z) be directly or indirectly liable for any Indebtedness which
provides that the holder thereof may (upon notice, lapse of time or both)
declare a default thereon or cause the payment thereof to be accelerated or
payable prior to its final scheduled maturity upon the occurrence of a default
with respect to any Indebtedness of any Unrestricted Subsidiary (including any
right to take enforcement action against such Unrestricted Subsidiary), except,
in the case of clause (x) or (y), to the extent permitted under Section 4.04
hereof.
The Company may revoke any Designation of a Subsidiary as an
Unrestricted Subsidiary ("Revocation"), whereupon such Subsidiary shall then
constitute a Restricted Subsidiary, if
(a) no Default or Event of Default shall have occurred and be
continuing at the time and after giving effect to such Revocation; and
(b) all Liens and Indebtedness of such Unrestricted Subsidiary
outstanding immediately following such Revocation would, if incurred at
such time, have been permitted to be incurred for all purposes of this
Indenture.
All Designations and Revocations must be evidenced by an
Officers' Certificate of the Company delivered to the Trustee certifying
compliance with the foregoing provisions.
SECTION 4.21. Change of Control.
(a) Upon the occurrence of a Change of Control, each Holder
will have the right to require that the Company purchase
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all or a portion of such Holder's Securities pursuant to the offer described
below (the "Change of Control Offer"), at a purchase price equal to 101% of the
principal amount thereof plus accrued interest, if any, thereon to the date of
purchase. Prior to the mailing of the notice referred to below, but in any event
within 30 days following any Change of Control, the Company will:
(1) repay in full and terminate all commitments under all
Indebtedness under the Credit Agreement and all other Senior Debt the
terms of which require repayment upon a Change of Control or offer to
repay in full and terminate all commitments under all Indebtedness
under the Credit Agreement and all other such Senior Debt and to repay
the Indebtedness owed to each lender or Holder which has accepted such
offer; or
(2) obtain the requisite consents under the Credit Agreement
and all other Senior Debt to permit the repurchase of the Securities as
provided below.
The Company shall first comply with the covenant in the
immediately preceding sentence before it shall be required to repurchase
Securities pursuant to the provisions described below.
(b) Within 30 days following the date upon which the Change
of Control occurs, the Company must send, by first class mail, a notice to each
Holder, with a copy to the Trustee, which notice shall govern the terms of the
Change of Control Offer. Such notice shall state, among other things:
(1) that the Change of Control Offer is being made pursuant
to this Section 4.21 and that all Securities tendered and not withdrawn
will be accepted for payment;
(2) the purchase price (including the amount of accrued
interest) and the purchase date, which must be no earlier than 30 days
nor later than 60 days from the date
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such notice is mailed, other than as may be required by law (the "Change of
Control Payment Date");
(3) that any Security not tendered will continue to accrue
interest;
(4) that, unless the Company defaults in making payment
therefor, any Security accepted for payment pursuant to the Change of
Control Offer shall cease to accrue interest after the Change of
Control Payment Date;
(5) that Holders electing to have a Security purchased
pursuant to a Change of Control Offer will be required to surrender the
Security, with the form entitled "Option of Holder to Elect Purchase"
on the reverse of the Security completed, to the Paying Agent at the
address specified in the notice prior to the close of business on the
third Business Day prior to the Change of Control Payment Date;
(6) that Holders will be entitled to withdraw their election
if the Paying Agent receives, not later than the Business Day prior to
the Change of Control Payment Date, a facsimile transmission or letter
setting forth the name of the Holder, the principal amount of the
Securities the Holder delivered for purchase and a statement that such
Holder is withdrawing his election to have such Securities purchased;
(7) that Holders whose Securities are purchased only in part
will be issued new Securities in a principal amount equal to the
unpurchased portion of the Securities surrendered; and
(8) the circumstances and relevant facts regarding such Change
of Control.
On or before the Change of Control Payment Date, the Company
shall (i) accept for payment Securities or portions thereof tendered pursuant to
the Change of Control Offer, (ii) deposit with the Paying Agent, in accordance
with Sec-
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tion 2.14, U.S. Legal Tender sufficient to pay the purchase price plus accrued
interest, if any, of all Securities so tendered and (iii) deliver to the Trustee
Securities so accepted together with an Officers' Certificate stating the
Securities or portions thereof being purchased by the Company. Upon receipt by
the Paying Agent of the monies specified in clause (ii) above and a copy of the
Officers' Certificate specified in clause (iii) above, the Paying Agent shall
promptly mail to the Holders of Securities so accepted payment in an amount
equal to the purchase price plus accrued interest, if any, and the Trustee shall
promptly authenticate and mail to such Holders new Securities equal in principal
amount to any unpurchased portion of the Securities surrendered. Any Securities
not so accepted shall be promptly mailed by the Company to the Holder thereof.
For purposes of this Section 4.21, the Trustee shall act as the Paying Agent.
Any amounts remaining after the purchase of all validly
tendered and not validly withdrawn Securities pursuant to a Change of Control
Offer shall be returned by the Trustee to the Company.
The Company shall and shall cause its Subsidiaries to comply
with all tender offer rules under state and Federal securities laws, including,
but not limited to, Section 14(e) under the Exchange Act and Rule 14e-1
thereunder, to the extent applicable to such offer. To the extent that the
provisions of any securities laws or regulations conflict with this Section
4.21, the Company shall comply with the applicable securities laws and
regulations and shall not be deemed to have breached its obligations under this
Section 4.21 by virtue thereof.
SECTION 4.22. Deposit of Funds with Trustee Pending Consummation of
the Spin-Off Transactions.
(a) On the Issue Date, the Company shall deposit with the
Trustee as hereinafter provided $486,875,000 (the "Special Redemption Amount").
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(b) In order to secure the full and punctual payment and
performance of the Company's obligation to redeem the Securities upon a Special
Redemption, the Company hereby grants to the Trustee, for the benefit of the
Holders, a continuing security interest in and to the Collateral, whether now
owned or existing or hereafter acquired or arising. The Trustee shall have no
obligation to file any financing statement or otherwise take any action to
maintain or perfect any such security interest.
(c) At all times until the earlier to occur of receipt by the
Trustee of (i) an Officers' Certificate stating that all of the Release
Conditions have been met or complied with, as the case may be, and (ii) a
request of the Company to deposit funds with the Trustee on the Redemption Date
pursuant to a Special Redemption, there shall be maintained with the Trustee an
account (the "Collateral Account") designated "The Bank of New York, Trustee
(subject to a security interest in the name of The Bank of New York as
Trustee)," which account shall be under the sole dominion and control of the
Trustee. On the Issue Date, the Company shall cause the Special Redemption
Amount to be deposited in the Collateral Account. Amounts on deposit in the
Collateral Account shall be invested and reinvested from time to time at the
written direction of the Company in Cash Equivalents (the "Fund") (in an account
at the Fund in the name of "The Bank of New York, Trustee (subject to a security
interest in the name of The Bank of New York, as Trustee)" (the "Money Market
Account")), which Cash Equivalents shall be held in the Collateral Account. Any
income received with respect to the balance from time to time standing to the
credit of the Collateral Account, including any interest or capital gains on
Cash Equivalents, shall remain, or be deposited, in the Collateral Account. The
Trustee shall not be liable or accountable for any losses resulting without
negligence on the part of the Trustee from the investment, reinvestment,
liquidation, sale or depreciation in the market value of any investment of
amounts on deposit in the Collateral Account. Subject to Article Seven hereof,
the Trustee solely in its individual capacity hereby waives any rights it may
have in such individual capacity to the Collateral Account and all funds and
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investments therein including, without limitation, any such rights arising
through any counterclaim, defense, recoupment, charge, lien or right of set-off.
(d) Upon notice from the Company to the Trustee pursuant to
subsection (c)(i) above, the security interests in the Collateral shall
terminate and all funds in the Collateral Account (the "Collateral Funds") shall
be released to the Company and transferred to an account previously designated
by it by wire transfer of immediately available funds and such funds will be
used for the purposes set forth in the Offering Memorandum under the heading
"Use of Proceeds". Upon notice from the Company to the Trustee pursuant to
subsection (c)(ii) above, the Trustee shall apply Collateral Funds to fund the
Special Redemption. Section 314(d) of the TIA shall not apply to the release of
Collateral pursuant to this provision if such release occurs prior to the filing
of the registration statement under the Securities Act pursuant to the
Registration Rights Agreement, after which time this Section 4.22 shall be
deemed deleted from this Indenture.
(e) If the Trust Funds are released and the Spin-Off
Transactions are not consummated within one Business Day of the date such Trust
Funds are released, the Company shall not have a Special Redemption obligation
at that time and shall not be deemed to have breached this Indenture as a result
of the Spin-Off Transactions failing to occur at that time if (x) an amount
equal to the amount of the Trust Funds released to the Company is redeposited
with the Trustee within one Business Day of the date the Company's Officers'
Certificate certifies that the Spin-Off Transactions will occur and (y) such
redeposit occurs prior to December 31, 1999. In the event of a redeposit in
accordance with the immediately preceding sentence, the Company may have the
Trust Funds re-released at any time on or prior to December 31, 1999, upon
receipt by the Trustee of an Officers' Certificate certifying that each of the
Release Conditions has been satisfied. Amounts redeposited pursuant to this
paragraph shall be placed in the Collateral Account and shall continue to secure
the full and punctual payment and performance of the
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Company's obligation to redeem the Securities if the Company shall be obligated
to make a Special Redemption.
ARTICLE FIVE
SUCCESSOR CORPORATION
SECTION 5.01. Merger, Consolidation and Sale of Assets.
(a) The Company will not, in a single transaction or series of
related transactions, consolidate or merge with or into any Person, or sell,
assign, transfer, lease, convey or otherwise dispose of (or cause or permit any
Restricted Subsidiary to sell, assign, transfer, lease, convey or otherwise
dispose of) after the Spin-Off Date all or substantially all of the Company's
assets (determined on a consolidated basis for the Company and the Restricted
Subsidiaries) whether as an entirety or substantially as an entirety to any
Person unless: (i) either (1) the Company shall be the surviving or continuing
corporation or (2) the Person (if other than the Company) formed by such
consolidation or into which the Company is merged or the Person which acquires
by sale, assignment, transfer, lease, conveyance or other disposition the
properties and assets of the Company and the Restricted Subsidiaries
substantially as an entirety (the "Surviving Entity") (x) shall be a corporation
organized and validly existing under the laws of the United States or any State
thereof or the District of Columbia and (y) shall expressly assume, by
supplemental indenture (in form and substance reasonably satisfactory to the
Trustee), executed and delivered to the Trustee, the due and punctual payment of
the principal of, and premium, if any, and interest on all of the Securities and
the performance of every covenant of the Securities, this Indenture and the
Registration Rights Agreement on the part of the Company to be performed or
observed; (ii) immediately after giving effect to such transaction and the
assumption contemplated by clause (i)(2)(y) above (including giving effect to
any Indebtedness and Acquired Indebtedness incurred or anticipated to be
incurred in connection
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with or in respect of such transaction), the Company or such Surviving Entity,
as the case may be, shall be able to incur at least $1.00 of additional
Indebtedness (other than Permitted Indebtedness) pursuant to Section 4.03; (iii)
immediately before and immediately after giving effect to such transaction and
the assumption contemplated by clause (i)(2)(y) above (including, without
limitation, giving effect to any Indebtedness and Acquired Indebtedness incurred
or anticipated to be incurred and any Lien granted in connection with or in
respect of the transaction), no Default or Event of Default shall have occurred
and be continuing; and (iv) the Company or the Surviving Entity shall have
delivered to the Trustee an Officers' Certificate and an Opinion of Counsel,
each stating that such consolidation, merger, sale, assignment, transfer, lease,
conveyance or other disposition and, if a supplemental indenture is required in
connection with such transaction, such supplemental indenture comply with the
applicable provisions of this Indenture and that all conditions precedent in
this Indenture relating to such transaction have been satisfied.
(b) For purposes of the foregoing, the transfer (by lease,
assignment, sale or otherwise, in a single transaction or series of
transactions) of all or substantially all of the properties or assets of one or
more Restricted Subsidiaries, the Capital Stock of which constitutes all or
substantially all of the properties and assets of the Company, shall be deemed
to be the transfer of all or substantially all of the properties and assets of
the Company. In addition, for purposes of the foregoing, consummation of the
Spin-Off Transactions shall be deemed not to be a transfer, conveyance or
disposition of substantially all of the Company's assets.
(c) No Guarantor (other than any Guarantor whose Guarantee is
to be released in accordance with the terms of the Guarantee and this Indenture
in connection with any transaction complying with the provisions of Section 4.12
will, and the Company will not cause or permit any Guarantor to, consolidate
with or merge with or into any Person other than the Company or any other
Guarantor unless: (i) the entity formed by or surviving any such consolidation
or merger (if other than the
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Guarantor) is a corporation organized and existing under the laws of the United
States or any State thereof or the District of Columbia; (ii) such entity
assumes by supplemental indenture all of the obligations of the Guarantor under
this Indenture, such Guarantor's Guarantee and the Registration Rights
Agreement; (iii) immediately after giving effect to such transaction, no Default
or Event of Default shall have occurred and be continuing; (iv) immediately
after giving effect to such transaction and the use of any net proceeds
therefrom on a pro forma basis, the Company could satisfy the provisions of
clause (a)(ii) of this Section 5.01; and (v) the Company shall have delivered to
the Trustee an Officers' Certificate and Opinion of Counsel, each stating that
such consolidation or merger and, if a supplemental indenture is required in
connection with such transaction, such supplemental indenture comply with the
applicable provisions of this Indenture and that all conditions precedent in
this Indenture relating to such transaction have been satisfied.
SECTION 5.02. Successor Corporation Substituted.
In accordance with the foregoing, upon any such consolidation,
combination, merger, conveyance, lease or any transfer of all or substantially
all of the assets of the Company in which the Company is not the continuing
corporation, the Surviving Entity formed by such consolidation or into which the
Company is merged or to which such conveyance, lease or transfer is made shall
succeed to, and be substituted for, and may exercise every right and power of,
the Company under this Indenture and the Securities with the same effect as if
such successor had been named as the Company herein, and thereafter the
predecessor corporation will be relieved of all further obligations and
covenants under this Indenture, the Securities and the Registration Rights
Agreement; provided that solely for purposes of computing amounts described in
subclause (iii) of the first paragraph of Section 4.04, any such Surviving
Entity shall only be deemed to have succeeded to and be substituted for the
Company with respect to periods subsequent to the effective time of such merger,
consolidation or transfer of assets.
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ARTICLE SIX
DEFAULT AND REMEDIES
SECTION 6.01. Events of Default.
An "Event of Default" occurs if:
(1) the failure to pay interest on any Security when the
same becomes due and payable and the default continues for a period of
30 days (whether or not such payment shall be prohibited by Article
Twelve hereof);
(2) the failure to pay the principal on any Security, when
such principal becomes due and payable, whether at maturity, upon
redemption or otherwise (including the failure to make a payment to
purchase Securities tendered pursuant to a Change of Control Offer or a
Net Proceeds Offer) (whether or not such payment shall be prohibited by
Article Twelve hereof);
(3) a default in the observance or performance of any other
covenant or agreement contained in this Indenture which default
continues for a period of 30 days after (x) the Company receives
written notice specifying the default from the Trustee or the Holders
of at least 25% of the outstanding principal amount of the Securities
(except in the case of a default with respect to Article Five, which
will constitute an Event of Default with such notice requirement but
without such passage of time requirement);
(4) a default under any mortgage, indenture or instrument
under which there may be issued or by which there may be secured or
evidenced any Indebtedness of the Company or of any Restricted
Subsidiary (or the payment of which is guaranteed by the Company or any
Restricted Subsidiary) whether such Indebtedness now exists or is
created after the Spin-Off Date, which default (a) is caused by a
failure to pay principal of such Indebtedness after any applicable
grace period provided in such Indebtedness
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on the date of such default (a "Payment Default"), or (b) results in
the acceleration of such Indebtedness prior to its express maturity
(and such acceleration is not rescinded, or such Indebtedness is not
repaid, within 30 days) and, in each case, the principal amount of any
such Indebtedness, together with the principal amount of any other such
Indebtedness under which there has been a Payment Default or the
maturity of which has been so accelerated (and such acceleration is not
rescinded, or such Indebtedness is not repaid, within 30 days),
aggregates $75.0 million;
(5) the Company or any of its Restricted Subsidiaries (A)
admits in writing its inability to pay its debts generally as they
become due, (B) commences a voluntary case or proceeding under any
Bankruptcy Law with respect to itself, (C) consents to the entry of a
judgment, decree or order for relief against it in an involuntary case
or proceeding under any Bankruptcy Law, (D) consents to the appointment
of a Custodian of it or for substantially all of its property, (E)
consents to or acquiesces in the institution of a bankruptcy or an
insolvency proceeding against it, (F) makes a general assignment for
the benefit of its creditors, or (G) takes any corporate action to
authorize or effect any of the foregoing;
(6) a court of competent jurisdiction enters a judgment,
decree or order for relief in respect of the Company or any of its
Significant Subsidiaries in an involuntary case or proceeding under any
Bankruptcy Law, which shall (A) approve as properly filed a petition
seeking reorganization, arrangement, adjustment or composition in
respect of the Company or any of its Significant Subsidiaries, (B)
appoint a Custodian of the Company or any of its Significant
Subsidiaries or for substantially all of any of their property or (C)
order the winding-up or liquidation of its affairs; and such judgment,
decree or order shall remain unstayed and in effect for a period of 60
consecutive days;
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(7) one or more judgments in an aggregate amount in excess of
$75.0 million not covered by adequate insurance shall have been
rendered against the Company or any of the Restricted Subsidiaries and
such judgments remain undischarged, unpaid or unstayed for a period of
60 days after such judgment or judgments become final and
nonappealable;
(8) any Guarantee of a Significant Subsidiary ceases to be in
full force and effect, or any Guarantee of such a Significant
Subsidiary is declared to be null and void and unenforceable or any
Guarantee of such a Significant Subsidiary is found to be invalid or
any Guarantor which is a Significant Subsidiary denies its liability
under its Guarantee (other than by reason of release of such Guarantor
in accordance with the terms of this Indenture); or
(9) the Release Conditions are not satisfied on or prior to
December 31, 1999 and the Company fails to effect the Special
Redemption pursuant to Section 4.22 of this Indenture on or before
January 14, 2000.
The Trustee shall, within 90 days after the occurrence of any
Default actually known to a Responsible Officer of the Trustee, give to the
Securityholders notice of such Default; provided that, except in the case of a
Default in the payment of principal of or interest on any of the Securities, the
Trustee shall be protected in withholding such notice if and so long as a
Responsible Officer of the Trustee in good faith determines that the withholding
of such notice is in the interest of the Securityholders.
SECTION 6.02. Acceleration.
If an Event of Default (other than an Event of Default
specified in clause (5) or (6) above) shall occur and be continuing, the Trustee
or the Holders of at least 25% in principal amount of outstanding Securities may
declare the principal of, premium, if any, and accrued and unpaid interest on
all the Securities to be due and payable by notice in writing to the Company
(and to the Trustee, if given by the Holders)
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specifying the respective Event(s) of Default and that it is a "notice of
acceleration" and the same shall become immediately due and payable. If an Event
of Default specified in clause (5) or (6) above occurs and is continuing, then
all unpaid principal of, premium, if any, and accrued and unpaid interest on,
all of the outstanding Securities shall ipso facto become and be immediately due
and payable without any declaration or other act on the part of the Trustee or
any Holder. If any Designated Senior Debt is outstanding at the time of any
acceleration of the Securities, the Company shall not make any payment with
respect to the Securities until five Business Days after the holders of such
Designated Senior Debt receive notice of such acceleration.
At any time after a declaration of acceleration with respect
to the Securities as described in the preceding paragraph, the Holders of a
majority in principal amount of the then outstanding Securities may rescind and
cancel such declaration and its consequences: (i) if the rescission would not
conflict with any judgment or decree; (ii) if all existing Events of Default
have been cured or waived except nonpayment of principal or interest that has
become due solely because of the acceleration; (iii) to the extent the payment
of such interest is lawful, if interest on overdue installments of interest and
overdue principal, which has become due otherwise than by such declaration of
acceleration, has been paid; (iv) if the Company has paid the Trustee its
compensation and reimbursed the Trustee for its reasonable expenses,
disbursements and advances and any other sums owing to the Trustee pursuant to
Section 7.07; and (v) in the event of the cure or waiver of an Event of Default
of the type described in clauses (5) and (6) of the description above of Events
of Default, the Trustee shall have received an Officers' Certificate and an
Opinion of Counsel that such Event of Default has been cured or waived.
No such rescission shall affect any subsequent Default or
Event of Default or impair any right consequent thereto.
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SECTION 6.03. Other Remedies.
If an Event of Default occurs and is continuing, the Trustee
may pursue any available remedy by proceeding at law or in equity to collect the
payment of principal of or interest on the Securities or to enforce the
performance of any provision of the Securities, this Indenture or any Guarantee.
The Trustee may maintain a proceeding even if it does not
possess any of the Securities or does not produce any of them in the proceeding.
A delay or omission by the Trustee or any Securityholder in exercising any right
or remedy accruing upon an Event of Default shall not impair the right or remedy
or constitute a waiver of or acquiescence in the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are cumulative to the
extent permitted by law.
SECTION 6.04. Waiver of Past Defaults.
Subject to Sections 6.02, 6.07 and 9.02, the Holders of a
majority in principal amount of the then outstanding Securities by written
notice to the Trustee may waive an existing Default or Event of Default and its
consequences, except a Default in the payment of principal of or premium, if
any, or interest on any Security as specified in clauses (1) and (2) of Section
6.01. The Company shall deliver to the Trustee an Officers' Certificate stating
that the requisite percentage of Holders have consented to such waiver and
attaching copies of such consents upon which the Trustee may conclusively rely.
When a Default or Event of Default is waived, it is cured and ceases.
SECTION 6.05. Control by Majority.
The Holders of not less than a majority in principal amount of
the outstanding Securities may direct the time, method and place of conducting
any proceeding for any remedy available to the Trustee or exercising any trust
or power conferred on it. Subject to Section 7.01, however, the Trustee may
refuse to follow any direction that conflicts with any law
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or this Indenture, that the Trustee determines may be unduly prejudicial to the
rights of another Securityholder, or that may involve the Trustee in personal
liability; provided that the Trustee may take any other action deemed proper by
the Trustee which is not inconsistent with such direction.
Prior to taking any action or following any direction pursuant
to this Section 6.05, the Trustee shall be entitled to indemnification from such
Holders satisfactory to it in its sole discretion against any fees, loss,
liability, cost or expense caused by taking such action or following such
direction.
SECTION 6.06. Limitation on Suits.
A Securityholder may not pursue any remedy with respect to
this Indenture, the Securities or any Guarantee unless:
(1) the Holder gives to the Trustee written notice of a
continuing Event of Default;
(2) the Holder or Holders of at least 25% in principal amount
of the outstanding Securities make a written request to the Trustee to
pursue the remedy;
(3) such Holder or Holders offer and, if requested, provide to
the Trustee indemnity satisfactory to the Trustee against any loss,
liability or expense;
(4) the Trustee does not comply with the request within 30
days after receipt of the request and the offer and, if requested, the
provision of indemnity; and
(5) during such 30-day period the Holder or Holders of a
majority in principal amount of the outstanding Securities do not give
the Trustee a direction which, in the opinion of the Trustee, is
inconsistent with the request.
A Securityholder may not use this Indenture to prejudice the
rights of another Securityholder or to obtain a preference or priority over such
other Securityholder.
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SECTION 6.07. Rights of Holders to Receive Payment.
Notwithstanding any other provision of this Indenture, the
right of any Holder to receive payment of principal of, premium and interest on
a Security, on or after the respective due dates expressed in such Security, or
to bring suit for the enforcement of any such payment on or after such
respective dates, shall not be impaired or affected without the consent of the
Holder.
SECTION 6.08. Collection Suit by Trustee.
If an Event of Default in payment of principal, premium or
interest specified in clause (1) or (2) of Section 6.01 occurs and is
continuing, the Trustee may recover judgment in its own name and as trustee of
an express trust against the Company or any other obligor on the Securities for
the whole amount of principal and accrued interest remaining unpaid, together
with interest on overdue principal and, to the extent that payment of such
interest is lawful, interest on overdue installments of interest, in each case
at the rate per annum borne by the Securities and such further amount as shall
be sufficient to cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel.
SECTION 6.09. Trustee May File Proofs of Claim.
The Trustee may file such proofs of claim and other papers or
documents and take such other actions as it may determine in its reasonable
discretion to be necessary or advisable (including participating as a member of
any creditors committee acting in the matter) in order to have the claims of the
Trustee (including any claim for the reasonable compensation, expenses, legal
fees, disbursements and advances of the Trustee, its agents, nominees,
custodians, counsel, accountants and experts) and the Securityholders allowed in
any judicial proceedings relating to the Company, its creditors or its property
and shall be entitled and empowered to collect and receive any monies or other
property payable or deliverable on any such
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claims and to distribute the same, and any Custodian in any such judicial
proceedings is hereby authorized by each Securityholder to make such payments to
the Trustee and, in the event that the Trustee shall consent to the making of
such payments directly to the Securityholders, to pay to the Trustee any amount
due to it for the reasonable compensation, expenses, legal fees, disbursements
and advances of the Trustee, its agents, nominees, custodians and counsel, and
any other amounts due the Trustee under Section 7.07. Nothing herein contained
shall be deemed to authorize the Trustee to authorize or consent to or accept or
adopt on behalf of any Securityholder any plan of reorganization, arrangement,
adjustment or composition affecting the Securities or the rights of any Holder
thereof, or to authorize the Trustee to vote in respect of the claim of any
Securityholder in any such proceeding.
SECTION 6.10. Priorities.
If the Trustee collects any money or property pursuant to this
Article Six, it shall pay out the money or property in the following order:
First: to the Trustee for amounts owing under Section 7.07;
Second: if the Holders are forced to proceed against the
Company, a Guarantor or any other obligor on the Securities directly
without the Trustee, to Holders for their collection costs;
Third: subject to Article Twelve, to Holders for amounts due
and unpaid on the Securities for principal, premium and interest,
ratably, without preference or priority of any kind, according to the
amounts due and payable on the Securities for principal, premium and
interest, respectively; and
Fourth: to the Company or any Guarantors, as their respective
interests may appear.
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The Trustee, upon prior notice to the Company, may fix a
record date and payment date for any payment to Securityholders pursuant to this
Section 6.10.
SECTION 6.11. Payment of Interest; Interest Rights Preserved.
Interest on any Security which is payable, and is punctually
paid or duly provided for, on any Interest Payment Date shall be paid to the
Person in whose name that Security is registered at the close of business on the
Record Date for such interest.
Any interest on any Security which is payable, but is not
punctually paid or duly provided for, on any Interest Payment Date (herein
called "Defaulted Interest") shall forthwith cease to be payable to the Holder
on such Record Date by virtue of having been such Holder; and such Defaulted
Interest may be paid by the Company, at its election in each case, as provided
in Subsection (1) or (2) below:
(1) The Company may elect to make payment of any
Defaulted Interest to the Persons in whose names the Securities are
registered at the close of business on a special Record Date (the
"Special Record Date") for the payment of such Defaulted Interest, which
shall be fixed in the following manner. The Company shall notify the
Trustee in writing of the amount of Defaulted Interest proposed to be
paid on each Security and the date of the proposed payment, and at the
same time the Company shall deposit with the Trustee an amount of money
equal to the aggregate amount proposed to be paid in respect of such
Defaulted Interest or shall make arrangements satisfactory to the
Trustee for such deposit prior to the date of the proposed payment, such
money when deposited to be held in trust for the benefit of the Persons
entitled to such Defaulted Interest as in this Subsection provided.
Thereupon the Trustee shall fix a Special Record Date for the payment of
such Defaulted Interest which shall be not more than 15 days and not
less than 10 days prior to the date of the
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proposed payment and not less than 10 days after the receipt by the
Trustee of the notice of the proposed payment. The Trustee shall
promptly notify the Company of such Special Record Date. In the name and
at the expense of the Company, the Trustee shall cause notice of the
proposed payment of such Defaulted Interest and the Special Record Dare
therefor to be mailed, first-class postage prepaid, to each Holder at
his address as it appears in the Security Register, not less than 10
days prior to such Special Record Date. Notice of the proposed payment
of such Defaulted Interest and the Special Record Date therefor having
been so mailed, such Defaulted Interest shall be paid to the Persons in
whose names the Securities (or their respective Predecessor Securities)
are registered on such Special Record Date and shall no longer be
payable pursuant to the following Subsection (2).
(2) The Company may make payment of any Defaulted
Interest in any other lawful manner not inconsistent with the
requirements of any securities exchange on which the Company has caused
the Securities to be listed, and upon such notice as may be required by
such exchange, if, after notice given by the Company to the Trustee of
the proposed payment pursuant to this Subsection, such payment shall be
deemed practicable by the Trustee.
Subject to the foregoing provisions of this Section, each
Security delivered under this Indenture upon registration of transfer of or in
exchange for or in lieu of any other Security shall carry the rights to interest
accrued and unpaid, and to accrue, which were carried by such other Security.
SECTION 6.12. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under
this Indenture or in any suit against the Trustee for any action taken or
omitted by it as Trustee, a court in its discretion may require the filing by
any party litigant in the suit of an undertaking to pay the costs of the suit,
and the court in its discretion may assess reasonable costs, including
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reasonable attorneys' fees and expenses, against any party litigant in the suit,
having due regard to the merits and good faith of the claims or defenses made by
the party litigant. This Section 6.12 does not apply to a suit by the Trustee, a
suit by a Holder pursuant to Section 6.07, or a suit by a Holder or Holders of
more than 10% in principal amount of the outstanding Securities.
ARTICLE SEVEN
TRUSTEE
SECTION 7.01. Duties of Trustee.
(a) If an Event of Default actually known to a
Responsible Officer of the Trustee has occurred and is continuing, the Trustee
shall exercise such of the rights and powers vested in it by this Indenture and
use the same degree of care and skill in its exercise as a prudent Person would
exercise or use under the circumstances in the conduct of its own affairs.
Subject to such provisions, the Trustee shall be under no obligation to exercise
any of its rights or powers under this Indenture at the request of any of the
Holders of Securities, unless they shall have offered to the Trustee security
and indemnity satisfactory to it in its sole discretion.
(b) Except during the continuance of an Event of Default
actually known to a Responsible Officer of the Trustee:
(1) The Trustee need perform only those duties as are
specifically set forth herein and no others and no implied covenants or
obligations shall be read into this Indenture against the Trustee.
(2) In the absence of bad faith on its part, the Trustee
may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions and such other documents delivered to it pursuant to Section
11.04 hereof
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furnished to the Trustee and conforming to the requirements of this
Indenture. However, the Trustee shall examine the certificates and
opinions to determine whether or not they conform to the requirements of
this Indenture (but need not confirm or investigate the accuracy of
mathematical calculations or other facts stated therein).
(c) The Trustee may not be relieved from liability for
its own negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(1) This paragraph does not limit the effect of paragraph
(b) of this Section 7.01.
(2) The Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer of the Trustee,
unless it is proved that the Trustee was negligent in ascertaining the
pertinent facts.
(3) The Trustee shall not be liable with respect to any
action it takes or omits to take in good faith in accordance with a
direction received by it pursuant to Section 6.05.
(d) No provision of this Indenture shall require the
Trustee to expend or risk its own funds or otherwise incur any financial
liability in the performance of any of its duties hereunder or to take or omit
to take any action under this Indenture or take any action at the request or
direction of Holders if it shall have reasonable grounds for believing that
repayment of such funds is not assured to it or it does not receive an indemnity
satisfactory to it in its sole discretion against such risk, liability, loss,
fee or expense which might be incurred by it in compliance with such request or
direction.
(e) Every provision of this Indenture that in any way
relates to the Trustee is subject to this Section 7.01.
(f) The Trustee shall not be liable for interest on any
money received by it except as the Trustee may agree in writing with the
Company. Money held in trust by the Trustee
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need not be segregated from other funds except to the extent required by law.
(g) Beyond the exercise of reasonable care in the custody
thereof, the Trustee shall have no duty as to any Collateral in its possession
or control or any income thereon or as to preservation of rights against prior
parties or any other rights pertaining thereto and the Trustee shall not be
responsible for filing any financing or continuation statements or recording any
documents or instruments in any public office at any time or times or otherwise
perfecting or maintaining the perfection of any security interest in the
Collateral. The Trustee shall be deemed to have exercised reasonable care in the
custody of the Collateral in its possession if the Collateral is accorded
treatment substantially equal to that which it accords its own property.
SECTION 7.02. Rights of Trustee.
Subject to Section 7.01:
(a) The Trustee may conclusively rely and shall be
protected in acting or refraining from acting on any document believed
by it to be genuine and to have been signed or presented by the proper
Person. The Trustee need not investigate any fact or matter stated in
the document.
(b) Before the Trustee acts or refrains from acting, it
may require an Officers' Certificate and an Opinion of Counsel, which
shall conform to the provisions of Section 11.05. The Trustee shall not
be liable for any action it takes or omits to take in good faith in
reliance on such certificate or opinion.
(c) The Trustee may act through its attorneys, agents,
custodians and nominees and shall not be responsible for the misconduct
or negligence of any attorney, agent, custodian or nominee (other than
such a person who is an employee of the Trustee) appointed with due
care.
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(d) The Trustee shall not be liable for any action it
takes or omits to take in good faith which it reasonably believes to be
authorized or within its rights or powers.
(e) The Trustee may consult with counsel and the advice
or opinion of such counsel as to matters of law shall be full and
complete authorization and protection from liability in respect of any
action taken, omitted or suffered by it hereunder in good faith and in
accordance with the advice or opinion of such counsel.
(f) The Trustee shall be under no obligation to exercise
any of the rights or powers vested in it by this Indenture at the
request, order or direction of any of the Holders pursuant to the
provisions of this Indenture, unless such Holders shall have offered to
the Trustee reasonable security or indemnity against the fees, costs,
expenses and liabilities which may be incurred therein or thereby.
(g) Except with respect to Section 4.01, the Trustee
shall not have any duty as to inquire as to the performance by the
Company of its covenants or obligations under this Indenture. The
Trustee shall not be deemed to have notice or any knowledge of any
matter (including without limitation defaults or events of default)
unless a Responsible Officer assigned to and working in the Trustee's
Corporate Trust Administration has actual knowledge thereof or unless
written notice thereof is received by the Trustee, attention: Corporate
Trust Administration and such notice references the Securities
generally, the Company or this Indenture.
(h) The rights, privileges, protections, immunities and
benefits given to the Trustee, including, without limitation, its right
to be indemnified, are extended to, and shall be enforceable by, the
Trustee in each of its capacities hereunder, and to each agent,
custodian and other Person employed to act hereunder.
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SECTION 7.03. Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become
the owner or pledgee of Securities and may otherwise deal with the Company, its
Subsidiaries, any Guarantors and their respective Affiliates with the same
rights it would have if it were not Trustee. Any Agent may do the same with like
rights. However, the Trustee must comply with Sections 7.10 and 7.11 of this
Indenture as well as the provisions of the TIA.
SECTION 7.04. Trustee's Disclaimer.
The Trustee shall not be responsible for and makes no
representation as to the validity or adequacy of this Indenture or the
Securities, it shall not be accountable for the Company's use of the proceeds
from the Securities, and it shall not be responsible for any statement of the
Company in this Indenture or any document issued in connection with the sale of
Securities (including without limitation any preliminary or final offering
memorandum) or any statement in the Securities other than the Trustee's
certificate of authentication. The Trustee makes no representations with respect
to the effectiveness or adequacy of this Indenture. The Trustee shall not be
responsible for independently ascertaining or maintaining such validity, if any,
and shall be fully protected in relying upon certificates and opinions delivered
to it in accordance with the terms of this Indenture.
SECTION 7.05. Notice of Default.
If a Default or an Event of Default occurs and is continuing
and a Responsible Officer of the Trustee receives actual notice of such event,
the Trustee shall mail to each Securityholder, as their names and addresses
appear on the Securityholder list described in Section 2.05, notice of the
uncured Default or Event of Default within 90 days after the Trustee receives
such notice (or 30 days in the case of a Default or Event of Default specified
in the following sentence). Except in the case of a Default or an Event of
Default in pay-
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ment of principal of, premium or interest on, any Security, including the
failure to make payment on (i) the Change of Control Payment Date pursuant to a
Change of Control Offer or (ii) the Excess Proceeds Offer Payment Date pursuant
to an Excess Proceeds Offer, the Trustee may withhold the notice if and so long
as the board of directors, the executive committee, or a trust committee of
directors, of the Trustee in good faith determines that withholding the notice
is in the interest of the Securityholders.
SECTION 7.06. Reports by Trustee to Holders.
This Section 7.06 shall not be operative as a part of this
Indenture until this Indenture is qualified under the TIA, and, until such
qualification, this Indenture shall be construed as if this Section 7.06 were
not contained herein.
Within 60 days after each May 15 of each year beginning with
2000, the Trustee shall, to the extent that any of the events described in TIA
ss. 313(a) occurred within the previous twelve months, but not otherwise, mail
to each Securityholder a brief report dated as of such May 15 that complies with
TIA ss. 313(a). The Trustee also shall comply with TIA ss.ss. 313(b), 313(c) and
313(d).
A copy of each report at the time of its mailing to
Securityholders shall be mailed to the Company and filed with the Commission and
each securities exchange, if any, on which the Securities are listed.
The Company shall notify a Responsible Officer of the Trustee
if the Securities become listed on any securities exchange or of any delisting
thereof.
SECTION 7.07. Compensation and Indemnity.
The Company shall pay to the Trustee from time to time such
compensation for its services hereunder as the Company and the Trustee shall
from time to time agree in writing. The Trustee's compensation shall not be
limited by any law on compensation of a trustee of an express trust. The Company
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shall reimburse the Trustee upon request for all reasonable disbursements,
expenses and advances (including reasonable fees and expenses of counsel)
incurred or made by it in addition to the compensation for its services, except
any such disbursements, expenses and advances as may be attributable to the
Trustee's negligence or bad faith. Such expenses shall include the reasonable
compensation, legal fees, disbursements and expenses of the Trustee's agents,
accountants, experts, nominees, custodians and counsel and any taxes or other
expenses incurred by a trust created pursuant to Section 8.01.
The Company shall indemnify the Trustee, its directors,
officers and employees and each predecessor Trustee for, and hold it harmless
against, any loss, liability or expense incurred by the Trustee without
negligence or bad faith on its part arising out of or in connection with the
administration of this trust and its duties under this Indenture, including the
reasonable expenses and attorneys' fees of defending itself against any claim of
liability arising hereunder. The Trustee shall notify the Company promptly of
any claim asserted against the Trustee for which it may seek indemnity. However,
the failure by the Trustee to so notify the Company shall not relieve the
Company of its obligations hereunder. The Company shall defend the claim and the
Trustee shall cooperate in the defense (and may employ its own counsel) at the
Company's expense. The Company need not pay for any settlement made without its
written consent, which consent shall not be unreasonably withheld or delayed.
The Company need not reimburse any expense or indemnify against any loss or
liability incurred by the Trustee as a result of the violation of this Indenture
by the Trustee if such violation arose from the Trustee's negligence or bad
faith.
To secure the Company's payment obligations in this Section
7.07, the Trustee shall have a senior claim and lien prior to the Securities
against all money or property held or collected by the Trustee, in its capacity
as Trustee.
When the Trustee incurs expenses or renders services after an
Event of Default specified in clause (5) or (6) of
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Section 6.01 occurs, the expenses (including the reasonable fees and expenses of
its agents and counsel) and the compensation for the services shall be preferred
over the status of the Holders in a proceeding under any Bankruptcy Law and are
intended to constitute expenses of administration under any Bankruptcy Law. The
Company's obligations under this Section 7.07 and any claim arising hereunder
shall survive termination of this Indenture, the resignation or removal of any
Trustee, the discharge of the Company's obligations pursuant to Article Eight
and any rejection or termination under any Bankruptcy Law.
SECTION 7.08. Replacement of Trustee.
The Trustee may resign at any time by so notifying the Company
in writing. The Holders of a majority in principal amount of the outstanding
Securities may remove the Trustee by so notifying the Company and the Trustee in
writing and may appoint a successor trustee with the Company's consent. The
Company may remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged a bankrupt or an insolvent;
(3) a receiver or other public officer takes charge of
the Trustee or its property; or
(4) the Trustee becomes legally incapable of acting with
respect to its duties hereunder.
If the Trustee resigns or is removed or if a vacancy exists in
the office of Trustee for any reason, the Company shall notify each Holder of
such event and shall promptly appoint a successor Trustee. Within one year after
the successor Trustee takes office, the Holders of a majority in principal
amount of the Securities may appoint a successor Trustee to replace the
successor Trustee appointed by the Company.
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A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Immediately after that,
the retiring Trustee shall transfer, after payment of all sums then owing to the
Trustee pursuant to Section 7.07, all property held by it as Trustee to the
successor Trustee, subject to the lien provided in Section 7.07, the resignation
or removal of the retiring Trustee shall become effective, and the successor
Trustee shall have all the rights, powers and duties of the Trustee under this
Indenture; provided, however, that no Trustee under this Indenture shall be
liable for any act or omission of any successor Trustee. A successor Trustee
shall mail notice of its succession to each Securityholder.
If a successor Trustee does not take office within 30 days
after the retiring Trustee resigns or is removed, the retiring Trustee (at the
expense of the Company), the Company or the Holders of at least 10% in principal
amount of the outstanding Securities may petition any court of competent
jurisdiction for the appointment of a successor Trustee.
If the Trustee fails to comply with Section 7.10, any
Securityholder may petition any court of competent jurisdiction for the removal
of the Trustee and the appointment of a successor Trustee.
Notwithstanding replacement of the Trustee pursuant to this
Section 7.08, the Company's obligations under Section 7.07 shall continue for
the benefit of the retiring Trustee and the Company shall pay to any such
replaced or removed Trustee all amounts owed under Section 7.07 upon such
replacement or removal.
SECTION 7.09. Successor Trustee by Merger, Etc.
If the Trustee consolidates with, merges or converts into, or
transfers all or substantially all of its corporate trust business to, another
corporation, the resulting, surviving or transferee corporation without any
further act shall, if such resulting, surviving or transferee corporation is
other-
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wise eligible hereunder, be the successor Trustee. In case any Securities shall
have been authenticated, but not delivered, by the Trustee then in office, any
successor by merger, conversion or consolidation to such authenticating Trustee
may adopt such authentication and deliver the Securities so authenticated with
the same effect as if such successor Trustee had itself authenticated such
Securities.
SECTION 7.10. Eligibility; Disqualification.
This Indenture shall always have a Trustee who satisfies the
requirement of TIA ss.ss. 310(a)(1) and 310(a)(5). The Trustee shall have a
combined capital and surplus of at least $50,000,000 as set forth in its most
recent published annual report of condition. The Trustee shall comply with TIA
ss. 310(b); provided, however, that there shall be excluded from the operation
of TIA ss. 310(b)(1) any indenture or indentures under which other securities,
or certificates of interest or participation in other securities, of the Company
are outstanding, if the requirements for such exclusion set forth in TIA ss.
310(b)(1) are met.
SECTION 7.11. Preferential Collection of Claims Against Company.
The Trustee, in its capacity as Trustee hereunder, shall
comply with TIA ss. 311(a), excluding any creditor relationship listed in TIA
ss. 311(b). A Trustee who has resigned or been removed shall be subject to TIA
ss. 311(a) to the extent indicated.
ARTICLE EIGHT
SATISFACTION AND DISCHARGE OF INDENTURE
SECTION 8.01. Legal Defeasance and Covenant Defeasance.
(a) The Company may, at its option and at any time, with
respect to the Securities, elect to have either para-
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graph (b) or paragraph (c) below be applied to the outstanding Securities upon
compliance with the conditions set forth in paragraph (d).
(b) Upon the Company's exercise under paragraph (a) of
the option applicable to this paragraph (b), the Company shall be deemed to have
been released and discharged from its obligations with respect to the
outstanding Securities on the date the conditions set forth below are satisfied
(hereinafter, "Legal Defeasance"). For this purpose, such Legal Defeasance means
that the Company shall be deemed to have paid and discharged the entire
indebtedness represented by the outstanding Securities, which shall thereafter
be deemed to be "outstanding" only for the purposes of the Sections and matters
under this Indenture referred to in (i) and (ii) below, and to have satisfied
all its other obligations under such Securities and this Indenture insofar as
such Securities are concerned, except for the following, which shall survive
until otherwise terminated or discharged hereunder: (i) the rights of the
Holders of outstanding Securities to receive payments in respect of the
principal of, premium, if any, and interest on such Securities when such
payments are due, (ii) the Company's obligations to issue temporary Securities,
register the transfer or exchange of any Securities, replace mutilated,
destroyed, lost or stolen Securities and maintain an office or agency for
payments in respect of the Securities, (iii) the rights, powers, trusts, duties
and immunities of the Trustee and the Company's obligations in connection
therewith, (iv) the Legal Defeasance provisions of this Indenture and (v)
Article Twelve. The Company may exercise its option under this paragraph (b)
notwithstanding the prior exercise of its option under paragraph (c) below with
respect to the Securities.
(c) Upon the Company's exercise under paragraph (a) of
the option applicable to this paragraph (c), the Company shall be released and
discharged from its obligations under any covenant contained in Article Five and
in Sections 4.03 through 4.21 with respect to the outstanding Securities on and
after the date the conditions set forth below are satisfied (hereinafter,
"Covenant Defeasance"), and the Securities shall there-
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after be deemed to be not "outstanding" for the purpose of any direction,
waiver, consent or declaration or act of Holders (and the consequences of any
thereof) in connection with such covenants, but shall continue to be deemed
"outstanding" for all other purposes hereunder. For this purpose, such Covenant
Defeasance means that, with respect to the outstanding Securities, the Company
and any Guarantor may omit to comply with and shall have no liability in respect
of any term, condition or limitation set forth in any such covenant, whether
directly or indirectly, by reason of any reference elsewhere herein to any such
covenant or by reason of any reference in any such covenant to any other
provision herein or in any other document and such omission to comply shall not
constitute a Default or an Event of Default under Section 6.01(3), nor shall any
event referred to in Section 6.01(4) or (7) thereafter constitute a Default or
an Event of Default thereunder but, except as specified above, the remainder of
this Indenture and such Securities shall be unaffected thereby.
(d) The following shall be the conditions to application
of either paragraph (b) or paragraph (c) above to the outstanding Securities:
(1) The Company must irrevocably deposit with the
Trustee, in trust, for the benefit of the Holder pursuant to an
irrevocable trust and security agreement in form and substance
reasonably satisfactory to the Trustee, U.S. Legal Tender or direct
non-callable obligations of, or non-callable obligations guaranteed by,
the United States of America for the payment of which obligation or
guarantee the full faith and credit of the United States of America is
pledged ("U.S. Government Obligations") or a combination thereof,
maturing as to principal and interest in such amounts and at such times
as are sufficient, without consideration of the reinvestment of such
interest and principal and after payment of all Federal, state and local
taxes or other charges or assessments in respect thereof payable by the
Trustee, in the opinion of a nationally recognized firm of Independent
public accountants, selected by the Company, expressed in a written cer-
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tification thereof (in form and substance reasonably satisfactory to the
Trustee) delivered to the Trustee, to pay the principal of, premium, if
any, and interest on all the outstanding Securities on the dates on
which any such payments are due and payable in accordance with the terms
of this Indenture and of the Securities;
(2) Such deposits shall not cause the Trustee to have a
conflicting interest as defined in and for purposes of the TIA;
(3) The Trustee shall have received Officers'
Certificates stating that no Default or Event of Default or event which
with notice or lapse of time or both would become a Default or an Event
of Default with respect to the Securities shall have occurred and be
continuing on the date of such deposit or, insofar as Section 6.01(5) or
(6) is concerned, at any time during the period ending on the 91st day
after the date of such deposit (it being understood that this condition
shall not be deemed satisfied until the expiration of such period);
(4) The Trustee shall have received Officers'
Certificates stating that such deposit will not result in a Default
under this Indenture or a breach or violation of, or constitute a
default under, any other material instrument or agreement to which the
Company or any of its Subsidiaries is a party or by which the Company or
any of its Subsidiaries is bound;
(5) (i) In the event the Company elects paragraph (b)
hereof, the Company shall deliver to the Trustee an Opinion of Counsel
in the United States, in form and substance reasonably satisfactory to
the Trustee confirming that (A) the Company has received from, or there
has been published by, the Internal Revenue Service a ruling or (B)
since the Issue Date, there has been a change in the applicable federal
income tax law, in either case to the effect that, and based thereon
such Opinion of Counsel shall confirm that, Holders of the Securities
will not
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recognize income, gain or loss for Federal income tax purposes as a
result of such deposit and the defeasance contemplated hereby and will
be subject to Federal income taxes on the same amounts, in the same
manner and at the same times as would have been the case if such deposit
and defeasance had not occurred, or (ii) in the event the Company elects
paragraph (c) hereof, the Company shall deliver to the Trustee an
Opinion of Counsel in the United States, in form and substance
reasonably satisfactory to the Trustee, confirming that, Holders of the
Securities will not recognize income, gain or loss for Federal income
tax purposes as a result of such deposit and the defeasance contemplated
hereby and will be subject to Federal income tax on the same amounts and
in the same manner and at the same times as would have been the case if
such deposit and defeasance had not occurred;
(6) The Company shall have delivered to the Trustee an
Opinion of Counsel stating that as a result of the Legal Defeasance or
Covenant Defeasance, neither the Trustee nor the trust have become or
are deemed to have become an "investment company" under the Investment
Company Act of 1940, as amended;
(7) The Company shall have delivered to the Trustee an
Officers' Certificate, in form and substance reasonably satisfactory to
the Trustee, stating that the deposit under clause (1) was not made by
the Company, a Guarantor or any Subsidiary of the Company with the
intent of defeating, hindering, delaying or defrauding any other
creditors of the Company, a Guarantor, or any Subsidiary of the Company
or others;
(8) The Company shall have delivered to the Trustee an
Opinion of Counsel, in form and substance reasonably satisfactory to
the Trustee, to the effect that, (A) the trust funds will not be
subject to any rights of holders of Indebtedness of the Company or any
Guarantor including, without limitation, those arising under this
Indenture, after the 91st day following the deposit, the trust funds
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will not be subject to the effect of any applicable bankruptcy,
insolvency, reorganization or similar laws affecting creditors' rights
generally;
(9) The Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent specified herein relating to the defeasance contemplated by
this Section 8.01 have been complied with; provided, however, that no
deposit under clause (1) above shall be effective to terminate the
obligations of the Company under the Securities or this Indenture prior
to 90 days following any such deposit; and
(10) The Company shall have paid all amounts owing to the
Trustee pursuant to Section 7.07.
Notwithstanding the foregoing, the Opinion of Counsel required
by paragraph (5) above need not be delivered if all Securities not theretofore
delivered to the Trustee for cancellation (i) have become due and payable, (ii)
will become due and payable on the maturity date for the securities within one
year, or (iii) are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of notice of redemption
by the Trustee in the name, and at the expense, of the Company.
In the event all or any portion of the Securities are to be
redeemed through such irrevocable trust, the Company must make arrangements
satisfactory to the Trustee, at the time of such deposit, for the giving of the
notice of such redemption or redemptions by the Trustee in the name and at the
expense of the Company.
SECTION 8.02. Satisfaction and Discharge.
In addition to the Company's rights under Section 8.01, the
Company may terminate all of its obligations under this Indenture (subject to
Section 8.03) when:
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(1) all Securities theretofore authenticated and
delivered (other than Securities which have been destroyed, lost or
stolen and which have been replaced or paid as provided in Section 2.07
and Securities for whose payment money has theretofore been deposited in
trust or segregated and held in trust by the Company or thereafter
repaid to the Company from such trust) have been delivered to the
Trustee for cancellation; or
(2) all Securities not theretofore delivered to the
Trustee for cancellation (except lost, stolen or destroyed Securities
which have been replaced or paid) have been called for redemption
pursuant to the terms of the Securities or have otherwise become due and
payable and the Company has irrevocably deposited or caused to be
deposited with the Trustee funds in an amount sufficient to pay and
discharge the entire Indebtedness on the Securities not theretofore
delivered to the Trustee for cancellation, for principal of, premium, if
any, and interest on the Securities to the date of deposit together with
irrevocable instructions from the Company directing the Trustee to apply
such funds to the payment thereof at maturity or redemption, as the case
may be; and
(3) the Company and/or the Guarantors have paid or caused
to be paid all other sums payable under this Indenture; and
(4) there exists no Default or Event of Default under
this Indenture; and
(5) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent specified herein relating to the satisfaction and discharge
of this Indenture have been complied with; and
(6) the Company shall have paid all amounts owing to the
Trustee pursuant to Section 7.07.
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SECTION 8.03. Survival of Certain Obligations.
Notwithstanding the satisfaction and discharge of this
Indenture and of the Securities referred to in Section 8.01 or 8.02, the
respective obligations of the Company and the Trustee under Sections 2.02, 2.03,
2.04, 2.05, 2.06, 2.07, 2.10, 2.12, 2.13, 4.01, 4.02 and 6.07, Article Seven and
Sections 8.05, 8.06 and 8.07 and Article Twelve shall survive until the
Securities are no longer outstanding, and thereafter the obligations of the
Company and the Trustee under Sections 7.07, 8.05, 8.06 and 8.07 shall survive.
Nothing contained in this Article Eight shall abrogate any of the rights,
obligations or duties of the Trustee under this Indenture.
SECTION 8.04. Acknowledgment of Discharge by Trustee.
Subject to Section 8.07, after (i) the conditions of Section
8.01 or 8.02 have been satisfied, (ii) the Company has paid or caused to be paid
all other sums payable hereunder by the Company, and (iii) the Company has
delivered to the Trustee an Officers' Certificate and an Opinion of Counsel,
each stating that all conditions precedent referred to in clause (i) above
relating to the satisfaction and discharge of this Indenture have been complied
with, the Trustee upon written request shall acknowledge in writing the
discharge of the Company's obligations under this Indenture except for those
surviving obligations specified in Section 8.03.
SECTION 8.05. Application of Trust Assets.
The Trustee shall hold any U.S. Legal Tender or U.S.
Government Obligations deposited with it in the irrevocable trust established
pursuant to Section 8.01. The Trustee shall apply the deposited U.S. Legal
Tender or the U.S. Government Obligations, together with earnings thereon,
through the Paying Agent, in accordance with this Indenture and the terms of the
irrevocable trust agreement established pursuant to Section 8.01, to the payment
of principal of and interest on the Securities. The U.S. Legal Tender or U.S.
Government Obligations so held in trust and deposited with the Trustee in
com-
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pliance with Section 8.01 shall not be part of the trust estate under this
Indenture, but shall constitute a separate trust fund for the benefit of all
Holders entitled thereto.
The Company shall pay and indemnify the Trustee against any tax,
fee or other charge imposed on or assessed against the U.S. Government
Obligations deposited pursuant to Section 8.01 or the principal and interest
received in respect thereof other than any such tax, fee or other charge which
by law is for the account of the Holders of Outstanding Securities.
SECTION 8.06. Repayment to the Company or Guarantors; Unclaimed Money.
Subject to Sections 7.07 and 8.01 and to applicable laws relating
to escheat, the Trustee shall promptly pay to the Company, or if deposited with
the Trustee by any Guarantor, to such Guarantor, upon receipt by the Trustee of
an Officers' Certificate, any excess money, determined in accordance with
Section 8.01, held by it at any time. The Trustee and the Paying Agent shall pay
to the Company or any Guarantor, as the case may be, upon receipt by the Trustee
or the Paying Agent, as the case may be, of an Officers' Certificate, any money
held by it for the payment of principal, premium, if any, or interest that
remains unclaimed for two years after payment to the Holders is required;
provided, however, that the Trustee and the Paying Agent before being required
to make any payment may, but need not, at the expense of the Company cause to be
published once in a newspaper of general circulation in The City of New York or
mail to each Holder entitled to such money notice that such money remains
unclaimed and that after a date specified therein (which shall not be less than
30 days from the date of such mailing or publication and shall be at least two
years after the date such money held by the Trustee for the payment of
principal, premium, if any, or interest remains unclaimed), any unclaimed
balance of such money then remaining will be repaid to the Company. After
payment to the Company or any Guarantor, as the case may be, Securityholders
entitled to such money must look solely to the Company for payment as gen-
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eral creditors unless an applicable abandoned property law designates another
Person, and all liability of the Trustee or Paying Agent with respect to such
money shall thereupon cease.
SECTION 8.07. Reinstatement.
If the Trustee or Paying Agent is unable to apply any money or
U.S. Government Obligations in accordance with this Indenture by reason of any
legal proceeding or by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, then and only then the Company's and each Guarantor's, if any,
obligations under this Indenture and the Securities shall be revived and
reinstated as though no deposit had been made pursuant to this Indenture until
such time as the Trustee is permitted to apply all such money or U.S. Government
Obligations in accordance with this Indenture; provided, however, that if the
Company or the Guarantors, as the case may be, have made any payment of
principal of, premium, if any, or interest on any Securities because of the
reinstatement of their obligations, the Company or the Guarantors, as the case
may be, shall be subrogated to the rights of the holders of such Securities to
receive such payment from the money or U.S. Government Obligations held by the
Trustee or Paying Agent.
ARTICLE NINE
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 9.01. Without Consent of Holders.
The Company and any Guarantors (when authorized by Board
Resolutions), and the Trustee, together, may amend or supplement this Indenture
or the Securities without notice to or consent of any Securityholder:
(1) to cure any ambiguity, defect or inconsistency;
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(2) to evidence the succession in accordance with Article
Five hereof of another Person to the Company or a Guarantor and the
assumption by any such successor of the covenants of the Company or a
Guarantor herein and in the Securities or a Guarantee, as the case may
be;
(3) to provide for uncertificated Securities in addition
to or in place of certificated Securities;
(4) to make any other change that does not materially
adversely affect the rights of any Securityholders hereunder;
(5) to comply with any requirements of the Commission in
connection with the qualification of this Indenture under the TIA; or
(6) to add or release any Guarantor pursuant to the terms
of this Indenture;
provided that each of the Company and any Guarantors has delivered to the
Trustee an Opinion of Counsel and an Officers' Certificate, each stating that
such amendment or supplement complies with the provisions of this Section 9.01;
and provided, further, that such amendment or supplement does not, in the
opinion of the Trustee, adversely affect the rights of any of the Holders in any
material respect. In formulating its opinion on such matters, the Trustee will
be entitled to rely on such evidence as it deems appropriate, including, without
limitation, solely on an Opinion of Counsel.
SECTION 9.02. With Consent of Holders.
Subject to Section 6.07, the Company and any Guarantors (when
authorized by Board Resolutions) and the Trustee, together, with the written
consent of the Holder or Holders of at least a majority in aggregate principal
amount of the then outstanding Securities, may amend or supplement this
Indenture, the Securities and any Guarantees without notice to any other
Securityholders. Subject to Section 6.07, the Holder or Holders of a majority in
aggregate principal amount of the then
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outstanding Securities may waive compliance by the Company with any provision of
this Indenture or the Securities without notice to any other Securityholder
(including, without limitation, the provisions of Section 4.22). Without the
consent of each Securityholder affected, however, no amendment, supplement or
waiver, including a waiver pursuant to Section 6.04, may:
(1) reduce the principal amount of Securities whose Holders must
consent to an amendment, supplement or waiver of any provision of this
Indenture, the Securities or any Guarantees;
(2) reduce the rate of or change or have the effect of changing
the time for payment of interest, including defaulted interest, on any
Security;
(3) reduce the principal of or change or have the effect of
changing the fixed maturity of any Securities, or change the date on
which any Securities may be subject to redemption or repurchase, or
reduce the redemption or repurchase price therefor;
(4) make any Securities payable in money other than that stated
in the Securities;
(5) make any change in provisions of this Indenture protecting
the right of each Holder to receive payment of principal of, premium,
if any, and interest on such Securities on or after the stated due
date thereof or to bring suit to enforce such payment, or permitting
Holders of a majority in principal amount of the then outstanding
Securities to waive Defaults or Events of Default;
(6) amend, change or modify in any material respect the
obligations of the Company to make and consummate a Change of Control
Offer after the occurrence of a Change of Control or make and
consummate a Net Proceeds Offer with respect to any Asset Sale that
has been consummated or modify any of the provisions or definitions
with respect thereto;
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(7) modify or change any provision of this Indenture or the
related definitions affecting the subordination or ranking of the
Securities or any Guarantee in a manner which adversely affects the
Holders;
(8) modify the provisions of Section 4.19, 6.04, 6.07 or this
Section 9.02 in any manner adverse to a Holder of Securities; or
(9) release any Guarantor from any of its obligations under its
Guarantee or this Indenture otherwise than in accordance with the
terms of this Indenture.
It shall not be necessary for the consent of the Holders under
this Section 9.02 to approve the particular form of any proposed amendment,
supplement or waiver, but it shall be sufficient if such consent approves the
substance thereof.
After an amendment, supplement or waiver under this Section 9.02
becomes effective, the Company shall mail to the Holders affected thereby a
notice briefly describing the amendment, supplement or waiver. Any failure of
the Company to mail such notice, or any defect therein, shall not, however, in
any way impair or affect the validity of any such supplemental indenture.
SECTION 9.03. Compliance with TIA.
From the date on which this Indenture is qualified under the TIA,
every amendment, waiver or supplement of this Indenture or the Securities shall
comply with the TIA as then in effect.
SECTION 9.04. Revocation and Effect of Consents.
Until an amendment, waiver or supplement becomes effective, a
consent to it by a Holder is a continuing consent by the Holder and every
subsequent Holder of a Security or portion of a Security that evidences the same
debt as the consenting Holder's Security, even if notation of the consent is not
made on any Security. However, any such Holder or subsequent Holder
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may revoke the consent as to his Security or portion of his Security by notice
to the Trustee or the Company received before the date on which the Trustee
receives an Officers' Certificate certifying that the Holders of the requisite
principal amount of Securities have consented (and not theretofore revoked such
consent) to the amendment, supplement or waiver.
The Company may, but shall not be obligated to, fix a record
date for the purpose of determining the Holders entitled to consent to any
amendment, supplement or waiver. If a record date is fixed, then notwithstanding
the last sentence of the immediately preceding paragraph, those Persons who were
Holders at such record date (or their duly designated proxies), and only those
Persons, shall be entitled to revoke any consent previously given, whether or
not such Persons continue to be Holders after such record date. No such consent
shall be valid or effective for more than 90 days after such record date.
After an amendment, supplement or waiver becomes effective, it
shall bind every Securityholder, unless it makes a change described in any of
clauses (1) through (11) of Section 9.02, in which case, the amendment,
supplement or waiver shall bind only each Holder of a Security who has consented
to it and every subsequent Holder of a Security or portion of a Security that
evidences the same debt as the consenting Holder's Security; provided that any
such waiver shall not impair or affect the right of any Holder to receive
payment of principal of and interest on a Security, on or after the respective
due dates expressed in such Security, or to bring suit for the enforcement of
any such payment on or after such respective dates without the consent of such
Holder.
SECTION 9.05. Notation on or Exchange of Securities.
If an amendment, supplement or waiver changes the terms of a
Security, the Trustee may require the Holder of the Security to deliver it to
the Trustee. The Trustee may place an appropriate notation on the Security about
the changed terms and return it to the Holder. Alternatively, if the Company or
the Trustee so determines, the Company in exchange for the Se-
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curity shall issue and the Trustee shall authenticate a new Security that
reflects the changed terms. Failure to make the appropriate notation or to issue
a new Security shall not affect the validity and effect of such amendment,
supplement or waiver.
SECTION 9.06. Trustee to Sign Amendments, Etc.
The Trustee shall execute any amendment, supplement or waiver
authorized pursuant to this Article Nine; provided that the Trustee may, but
shall not be obligated to, execute any such amendment, supplement or waiver
which affects the Trustee's own rights, duties or immunities under this
Indenture. The Trustee shall be entitled to receive, and shall be fully
protected in relying upon, an Opinion of Counsel and an Officers' Certificate
each stating that the execution of any amendment, supplement or waiver
authorized pursuant to this Article Nine is authorized or permitted by this
Indenture and constitutes the legal, valid and binding obligations of the
Company and any Guarantor enforceable in accordance with its terms (subject to
customary exceptions) and, in the case of any supplemental indenture required by
Section 4.18, constitutes a guarantee as defined therein. Such Opinion of
Counsel shall be at the expense of the Company, and the Trustee shall have a
lien under Section 7.07 for any such expense.
ARTICLE TEN
GUARANTEE
SECTION 10.01. Unconditional Guarantee.
Each Guarantor agrees to unconditionally, jointly and
severally, guarantee to each Holder of a Security authenticated and delivered by
the Trustee, and to the Trustee and its successors and assigns, that: (i) the
principal of, premium, if any, and interest on the Securities will be promptly
paid in full when due, subject to any applicable grace period, whether at
maturity, by acceleration or otherwise and interest on the
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overdue principal, if any, and interest on any interest, to the extent lawful,
of the Securities and all other Obligations of the Company to the Holders or the
Trustee hereunder or thereunder will be promptly paid in full or performed, all
in accordance with the terms hereof and thereof; and (ii) in case of any
extension of time of payment or renewal of any Securities or of any such other
Obligations, the same will be promptly paid in full when due or performed in
accordance with the terms of the extension or renewal, subject to any applicable
grace period, whether at stated maturity, by acceleration or otherwise, subject,
however, in the case of clauses (i) and (ii) above, to the limitations set forth
in Section 10.03. Each Guarantor agrees that its obligations hereunder shall be
unconditional, irrespective of the validity, regularity or enforceability of the
Securities or this Indenture, the absence of any action to enforce the same, any
waiver or consent by any Holder of the Securities with respect to any provisions
hereof or thereof, the recovery of any judgment against the Company, any action
to enforce the same or any other circumstance which might otherwise constitute a
legal or equitable discharge or defense of a Guarantor. Each Guarantor waives
diligence, presentment, demand of payment, filing of claims with a court in the
event of insolvency or bankruptcy of the Company, any right to require a
proceeding first against the Company, protest, notice and all demands whatsoever
and covenants that its Guarantee will not be discharged except by complete
performance of the obligations contained in the Securities, this Indenture and
each Guarantee. If any Securityholder or the Trustee is required by any court or
otherwise to return to the Company, any Guarantor or any custodian, trustee,
liquidator or other similar official acting in relation to the Company or any
Guarantor, any amount paid by the Company or any Guarantor to the Trustee or
such Securityholder, each Guarantee to the extent theretofore discharged, shall
be reinstated in full force and effect. Each Guarantor further agrees that, as
between each Guarantor, on the one hand, and the Holders and the Trustee, on the
other hand, (x) the maturity of the obligations guaranteed hereby may be
accelerated as provided in Article Six for the purposes of each Guarantee
notwithstanding any stay, injunction
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or other prohibition preventing such acceleration in respect of the obligations
guaranteed hereby, and (y) in the event of any acceleration of such obligations
as provided in Article Six, such obligations (whether or not due and payable)
shall forthwith become due and payable by each Guarantor for the purpose of its
Guarantee.
SECTION 10.02. Severability.
In case any provision of a Guarantee shall be invalid, illegal
or unenforceable, the validity, legality, and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
SECTION 10.03. Release of a Guarantor.
In the event of either (i) the issuance or sale of Capital
Stock of a Guarantor which results in the Guarantor no longer being a Subsidiary
of the Company, (ii) a Guarantor becoming an Unrestricted Subsidiary or (iii)
the sale of all or substantially all of the assets of a Guarantor pursuant to an
Asset Sale which complies with the provisions of Section 4.12, the applicable
Guarantor's Guarantee will be released.
The Trustee shall deliver an appropriate instrument evidencing
such release upon receipt of a request by the Company accompanied by an
Officers' Certificate and Opinion of Counsel certifying as to the compliance
with this Section 10.03. Any Guarantor not so released remains liable for the
full amount of principal of and interest on the Securities as provided in this
Article Ten.
SECTION 10.04. Limitation of a Guarantor's Liability.
Each Guarantor and, by its acceptance hereof, each Holder
hereby confirms that it is the intention of all such parties that the guarantee
by such Guarantor pursuant to its Guarantee not constitute a fraudulent transfer
or conveyance for purposes of any Bankruptcy Law, the Uniform Fraudulent
Conveyance Act, the Uniform Fraudulent Transfer Act or any similar Federal or
state law. To effectuate the foregoing intention,
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the Holders and each Guarantor irrevocably agree that the obligations of each
Guarantor under its Guarantee shall be limited to the maximum amount as will,
after giving effect to all other contingent and fixed liabilities of such
Guarantor, and after giving effect to any collections from or payments made by
or on behalf of any other Guarantor in respect of the obligations of such other
Guarantor under its Guarantee, or pursuant to Section 10.05, result in the
obligations of such Guarantor under its Guarantee not constituting such
fraudulent transfer or conveyance.
SECTION 10.05. Contribution.
In order to provide for just and equitable contribution among
the Guarantors, the Guarantors agree, inter se, that in the event any payment or
distribution is made by any Guarantor (a "Funding Guarantor") under its
Guarantee, such Funding Guarantor shall be entitled to a contribution from all
other Guarantors in a pro rata amount based on the Adjusted Net Assets of each
Guarantor (including the Funding Guarantor) for all payments, damages and
expenses incurred by that Funding Guarantor in discharging the Company's
obligations with respect to the Securities or any other Guarantor's obligations
with respect to its Guarantee. "Adjusted Net Assets" of a Guarantor at any date
shall mean the lesser of the amount by which (x) the fair value of the property
of such Guarantor exceeds the total amount of liabilities, including, without
limitation, contingent liabilities (after giving effect to all other fixed and
contingent liabilities incurred or assumed on such date), but excluding
liabilities under the Guarantee of such Guarantor at such date and (y) the
present fair salable value of the assets of such Guarantor at such date exceeds
the amount that will be required to pay the probable liability of such Guarantor
on its debts (after giving effect to all other fixed and contingent liabilities
incurred or assumed on such date), excluding debt in respect of the Guarantee of
such Guarantor, as they become absolute and matured.
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SECTION 10.06. Waiver of Subrogation.
Until all Guarantee Obligations are paid in full, each
Guarantor hereby irrevocably waives any claims or other rights which it may now
or hereafter acquire against the Company that arise from the existence, payment,
performance or enforcement of such Guarantor's obligations under its Guarantee
and this Indenture, including, without limitation, any right of subrogation,
reimbursement, exoneration, indemnification, and any right to participate in any
claim or remedy of any Holder of Securities against the Company, whether or not
such claim, remedy or right arises in equity, or under contract, statute or
common law, including, without limitation, the right to take or receive from the
Company, directly or indirectly, in cash or other property or by set-off or in
any other manner, payment or security on account of such claim or other rights.
If any amount shall be paid to any Guarantor in violation of the preceding
sentence and the Securities shall not have been paid in full, such amount shall
be deemed to have been paid to such Guarantor for the benefit of, and held in
trust for the benefit of, the Holders of the Securities, and shall forthwith be
paid to the Trustee for the benefit of such Holders to be credited and applied
upon the Securities, in accordance with the terms of this Indenture. Each
Guarantor acknowledges that it will receive direct and indirect benefits from
the financing arrangements contemplated by this Indenture and that the waiver
set forth in this Section 10.06 is knowingly made in contemplation of such
benefits.
SECTION 10.07. Execution of Guarantees.
To evidence its guarantee to the Securityholders set forth in
this Article Ten, each Guarantor shall execute a Guarantee in substantially the
form of Exhibit G attached hereto, which shall be endorsed on each Security
ordered to be authenticated and delivered by the Trustee. Each Guarantor agrees
that its Guarantee set forth in this Article Ten shall remain in full force and
effect notwithstanding any failure to endorse on each Security a notation of
such Guarantee as well as a supplemental indenture as required by Section 4.18.
Each such
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Guarantee shall be signed on behalf of each Guarantor by two Officers, or an
Officer and an Assistant Secretary or one Officer shall sign and one Officer or
an Assistant Secretary (each of whom shall, in each case, have been duly
authorized by all requisite corporate actions) shall attest to such Guarantee
prior to the authentication of the Security on which it is endorsed, and the
delivery of such Security by the Trustee, after the authentication thereof
hereunder, shall constitute due delivery of such Guarantee on behalf of such
Guarantor. Such signatures upon the Guarantee may be by manual or facsimile
signature of such officers and may be imprinted or otherwise reproduced on the
Guarantee, and in case any such officer who shall have signed the Guarantee
shall cease to be such officer before the Security on which such Guarantee is
endorsed shall have been authenticated and delivered by the Trustee or disposed
of by the Company, such Security nevertheless may be authenticated and delivered
or disposed of as though the person who signed the Guarantee had not ceased to
be such officer of the Guarantor.
SECTION 10.08. Waiver of Stay, Extension or Usury Laws.
Each Guarantor covenants (to the extent that it may lawfully
do so) that it will not at any time insist upon, plead, or in any manner
whatsoever claim or take the benefit or advantage of, any stay or extension law
or any usury law or other law that would prohibit or forgive each such Guarantor
from performing its Guarantee as contemplated herein, wherever enacted, now or
at any time hereafter in force, or which may affect the covenants or the
performance of this Indenture; and (to the extent that it may lawfully do so)
each such Guarantor hereby expressly waives all benefit or advantage of any such
law, and covenants that it will not hinder, delay or impede the execution of any
power herein granted to the Trustee, but will suffer and permit the execution of
every such power as though no such law had been enacted.
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ARTICLE ELEVEN
MISCELLANEOUS
SECTION 11.01. TIA Controls.
If any provision of this Indenture limits, qualifies, or
conflicts with the duties imposed by operation of Section 318(c) of the TIA, the
imposed duties shall control.
SECTION 11.02. Notices.
Any notices or other communications required or permitted
hereunder shall be in writing, and shall be sufficiently given if made by hand
delivery, by telecopier or registered or certified mail, postage prepaid, return
receipt requested, addressed as follows:
if to the Company or a Guarantor:
Tenneco Inc.
500 North Field Drive
Lake Forest, Illinois 60045
Attention: Karl A. Stewart
Facsimile: (847) 482-5940
if to the Trustee:
The Bank of New York
101 Barclay Street
Floor 21W
New York, New York 10286
Attention: Corporate Trust Administration
Facsimile: (212) 815-5915
Each of the Company and the Trustee by written notice to each
other such Person may designate additional or different
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addresses for notices to such Person. Any notice or communication to the Company
or a Guarantor or the Trustee shall be deemed to have been given or made as of
the date so delivered if personally delivered; when receipt is acknowledged, if
telecopied; and five (5) calendar days after mailing if sent by registered or
certified mail, postage prepaid (except that a notice of change of address shall
not be deemed to have been given until actually received by the addressee).
Any notice or communication mailed to a Securityholder shall
be mailed to him by first class mail or other equivalent means at his address as
it appears on the registration books of the Registrar and shall be sufficiently
given to him if so mailed within the time prescribed.
Failure to mail a notice or communication to a Securityholder
or any defect in it shall not affect its sufficiency with respect to other
Securityholders. If a notice or communication is mailed in the manner provided
above, it is duly given, whether or not the addressee receives it.
SECTION 11.03. Communications by Holders with Other Holders.
Securityholders may communicate pursuant to TIA ss. 312(b)
with other Securityholders with respect to their rights under this Indenture,
the Securities or any Guarantees. The Company, the Trustee, the Registrar and
any other Person shall have the protection of TIA ss. 312(c).
SECTION 11.04. Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company to the Trustee
to take any action under this Indenture, the Company shall furnish to the
Trustee at the request of the Trustee:
(1) an Officers' Certificate, in form and substance
satisfactory to the Trustee, stating that, in the opinion of the
signers, all conditions precedent, if any, provided
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for in this Indenture relating to the proposed action have been
complied with; and
(2) an Opinion of Counsel stating that, in the opinion of
such counsel, all such conditions precedent have been complied with.
SECTION 11.05. Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture, other than the Officers'
Certificate required by Section 4.08, shall include:
(1) a statement that the person making such certificate
or opinion has read such covenant or condition;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of such person, he
has made such examination or investigation as is necessary to enable
him to express an informed opinion as to whether or not such covenant
or condition has been complied with; and
(4) a statement as to whether or not, in the opinion of
each such person, such condition or covenant has been complied with;
provided, however, that with respect to matters of fact an Opinion of
Counsel may rely on an Officers' Certificate or certificates of public
officials.
SECTION 11.06. Rules by Trustee, Paying Agent, Registrar.
The Trustee, Paying Agent or Registrar may make reasonable
rules for its functions.
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SECTION 11.07. Legal Holidays.
If a payment date is not a Business Day, payment may be made
on the next succeeding day that is a Business Day with the same force and effect
as if made on such payment date.
SECTION 11.08. Governing Law.
THIS INDENTURE, THE SECURITIES AND ANY GUARANTEES WILL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK
BUT WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE
EXTENT THAT THE APPLICATION OF THE LAW OF ANOTHER JURISDICTION WOULD BE REQUIRED
THEREBY. Each of the parties hereto agrees to submit to the jurisdiction of the
courts of the State of New York in any action or proceeding arising out of or
relating to this Indenture.
SECTION 11.09. No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another indenture,
loan or debt agreement of any of the Company or any of its Subsidiaries or any
Guarantor. Any such indenture, loan or debt agreement may not be used to
interpret this Indenture.
SECTION 11.10. No Recourse Against Others.
A director, officer, employee, stockholder or incorporator, as
such, of the Company or any of its Subsidiaries or any Guarantor shall not have
any liability for any obligations of the Company or any Guarantor under the
Securities, this Indenture or any Guarantee or for any claim based on, in
respect of or by reason of such obligations or their creations. Each
Securityholder by accepting a Security waives and releases all such liability.
Such waiver and release are part of the consideration for the issuance of the
Securities.
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SECTION 11.11. Successors.
All agreements of the Company and any Guarantors in this
Indenture, the Securities and any Guarantees shall bind their respective
successors. All agreements of the Trustee in this Indenture shall bind its
successor.
SECTION 11.12. Duplicate Originals.
All parties may sign any number of copies of this Indenture.
Each signed copy or counterpart shall be an original, but all of them together
shall represent the same agreement.
SECTION 11.13. Severability.
In case any one or more of the provisions in this Indenture,
in the Securities or in any Guarantee shall be held invalid, illegal or
unenforceable, in any respect for any reason, the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions shall not in any way be affected or impaired thereby, it being
intended that all of the provisions hereof shall be enforceable to the full
extent permitted by law.
SECTION 11.14. Table of Contents, Headings, Etc.
The table of contents, cross-reference sheet and headings of
the Articles and Sections of this Indenture have been inserted for convenience
of reference only, and are not to be considered a part hereof, and shall in no
way modify or restrict any of the terms or provisions hereof.
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ARTICLE TWELVE
SUBORDINATION
SECTION 12.01. Securities Subordinated to Senior Debt; Guarantees
Subordinated to Guarantor Senior Debt.
The Company and each Guarantor covenant and agree, and each
Holder of the Securities, by its acceptance thereof, likewise covenants and
agrees, that all Securities and Guarantees shall be issued subject to the
provisions of this Article Twelve; and each Person holding any Security, whether
upon original issue or upon transfer, assignment or exchange thereof, accepts
and agrees that the payment of all Obligations on the Securities and Guarantees
by the Company and any Guarantors shall, to the extent and in the manner herein
set forth, be subordinated and junior in right of payment to the prior payment
in full in cash or Cash Equivalents (or such payment shall be duly provided for
to the satisfaction of the holders of the Senior Debt and Guarantor Senior Debt,
as the case may be) of all Obligations on the Senior Debt and Guarantor Senior
Debt, as the case may be; that the subordination is for the benefit of, and
shall be enforceable directly by, the holders of Senior Debt and Guarantor
Senior Debt, as the case may be, and that each holder of Senior Debt and
Guarantor Senior Debt, as the case may be, whether now outstanding or hereafter
created, incurred, assumed or guaranteed shall be deemed to have acquired Senior
Debt and Guarantor Senior Debt, as the case may be, in reliance upon the
covenants and provisions contained in this Indenture.
SECTION 12.02. No Payment on Securities in Certain Circumstances.
(a) If any default occurs and is continuing in the payment
when due, whether at maturity, upon any redemption, by declaration or otherwise,
of any principal of, interest on, unpaid drawings for letters of credit issued
in respect of, regu-
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larly accruing fees with respect to, or other Obligations with respect to, any
Senior Debt, no payment or distribution of any kind or character shall be made
by or on behalf of the Company or any Guarantor with respect to any Obligations
on the Securities or the Guarantees or to acquire, redeem or defease any of the
Securities for cash or property or otherwise. In addition, if any other event of
default occurs and is continuing with respect to any Designated Senior Debt, as
such event of default is defined in the instrument creating or evidencing such
Designated Senior Debt, permitting the holders of such Designated Senior Debt
then outstanding to accelerate the maturity thereof and if the Representative
for such Designated Senior Debt gives written notice of the event of default to
the Trustee (a "Default Notice"), then neither the Company, any Guarantor nor
any other Person on its behalf shall (x) make any payment or distribution of any
kind or character with respect to any Obligations on the Securities or the
Guarantees or (y) acquire, redeem or defease any of the Securities for cash or
property or otherwise for a period of time (the "Blockage Period") terminating
on the earliest to occur of (1) the date all events of default with respect to
the applicable issue of Designated Senior Debt have been cured or waived or
shall have ceased to exist and the Company and the Trustee receive written
notice thereof from the Representative for the applicable issue of Designated
Senior Debt, (2) the Trustee receives written notice from the Representative for
the applicable issue of Designated Senior Debt terminating the Blockage Period,
or the benefits of this sentence are waived by the Representative for the
applicable issue of Designated Senior Debt, (3) the applicable issue of
Designated Senior Debt is discharged or paid in full in cash or Cash Equivalents
or (4) the expiration of the 180-day consecutive period commencing on the date
of the giving of such Default Notice. Upon the termination of such Blockage
Period, the Company shall (to the extent not otherwise prohibited by this
Article Twelve) promptly resume making all payments on the Securities, including
all payments not made during such Blockage Period. Notwithstanding anything
herein to the contrary, in no event shall a Blockage Period extend beyond 179
days from the date the Default Notice was delivered to the Trustee and
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only one such Blockage Period may be commenced within any 360 consecutive days.
No event of default which existed or was continuing on the date of the
commencement of any Blockage Period with respect to the Designated Senior Debt
shall be, or be made, the basis for commencement of a second Blockage Period by
the Representative of such Designated Senior Debt, whether or not after a period
of 360 consecutive days, unless such event of default shall have been cured or
waived or ceased to exist for a period of not less than 90 consecutive days (it
being acknowledged that any subsequent action, or any breach of any financial
covenants for a period commencing after the date of commencement of such
Blockage Period that, in either case, would give rise to an event of default
pursuant to any provisions of the Designated Senior Debt under which an event of
default previously existed or was continuing shall constitute a new event of
default for this purpose).
(b) In the event that, notwithstanding the foregoing, any
payment or distribution shall be received by the Trustee or any Holder when such
payment or distribution is prohibited by Section 12.02(a), such payment or
distribution shall be held in trust for the benefit of, and shall be paid over
or delivered to, the holders of Senior Debt or Guarantor Senior Debt, as the
case may be, (pro rata to such holders on the basis of the respective amount of
Senior Debt or Guarantor Senior Debt, as the case may be, held by such holders)
or their Representative as their respective interests may appear. The Trustee
shall be entitled to conclusively rely on information regarding amounts then due
and owing on the Senior Debt or Guarantor Senior Debt, as the case may be, if
any, received from the holders of Senior Debt or Guarantor Senior Debt (or their
Representatives), as the case may be, or, if such information is not received
from such holders or their Representatives, from the Company. The Company shall
keep complete and accurate records of the names, addresses and amounts owed to
all holders of Senior Debt and Guarantor Senior Debt, shall produce such records
to the Trustee upon request and the Trustee shall be absolutely protected in
relying on such records in paying over or delivering moneys pursuant to this
Article Twelve.
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Nothing contained in this Article Twelve shall limit or
compromise the right of the Trustee or the Holders to take any action to
accelerate the maturity of the Securities pursuant to Section 6.02 or to pursue
any rights or remedies hereunder or otherwise; provided, however, that all
Senior Debt and Guarantor Senior Debt of the applicable Guarantor thereafter due
or declared to be due shall first be paid in full in cash or Cash Equivalents
before the Holders are entitled to receive any payment or distribution of any
kind or character with respect to Obligations on the Securities or the Guarantee
of the applicable Guarantor, as the case may be.
SECTION 12.03. Payment Over of Proceeds upon Dissolution, Etc.
(a) Upon any payment or distribution of assets or
securities of the Company or a Guarantor of any kind or character, whether in
cash, property or securities to creditors upon any liquidation, dissolution,
winding-up, reorganization, assignment for the benefit of creditors or
marshaling of assets of the Company or such Guarantor or in a bankruptcy,
reorganization, insolvency, receivership or other similar proceeding relating to
the Company or its property or such Guarantor or its property, whether voluntary
or involuntary, all Obligations due or to become due upon all Senior Debt or
Guarantor Senior Debt of such Guarantor, as the case may be, shall first be paid
in full in cash or Cash Equivalents, or such payment shall be duly provided for
to the satisfaction of the holders of Senior Debt or Guarantor Senior Debt of
such Guarantor, as the case may be, before any payment or distribution of any
kind or character is made on account of any Obligations on the Securities or the
Guarantee of such Guarantor, as the case may be, or for the acquisition,
redemption or defeasance of any of the Securities for cash or property or
otherwise. Upon any such dissolution, winding-up, liquidation, reorganization,
assignment, marshalling of assets, receivership or similar proceeding, any
payment or distribution of assets or securities of the Company or a Guarantor of
any kind or character, whether in cash, property or securities, to which the
Holders or the Trustee under this Indenture would be entitled, except for the
provisions
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hereof, shall be paid by the Company or such Guarantor or by any receiver,
trustee in bankruptcy, liquidating trustee, agent or other Person making such
payment or distribution, or by the Holders or by the Trustee under this
Indenture if received by them, directly to the holders of Senior Debt or
Guarantor Senior Debt of such Guarantor, as the case may be (pro rata to such
holders on the basis of the respective amounts of Senior Debt or Guarantor
Senior Debt of such Guarantor, as the case may be, held by such holders) or
their respective Representatives, or to the trustee or trustees under any
indenture pursuant to which any of such Senior Debt or Guarantor Senior Debt of
such Guarantor, as the case may be, may have been issued, as their respective
interests may appear, for application to the payment of Senior Debt or Guarantor
Senior Debt of such Guarantor, as the case may be, remaining unpaid until all
such Senior Debt or Guarantor Senior Debt of such Guarantor, as the case may be,
has been paid in full in cash or Cash Equivalents after giving effect to any
concurrent payment or distribution in cash or Cash Equivalents to or for the
holders of Senior Debt or Guarantor Senior Debt of such Guarantor, as the case
may be.
(b) To the extent any payment of Senior Debt or Guarantor
Senior Debt (whether by or on behalf of the Company or a Guarantor, as proceeds
of security or enforcement of any right of setoff or otherwise) is declared to
be fraudulent or preferential, set aside or required to be paid to any receiver,
trustee in bankruptcy, liquidating trustee, agent or other similar Person under
any bankruptcy, insolvency, receivership, fraudulent conveyance or similar law,
then, if such payment is recovered by, or paid over to, such receiver, trustee
in bankruptcy, liquidating trustee, agent or other similar Person, the Senior
Debt or Guarantor Senior Debt or part thereof originally intended to be
satisfied shall be deemed to be reinstated and outstanding as if such payment
had not occurred.
(c) In the event that, notwithstanding the foregoing, any
payment or distribution of assets or securities of the Company or a Guarantor of
any kind or character, whether in cash, property or securities, shall be
received by the Trustee or any Holder when such payment or distribution is
prohibited
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by Section 12.03(a), such payment or distribution shall be held in trust for the
benefit of, and shall be paid over or delivered to, the holders of Senior Debt
or Guarantor Senior Debt of such Guarantor, as the case may be (pro rata to such
holders on the basis of the respective amount of Senior Debt or Guarantor Senior
Debt of such Guarantor, as the case may be, held by such holders) or their
respective Representatives, or to the trustee or trustees under any indenture
pursuant to which any of such Senior Debt or Guarantor Senior Debt of such
Guarantor, as the case may be, may have been issued, as their respective
interests may appear, for application to the payment of Senior Debt or Guarantor
Senior Debt of such Guarantor, as the case may be, remaining unpaid until all
such Senior Debt or Guarantor Senior Debt of such Guarantor, as the case may be,
has been paid in full in cash or Cash Equivalents, after giving effect to any
concurrent payment or distribution to or for the holders of such Senior Debt or
Guarantor Senior Debt of such Guarantor, as the case may be.
(d) The consolidation of the Company with, or the merger
of the Company with or into, another corporation or the liquidation or
dissolution of the Company following the conveyance or transfer of all or
substantially all of its assets, to another corporation upon the terms and
conditions provided in Article Five hereof shall not be deemed a dissolution,
winding-up, liquidation or reorganization for the purposes of this Section if,
in the event the Company is not the surviving corporation, such other
corporation shall, as a part of such consolidation, merger, conveyance or
transfer, assume the Company's obligations hereunder in accordance with Article
Five hereof.
SECTION 12.04. Payments May Be Paid Prior to Dissolution.
Nothing contained in this Article Twelve or elsewhere in this
Indenture shall prevent (i) the Company, except under the conditions described
in Sections 12.02 and 12.03, from making payments at any time for the purpose of
making payments of principal of and interest on the Securities, or from
depositing with the Trustee any monies for such payments, or (ii) in the
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absence of actual knowledge by the Trustee that a given payment would be
prohibited by Section 12.02 or 12.03, the application by the Trustee of any
monies deposited with it for the purpose of making such payments of principal
of, and interest on, the Securities to the Holders entitled thereto unless at
least one Business Day prior to the date upon which such payment would otherwise
become due and payable, the Trustee shall have received the written notice
provided for in Section 12.02(a) or in Section 12.07. The Company shall give
prompt written notice to the Trustee of any dissolution, winding-up, liquidation
or reorganization of the Company.
SECTION 12.05. Subrogation.
Subject to the payment in full in cash or Cash Equivalents of
all Senior Debt and Guarantor Senior Debt, the Holders shall be subrogated to
the rights of the holders of Senior Debt and Guarantor Senior Debt to receive
payments or distributions of cash, property or securities of the Company and
such Guarantor applicable to the Senior Debt and Guarantor Senior Debt until the
Securities shall be paid in full; and, for the purposes of such subrogation, no
such payments or distributions to the holders of the Senior Debt and Guarantor
Senior Debt by or on behalf of the Company or any Guarantor or by or on behalf
of the Holders by virtue of this Article Twelve which otherwise would have been
made to the Holders shall, as between the Company or any Guarantor and the
Holders, be deemed to be a payment by the Company or any Guarantor to or on
account of the Senior Debt or Guarantor Senior Debt, as the case may be, it
being understood that the provisions of this Article Twelve are and are intended
solely for the purpose of defining the relative rights of the Holders, on the
one hand, and the holders of the Senior Debt or Guarantor Senior Debt, as the
case may be, on the other hand.
SECTION 12.06. Obligations of the Company Unconditional.
Nothing contained in this Article Twelve or elsewhere in this
Indenture or in the Securities or Guarantees is in-
<PAGE> 160
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tended to or shall impair, as among the Company, any Guarantor, their respective
creditors other than the holders of Senior Debt or Guarantor Senior Debt, and
the Holders, the obligation of the Company and any Guarantors, which is absolute
and unconditional, to pay to the Holders the principal of and any interest on
the Securities as and when the same shall become due and payable in accordance
with their terms, or is intended to or shall affect the relative rights of the
Holders and creditors of the Company and any Guarantors other than the holders
of any Senior Debt or Guarantor Senior Debt, nor shall anything herein or
therein prevent the Holders or the Trustee on their behalf from exercising all
remedies otherwise permitted by applicable law upon default under this
Indenture, subject to the rights, if any, under this Article Twelve of the
holders of Senior Debt or Guarantor Senior Debt in respect of cash, property or
securities of the Company or any Guarantor received upon the exercise of any
such remedy.
SECTION 12.07. Notice to Trustee.
The Company shall give prompt written notice to the Trustee of
any fact known to the Company which would prohibit the making of any payment or
distribution to or by the Trustee in respect of the Securities pursuant to the
provisions of this Article Twelve. Regardless of anything to the contrary
contained in this Article Twelve or elsewhere in this Indenture, the Trustee
shall not be charged with knowledge of the existence of any default or event of
default with respect to any Senior Debt or Guarantor Senior Debt or of any other
facts which would prohibit the making of any payment or distribution to or by
the Trustee unless and until the Trustee shall have received notice in writing
referencing this Indenture and the Notes from the Company, or from a holder of
Senior Debt or Guarantor Senior Debt or a Representative therefor, and, prior to
the receipt of any such written notice, the Trustee shall be entitled to assume
(in the absence of actual knowledge of a Responsible Officer to the contrary)
that no such facts exist.
In the event that the Trustee determines in good faith that
any evidence is required with respect to the right
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of any Person as a holder of Senior Debt or Guarantor Senior Debt to participate
in any payment or distribution pursuant to this Article Twelve, the Trustee may
request such Person to furnish evidence to the reasonable satisfaction of the
Trustee as to the amounts of Senior Debt or Guarantor Senior Debt held by such
Person, the extent to which such Person is entitled to participate in such
payment or distribution and any other facts pertinent to the rights of such
Person under this Article Twelve, and if such evidence is not furnished the
Trustee may defer any payment to such Person pending judicial determination as
to the right of such person to receive such payment.
SECTION 12.08. Reliance on Judicial Order or Certificate of Liquidating
Agent.
Upon any payment or distribution of assets or securities of
the Company or any Guarantor referred to in this Article Twelve, the Trustee,
subject to the provisions of Article Seven hereof, and the Holders shall be
entitled to rely upon any order or decree made by any court of competent
jurisdiction in which bankruptcy, dissolution, winding-up, liquidation or
reorganization proceedings are pending, or upon a certificate of the receiver,
trustee in bankruptcy, liquidating trustee, agent or other person making such
payment or distribution, delivered to the Trustee or the Holders, for the
purpose of ascertaining the persons entitled to participate in such
distribution, the holders of the Senior Debt or Guarantor Senior Debt and other
Indebtedness of the Company, the amount thereof or payable thereon, the amount
or amounts paid or distributed thereon and all other facts pertinent thereto or
to this Article Twelve.
SECTION 12.09. Trustee's Relation to Senior Debt or Guarantor Senior Debt.
The Trustee and any agent of the Company or the Trustee shall
be entitled to all the rights set forth in this Article Twelve with respect to
any Senior Debt or Guarantor Senior Debt which may at any time be held by it in
its individual capacity or any other capacity to the same extent as any other
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holder of Senior Debt or Guarantor Senior Debt and nothing in this Indenture
shall deprive the Trustee or any such agent of any of its rights as such holder.
With respect to the holders of Senior Debt or Guarantor Senior
Debt, the Trustee undertakes to perform or to observe only such of its covenants
and obligations as are specifically set forth in this Article Twelve, and no
implied covenants or obligations with respect to the holders of Senior Debt or
Guarantor Senior Debt shall be read into this Indenture against the Trustee. The
Trustee shall not be deemed to owe any fiduciary duty to the holders of Senior
Debt or Guarantor Senior Debt.
Whenever a payment or distribution is to be made or a notice
given to holders or owners of Senior Debt or Guarantor Senior Debt, the payment
or distribution may be made and the notice may be given to their Representative,
if any.
SECTION 12.10. Subordination Rights Not Impaired by Acts or Omissions of the
Company or a Guarantor or Holders of Senior Debt.
No right of any present or future holders of any Senior Debt
or Guarantor Senior Debt to enforce subordination as provided herein shall at
any time in any way be prejudiced or impaired by any act or failure to act on
the part of the Company or a Guarantor or by any act or failure to act, in good
faith, by any such holder, or by any noncompliance by the Company or a Guarantor
with the terms of this Indenture, regardless of any knowledge thereof which any
such holder may have or otherwise be charged with.
Without in any way limiting the generality of the foregoing
paragraph, the holders of Senior Debt or Guarantor Senior Debt may, at any time
and from time to time, without the consent of or notice to the Trustee or the
Holders, without incurring responsibility to the Trustee or the Holders and
without impairing or releasing the subordination provided in this Article Twelve
or the obligations hereunder of the Holders to
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the holders of the Senior Debt or Guarantor Senior Debt, do any one or more of
the following: (i) change the manner, place or terms of payment or extend the
time of payment of, or renew or alter, Senior Debt or Guarantor Senior Debt, or
otherwise amend or supplement in any manner Senior Debt or Guarantor Senior
Debt, or any instrument evidencing or securing the same or any agreement under
which Senior Debt or Guarantor Senior Debt is outstanding; (ii) sell, exchange,
release or otherwise deal with any property pledged, mortgaged or otherwise
securing Senior Debt or Guarantor Senior Debt; (iii) release any Person liable
in any manner for the payment or collection of Senior Debt or Guarantor Senior
Debt; and (iv) exercise or refrain from exercising any rights against the
Company or a Guarantor or any other Person.
SECTION 12.11. Holders Authorize Trustee To Effectuate Subordination of
Securities.
Each Holder by its acceptance of the Securities authorizes and
expressly directs the Trustee on its behalf to take such action as may be
necessary or appropriate to effectuate, as between the holders of Senior Debt or
Guarantor Senior Debt and the Holders, the subordination provided in this
Article Twelve, and appoints the Trustee its attorney-in-fact for such purposes,
including, in the event of any dissolution, winding-up, liquidation or
reorganization of the Company or a Guarantor (whether in bankruptcy, insolvency,
receivership, reorganization or similar proceedings or upon an assignment for
the benefit of creditors or otherwise) tending towards liquidation of the
business and assets of the Company or a Guarantor, the filing of a claim for the
unpaid balance of its Securities and accrued interest in the form required in
those proceedings.
If the Trustee does not file a proper claim or proof of debt
in the form required in such proceeding prior to 30 days before the expiration
of the time to file such claim or claims, then the holders of the Senior Debt or
Guarantor Senior Debt or their Representative are hereby authorized to have the
right to file and are hereby authorized to file an appropriate claim for and on
behalf of the Holders of said Securities.
<PAGE> 164
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Nothing herein contained shall be deemed to authorize the Trustee or the holders
of Senior Debt or Guarantor Senior Debt or their Representative to authorize or
consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Securities
or the rights of any Holder thereof, or to authorize the Trustee or the holders
of Senior Debt or Guarantor Senior Debt or their Representative to vote in
respect of the claim of any Holder in any such proceeding.
SECTION 12.12. This Article Twelve Not To Prevent Events of Default.
The failure to make a payment on account of principal of or
interest on the Securities by reason of any provision of this Article Twelve
will not be construed as preventing the occurrence of an Event of Default.
SECTION 12.13. Trustee's Compensation Not Prejudiced.
Nothing in this Article Twelve will apply to amounts due to
the Trustee pursuant to other Sections in this Indenture.
<PAGE> 165
S-1
SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed as of the date first written above.
TENNECO INC.
By:
-------------------------------
Name:
Title:
THE BANK OF NEW YORK,
as Trustee
By:
-------------------------------
Name:
Title:
<PAGE> 166
EXHIBIT A
[FORM OF SERIES A SECURITY]
THIS NOTE (AND ANY GUARANTEE THEREOF) HAS NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") AND NEITHER
THIS SECURITY (NOR ANY GUARANTEE THEREOF) NOR ANY INTEREST OR PARTICIPATION
HEREIN (OR THEREIN) MAY BE OFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED,
ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR
UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT. THE HOLDER HEREOF, BY ITS ACCEPTANCE OF THIS
SECURITY, AGREES FOR THE BENEFIT OF THE ISSUER THAT THIS SECURITY MAY NOT BE
OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED PRIOR TO THE EXPIRATION OF THE
HOLDING PERIOD APPLICABLE THERETO UNDER RULE 144(K) UNDER THE SECURITIES ACT
WHICH IS APPLICABLE TO THIS SECURITY (THE "RESALE RESTRICTION TERMINATION DATE")
OTHER THAN (1) TO THE ISSUER OR ITS SUBSIDIARIES, (2) SO LONG AS THIS SECURITY
IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE
144A"), TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A "QUALIFIED
INSTITUTIONAL BUYER" WITHIN THE MEANING OF RULE 144A PURCHASING FOR ITS OWN
ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER, IN EACH CASE TO
WHOM NOTICE IS GIVEN THAT THE RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE IN
RELIANCE ON RULE 144A (AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON THE
CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS SECURITY IF THIS SECURITY IS NOT
IN BOOK-ENTRY FORM), (3) TO A NON-"U.S. PERSON" IN AN "OFFSHORE TRANSACTION" (AS
SUCH TERMS ARE DEFINED IN REGULATION S UNDER THE SECURITIES ACT) IN ACCORDANCE
WITH REGULATION S UNDER THE SECURITIES ACT (AS INDICATED BY THE BOX CHECKED BY
THE TRANSFEROR ON THE CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS SECURITY IF
THIS SECURITY IS NOT IN BOOK-ENTRY FORM), (4) PURSUANT TO ANY OTHER AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, INCLUDING
THE EXEMPTION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT, IF AVAILABLE, OR
(5) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT,
SUBJECT IN EACH OF THE FOREGOING CASES TO ANY REQUIREMENT OF LAW
A-1
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THAT THE DISPOSITION OF ITS PROPERTY OR THE PROPERTY OF SUCH INVESTOR ACCOUNT OR
ACCOUNTS BE AT ALL TIMES WITHIN ITS OR THEIR CONTROL, AND SUBJECT TO THE RIGHT
OF THE ISSUER OR THE TRUSTEE FOR THE SECURITIES PRIOR TO ANY SUCH SALE, PLEDGE
OR OTHER TRANSFER PURSUANT TO CLAUSE (4) ABOVE TO REQUIRE THE DELIVERY OF AN
OPINION OF COUNSEL, CERTIFICATIONS AND/OR OTHER INFORMATION SATISFACTORY TO EACH
OF THEM. THIS LEGEND WILL BE REMOVED UPON REQUEST OF THE HOLDER ON OR AFTER THE
RESALE RESTRICTION TERMINATION DATE.
A-2
<PAGE> 168
TENNECO INC.
11 5/8% Senior Subordinated Notes
due October 15, 2009, Series A
CUSIP No.:
No. [ ] $[ ]
TENNECO INC., a Delaware corporation (the "Company", which
term includes any successor corporation), for value received promises to pay to
Cede & Co. or registered assigns, the principal sum of [ ] Dollars, on October
15, 2009.
Interest Payment Dates: April 15 and October 15, commencing
April 15, 2000.
Record Dates: April 1 and October 1.
Reference is made to the further provisions of this Security
contained herein, which will for all purposes have the same effect as if set
forth at this place.
A-3
<PAGE> 169
IN WITNESS WHEREOF, the Company has caused this Security to be
signed manually or by facsimile by its duly authorized officers.
Dated: October 14, 1999
TENNECO INC.
By:
----------------------------------
Name:
Title:
By:
----------------------------------
Name:
Title:
A-4
<PAGE> 170
This is one of the 11 5/8% Senior Subordinated Notes due 2009,
Series A, described in the within-mentioned Indenture.
Dated: October 14, 1999 THE BANK OF NEW YORK,
as Trustee
By:
----------------------------------
Authorized Signatory
A-5
<PAGE> 171
(REVERSE OF SECURITY)
TENNECO INC.
11 5/8% Senior Subordinated Notes
due October 15, 2009, Series A
1. Interest.
TENNECO INC., a Delaware corporation (the "Company"), promises
to pay interest on the principal amount of this Security at the rate per annum
shown above. The Company will pay interest semi-annually on April 15 and October
15 of each year (an "Interest Payment Date"), commencing April 15, 2000.
Interest on the Securities will accrue from the most recent date to which
interest has been paid or, if no interest has been paid, from October 14, 1999.
Interest will be computed on the basis of a 360-day year of twelve 30-day
months.
The Company shall pay interest on overdue principal from time
to time on demand at the rate borne by the Securities plus 2% and on overdue
installments of interest (without regard to any applicable grace periods) to the
extent lawful.
2. Method of Payment.
The Company shall pay interest on the Securities (except
defaulted interest) to the persons who are the registered Holders at the close
of business on the Record Date immediately preceding the Interest Payment Date
even if the Securities are canceled on registration of transfer or registration
of exchange after such Record Date. Holders must surrender Securities to a
Paying Agent to collect principal payments. The Company shall pay principal and
interest in money of the United States that at the time of payment is legal
tender for payment of public and private debts. The Company may deliver any such
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interest payment to the Paying Agent or to a Holder at the Holder's registered
address.
3. Paying Agent and Registrar.
Initially, The Bank of New York (the "Trustee") will act as
Paying Agent and Registrar. The Company may change any Paying Agent, Registrar
or co-Registrar without notice to the Holders.
4. Indenture.
The Company issued the Securities under an Indenture, dated as
of October 14, 1999 (the "Indenture"), between the Company and the Trustee.
Capitalized terms herein are used as defined in the Indenture unless otherwise
defined herein. The terms of the Securities include those stated in the
Indenture and those made part of the Indenture by reference to the Trust
Indenture Act of 1939 (15 U.S.C. ss.ss. 77aaa-77bbbb) (the "TIA"), as in effect
on the date of the Indenture until such time as the Indenture is qualified under
the TIA, and thereafter as in effect on the date on which the Indenture is
qualified under the TIA. Notwithstanding anything to the contrary herein, the
Securities are subject to all such terms, and Holders of Securities are referred
to the Indenture and the TIA for a statement of them. The Securities are limited
in aggregate principal amount to $750,000,000.
5. Optional Redemption.
The Securities will be redeemable, at the Company's option, in
whole at any time or in part from time to time, on and after October 15, 2004
upon not less than 30 nor more than 60 days' notice, at the following redemption
prices (expressed as percentages of the principal amount thereof) if redeemed
during the twelve-month period commencing on October 15 of the applicable year
set forth below, plus, in each case, accrued and unpaid interest, if any, to the
date of redemption:
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<TABLE>
<CAPTION>
Year Percentage
---- ----------
<S> <C>
2004........................................ 105.813%
2005........................................ 103.875%
2006........................................ 101.938%
2007 and thereafter......................... 100.000%
</TABLE>
6. Optional Redemption upon Public Equity Offerings.
At any time, or from time to time, on or prior to October 15,
2002, the Company may, at its option, use all or any portion of the net cash
proceeds of one or more Public Equity Offerings (as defined below) to redeem up
to 35% of the aggregate principal amount of the Securities issued at a
redemption price equal to 111.625% of the principal amount thereof plus accrued
and unpaid interest, if any, to the date of redemption; provided that at least
65% of the aggregate principal amount of Securities issued remains outstanding
immediately after any such redemption. In order to effect the foregoing
redemption with the proceeds of any Public Equity Offering, the Company shall
make such redemption not more than 180 days after the consummation of any such
Public Equity Offering.
As used in the preceding paragraph, "Public Equity Offering"
means an underwritten public offering of Qualified Capital Stock of the Company
pursuant to a registration statement filed with the Commission in accordance
with the Securities Act.
7. Special Redemption.
If the Spin-Off Transactions are not consummated in a manner
consistent in all material respects with the description of such transactions
contained in the Offering Memorandum or if any of the other Release Conditions
are not satisfied, in each case, on or prior to December 31, 1999, then the
Company will be required to mail a notice of redemption on such date and redeem
the Securities in whole on January 14, 2000 at a redemption price of 101% of
their principal amount, plus accrued interest to the date of redemption. The
Company will also have the option to redeem the Securities, in whole but not in
part (at a redemption price of 101% of their principal amount, plus accrued
in-
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<PAGE> 174
terest to the date of redemption), by mailing a notice of redemption at any
time on or prior to December 31, 1999 (with a redemption date 15 days after the
mailing date of such notice) if it determines that the Spin-Off Transactions are
likely not to be able to be consummated in a manner consistent in all material
respects with the description of such transactions contained in the Offering
Memorandum or that any of the other Release Conditions are likely not to be able
to be satisfied, in each case, on or prior to December 31, 1999. A redemption
pursuant to this paragraph shall be herein referred to as a "Special
Redemption".
If the Securities are redeemed pursuant to a Special
Redemption and the Company did not use commercially reasonable efforts to cause
the Release Conditions to be satisfied, and if the Company consummates
transactions similar to the Spin-Off Transactions at any time prior to the 180th
day after the date the Securities were redeemed, then each Securityholder as of
the redemption date must be paid an additional amount equal to the Make-Whole
Amount.
8. Notice of Redemption.
Notice of redemption will be mailed at least 30 days but not
more than 60 days before the Redemption Date (other than with respect to a
Special Redemption, as described above) to each Holder of Securities to be
redeemed at such Holder's registered address. Securities in denominations of
$1,000 may be redeemed only in whole. The Trustee may select for redemption
portions (equal to $1,000 or any integral multiple thereof) of the principal of
Securities that have denominations larger than $1,000.
If any Security is to be redeemed in part only, the notice of
redemption that relates to such Security shall state the portion of the
principal amount thereof to be redeemed. A
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<PAGE> 175
new Security in a principal amount equal to the unredeemed portion thereof will
be issued in the name of the Holder thereof upon cancellation of the original
Security. On and after the Redemption Date, interest will cease to accrue on
Securities or portions thereof called for redemption.
9. Change of Control Offer.
Upon the occurrence of a Change of Control, the Company will
be required to offer to purchase all of the outstanding Securities at a purchase
price equal to 101% of the principal amount thereof plus accrued and unpaid
interest, if any, to the date of repurchase.
10. Limitation on Disposition of Assets.
The Company is, subject to certain conditions, obligated to
make an offer to purchase Securities at 100% of their principal amount plus
accrued and unpaid interest to the date of repurchase with certain net cash
proceeds of certain sales or other dispositions of assets in accordance with the
Indenture.
11. Denominations; Transfer; Exchange.
The Securities are in registered form, without coupons, in
denominations of $1,000 and integral multiples of $1,000. A Holder shall
register the transfer of or exchange Securities in accordance with the
Indenture. The Registrar may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and to pay certain transfer
taxes or similar governmental charges payable in connection therewith as
permitted by the Indenture. The Registrar need not register the transfer of or
exchange any Securities or portions thereof selected for redemption, except the
unredeemed portion of any security being redeemed in part.
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<PAGE> 176
12. Persons Deemed Owners.
The registered Holder of a Security shall be treated as the
owner of it for all purposes.
13. Unclaimed Funds.
If funds for the payment of principal or interest remain
unclaimed for two years, the Trustee and the Paying Agent will repay the funds
to the Company at its request. After that, all liability of the Trustee and such
Paying Agent with respect to such funds shall cease.
14. Legal Defeasance and Covenant Defeasance.
The Company may be discharged from its obligations under the
Indenture and the Securities except for certain provisions thereof, and may be
discharged from its obligations to comply with certain covenants contained in
the Indenture and the Securities, in each case upon satisfaction of certain
conditions specified in the Indenture.
15. Amendment; Supplement; Waiver.
Subject to certain exceptions, the Indenture or the Securities
may be amended or supplemented with the written consent of the Holders of at
least a majority in aggregate principal amount of the Securities then
outstanding, and any existing Default or Event of Default or compliance with any
provision may be waived with the consent of the Holders of a majority in
aggregate principal amount of the Securities then outstanding. Without notice to
or consent of any Holder, the parties thereto may amend or supplement the
Indenture or the Securities to, among other things, cure any ambiguity, defect
or inconsistency, provide for uncertificated Securities in addition to or in
place of certificated Securities or comply with any requirements of the
Commission in connection with the qualification of the Indenture under the TIA,
or make any other change that does not materially adversely affect the rights of
any Holder of a Security.
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<PAGE> 177
16. Restrictive Covenants.
The Indenture contains certain covenants that, among other
things, limit the ability of the Company and certain of its subsidiaries to make
restricted payments, to incur indebtedness, to create liens, to issue preferred
or other capital stock of subsidiaries, to sell assets, to permit restrictions
on dividends and other payments by subsidiaries to the Company, to consolidate,
merge or sell all or substantially all of its assets, to engage in transactions
with affiliates or to engage in certain businesses. The limitations are subject
to a number of important qualifications and exceptions.
17. Defaults and Remedies.
If an Event of Default occurs and is continuing, the Trustee
or the Holders of at least 25% in aggregate principal amount of Securities then
outstanding may declare all the Securities to be due and payable immediately in
the manner and with the effect provided in the Indenture. Holders of Securities
may not enforce the Indenture or the Securities except as provided in the
Indenture. The Trustee is not obligated to enforce the Indenture or the
Securities unless it has received indemnity satisfactory to it. The Indenture
permits, subject to certain limitations therein provided, Holders of a majority
in aggregate principal amount of the Securities then outstanding to direct the
Trustee in its exercise of any trust or power. The Trustee may withhold from
Holders of Securities notice of any continuing Default or Event of Default
(except a Default in payment of principal, premium or interest, including an
accelerated payment) if it determines that withholding notice is in their
interest.
18. Trustee Dealings with Company.
The Trustee under the Indenture, in its individual or any
other capacity, may become the owner or pledgee of Securities and may otherwise
deal with the Company, its Subsidiaries,
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<PAGE> 178
any Guarantor and their respective Affiliates as if it were not the Trustee.
19. No Recourse Against Others.
No stockholder, director, officer, employee or incorporator,
as such, of the Company shall have any liability for any obligation of the
Company under the Securities or the Indenture or for any claim based on, in
respect of or by reason of, such obligations or their creation. Each Holder of a
Security by accepting a Security waives and releases all such liability. The
waiver and release are part of the consideration for the issuance of the
Securities.
20. Authentication.
This Security shall not be valid until the Trustee or
authenticating agent signs the certificate of authentication on this Security.
21. Abbreviations and Defined Terms.
Customary abbreviations may be used in the name of a Holder of
a Security or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts
to Minors Act).
22. CUSIP Numbers.
Pursuant to a recommendation promulgated by the Committee on
Uniform Security Identification Procedures, the Company has caused CUSIP numbers
to be printed on the Securities as a convenience to the Holders of the
Securities. No representation is made as to the accuracy of such numbers as
printed on the Securities and reliance may be placed only on the other
identification numbers printed hereon.
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<PAGE> 179
23. Registration Rights.
Pursuant to the Registration Rights Agreement, the Company
will be obligated upon the occurrence of certain events to consummate an
exchange offer pursuant to which the Holder of this Security shall have the
right to exchange this Series A Security for the Company's 11 5/8% Senior
Subordinated Notes due 2009, Series B (the "Series B Securities"), which have
been registered under the Securities Act, in like principal amount and having
terms identical in all material respects as the Series A Securities. The Holders
shall be entitled to receive certain additional interest payments in the event
such exchange offer is not consummated and upon certain other conditions, all
pursuant to and in accordance with the terms of the Registration Rights
Agreement.
24. Subordination.
The Securities are subordinated in right of payment, in the
manner and to the extent set forth in the Indenture, to the prior payment in
full in cash or Cash Equivalents of all Senior Debt of the Company, whether
outstanding on the date of the Indenture or thereafter created, incurred,
assumed or guaranteed. Each Holder by his acceptance hereof agrees to be bound
by such provisions and authorizes and expressly directs the Trustee, on his
behalf, to take such action as may be necessary or appropriate to effectuate the
subordination provided for in the Indenture and appoints the Trustee his
attorney-in-fact for such purposes.
The Company will furnish to any Holder of a Security upon
written request and without charge a copy of the Indenture. Requests may be made
to TENNECO INC., 500 North Field Drive, Lake Forest, IL 60045, Attention: Chief
Financial Officer.
A-14
<PAGE> 180
ASSIGNMENT FORM
I or we assign and transfer this Security to
________________________________________________________________________________
________________________________________________________________________________
(Print or type name, address and zip code of assignee or transferee)
________________________________________________________________________________
(Insert Social Security or other identifying number of assignee or transferee)
and irrevocably appoint_________________________________________________________
agent to transfer this Security on the books of the Company.
The agent may substitute another to act for him.
Dated: _________________ Signed: ___________________
(Sign exactly as
name appears on the
other side of this
Security)
Signature Guarantee:____________________________________________________________
Participant in a recognized Signature Guarantee Medallion
Program (or other signature guarantor reasonably acceptable
to the Trustee)
A-15
<PAGE> 181
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the
Company pursuant to Section 4.12 or Section 4.21 of the Indenture, check the
appropriate box:
Section 4.12 [ ] Section 4.21 [ ]
If you want to elect to have only part of this Security
purchased by the Company pursuant to Section 4.12 or Section 4.21 of the
Indenture, state the amount: $_____________
Date: ________________________ Your Signature:________________________________
(Sign exactly as
your name appears
on the other side
of this Security)
Signature Guarantee:____________________________________________________________
Participant in a recognized Signature Guarantee Medallion
Program (or other signature guarantor reasonably acceptable
to the Trustee)
A-16
<PAGE> 182
EXHIBIT B
[FORM OF SERIES B SECURITY]
TENNECO INC.
11 5/8% Senior Subordinated Notes
due October 15, 2009, Series B
CUSIP No.: [ ]
No. [ ] $[ ]
TENNECO INC., a Delaware corporation (the "Company", which
term includes any successor corporation), for value received promises to pay to
Cede & Co. or registered assigns, the principal sum of [ ] Dollars, on October
15 , 2009.
Interest Payment Dates: April 15 and October 15, commencing
April 15, 2000.
Record Dates: April 1 and October 1.
Reference is made to the further provisions of this Security
contained herein, which will for all purposes have the same effect as if set
forth at this place.
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<PAGE> 183
IN WITNESS WHEREOF, the Company has caused this Security to be
signed manually or by facsimile by its duly authorized officers.
Dated: [ ], 1999
TENNECO INC.
By:
------------------------------------
Name:
Title:
By:
------------------------------------
Name:
Title:
B-2
<PAGE> 184
This is one of the 11 5/8% Senior Subordinated Notes due 2009,
Series B, described in the within-mentioned Indenture.
Dated: THE BANK OF NEW YORK,
as Trustee
By:
----------------------------
Authorized Signatory
B-3
<PAGE> 185
(REVERSE OF SECURITY)
TENNECO INC.
11 5/8% Senior Subordinated Notes
due October 15, 2009, Series B
1. Interest.
TENNECO INC., a Delaware corporation (the "Company"), promises
to pay interest on the principal amount of this Security at the rate per annum
shown above. The Company will pay interest semi-annually on April 15 and October
15 of each year (an "Interest Payment Date"), commencing April 15, 2000.
Interest on the Securities will accrue from the most recent date to which
interest has been paid or, if no interest has been paid, from October 14, 1999.
Interest will be computed on the basis of a 360-day year of twelve 30-day
months.
The Company shall pay interest on overdue principal from time
to time on demand at the rate borne by the Securities plus 2% and on overdue
installments of interest (without regard to any applicable grace periods) to the
extent lawful.
2. Method of Payment.
The Company shall pay interest on the Securities (except
defaulted interest) to the persons who are the registered Holders at the close
of business on the Record Date immediately preceding the Interest Payment Date
even if the Securities are canceled on registration of transfer or registration
of exchange after such Record Date. Holders must surrender Securities to a
Paying Agent to collect principal payments. The Company shall pay principal and
interest in money of the United States that at the time of payment is legal
tender for payment of public and private debts. The Company may deliver any such
interest payment to the Paying Agent or to a Holder at the Holder's registered
address.
B-4
<PAGE> 186
3. Paying Agent and Registrar.
Initially, The Bank of New York (the "Trustee") will act as
Paying Agent and Registrar. The Company may change any Paying Agent, Registrar
or co-Registrar without notice to the Holders.
4. Indenture.
The Company issued the Securities under an Indenture, dated as
of October 14, 1999 (the "Indenture"), between the Company and the Trustee.
Capitalized terms herein are used as defined in the Indenture unless otherwise
defined herein. The terms of the Securities include those stated in the
Indenture and those made part of the Indenture by reference to the Trust
Indenture Act of 1939 (15 U.S.C. ss.ss. 77aaa-77bbbb) (the "TIA"), as in effect
on the date of the Indenture until such time as the Indenture is qualified under
the TIA, and thereafter as in effect on the date on which the Indenture is
qualified under the TIA. Notwithstanding anything to the contrary herein, the
Securities are subject to all such terms, and Holders of Securities are referred
to the Indenture and the TIA for a statement of them. The Securities are limited
in aggregate principal amount to $750,000,000.
5. Optional Redemption.
The Securities will be redeemable, at the Company's option, in
whole at any time or in part from time to time, on and after October 15, 2004
upon not less than 30 nor more than 60 days' notice, at the following redemption
prices (expressed as percentages of the principal amount thereof) if redeemed
during the twelve-month period commencing on October 15 of the applicable year
set forth below, plus, in each case, accrued and unpaid interest, if any, to the
date of redemption:
B-5
<PAGE> 187
<TABLE>
<CAPTION>
Year Percentage
---- ----------
<S> <C>
2004........................................ 105.813%
2005........................................ 103.875%
2006........................................ 101.938%
2007 and thereafter......................... 100.000%
</TABLE>
6. Optional Redemption upon Public Equity Offerings.
At any time, or from time to time, on or prior to October 15,
2002, the Company may, at its option, use all or any portion of the net cash
proceeds of one or more Public Equity Offerings (as defined below) to redeem up
to 35% of the aggregate principal amount of the Securities issued at a
redemption price equal to 111.625% of the principal amount thereof plus accrued
and unpaid interest, if any, to the date of redemption; provided that at least
65% of the aggregate principal amount of Securities issued remains outstanding
immediately after any such redemption. In order to effect the foregoing
redemption with the proceeds of any Public Equity Offering, the Company shall
make such redemption not more than 180 days after the consummation of any such
Public Equity Offering.
As used in the preceding paragraph, "Public Equity Offering"
means an underwritten public offering of Qualified Capital Stock of the Company
pursuant to a registration statement filed with the Commission in accordance
with the Securities Act.
7. Special Redemption.
If the Spin-Off Transactions are not consummated in a manner
consistent in all material respects with the description of such transactions
contained in the Offering Memorandum or if any of the other Release Conditions
are not satisfied, in each case, on or prior to December 31, 1999, then the
Company will be required to mail a notice of redemption on such date and redeem
the Securities in whole on January 14, 2000 at a redemption price of 101% of
their principal amount, plus accrued in-
B-6
<PAGE> 188
terest to the date of redemption. The Company will also have the option to
redeem the Securities, in whole but not in part (at a redemption price of 101%
of their principal amount, plus accrued interest to the date of redemption), by
mailing a notice of redemption at any time on or prior to December 31, 1999
(with a redemption date 15 days after the mailing date of such notice) if it
determines that the Spin-Off Transactions are likely not to be able to be
consummated in a manner consistent in all material respects with the description
of such transactions contained in the Offering Memorandum or that any of the
other Release Conditions are likely not to be able to be satisfied, in each
case, on or prior to December 31, 1999. A redemption pursuant to this paragraph
shall be herein referred to as a "Special Redemption".
If the Securities are redeemed pursuant to a Special
Redemption and the Company did not use commercially reasonable efforts to cause
the Release Conditions to be satisfied, and if the Company consummates
transactions similar to the Spin-Off Transactions at any time prior to the 180th
day after the date the Securities were redeemed, then each Securityholder as of
the redemption date must be paid an additional amount equal to the Make-Whole
Amount.
8. Notice of Redemption.
Notice of redemption will be mailed at least 30 days but not
more than 60 days before the Redemption Date (other than with respect to a
Special Redemption, as described above) to each Holder of Securities to be
redeemed at such Holder's registered address. Securities in denominations of
$1,000 may be redeemed only in whole. The Trustee may select for redemption
portions (equal to $1,000 or any integral multiple thereof) of the principal of
Securities that have denominations larger than $1,000.
If any Security is to be redeemed in part only, the notice of
redemption that relates to such Security shall state the portion of the
principal amount thereof to be redeemed. A
B-7
<PAGE> 189
new Security in a principal amount equal to the unredeemed portion thereof will
be issued in the name of the Holder thereof upon cancellation of the original
Security. On and after the Redemption Date, interest will cease to accrue on
Securities or portions thereof called for redemption.
9. Change of Control Offer.
Upon the occurrence of a Change of Control, the Company will
be required to offer to purchase all of the outstanding Securities at a purchase
price equal to 101% of the principal amount thereof plus accrued and unpaid
interest, if any, to the date of repurchase.
10. Limitation on Disposition of Assets.
The Company is, subject to certain conditions, obligated to
make an offer to purchase Securities at 100% of their principal amount plus
accrued and unpaid interest to the date of repurchase with certain net cash
proceeds of certain sales or other dispositions of assets in accordance with the
Indenture.
B-8
<PAGE> 190
11. Denominations; Transfer; Exchange.
The Securities are in registered form, without coupons, in
denominations of $1,000 and integral multiples of $1,000. A Holder shall
register the transfer of or exchange Securities in accordance with the
Indenture. The Registrar may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and to pay certain transfer
taxes or similar governmental charges payable in connection therewith as
permitted by the Indenture. The Registrar need not register the transfer of or
exchange any Securities or portions thereof selected for redemption, except the
unredeemed portion of any security being redeemed in part.
12. Persons Deemed Owners.
The registered Holder of a Security shall be treated as the
owner of it for all purposes.
13. Unclaimed Funds.
If funds for the payment of principal or interest remain
unclaimed for two years, the Trustee and the Paying Agent will repay the funds
to the Company at its request. After that, all liability of the Trustee and such
Paying Agent with respect to such funds shall cease.
14. Legal Defeasance and Covenant Defeasance.
The Company may be discharged from its obligations under the
Indenture and the Securities except for certain provisions thereof, and may be
discharged from its obligations to comply with certain covenants contained in
the Indenture and the Securities, in each case upon satisfaction of certain
conditions specified in the Indenture.
15. Amendment; Supplement; Waiver.
Subject to certain exceptions, the Indenture or the Securities
may be amended or supplemented with the written con-
B-9
<PAGE> 191
sent of the Holders of at least a majority in aggregate principal amount of the
Securities then outstanding, and any existing Default or Event of Default or
compliance with any provision may be waived with the consent of the Holders of a
majority in aggregate principal amount of the Securities then outstanding.
Without notice to or consent of any Holder, the parties thereto may amend or
supplement the Indenture or the Securities to, among other things, cure any
ambiguity, defect or inconsistency, provide for uncertificated Securities in
addition to or in place of certificated Securities or comply with any
requirements of the Commission in connection with the qualification of the
Indenture under the TIA, or make any other change that does not materially
adversely affect the rights of any Holder of a Security.
16. Restrictive Covenants.
The Indenture contains certain covenants that, among other
things, limit the ability of the Company and certain of its subsidiaries to make
restricted payments, to incur indebtedness, to create liens, to issue preferred
or other capital stock of subsidiaries, to sell assets, to permit restrictions
on dividends and other payments by subsidiaries to the Company, to consolidate,
merge or sell all or substantially all of its assets, to engage in transactions
with affiliates or to engage in certain businesses. The limitations are subject
to a number of important qualifications and exceptions.
17. Defaults and Remedies.
If an Event of Default occurs and is continuing, the Trustee
or the Holders of at least 25% in aggregate principal amount of Securities then
outstanding may declare all the Securities to be due and payable immediately in
the manner and with the effect provided in the Indenture. Holders of Securities
may not enforce the Indenture or the Securities except as provided in the
Indenture. The Trustee is not obligated to enforce the Indenture or the
Securities unless it has received indemnity satisfactory to it. The Indenture
permits, subject
B-10
<PAGE> 192
to certain limitations therein provided, Holders of a majority in aggregate
principal amount of the Securities then outstanding to direct the Trustee in its
exercise of any trust or power. The Trustee may withhold from Holders of
Securities notice of any continuing Default or Event of Default (except a
Default in payment of principal, premium or interest, including an accelerated
payment) if it determines that withholding notice is in their interest.
18. Trustee Dealings with Company.
The Trustee under the Indenture, in its individual or any
other capacity, may become the owner or pledgee of Securities and may otherwise
deal with the Company, its Subsidiaries, any Guarantor and their respective
Affiliates as if it were not the Trustee.
19. No Recourse Against Others.
No stockholder, director, officer, employee or incorporator,
as such, of the Company shall have any liability for any obligation of the
Company under the Securities or the Indenture or for any claim based on, in
respect of or by reason of, such obligations or their creation. Each Holder of a
Security by accepting a Security waives and releases all such liability. The
waiver and release are part of the consideration for the issuance of the
Securities.
20. Authentication.
This Security shall not be valid until the Trustee or
authenticating agent signs the certificate of authentication on this Security.
21. Abbreviations and Defined Terms.
Customary abbreviations may be used in the name of a Holder of
a Security or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants
B-11
<PAGE> 193
in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).
22. CUSIP Numbers.
Pursuant to a recommendation promulgated by the Committee on
Uniform Security Identification Procedures, the Company has caused CUSIP numbers
to be printed on the Securities as a convenience to the Holders of the
Securities. No representation is made as to the accuracy of such numbers as
printed on the Securities and reliance may be placed only on the other
identification numbers printed hereon.
23. Subordination.
The Securities are subordinated in right of payment, in the
manner and to the extent set forth in the Indenture, to the prior payment in
full, in cash or Cash Equivalents of all Senior Debt of the Company, whether
outstanding on the date of the Indenture or thereafter created, incurred,
assumed or guaranteed. Each Holder by his acceptance hereof agrees to be bound
by such provisions and authorizes and expressly directs the Trustee, on his
behalf, to take such action as may be necessary or appropriate to effectuate the
subordination provided for in the Indenture and appoints the Trustee his
attorney-in-fact for such purposes.
The Company will furnish to any Holder of a Security upon
written request and without charge a copy of the Indenture. Requests may be made
to: TENNECO INC., 500 North Field Drive, Lake Forest, IL 60045, Attention: Chief
Financial Officer.
B-12
<PAGE> 194
ASSIGNMENT FORM
I or we assign and transfer this Security to
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Print or type name, address and zip code of assignee or
transferee)
- --------------------------------------------------------------------------------
(Insert Social Security or other identifying number of assignee or transferee)
and irrevocably appoint
--------------------------------------------------------
agent to transfer this Security on the books of the Company.
The agent may substitute another to act for him.
Dated: Signed:
-------------------- ------------------------
(Sign exactly as
name appears on the
other side of this
Security)
Signature Guarantee:
------------------------------------------------------------
Participant in a recognized Signature
Guarantee Medallion Program (or other
signature guarantor program reasonably
acceptable to the Trustee)
B-13
<PAGE> 195
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the
Company pursuant to Section 4.12 or Section 4.21 of the Indenture, check the
appropriate box:
Section 4.12 [ ] Section 4.21 [ ]
If you want to elect to have only part of this Security
purchased by the Company pursuant to Section 4.12 or Section 4.21 of the
Indenture, state the amount: $
---------------
Date: Your Signature:
-------------------- ------------------------------------
(Sign exactly as
your name appears
on the other side
of this Security)
Signature Guarantee:
-----------------------------------------------------------
Participant in a recognized Signature
Guarantee Medallion Program (or other
signature guarantor program reasonably
acceptable to the Trustee)
B-14
<PAGE> 196
EXHIBIT C
FORM OF LEGEND FOR GLOBAL SECURITIES
Any Global Security authenticated and delivered hereunder
shall bear a legend (which would be in addition to any other legends required in
the case of a Restricted Security) in substantially the following form:
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE
INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A
DEPOSITORY OR A NOMINEE OF A DEPOSITORY OR A SUCCESSOR DEPOSITORY. THIS
SECURITY IS NOT EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A
PERSON OTHER THAN THE DEPOSITORY OR ITS NOMINEE EXCEPT IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO TRANSFER OF THIS
SECURITY (OTHER THAN A TRANSFER OF THIS SECURITY AS A WHOLE BY THE
DEPOSITORY TO A NOMINEE OF THE DEPOSITORY OR BY A NOMINEE OF THE
DEPOSITORY TO THE DEPOSITORY OR ANOTHER NOMINEE OF THE DEPOSITORY) MAY
BE REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
INDENTURE.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION
("DTC"), TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE
NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO.
OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE
OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
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<PAGE> 197
EXHIBIT D
CERTIFICATE TO BE DELIVERED UPON EXCHANGE
OR REGISTRATION OF TRANSFER OF SECURITIES
Re: 11 5/8% Senior Subordinated Notes
due 2009, Series A, and 11 5/8%
Senior Subordinated Notes due 2009,
Series B (the "Securities"), of
Tenneco Inc.
-----------------------------------
This Certificate relates to $ principal amount of
Securities held in the form of* a beneficial interest in a Global Security
or* Physical Securities by (the "Transferor").
The Transferor:*
|_| has requested by written order that the Registrar
deliver in exchange for its beneficial interest in the Global Security held by
the Depositary a Physical Security or Physical Securities in definitive,
registered form of authorized denominations and an aggregate number equal to its
beneficial interest in such Global Security (or the portion thereof indicated
above); or
|_| has requested by written order that the Registrar
exchange or register the transfer of a Physical Security or Physical Securities.
In connection with such request and in respect of each such
Security, the Transferor does hereby certify that the Transferor is familiar
with the Indenture relating to the above captioned Securities and the
restrictions on transfers thereof as provided in Section 2.16 of such Indenture,
and that the transfer of this Securities does not require registration under the
Securities Act of 1933, as amended (the "Act") because*:
D-1
<PAGE> 198
|_| Such Security is being acquired for the Transferor's
own account, without transfer (in satisfaction of Section 2.16(a)(II)(A) or
Section 2.16(d)(i)(A) of the Indenture).
|_| Such Security is being transferred to a "qualified
institutional buyer" (as defined in Rule 144A under the Act), in reliance on
Rule 144A.
|_| Such Security is being transferred to an
institutional "accredited investor" (within the meaning of subparagraphs (a)(1),
(2), (3) or (7) of Rule 501 under the Act.
|_| Such Security is being transferred in reliance on
Regulation S under the Act
|_| Such Security is being transferred in reliance on
Rule 144 under the Act.
|_| Such Security is being transferred in reliance on and
in compliance with an exemption from the registration requirements of the Act
other than Rule 144A or Rule 144 or Regulation S under the Act to a person other
than an institutional "accredited investor."
-------------------------------
[INSERT NAME OF TRANSFEROR]
By:
---------------------------
[Authorized Signatory]
Date:
----------------
*Check applicable box.
D-2
<PAGE> 199
EXHIBIT E
Form of Certificate To Be
Delivered in Connection with
Transfers to Institutional Accredited Investors
------------------, ------
The Bank of New York
101 Barclay Street
Floor 21W
New York, New York 10286
Attention: Corporate Trust Administration
Re: Tenneco Inc. (the "Company") Indenture (the "Indenture")
relating to 11 5/8% Senior Subordinated Notes due 2009,
Series A,
or 11 5/8% Senior Subordinated Notes due 2009, Series B
Ladies and Gentlemen:
In connection with our proposed purchase of 11 5/8% Senior
Subordinated Notes due 2009, Series A, or 11 5/8% Senior Subordinated Notes due
2009, Series B (the "Securities"), of Tenneco Inc. (the "Company"), we confirm
that:
1. We have received such information as we deem necessary
in order to make our investment decision.
2. We understand that any subsequent transfer of the
Securities is subject to certain restrictions and conditions set forth in the
Indenture and the undersigned agrees to be bound by, and not to resell, pledge
or otherwise transfer the Securities except in compliance with, such
restrictions and
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<PAGE> 200
conditions and the Securities Act of 1933, as amended (the "Securities Act").
3. We understand that the offer and sale of the Securities
have not been registered under the Securities Act, and that the Securities may
not be offered or sold within the United States or to, or for the account or
benefit of, U.S. persons except as permitted in the following sentence. We agree
for the benefit of the issuer that this Security may not be offered, sold,
pledged or otherwise transferred prior to the expiration of the holding period
applicable thereto under Rule 144(k) under the Securities Act which is
applicable to this Security (the "Resale Restriction Termination Date") other
than (1) to the issuer or its subsidiaries, (2) so long as this Security is
eligible for resale pursuant to Rule 144A under the Securities Act ("Rule
144A"), to a person whom the seller reasonably believes is a "Qualified
Institutional Buyer" within the meaning of Rule 144A purchasing for its own
account or for the account of a Qualified Institutional Buyer, in each case to
whom notice is given that the resale, pledge or other transfer is being made in
reliance on Rule 144A (as indicated by the box checked by the transferor on the
certificate of transfer on the reverse of this Security if this Security is not
in book-entry form), (3) to a non-"U.S. person" in an "Offshore Transaction" (as
such terms are defined in Regulation S under the Securities Act) in accordance
with Regulation S under the Securities Act (as indicated by the box checked by
the transferor on the certificate of transfer on the reverse of this Security if
this Security is not in book-entry form), (4) pursuant to any other available
exemption from the registration requirements of the Securities Act, including
the exemption provided by Rule 144 under the Securities Act, if available, or
(5) pursuant to an effective registration statement under the Securities Act,
subject in each of the foregoing cases to any requirement of law that the
disposition of its property or the property of such investor account or accounts
be at all times within its or their control, and subject to the right of the
issuer or the Trustee for the Securities prior to any such sale, pledge or other
transfer pursuant to clause (4) above to require the de-
E-2
<PAGE> 201
livery of an opinion of counsel, certifications and/or other information
satisfactory to each of them. This legend will be removed upon request of the
holder on or after the Resale Restriction Termination Date.
4. We understand that, on any proposed resale of
Securities, we will be required to furnish to the Trustee and the Company, such
certification, legal opinions and other information as the Trustee and the
Company may reasonably require to confirm that the proposed sale complies with
the foregoing restrictions. We further understand that the Securities purchased
by us will bear a legend to the foregoing effect.
5. We are an institutional "accredited investor" (as
defined in Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities
Act) and have such knowledge and experience in financial and business matters as
to be capable of evaluating the merits and risks of our investment in the
Securities, and we and any accounts for which we are acting are each able to
bear the economic risk of our or their investment, as the case may be.
6. We are acquiring the Securities purchased by us for our
account or for one or more accounts (each of which is an institutional
"accredited investor") as to each of which we exercise sole investment
discretion.
E-3
<PAGE> 202
You and the Company are entitled to rely upon this letter and
are irrevocably authorized to produce this letter or a copy hereof to any
interested party in any administrative or legal proceeding or official inquiry
with respect to the matters covered hereby.
Very truly yours,
[Name of Transferee]
By:
---------------------------
[Authorized Signatory]
E-4
<PAGE> 203
EXHIBIT F
Form of Certificate To Be
Delivered in Connection
with Regulation S Transfers
,
------------- -----
The Bank of New York
101 Barclay Street
Floor 21W
New York, New York 10286
Attention: Corporate Trust Administration
Re: Tenneco Inc. (the "Company") 11 5/8% Senior Subordinated
Notes due 2009, Series A, and 11 5/8% Senior
Subordinated Notes due 2009,
Series B (the "Securities")
--------------------------------------------------------
Dear Sirs:
In connection with our proposed sale of $ aggregate
principal amount of the Securities, we confirm that such sale has been effected
pursuant to and in accordance with Regulation S under the Securities Act of
1933, as amended (the "Securities Act"), and, accordingly, we represent that:
(1) the offer of the Securities was not made to a person in
the United States;
(2) either (a) at the time the buy offer was originated, the
transferee was outside the United States or we and any person acting on our
behalf reasonably believed that the
F-1
<PAGE> 204
transferee was outside the United States, or (b) the transaction was executed
in, on or through the facilities of a designated offshore securities market and
neither we nor any person acting on our behalf knows that the transaction has
been pre-arranged with a buyer in the United States;
(3) no directed selling efforts have been made in the United
States in contravention of the requirements of Rule 903(b) or Rule 904(b) of
Regulation S, as applicable;
(4) the transaction is not part of a plan or scheme to evade
the registration requirements of the Securities Act; and
(5) we have advised the transferee of the transfer
restrictions applicable to the Securities.
You and the Company are entitled to rely upon this letter and
are irrevocably authorized to produce this letter or a copy hereof to any
interested party in any administrative or legal proceedings or official inquiry
with respect to the matters covered hereby. Defined terms used herein without
definition have the respective meanings provided in Regulation S.
Very truly yours,
[Name of Transferor]
By:
---------------------------
[Authorized Signatory]
F-2
<PAGE> 205
EXHIBIT G
[FORM OF GUARANTEE]
Each undersigned Guarantor (as defined in the Indenture
referred to in the Security upon which this notation is endorsed and each
referred to as the "Guarantor," which term includes any successor person under
the Indenture) unconditionally guarantees on a senior subordinated basis as set
forth in Article Twelve of the Indenture (such guarantee by the Guarantor being
referred to herein as a "Guarantee") (i) the due and punctual payment of the
principal of and interest on the Securities, whether at maturity, by
acceleration or otherwise, the due and punctual payment of interest on the
overdue principal and interest, if any, on the Securities, to the extent lawful,
and the due and punctual performance of all other obligations of the Company to
the Holders or the Trustee all in accordance with the terms set forth in Article
Ten of the Indenture and (ii) in case of any extension of time of payment or
renewal of any Securities or any of such other obligations, that the same will
be promptly paid in full when due or performed in accordance with the terms of
the extension or renewal, whether at stated maturity, by acceleration or
otherwise.
No stockholder, officer, director or incorporator, as such,
past, present or future, of the Guarantor shall have any liability under the
Guarantee by reason of his or its status as such stockholder, officer, director
or incorporator.
The Guarantee shall not be valid or obligatory for any purpose
until the certificate of authentication on the Securities upon which the
Guarantee is noted shall have been executed by the Trustee under the Indenture
by the manual signature of one of its authorized officers.
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EXHIBIT H
Form of Opinion of Counsel to the Guarantors
1. Each of the Guarantors has the requisite corporate power
and authority to execute, deliver and perform its obligations under the
Indenture and the Supplemental Indenture; the execution and delivery of, and the
performance by each of the Guarantors of its obligations under, the Indenture
and the Supplemental Indenture have been duly and validly authorized by each
Guarantor; and the Indenture and the Supplemental Indenture (assuming due
authorization and execution by each party thereto other than a Guarantor)
constitute the valid and binding agreements of each Guarantor, enforceable
against each Guarantor in accordance with their terms.
2. The Guarantees have been duly authorized by each
Guarantor and, when delivered to the Trustee will have been validly delivered,
and each Guarantee will constitute a valid and binding obligation of each
Guarantor, enforceable in accordance with their terms.
3. Each of the Guarantors is validly existing and in good
standing under the laws of its jurisdiction of incorporation or organization
with requisite corporate power and authority to own, lease and operate its
properties and to conduct its business as described in the Offering Memorandum,
and is duly registered and qualified to conduct its business and is in good
standing in each jurisdiction where the nature of its properties or the conduct
of its business requires such registration or qualification, except where the
failure to so register or qualify would not reasonably be expected to have a
Material Adverse Effect (as defined in the Purchase Agreement).
4. Each Guarantor has the requisite power and authority to
execute, deliver and perform its obligations under the Assumption Agreement, the
Purchase Agreement and the Regis-
H-1
<PAGE> 207
tration Rights Agreement; the execution and delivery of, and the performance by
each Guarantor of its obligations under, the Assumption Agreement, the Purchase
Agreement and the Registration Rights Agreement has been duly and validly
authorized by each Guarantor. Each of the Registration Rights Agreement,
Assumption Agreement and Purchase Agreement (assuming due authorization and
execution by each party thereto other than a Guarantor) constitutes the valid
and legally binding agreement of each Guarantor, enforceable against each
Guarantor in accordance with its terms.
5. None of (x) the execution, delivery or performance of
the Guarantees by any of the Guarantors, (y) the execution, delivery or
performance of the Assumption Agreements and the Supplemental Indenture by any
of the Guarantors, or (z) the consummation by any Guarantor of any of the
transactions contemplated by the Indenture or the Offering Memorandum, (i) to
such counsel's knowledge, requires any consent, approval, authorization or other
order of, or registration or filing with (each, a "Consent"), any court,
regulatory body, administrative agency or other governmental body, agency or
official (except such as may have been obtained or may be required in connection
with the registration under the Securities Act of the Securities in accordance
with the Registration Rights Agreement, the qualification of the Indenture under
the 1939 Act and except for compliance with the securities or Blue Sky laws of
various jurisdictions), (ii) conflicts or will conflict with or constitutes or
will constitute a breach of,or a default under, the certificate or articles of
incorporation or by-laws, or other organizational documents, of any Guarantor,
except any such conflicts, breaches and defaults that in the aggregate would not
have a Material Adverse Effect (as defined in the Purchase Agreement), (iii) to
such counsel's knowledge, conflicts or will conflict with or constitutes or will
constitute a breach of, or a default under, any agreement, indenture, lease or
other instrument known to us to which a Guarantor is a party or by which any
Guarantor or any of their respective properties may be bound, except as
disclosed in the Offering Memorandum including, without limitation, any Consent
required in connec-
H-2
<PAGE> 208
tion with the debt realignment described therein, or any such conflicts,
breaches and defaults that in the aggregate would not reasonably be expected to
have a Material Adverse Effect, (it being understood that such counsel expresses
no opinion in this paragraph 5 regarding compliance with disclosure requirements
or prohibitions against fraud or misrepresentation), (iv) violates or will
violate any statute, law, regulation or filing or judgment, injunction, order or
decree known to us to be applicable to any Guarantor or any of their respective
properties, except any such violations that in the aggregate could not have a
Material Adverse Effect (it being understood that such counsel expresses no
opinion in this paragraph 5 regarding compliance with disclosure requirements or
prohibitions against fraud or misrepresentation), or (v) will result in the
creation or imposition of any lien, charge or encumbrance upon any property or
assets of any Guarantor pursuant to the terms of any agreement or instrument
known to such counsel to which any of them is a party or by which any of them
may be bound or to which any of their property or assets is subject, other than
as disclosed in the Offering Memorandum.
6. Such opinion of counsel may assume that New York law is
identical to the Illinois Law for purposes of rendering the opinions contained
in paragraphs 1, 2 and 4. Such opinion of counsel may advise that: (i) such
counsel is not admitted to practice in any state other than Illinois, and does
not render any opinion as to legal matters subject to or governed by laws other
than those of the State of Illinois, United States federal jurisprudence or the
Delaware General Corporate Law and (ii) any opinion to the effect that an
instrument constitutes a binding obligation of any person, or that it is
enforceable in accordance with its terms, does not include any opinion that
specific performance or other equitable relief or remedies would be available in
the event of a breach of any particular provision thereof and is qualified by
the effect of applicable bankruptcy, moratorium, insolvency, reorganization,
fraudulent conveyance, and other laws and legal principles affecting or limiting
creditors' rights generally and general equitable principles (whether considered
in a proceeding in equity or at
H-3
<PAGE> 209
law) and, in certain circumstances, considerations of public policy, and (iii)
the enforceability of any indemnification or contribution provision of any
contract may be prohibited or limited under applicable securities laws or public
policy underlying such laws.
H-4
<PAGE> 210
EXHIBIT I
Form of Guarantor Secretary Certificate
I, [ ], Secretary of [Guarantor], a [Delaware]
corporation (the "Guarantor") do hereby certify that:
1. A true and complete copy of the certificate of
incorporation of the Guarantor, together with all amendments to date, certified
by the secretary of state of its respective state of incorporation, is attached
as Annex A. Each certificate of incorporation is in full force and effect on
this date. No action has been taken by the Board of Directors of the Guarantor
for the purpose of effecting any further amendment to or modification of such
certificates of incorporation.
2. A true and correct copy of the By-laws of the Guarantor
is attached as Annex B. Such By-laws are in full force and effect on this date.
3. No proceedings with regard to the consolidation, sale of
assets and business, liquidation, or dissolution of the Guarantor have been
taken or are pending in its respective state of incorporation nor have the Board
of Directors or the stockholders of the Guarantor taken any steps to authorize
or institute any of the foregoing.
4. True and correct copies of the resolutions duly adopted
by the Board of Directors of the Guarantor dated [ ], 1999 are attached
as Annex C (the "Resolutions"). Such Resolutions constitute the only actions
taken by the Guarantor's Board of Directors or any committee thereof relating to
the guarantee (the "Guarantee") by the Guarantor of up to $750,000,000 aggregate
principal amount of 11 5/8% Senior Subordinated Notes due 2009 of Tenneco Inc.
("Tenneco") issued under the Indenture (as defined below). Such Resolutions have
not been amended, modified or rescinded and are in full force and effect on the
date hereof.
5. The assumption agreement (the "Assumption Agreement") by
and among the Company and Salomon Smith Barney Inc.,
I-1
<PAGE> 211
Banc of America Securities LLC, Bear, Stears & Co. Inc., Chase Securities Inc.,
Credit Suisse First Boston Corporation, Morgan Stanley & Co. Incorporated, Banc
One Capital Markets, Inc., BNY Capital Markets, Inc., Commerzbank Capital
Markets Corporation, First Union Securities, Inc., ING Barings LLC, Nesbitt
Burns Securities Inc., Scotia Capital Markets (USA) Inc., SG Cowen Securities
Corporation and TD Securities (USA) Inc. (the "Initial Purchasers") pursuant to
which the Guarantor has agreed to become a party to the Purchase Agreement,
dated October 8, 1999 (the "Purchase Agreement"), and the Registration Rights
Agreement, dated October 14, 1999 (the "Registration Rights Agreement"), each by
and among Tenneco and the Initial Purchasers, is in a form which the officers of
the Company were authorized to execute and deliver by the Board of Directors of
the Company pursuant to the Resolutions.
6. The Indenture (the "Indenture") dated as of October 14,
1999, by and between Tenneco and The Bank of New York, as Trustee, is in a form
which the officers of the Guarantor were authorized to execute and deliver by
the Board of Directors of the Guarantor pursuant to the Resolutions.
7. Attached hereto as Annex D is a specimen of the
Guarantee, substantially in the form of Exhibit G to the Indenture, authorized
by the Board of Directors of the Guarantor pursuant to the Resolutions.
8. Each person who, as a director or officer of the
Guarantor, signed, by facsimile or otherwise, (i) the Assumption Agreement; (ii)
the Indenture; (iii) the certificates for the Guarantee being delivered today to
the Trustee; or (iv) any other document delivered prior hereto or on the date
hereof in connection with the execution and delivery of the Assumption Agreement
or the Indenture and the issuance of the Guarantees was duly appointed,
qualified and acting as an officer of the Guarantor at the respective times of
such signing and delivery, and the signatures of such persons appearing on such
documents are their genuine signatures.
I-2
<PAGE> 212
IN WITNESS WHEREOF, the undersigned has hereunto set his hand
this day of [ ], 1999.
By:
-----------------------------------
Name:
Title:
I-3
<PAGE> 213
EXHIBIT J
OFFICERS' CERTIFICATE
REGARDING RELEASE CONDITIONS
[ ], 1999
The Bank of New York,
as Trustee
101 Barclay Street
Floor 21W
New York, New York 10286
Ladies and Gentlemen:
Pursuant to Section 4.22 of the Indenture dated as of October
14, 1999 (as supplemented from time to time in accordance with its terms, the
"Indenture"), among Tenneco Inc. (the "Company") and The Bank of New York, as
Trustee (the "Trustee"), the undersigned officers do hereby certify on behalf of
the Company on the date hereof, as follows (terms used but not defined herein
have the respective meanings assigned to them in the Indenture):
(i) For purposes of delivering this certificate, the
undersigned have read Section 4.22 of the Indenture and have made such
investigations and inquiries as such officers have deemed appropriate.
(ii) In the opinion of the undersigned, we have made such
examination and investigation as is necessary to express an informed opinion as
to compliance with Section 4.22 and based upon the foregoing, the undersigned
have concluded that all of the applicable Release Conditions set forth in
Section 4.22 of the Indenture have been satisfied or waived.
J-1
<PAGE> 214
This Certificate is being delivered by each of the undersigned
only in his capacity as an officer of the Company and not individually as of the
date hereof.
TENNECO INC.
By:
------------------------------------------
Name:
Title:
By:
------------------------------------------
Name:
Title:
J-2
<PAGE> 215
EXHIBIT K
Form of Supplemental Indenture
SUPPLEMENTAL INDENTURE (this "Supplemental Indenture"), dated
as of , 1999, among [Subsidiary Guarantors] (the "Guarantors"), each
a subsidiary of Tenneco, Inc., a Delaware corporation (the "Company"), the
Company and The Bank of New York, a New York banking corporation, as trustee
under the Indenture referred to below (the "Trustee").
W I T N E S S E T H :
WHEREAS the Company has heretofore executed and delivered to
the Trustee an Indenture (as such may be amended from time to time, the
"Indenture"), dated as of October 14, 1999, providing for the issuance of an
aggregate principal amount of up to $750,000,000 of 11 5/8% Senior Subordinated
Notes due 2009 (the "Securities");
WHEREAS, to effect the separation of Tenneco's automotive,
packaging and administrative businesses, the Company will enter into and
consummate the Spin-Off Transactions (as defined in the Indenture);
WHEREAS, to ensure the consummation of the Spin-Off
Transactions, the Company shall have deposited the Special Redemption Amount (as
defined in the Indenture) with the Trustee to be held in escrow;
WHEREAS Section 4.22 of the Indenture provides that, to effect
the release of the Special Redemption Amount, the Company is required to, among
other things, cause the Guarantors to execute and deliver to the Trustee a
supplemental indenture pursuant to which each Guarantor shall unconditionally
guarantee all of the Company's obligations under the Securities
K-1
<PAGE> 216
pursuant to a Guarantee on the terms and conditions set forth herein; and
WHEREAS pursuant to Section 9.01 of the Indenture, the Trustee
and the Company are authorized to execute and deliver this Supplemental
Indenture;
NOW THEREFORE, in consideration of the foregoing and for other
good and valuable consideration, the receipt of which is hereby acknowledged,
the Guarantors, the Company and the Trustee mutually covenant and agree for the
equal and ratable benefit of the holders of the Securities as follows:
1. Definitions. (a) Capitalized terms used herein without
definition shall have the meanings assigned to them in the Indenture.
(b) For all purposes of this Supplemental Indenture, except
as otherwise herein expressly provided or unless the context otherwise requires:
(i) the terms and expressions used herein shall have the same meanings as
corresponding terms and expressions used in the Indenture; and (ii) the words
"herein," "hereof" and "hereby" and other words of similar import used in this
Supplemental Indenture refer to this Supplemental Indenture as a whole and not
to any particular section hereof.
2. Agreement to Guarantee. Each Guarantor hereby agrees,
jointly and severally with all other Guarantors, to guarantee the Company's
obligations under the Securities on the terms and subject to the conditions set
forth in Articles Ten and Twelve of the Indenture and to be bound by all other
applicable provisions of the Indenture. From and after the date hereof, each
Guarantor shall be a Guarantor for all purposes under the Indenture and the
Securities.
3. Ratification of Indenture; Supplemental Indentures Part
of Indenture. Except as expressly amended hereby, the Indenture is in all
respects ratified and confirmed and all the terms, conditions and provisions
thereof shall remain in full force and effect. This Supplemental Indenture shall
form a part of the Indenture for all purposes, and every holder of Securities
heretofore or hereafter authenticated and delivered shall be bound hereby.
K-2
<PAGE> 217
4. Governing Law. THIS SUPPLEMENTAL INDENTURE SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK
BUT WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE
EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE
REQUIRED THEREBY.
5. Trustee Makes No Representation. The Trustee makes no
representation as to the validity or sufficiency of this Supplemental Indenture.
The recitals contained herein shall be taken as the statements of the Company
and each Guarantor, and the Trustee assumes no responsibility for their
correctness.
6. Counterparts. The parties may sign any number of copies
of this Supplemental Indenture. Each signed copy shall be an original, but all
of them together represent the same agreement.
7. Effect of Headings. The Section headings herein are for
convenience only and shall not affect the construction thereof.
K-3
<PAGE> 218
IN WITNESS WHEREOF, the parties hereto have caused this
Supplemental Indenture to be duly executed as of the date first above written.
[GUARANTOR]
By:
-----------------------------------------
Name:
Title:
TENNECO, INC.
By:
-----------------------------------------
Name:
Title:
By:
-----------------------------------------
Name:
Title:
THE BANK OF NEW YORK, as Trustee
By:
-----------------------------------------
Name:
Title:
K-4
<PAGE> 1
EXHIBIT 4.4(b)
SUPPLEMENTAL INDENTURE
SUPPLEMENTAL INDENTURE (this "Supplemental Indenture"), dated as of
November 4, 1999, among Tenneco Automotive Inc., a Delaware corporation, Tenneco
International Holding Corp., a Delaware corporation, Tenneco Global Holdings
Inc., a Delaware corporation, The Pullman Company, a Delaware corporation,
Clevite Industries Inc., a Delaware corporation, and TMC Texas Inc., a Delaware
corporation (the "Guarantors"), each a subsidiary of Tenneco Inc., a Delaware
corporation (the "Company"), the Company and The Bank of New York, a New York
banking corporation, as trustee under the Indenture referred to below (the
"Trustee").
W I T N E S S E T H :
WHEREAS the Company has heretofore executed and delivered to the
Trustee an Indenture (as such may be amended from time to time, the
"Indenture"), dated as of October 14, 1999, providing for the issuance of an
aggregate principal amount of up to $750,000,000 of 11 5/8% Senior Subordinated
Notes due 2009 (the "Securities");
WHEREAS, to effect the separation of the Company's automotive,
packaging and administrative services businesses, the Company will enter into
and consummate the Spin-Off Transactions (as defined in the Indenture);
WHEREAS, to ensure the consummation of the Spin-Off Transactions,
the Company has deposited the Special Redemption Amount (as defined in the
Indenture) with the Trustee to be held in escrow;
WHEREAS Section 4.22 of the Indenture provides that, to effect the
release of the Special Redemption Amount, the Company is required to, among
other things, cause the Guarantors to execute and deliver to the Trustee a
supplemental indenture pursuant to which each Guarantor shall unconditionally
guarantee all of the Company's obligations under the Securities pursuant to a
Guarantee on the terms and conditions set forth herein; and
<PAGE> 2
WHEREAS pursuant to Section 9.01 of the Indenture, the Trustee and
the Company are authorized to execute and deliver this Supplemental Indenture;
NOW THEREFORE, in consideration of the foregoing and for other good
and valuable consideration, the receipt of which is hereby acknowledged, the
Guarantors, the Company and the Trustee mutually covenant and agree for the
equal and ratable benefit of the holders of the Securities as follows:
1. Definitions. (a) Capitalized terms used herein without definition
shall have the meanings assigned to them in the Indenture.
(b) For all purposes of this Supplemental Indenture, except as
otherwise herein expressly provided or unless the context otherwise requires:
(i) the terms and expressions used herein shall have the same meanings as
corresponding terms and expressions used in the Indenture; and (ii) the words
"herein," "hereof" and "hereby" and other words of similar import used in this
Supplemental Indenture refer to this Supplemental Indenture as a whole and not
to any particular section hereof.
2. Agreement to Guarantee. Each Guarantor hereby agrees, jointly and
severally with all other Guarantors, to guarantee the Company's obligations
under the Securities on the terms and subject to the conditions set forth in
Articles Ten and Twelve of the Indenture and to be bound by all other applicable
provisions of the Indenture. From and after the date hereof, each Guarantor
shall be a Guarantor for all purposes under the Indenture and the Securities.
3. Ratification of Indenture; Supplemental Indentures Part of
Indenture. Except as expressly amended hereby, the Indenture is in all respects
ratified and confirmed and all the terms, conditions and provisions thereof
shall remain in full force and effect. This Supplemental Indenture shall form a
part of the Indenture for all purposes, and every holder of Securities
heretofore or hereafter authenticated and delivered shall be bound hereby.
<PAGE> 3
4. Governing Law. THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK BUT WITHOUT
GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT
THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
5. Trustee Makes No Representation. The Trustee makes no
representation as to the validity or sufficiency of this Supplemental Indenture.
The recitals contained herein shall be taken as the statements of the Company
and each Guarantor, and the Trustee assumes no responsibility for their
correctness.
6. Counterparts. The parties may sign any number of copies of this
Supplemental Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement.
7. Effect of Headings. The Section headings herein are for
convenience only and shall not affect the construction thereof.
<PAGE> 4
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture
to be duly executed as of the date first above written.
TENNECO AUTOMOTIVE INC.
By: /s/ Timothy R. Donovan
----------------------------
Timothy R. Donovan
Senior Vice President
And General Counsel
By: /s/ Don P. Carpenter
----------------------------
Don P. Carpenter
Vice President and
Assistant Secretary
TENNECO INTERNATIONAL HOLDING
CORP.
By: /s/ Timothy R. Donovan
----------------------------
Timothy R. Donovan
Vice President and
Assistant Secretary
By: /s/ Don P. Carpenter
----------------------------
Don P. Carpenter
Vice President and
Assistant Secretary
<PAGE> 5
TENNECO GLOBAL HOLDINGS INC.
By: /s/ Timothy R. Donovan
----------------------------
Timothy R. Donovan
Vice President and
Assistant Secretary
By: /s/ Don P. Carpenter
----------------------------
Don P. Carpenter
Vice President and
Assistant Secretary
THE PULLMAN COMPANY
By: /s/ Timothy R. Donovan
----------------------------
Timothy R. Donovan
Vice President and
Assistant Secretary
By: /s/ Don P. Carpenter
----------------------------
Don P. Carpenter
Vice President and
Assistant Secretary
TMC TEXAS INC.
By: /s/ Bert F. Neece
----------------------------
Bert F. Neece
Vice President and
Assistant Treasurer
By: /s/ Don P. Carpenter
----------------------------
Don P. Carpenter
Vice President
and Secretary
<PAGE> 6
TENNECO INC.
By: /s/ Robert T. Blakely
----------------------------
Name:
Title:
By: /s/ Karl A. Stewart
----------------------------
Name:
Title:
THE BANK OF NEW YORK, as Trustee
By: /s/ Mary LaGumina
----------------------------
Name:
Title:
<PAGE> 7
CLEVITE INDUSTRIES INC.
By: /s/ Timothy R. Donovan
----------------------------
Timothy R. Donovan
Vice President and
Assistant Secretary
By: /s/ Don P. Carpenter
----------------------------
Don P. Carpenter
Vice President and
Assistant Secretary
<PAGE> 1
EXHIBIT 4.5(a)
EXECUTION COPY
================================================================================
$1.55 BILLION
CREDIT AGREEMENT
among
TENNECO INC.
(to be renamed TENNECO AUTOMOTIVE INC.),
as Borrower,
The Several Lenders
from Time to Time Parties Hereto,
COMMERZBANK
and
BANK OF AMERICA, N.A.,
as Co-Documentation Agents,
CITICORP USA, INC.,
as Syndication Agent,
and
THE CHASE MANHATTAN BANK,
as Administrative Agent
Dated as of September 30, 1999
================================================================================
CHASE SECURITIES INC., as Lead Arranger and Book Manager
<PAGE> 2
TABLE OF CONTENTS
Page
----
SECTION 1. DEFINITIONS.......................................................2
1.1 Defined Terms...................................................2
1.2 Other Definitional Provisions..................................24
SECTION 2. AMOUNT AND TERMS OF COMMITMENTS..................................25
2.1 Term Commitments...............................................25
2.2 Procedure for Term Loan Borrowing..............................25
2.3 Repayment of Term Loans........................................25
2.4 Revolving Commitments..........................................27
2.5 Procedure for Revolving Loan Borrowing.........................27
2.6 Swingline Commitment...........................................28
2.7 Procedure for Swingline Borrowing; Refunding of
Swingline Loans..............................................28
2.8 Commitment Fees, etc. .........................................30
2.9 Termination or Reduction of Commitments........................30
2.10 Optional Prepayments..........................................30
2.11 Mandatory Prepayments and Commitment Reductions...............31
2.12 Conversion and Continuation Options...........................33
2.13 Limitations on Eurodollar Tranches............................34
2.14 Interest Rates and Payment Dates..............................34
2.15 Computation of Interest and Fees..............................35
2.16 Inability to Determine Interest Rate..........................35
2.17 Pro Rata Treatment and Payments...............................36
2.18 Requirements of Law...........................................37
2.19 Taxes.........................................................38
2.20 Indemnity.....................................................40
2.21 Change of Lending Office......................................40
2.22 Replacement of Lenders........................................41
SECTION 3. LETTERS OF CREDIT................................................41
3.1 L/C Commitment.................................................41
3.2 Procedure for Issuance of Letter of Credit.....................42
3.3 Fees and Other Charges.........................................42
3.4 L/C Participations.............................................42
3.5 Reimbursement Obligation of the Borrower.......................43
3.6 Obligations Absolute...........................................43
3.7 Letter of Credit Payments......................................44
3.8 Applications...................................................44
SECTION 4. REPRESENTATIONS AND WARRANTIES...................................44
4.1 Financial Condition............................................44
<PAGE> 3
Page
----
4.2 No Change......................................................45
4.3 Corporate Existence; Compliance with Law.......................45
4.4 Corporate Power; Authorization; Enforceable Obligations........46
4.5 No Legal Bar...................................................46
4.6 Litigation.....................................................46
4.7 No Default.....................................................46
4.8 Ownership of Property; Liens...................................47
4.9 Intellectual Property..........................................47
4.10 Taxes.........................................................47
4.11 Federal Regulations...........................................47
4.12 Labor Matters.................................................47
4.13 ERISA.........................................................47
4.14 Investment Company Act; Other Regulations.....................48
4.15 Subsidiaries..................................................48
4.16 Use of Proceeds...............................................48
4.17 Environmental Matters.........................................48
4.18 Accuracy of Information, etc..................................49
4.19 Security Documents............................................50
4.20 Solvency......................................................50
4.21 Year 2000 Matters.............................................50
4.22 Senior Indebtedness...........................................51
4.23 Certain Documents.............................................51
SECTION 5. CONDITIONS PRECEDENT.............................................51
5.1 Conditions to Signing Date.....................................51
5.2 Conditions to Effective Date...................................52
5.3 Conditions to Initial Extensions of Credit.....................52
5.4 Conditions to Each Extension of Credit.........................56
SECTION 6. AFFIRMATIVE COVENANTS............................................56
6.1 Financial Statements...........................................56
6.2 Certificates; Other Information................................57
6.3 Payment of Obligations.........................................58
6.4 Maintenance of Existence; compliance...........................58
6.5 Maintenance of Property; Insurance.............................58
6.6 Inspection of Property; Books and Records; Discussions.........58
6.7 Notices........................................................58
6.8 Environmental Laws.............................................59
6.9 Interest Rate Protection.......................................59
6.10 Additional Collateral, etc....................................59
SECTION 7. NEGATIVE COVENANTS...............................................61
7.1 Financial Condition Covenants..................................61
7.2 Indebtedness...................................................62
7.3 Liens..........................................................63
- ii -
<PAGE> 4
Page
----
7.4 Fundamental Changes............................................65
7.5 Disposition of Property........................................65
7.6 Restricted Payments............................................66
7.7 Capital Expenditures...........................................67
7.8 Investments....................................................67
7.9 Optional Payments and Modifications of Senior
Subordinated Notes. .......................................68
7.10 Transactions with Affiliates..................................68
7.11 Sales and Leasebacks..........................................69
7.12 Changes in Fiscal Periods.....................................69
7.13 Negative Pledge Clauses.......................................69
7.14 Lines of Business.............................................69
7.15 Amendments to Spin-Off Documents..............................69
SECTION 8. EVENTS OF DEFAULT................................................69
SECTION 9. THE AGENTS.......................................................73
9.1 Appointment....................................................73
9.2 Delegation of Duties...........................................73
9.3 Exculpatory Provisions.........................................73
9.4 Reliance by Administrative Agent...............................73
9.5 Notice of Default..............................................74
9.6 Non-Reliance on Agents and Other Lenders.......................74
9.7 Indemnification................................................75
9.8 Agent in Its Individual Capacity...............................75
9.9 Successor Administrative Agent.................................75
9.10 Co-Documentation Agents and Syndication Agent.................76
SECTION 10. MISCELLANEOUS...................................................76
10.1 Amendments and Waivers........................................76
10.2 Notices.......................................................77
10.3 No Waiver; Cumulative Remedies................................78
10.4 Survival of Representations and Warranties....................78
10.5 Payment of Expenses and Taxes.................................78
10.6 Successors and Assigns; Participations and Assignments........79
10.7 Adjustments; Set-off..........................................82
10.8 Counterparts..................................................83
10.9 Severability..................................................83
10.10 Integration..................................................83
10.11 GOVERNING LAW................................................83
10.12 Submission To Jurisdiction; Waivers..........................83
10.13 Acknowledgments..............................................84
10.14 Releases of Guarantees and Liens.............................84
10.15 Confidentiality..............................................85
10.16 WAIVERS OF JURY TRIAL........................................85
- iii -
<PAGE> 5
ANNEX:
A Pricing Grid
SCHEDULES:
1.1A Commitments
1.1B Mortgaged Property
4.4 Consents, Authorizations, Filings and Notices
4.15 Subsidiaries
4.19(a) UCC Filing Jurisdictions
4.19(b) Mortgage Filing Jurisdictions
7.2(d) Existing Indebtedness
7.3(f) Existing Liens
7.5 Dispositions
7.8(i) Existing Investments
EXHIBITS:
A Form of Guarantee and Collateral Agreement
B Form of Compliance Certificate
C Form of Closing Certificate
D Form of Mortgage
E Form of Assignment and Acceptance
F Form of Legal Opinion of Jenner & Block (Signing Date)
G Form of Prepayment Option Notice
H Form of Exemption Certificate
- iv -
<PAGE> 6
CREDIT AGREEMENT, dated as of September 30, 1999, among
TENNECO INC., a Delaware corporation (the "Borrower"), the several banks and
other financial institutions or entities from time to time parties to this
Agreement (the "Lenders"), COMMERZBANK, AG and BANK OF AMERICA, N.A., as
co-documentation agents (in such capacity, the "Co-Documentation Agents"),
CITICORP USA, INC., as syndication agent (in such capacity, the "Syndication
Agent"), and THE CHASE MANHATTAN BANK, as administrative agent.
RECITALS
1. Pursuant to the Distribution Agreement (such term and the
other capitalized terms used in these recitals having the meaning set forth in
this Agreement unless the context otherwise requires) between the Borrower and
Tenneco Packaging Inc., a Delaware corporation ("Packaging") which is a direct
wholly owned Subsidiary of the Borrower, the Borrower has agreed to separate and
divide the existing businesses of the Borrower so that (a) the Packaging
Business shall be owned directly and indirectly by Packaging, and (b) the
Automotive Business shall be directly and indirectly owned by the Borrower, and
the Borrower will be renamed Tenneco Automotive, Inc. immediately following the
separation and division described above and prior to the distribution described
in the succeeding paragraph.
2. Following the separation and division described in the
preceding paragraph 1 the Borrower shall distribute, as a dividend to the
holders of the shares of its common stock, all of the capital stock of Packaging
(the transactions described in paragraph 1 above and this paragraph 2, as more
particularly described in the Spin-Off SEC Filings (as defined below), the
"Spin-Off").
3. Packaging intends to sell the 43% of the common stock of
Packaging Corporation of America, a Delaware corporation ("PCA"), owned by it to
the public in a registered public offering (the "PCA IPO"). The PCA IPO may
occur before or after the Spin-Off and is not a condition to the Spin-Off.
4. Pursuant to the Distribution Agreement and in connection
with the Spin-Off, certain pre-existing indebtedness of the Borrower and
Packaging and certain of their respective Subsidiaries will be paid in full and
canceled, or realigned through some combination of tender offers, exchange
offers, prepayments and other refinancings (the Spin-Off and the other
transactions to be performed pursuant to and in connection with the Spin-Off,
the "Spin-Off Transactions").
5. The Borrower has requested that the Lenders, the
Co-Documentation Agents, the Administrative Agent and the Syndication Agent
enter this Agreement in order to make available to the Borrower the
$1,550,000,000 credit facilities described herein on the terms and conditions
set forth herein.
The parties hereto hereby agree as follows:
<PAGE> 7
2
SECTION 1. DEFINITIONS
1.1 Defined Terms. As used in this Agreement, the terms listed
in this Section 1.1 shall have the respective meanings set forth in this Section
1.1.
"ABR": for any day, a rate per annum (rounded upwards, if
necessary, to the next 1/16 of 1%) equal to the greater of (a) the Prime Rate in
effect on such day, and (b) the Federal Funds Effective Rate in effect on such
day plus 1/2 of 1%. For purposes hereof "Prime Rate" shall mean the rate of
interest per annum publicly announced from time to time by Chase as its prime
rate in effect at its principal office in New York City (the Prime Rate not
being intended to be the lowest rate of interest charged by Chase in connection
with extensions of credit to debtors). Any change in the ABR due to a change in
the Prime Rate or the Federal Funds Effective Rate shall be effective as of the
opening of business on the effective day of such change in the Prime Rate, or
the Federal Funds Effective Rate, respectively.
"ABR Loans": Loans the rate of interest applicable to which is
based upon the ABR.
"Adjustment Date": as defined in the Pricing Grid.
"Administrative Agent": Chase, together with its affiliates,
as the arranger of the Commitments and as the administrative agent for the
Lenders under this Agreement and the other Loan Documents, together with any of
its successors.
"Affiliate": as to any Person, any other Person that, directly
or indirectly, is in control of, is controlled by, or is under common control
with, such Person. For purposes of this definition, "control" of a Person means
the power, directly or indirectly, either to (a) vote 10% or more of the
securities having ordinary voting power for the election of directors (or
persons performing similar functions) of such Person or (b) direct or cause the
direction of the management and policies of such Person, whether by contract or
otherwise.
"Agents": the collective reference to the Syndication Agent,
the Co-Documentation Agents and the Administrative Agent.
"Aggregate Exposure": with respect to any Lender at any time,
an amount equal to (a) until the Funding Date, the aggregate amount of such
Lender's Commitments at such time and (b) thereafter, the sum of (i) the
aggregate then unpaid principal amount of such Lender's Term Loans and (ii) the
amount of such Lender's Revolving Commitment then in effect or, if the Revolving
Commitments have been terminated, the amount of such Lender's Revolving
Extensions of Credit then outstanding.
"Aggregate Exposure Percentage": with respect to any Lender at
any time, the ratio (expressed as a percentage) of such Lender's Aggregate
Exposure at such time to the Aggregate Exposure of all Lenders at such time.
<PAGE> 8
3
"Agreement": this Credit Agreement, as amended, supplemented
or otherwise modified from time to time.
"Applicable Margin": for each Type of Loan, the rate per annum
set forth under the relevant column heading below:
<TABLE>
<CAPTION>
ABR Loans Eurodollar Loans
<S> <C> <C>
Revolving Loans and Swingline Loans 1.75% 2.75%
Tranche A Term Loans 1.75% 2.75%
Tranche B Term Loans 2.25% 3.25%
Tranche C Term Loans 2.50% 3.50%
</TABLE>
; provided, that on and after the first Adjustment Date occurring after the
first anniversary of the Funding Date, the Applicable Margin with respect to
Revolving Loans, Swingline Loans and Tranche A Term Loans will be determined
pursuant to the Pricing Grid.
"Applicable Prepayment Percentage": (a) with respect to any
prepayment of the Term Loans required pursuant to Section 2.11(a)(i) in
connection the issuance of any Capital Stock, 50%; (b) with respect to any
prepayment of the Term Loans required pursuant to Section 2.11(a)(i) in
connection with the issuance or incurrence of any Indebtedness (i) 100% if the
Consolidated Leverage Ratio is equal to or more than 3.0 to 1.0 as of the last
day of the most recently ended fiscal quarter, (ii) 75% if the Consolidated
Leverage Ratio is less than 3.0 to 1.0 as of the last day of the most recently
ended fiscal quarter and (iii) 50% if the Consolidated Leverage Ratio is less
than 2.5 to 1.0 as of the last day of the most recently ended fiscal quarter;
(c) with respect to any prepayment of the Term Loans required pursuant to
Section 2.11(b) in connection with any Asset Sale or Recovery Event (i) if the
Borrower's senior unsecured long-term debt rating is at least investment grade
from each of Moody's Investors Service, Inc. and Standard & Poor's Rating Group
and one of such ratings is higher than BAA3 or BBB-, as applicable, 50% or (ii)
otherwise, 100%; and (d) with respect to any prepayment of the Term Loans
required pursuant to Section 2.11(c) for any fiscal year (i) 75% if the
Consolidated Leverage Ratio is equal to or more than 3.0 to 1.0 as of the last
day of the most recently ended fiscal quarter and (ii) 50% if the Consolidated
Leverage Ratio is less than 3.0 to 1.0 as of the last day of the most recently
ended fiscal quarter.
"Application": an application, in such form as the Issuing
Lender may specify from time to time, requesting the Issuing Lender to open a
Letter of Credit.
"Approved Fund": with respect to any Lender that is a fund
that invests in commercial loans, any other fund that invests in commercial
loans and is managed or advised by the same investment advisor as such Lender or
by an Affiliate of such investment advisor.
"Asset Sale": any Disposition of property or series of related
Dispositions of property (excluding any such Disposition permitted by clause
(a), (b), (c), (d), (e), (f), (h) or (i) of Section 7.5) that yields Net Cash
Proceeds to the Borrower or any of its Subsidiaries in excess of $2,000,000.
<PAGE> 9
4
"Assignee": as defined in Section 10.6(c).
"Assignment and Acceptance": an Assignment and Acceptance,
substantially in the form of Exhibit E.
"Assignor": as defined in Section 10.6(c).
"Automotive Business": as defined in the Distribution
Agreement.
"Available Revolving Commitment": as to any Revolving Lender
at any time, an amount equal to the excess, if any, of (a) such Lender's
Revolving Commitment then in effect over (b) such Lender's Revolving Extensions
of Credit then outstanding; provided, that in calculating any Lender's Revolving
Extensions of Credit for the purpose of determining such Lender's Available
Revolving Commitment pursuant to Section 2.8(a), the aggregate principal amount
of Swingline Loans then outstanding shall be deemed to be zero.
"Benefitted Lender": as defined in Section 10.7(a).
"Board": the Board of Governors of the Federal Reserve System
of the United States (or any successor).
"Borrower": as defined in the preamble hereto.
"Borrowing Date": any Business Day specified by the Borrower
as a date on which the Borrower requests the relevant Lenders to make Loans
hereunder.
"Business": as defined in Section 4.17(b).
"Business Day": a day other than a Saturday, Sunday or other
day on which commercial banks in New York City are authorized or required by law
to close, provided, that with respect to notices and determinations in
connection with, and payments of principal and interest on, Eurodollar Loans,
such day is also a day for trading by and between banks in Dollar deposits in
the interbank eurodollar market.
"Capital Expenditures": for any period, with respect to any
Person, the aggregate of all expenditures by such Person and its Subsidiaries
for the acquisition or leasing (pursuant to a capital lease) of fixed or capital
assets or additions to equipment (including replacements, capitalized repairs
and improvements during such period) that should be capitalized under GAAP on a
consolidated balance sheet of such Person and its Subsidiaries.
"Capital Lease Obligations": as to any Person, the obligations
of such Person to pay rent or other amounts under any lease of (or other
arrangement conveying the right to use) real or personal property, or a
combination thereof, which obligations are required to be classified and
accounted for as capital leases on a balance sheet of such Person under GAAP
and, for the purposes of this Agreement, the amount of such obligations at any
time shall be the capitalized amount thereof at such time determined in
accordance with GAAP.
<PAGE> 10
5
"Capital Stock": any and all shares, interests, participations
or other equivalents (however designated) of capital stock of a corporation, any
and all equivalent ownership interests in a Person (other than a corporation)
and any and all warrants, rights or options to purchase any of the foregoing.
"Cash Equivalents": (a) marketable direct obligations issued
by, or unconditionally guaranteed by, the United States Government or issued by
any agency thereof and backed by the full faith and credit of the United States,
in each case maturing within one year from the date of acquisition; (b)
certificates of deposit, time deposits, eurodollar time deposits or overnight
bank deposits having maturities of six months or less from the date of
acquisition issued by any Lender or by any commercial bank organized under the
laws of the United States or any state thereof having combined capital and
surplus of not less than $500,000,000; (c) commercial paper of an issuer rated
at least A-1 by Standard & Poor's Ratings Services ("S&P") or P-1 by Moody's
Investors Service, Inc. ("Moody's"), or carrying an equivalent rating by a
nationally recognized rating agency, if both of the two named rating agencies
cease publishing ratings of commercial paper issuers generally, and maturing
within six months from the date of acquisition; (d) repurchase obligations of
any Lender or of any commercial bank satisfying the requirements of clause (b)
of this definition, having a term of not more than 30 days, with respect to
securities issued or fully guaranteed or insured by the United States
government; (e) securities with maturities of one year or less from the date of
acquisition issued or fully guaranteed by any state, commonwealth or territory
of the United States, by any political subdivision or taxing authority of any
such state, commonwealth or territory or by any foreign government, the
securities of which state, commonwealth, territory, political subdivision,
taxing authority or foreign government (as the case may be) are rated at least A
by S&P or A by Moody's; (f) securities with maturities of six months or less
from the date of acquisition backed by standby letters of credit issued by any
Lender or any commercial bank satisfying the requirements of clause (b) of this
definition; or (g) shares of money market mutual or similar funds which invest
exclusively in assets satisfying the requirements of clauses (a) through (f) of
this definition.
"Chase": The Chase Manhattan Bank.
"Code": the Internal Revenue Code of 1986, as amended from
time to time.
"Co-Documentation Agents": as defined in the preamble hereto.
"Collateral": all property of the Loan Parties, now owned or
hereafter acquired, upon which a Lien is purported to be created by any Security
Document.
"Commitment": as to any Lender, the sum of the Tranche A Term
Commitment, the Tranche B Term Commitment, the Tranche C Term Commitment and the
Revolving Commitment of such Lender.
"Commitment Fee Rate": 1/2 of 1% per annum; provided, that on
and after the first Adjustment Date occurring after the first anniversary of the
Funding Date, the Commitment Fee Rate will be determined pursuant to the Pricing
Grid.
<PAGE> 11
6
"Commonly Controlled Entity": an entity, whether or not
incorporated, that is under common control with the Borrower within the meaning
of Section 4001 of ERISA or is part of a group that includes the Borrower and
that is treated as a single employer under Section 414 of the Code.
"Compliance Certificate": a certificate duly executed by a
Responsible Officer substantially in the form of Exhibit B.
"Confidential Information Memorandum": the Confidential
Information Memorandum dated July 1999 and furnished to the Lenders, as
supplemented by letter dated September 10, 1999 from the Borrower to the
Lenders.
"Consolidated Current Assets": at any date, all amounts (other
than cash and Cash Equivalents) that would, in conformity with GAAP, be set
forth opposite the caption "total current assets" (or any like caption) on a
consolidated balance sheet of the Borrower and its Subsidiaries at such date.
"Consolidated Current Liabilities": at any date, all amounts
that would, in conformity with GAAP, be set forth opposite the caption "total
current liabilities" (or any like caption) on a consolidated balance sheet of
the Borrower and its Subsidiaries at such date, but excluding (a) the current
portion of any Funded Debt of the Borrower and its Subsidiaries and (b) without
duplication of clause (a) above, all Indebtedness consisting of Revolving Loans
or Swingline Loans to the extent otherwise included therein.
"Consolidated EBITDA": for any period, Consolidated Net Income
for such period plus, without duplication and to the extent reflected as a
charge in the statement of such Consolidated Net Income for such period, the sum
of (a) income tax expense, (b) interest expense, amortization or writeoff of
debt discount and debt issuance costs and commissions, discounts and other fees
and charges associated with Indebtedness (including the Loans), (c) depreciation
and amortization expense, (d) amortization of intangibles (including, but not
limited to, goodwill) and organization costs, (e) any extraordinary, unusual or
non-recurring non-cash expenses or losses (including, whether or not otherwise
includable as a separate item in the statement of such Consolidated Net Income
for such period, non-cash losses on sales of assets outside of the ordinary
course of business), and (f) any other non-cash charges (excluding any such
charge that constitutes an accrual of or a reserve for cash charges for any
future period), and minus, to the extent taken into account in calculating
Consolidated Net Income for such period, the sum of (a) interest income, (b) any
non-cash extraordinary, unusual or non-recurring income or gains (including,
whether or not otherwise includable as a separate item in the statement of such
Consolidated Net Income for such period, gains on the sales of assets outside of
the ordinary course of business) and (c) any other non-cash income, all as
determined on a consolidated basis. For the purposes of calculating Consolidated
EBITDA for any period of four consecutive fiscal quarters (each, a "Reference
Period") pursuant to any determination of the Consolidated Leverage Ratio, if
during such Reference Period the Borrower or any Subsidiary shall have made a
Material Acquisition, Consolidated EBITDA for such Reference Period shall be
calculated after giving pro forma effect thereto as if such Material Acquisition
occurred on the first day of such Reference Period. As used in this definition,
"Material Acquisition" means any
<PAGE> 12
7
acquisition of property or series of related acquisitions of property that (a)
constitutes assets comprising all or substantially all of an operating unit of a
business or constitutes all or substantially all of the common stock of a Person
and (b) involves the payment of consideration by the Borrower and its
Subsidiaries in excess of $5,000,000. Notwithstanding the forgoing, (i) the
Consolidated EBITDA for the fiscal quarters ended June 30, 1999 and September
30, 1999 shall be deemed to be $124,000,000 and $91,000,000, respectively, and
(ii) with respect to the fiscal quarter ended December 31, 1999, Consolidated
EBITDA shall be increased by (x) the amount (such amount not to be in excess of
$55,000,000) of restructuring charges associated with the Borrower's
cost-reduction plan included in the calculation of Consolidated Net Income for
such quarter and (y) the amount (such amount not to be in excess of
$400,000,000) of transaction fees and expenses and debt realignment costs
(including certain taxes related thereto) incurred in connection with the
Spin-Off included in the calculation of Consolidated Net Income for such
quarter.
"Consolidated Fixed Charge Coverage Ratio": for any period,
the ratio of (a) Consolidated EBITDA for such period less the aggregate amount
actually paid by the Borrower and its Subsidiaries during such period on account
of Capital Expenditures to (b) Consolidated Interest Expense for such period.
"Consolidated Interest Coverage Ratio": for any period, the
ratio of (a) Consolidated EBITDA for such period to (b) Consolidated Interest
Expense for such period.
"Consolidated Interest Expense": for any period, total cash
interest expense (including that attributable to Capital Lease Obligations but
net of interest income) of the Borrower and its Subsidiaries for such period
with respect to all outstanding Indebtedness of the Borrower and its
Subsidiaries (including all commissions, discounts and other fees and charges
owed with respect to letters of credit and bankers? acceptance financing and net
costs under Hedge Agreements in respect of interest rates to the extent such net
costs are allocable to such period in accordance with GAAP).
"Consolidated Leverage Ratio": as at the last day of any
period, the ratio of (a) Consolidated Total Debt on such day to (b) Consolidated
EBITDA for such period.
"Consolidated Net Income": for any period, the consolidated
net income (or loss) of the Borrower and its Subsidiaries, determined on a
consolidated basis in accordance with GAAP; provided that there shall be
excluded (a) the income (or deficit) of any Person accrued prior to the date it
becomes a Subsidiary of the Borrower or is merged into or consolidated with the
Borrower or any of its Subsidiaries, (b) the income (or deficit) of any Person
(other than a Subsidiary of the Borrower) in which the Borrower or any of its
Subsidiaries has an ownership interest, except to the extent that any such
income is actually received by the Borrower or such Subsidiary in the form of
dividends or similar distributions and (c) the undistributed earnings of any
Subsidiary of the Borrower to the extent that the declaration or payment of
dividends or similar distributions by such Subsidiary is not at the time
permitted by the terms of any Contractual Obligation (other than under any Loan
Document) or Requirement of Law applicable to such Subsidiary.
<PAGE> 13
8
"Consolidated Total Assets": at any date, all amounts that
would, in conformity with GAAP, be set forth opposite the caption "total assets"
(or any like caption) on a consolidated balance sheet of the Borrower and its
Subsidiaries at such date.
"Consolidated Total Debt": at any date, the aggregate
principal amount of all Indebtedness of the Borrower and its Subsidiaries at
such date, determined on a consolidated basis in accordance with GAAP.
"Consolidated Working Capital": at any date, the excess of
Consolidated Current Assets on such date over Consolidated Current Liabilities
on such date.
"Continuing Directors": the directors of the Borrower on the
Funding Date, after giving effect to the Spin-Off and the other Transactions
contemplated hereby, and each other director, if, in each case, such other
director's nomination for election to the board of directors of the Borrower is
recommended by at least a majority of the then Continuing Directors.
"Contractual Obligation": as to any Person, any provision of
any security issued by such Person or of any agreement, instrument or other
undertaking to which such Person is a party or by which it or any of its
property is bound.
"Default": any of the events specified in Section 8, whether
or not any requirement for the giving of notice, the lapse of time, or both, has
been satisfied.
"Disposition": with respect to any property, any sale, lease,
sale and leaseback, assignment, conveyance, transfer or other disposition
thereof (other than any transaction for purposes of collateral or security to
the extent permitted hereunder). The terms "Dispose" and "Disposed of" shall
have correlative meanings.
"Distribution Agreement": the Distribution Agreement to be
entered into between the Borrower and Packaging substantially in the form
included in Amendment No.2 to the Form S-4 Filing, as amended, modified or
supplemented from time to time in accordance with Section 7.15.
"Dollars" and "$": dollars in lawful currency of the United
States.
"Domestic Subsidiary": any Subsidiary of the Borrower
organized under the laws of any jurisdiction within the United States.
"Effective Date": the date on which the conditions precedent
set forth in Section 5.2 shall have been satisfied.
"Environmental Laws": any and all foreign, Federal, state,
local or municipal laws, rules, orders, regulations, statutes, ordinances,
codes, decrees, requirements of any Governmental Authority or other Requirements
of Law (including common law) regulating, relating to or imposing liability or
standards of conduct concerning protection of human health or the environment,
as now or may at any time hereafter be in effect.
<PAGE> 14
9
"ERISA": the Employee Retirement Income Security Act of 1974,
as amended from time to time.
"Eurocurrency Reserve Requirements": for any day as applied to
a Eurodollar Loan, the aggregate (without duplication) of the maximum rates
(expressed as a decimal) of reserve requirements in effect on such day
(including basic, supplemental, marginal and emergency reserves under any
regulations of the Board or other Governmental Authority having jurisdiction
with respect thereto) dealing with reserve requirements prescribed for
eurocurrency funding (currently referred to as "Eurocurrency Liabilities" in
Regulation D of the Board) maintained by a member bank of the Federal Reserve
System.
"Eurodollar Base Rate": with respect to each day during each
Interest Period pertaining to a Eurodollar Loan, the rate per annum determined
on the basis of the rate for deposits in Dollars for a period equal to such
Interest Period commencing on the first day of such Interest Period appearing on
Page 3750 of the Dow Jones Markets screen as of 11:00 a.m., London time, two
Business Days prior to the beginning of such Interest Period. In the event that
such rate does not appear on Page 3750 of the Dow Jones Markets screen (or
otherwise on such screen), the "Eurodollar Base Rate" shall be determined by
reference to such other comparable publicly available service for displaying
eurodollar rates as may be selected by the Administrative Agent or, in the
absence of such availability, by reference to the rate at which the
Administrative Agent is offered Dollar deposits at or about 11:00 a.m., New York
City time, two Business Days prior to the beginning of such Interest Period in
the interbank eurodollar market where its eurodollar and foreign currency and
exchange operations are then being conducted for delivery on the first day of
such Interest Period for the number of days comprised therein.
"Eurodollar Loans": Loans the rate of interest applicable to
which is based upon the Eurodollar Rate.
"Eurodollar Rate": with respect to each day during each
Interest Period pertaining to a Eurodollar Loan, a rate per annum determined for
such day in accordance with the following formula (rounded upward to the nearest
1/100th of 1%):
Eurodollar Base Rate
------------------------------------------
1.00 --- Eurocurrency Reserve Requirements
"Eurodollar Tranche": the collective reference to Eurodollar
Loans under a particular Facility the then current Interest Periods with respect
to all of which begin on the same date and end on the same later date (whether
or not such Loans shall originally have been made on the same day).
"Event of Default": any of the events specified in Section 8,
provided that any requirement for the giving of notice, the lapse of time, or
both, has been satisfied.
"Excess Cash Flow": for any fiscal year of the Borrower, the
excess, if any, of (a) the sum, without duplication, of (i) Consolidated Net
Income for such fiscal year, (ii) an amount equal to the amount of all non-cash
charges (including depreciation and amortization)
<PAGE> 15
10
deducted in arriving at such Consolidated Net Income, (iii) decreases in
Consolidated Working Capital for such fiscal year, and (iv) an amount equal to
the aggregate net non-cash loss on the Disposition of property by the Borrower
and its Subsidiaries during such fiscal year (other than sales of inventory in
the ordinary course of business), to the extent deducted in arriving at such
Consolidated Net Income over (b) the sum, without duplication, of (i) an amount
equal to the amount of all non-cash credits included in arriving at such
Consolidated Net Income, (ii) the aggregate amount actually paid by the Borrower
and its Subsidiaries in cash during such fiscal year on account of Capital
Expenditures (excluding the principal amount of Indebtedness incurred in
connection with such expenditures, any such expenditures financed with the
proceeds of any Reinvestment Deferred Amount and any Capital Expenditures with
respect to which the Borrower delivered a certificate pursuant to the
immediately following clause (iii) in connection with the calculation of Excess
Cash Flow for the last fiscal year), (iii) the aggregate amount of Capital
Expenditures that the Borrower or any of its Subsidiaries became obligated to
make but that are not made during such fiscal year, provided that the Borrower
shall deliver a certificate to the Administrative Agent not later than 90 days
after the end of such fiscal year, signed by a Responsible Officer of the
Borrower and certifying that such Capital Expenditure will be made in the
following fiscal year and the aggregate amount of all such Capital Expenditures
shall not exceed the limitations set forth in Section 7.7 for such fiscal year,
(iv) the net amount of all prepayments of Revolving Loans and Swingline Loans
and other revolving credit facilities during such fiscal year and all optional
prepayments of the Term Loans during such fiscal year, (v) the aggregate amount
of all regularly scheduled principal payments of Funded Debt (including the Term
Loans) of the Borrower and its Subsidiaries made during such fiscal year, (vi)
increases in Consolidated Working Capital for such fiscal year, and (vii) an
amount equal to the aggregate net non-cash gain on the Disposition of property
by the Borrower and its Subsidiaries during such fiscal year (other than sales
of inventory in the ordinary course of business), to the extent included in
arriving at such Consolidated Net Income.
"Excess Cash Flow Application Date": as defined in Section
2.11(c).
"Exchange Act": the Securities Exchange Act of 1934, as
amended.
"Excluded Subsidiary": (i) any Foreign Subsidiary, (ii) any
other Subsidiary if and at such time as the Borrower and its Subsidiaries own
Capital Stock representing less than 80% of the ordinary voting power of such
other Subsidiary, (iii) any Immaterial Subsidiary and (iv) any Finance
Subsidiary if the execution and delivery of any Loan Document by such Finance
Subsidiary would materially adversely affect the treatment of any Permitted
Receivables Financing as a true sale transaction.
"Facility": each of (a) the Tranche A Term Commitments and the
Tranche A Term Loans made thereunder (the "Tranche A Term Facility"), (b) the
Tranche B Term Commitments and the Tranche B Term Loans made thereunder (the
"Tranche B Term Facility"), (c) the Tranche C Term Commitments and the Tranche C
Term Loans made thereunder (the "Tranche C Term Facility"), (d) the Revolving
Commitments and the extensions of credit made thereunder (the "Revolving
Facility"), and (e) each other credit facility that may be added to this
Agreement after the date hereof.
<PAGE> 16
11
"Federal Funds Effective Rate": for any day, the weighted
average of the rates on overnight federal funds transactions with members of the
Federal Reserve System arranged by federal funds brokers, as published on the
next succeeding Business Day by the Federal Reserve Bank of New York, or, if
such rate is not so published for any day that is a Business Day, the average of
the quotations for the day of such transactions received by the Administrative
Agent from three federal funds brokers of recognized standing selected by it.
"Finance Subsidiary": Tenneco Automotive RSA Company and any
other Wholly Owned Subsidiary of the Borrower that is formed for the sole
purpose of engaging in Permitted Receivables Financings.
"Foreign Subsidiary": any Subsidiary of the Borrower that is
not a Domestic Subsidiary.
"Form S-4 Filing": the Registration Statement on Form S-4
filed by Packaging with the SEC on July 15, 1999 with respect to the Spin-Off
Transactions, as amended from time to time thereafter.
"Form 10 Filing": the General Form for Registration of
Securities on Form 10 filed by Packaging with the SEC on July 15, 1999 with
respect to the Spin-Off Transactions, as amended from time to time thereafter.
"Funded Debt": as to any Person, all Indebtedness of such
Person that matures more than one year from the date of its creation or matures
within one year from such date but is renewable or extendible, at the option of
such Person, to a date more than one year from such date or arises under a
revolving credit or similar agreement that obligates the lender or lenders to
extend credit during a period of more than one year from such date, including
all current maturities and current sinking fund payments in respect of such
Indebtedness whether or not required to be paid within one year from the date of
its creation and, in the case of the Borrower, Indebtedness in respect of the
Loans.
"Funding Date": the date on which the conditions precedent set
forth in Section 5.3 shall have been satisfied.
"Funding Office": the office of the Administrative Agent
specified in Section 10.2 or such other office as may be specified from time to
time by the Administrative Agent as its funding office by written notice to the
Borrower and the Lenders.
"GAAP": generally accepted accounting principles in the United
States as in effect from time to time, except that for purposes of Section 7.1
and the definition of "Applicable Prepayment Percentage," GAAP shall be
determined on the basis of such principles in effect on the date hereof and
consistent with those used in the preparation of the most recent audited
financial statements delivered pursuant to Section 4.1, provided that, if the
Borrower notifies the Administrative Agent within one year after the
effectiveness of any applicable Accounting Change (as defined below) that the
Borrower requests an amendment to any provision hereof to eliminate the effect
of such Accounting Change or in the application thereof
<PAGE> 17
12
on the operation of such provision (or if the Administrative Agent notifies the
Borrower within one year after the effectiveness of any such Accounting Change
that the Administrative Agent requests an amendment to any provision hereof for
such purpose), regardless of whether any such notice is given before or after
such Accounting Change or in the application thereof, then such provision shall
be interpreted on the basis of GAAP as in effect and applied immediately before
such Accounting Change shall have become effective until such notice shall have
been withdrawn or such provision amended in accordance herewith. "Accounting
Change" refers to a change after the date hereof in accounting principles
required by the promulgation of any rule, regulation, pronouncement or opinion
by the Financial Accounting Standards Board of the American Institute of
Certified Public Accountants or, if applicable, the SEC.
"Governmental Authority": any nation or government, any state
or other political subdivision thereof, any agency, authority, instrumentality,
regulatory body, court, central bank or other entity exercising executive,
legislative, judicial, taxing, regulatory or administrative functions of or
pertaining to government, any securities exchange and any self-regulatory
organization (including the National Association of Insurance Commissioners).
"Granting Bank": as defined in Section 10.6(d).
"Guarantee and Collateral Agreement": the Guarantee and
Collateral Agreement to be executed and delivered by the Borrower and each
Subsidiary Guarantor, substantially in the form of Exhibit A, as the same may be
amended, supplemented or otherwise modified from time to time.
"Guarantee Obligation": as to any Person (the "guaranteeing
person"), any obligation of (a) the guaranteeing person or (b) another Person
(including any bank under any letter of credit) to induce the creation of which
the guaranteeing person has issued a reimbursement, counter indemnity or similar
obligation, in either case guaranteeing or in effect guaranteeing any
Indebtedness, leases, dividends or other obligations (the "primary obligations")
of any other third Person (the "primary obligor") in any manner, whether
directly or indirectly, including any obligation of the guaranteeing person,
whether or not contingent, (i) to purchase any such primary obligation or any
property constituting direct or indirect security therefor, (ii) to advance or
supply funds (1) for the purchase or payment of any such primary obligation or
(2) to maintain working capital or equity capital of the primary obligor or
otherwise to maintain the net worth or solvency of the primary obligor, (iii) to
purchase property, securities or services primarily for the purpose of assuring
the owner of any such primary obligation of the ability of the primary obligor
to make payment of such primary obligation or (iv) otherwise to assure or hold
harmless the owner of any such primary obligation against loss in respect
thereof; provided, however, that the term Guarantee Obligation shall not include
endorsements of instruments for deposit or collection in the ordinary course of
business. The amount of any Guarantee Obligation of any guaranteeing person
shall be deemed to be the lower of (a) an amount equal to the stated or
determinable amount of the primary obligation in respect of which such Guarantee
Obligation is made and (b) the maximum amount for which such guaranteeing person
may be liable pursuant to the terms of the instrument embodying such Guarantee
Obligation, unless such primary obligation and the maximum amount for which such
guaranteeing person may be liable are not stated or determinable, in which case
the amount of such Guarantee Obligation shall be such
<PAGE> 18
13
guaranteeing person?s maximum reasonably anticipated liability in respect
thereof as determined by the Borrower in good faith.
"Guarantors": the collective reference to the Subsidiary
Guarantors and any other Person that guarantees payment of all or a portion of
the Obligations.
"Hedge Agreements": all interest rate swaps, caps or collar
agreements or similar arrangements dealing with interest rates or currency
exchange rates or the exchange of nominal interest obligations, either generally
or under specific contingencies.
"Immaterial Subsidiary": at any time, any Domestic Subsidiary
of the Borrower having total assets (as determined in accordance with GAAP) in
an amount of less than 1% of Consolidated Total Assets of the Borrower and its
Domestic Subsidiaries; provided, however, that the total assets (as so
determined) of all Immaterial Subsidiaries shall not exceed 5% of Consolidated
Total Assets of the Borrower and its Domestic Subsidiaries. In the event that
total assets of all Immaterial Subsidiaries exceed 5% of Consolidated Total
Assets of the Borrower and its Domestic Subsidiaries, the Borrower will
designate Domestic Subsidiaries which would otherwise constitute Immaterial
Subsidiaries to be excluded as Immaterial Subsidiaries until such 5% threshold
is met.
"Indebtedness": of any Person at any date, without
duplication, (a) all indebtedness of such Person for borrowed money, (b) all
obligations of such Person for the deferred purchase price of property or
services (other than any such obligations incurred in the ordinary course of
such Person?s business maturing less than one (1) year from the creation
thereof), (c) all obligations of such Person evidenced by notes, bonds,
debentures or other similar instruments (other than an operating lease,
synthetic lease or similar arrangement), (d) for the purposes of Sections 7.2
and 8(e) only, all indebtedness created or arising under any conditional sale or
other title retention agreement (other than an operating lease) with respect to
property acquired by such Person (even though the rights and remedies of the
seller or lender under such agreement in the event of default are limited to
repossession or sale of such property), (e) for the purposes of Sections 7.2 and
8(e) only, all Capital Lease Obligations of such Person, (f) for the purposes of
Sections 7.2 and 8(e) only, all obligations of such Person, contingent or
otherwise, as an account party under acceptances, surety bonds or similar
arrangements (other than obligations arising out of endorsements of instruments
for deposit or collection in the ordinary course of business), (g) all unpaid
reimbursement obligations of such Person in respect of drawings under letters of
credit and, for purposes of Sections 7.2 and 8(e) only, the face amount of all
letters of credit issued for the account of such Person, (h) for the purposes of
Sections 7.2 and 8(e) only, all Guarantee Obligations of such Person in respect
of obligations of the kind referred to in clauses (a) through (f) above, (i)
without limitation of the foregoing, all obligations of the kind referred to in
clauses (a) through (h) above secured by (or for which the holder of such
obligation has an existing right, contingent or otherwise, to be secured by) any
Lien on property (including accounts and contract rights) owned by such Person,
whether or not such Person has assumed or become liable for the payment of such
obligation, provided that the amount of any such obligation shall be deemed to
be the lesser of the face principal amount thereof and the fair market value of
the property subject to such Lien and (j) for the purposes of Sections 7.2 and
8(e) only, all obligations of such Person in respect of Hedge Agreements.
<PAGE> 19
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"Insolvency": with respect to any Multiemployer Plan, the
condition that such Plan is insolvent within the meaning of Section 4245 of
ERISA.
"Insolvent": pertaining to a condition of Insolvency.
"Intellectual Property": the collective reference to all
rights, priorities and privileges relating to intellectual property, whether
arising under United States, multinational or foreign laws or otherwise,
including copyrights, copyright licenses, patents, patent licenses, trademarks,
trademark licenses, technology, know-how and processes, and all rights to sue at
law or in equity for any infringement or other impairment thereof, including the
right to receive all proceeds and damages therefrom.
"Interest Payment Date": (a) as to any ABR Loan, the last day
of each March, June, September and December to occur while such Loan is
outstanding and the final maturity date of such Loan, (b) as to any Eurodollar
Loan having an Interest Period of three months or less, the last day of such
Interest Period, (c) as to any Eurodollar Loan having an Interest Period longer
than three months, each day that is three months, or a whole multiple thereof,
after the first day of such Interest Period and the last day of such Interest
Period and (d) as to any Loan (other than any Revolving Loan that is an ABR Loan
and any Swingline Loan), the date of any repayment or prepayment made in respect
thereof.
"Interest Period": as to any Eurodollar Loan, (a) initially,
the period commencing on the borrowing or conversion date, as the case may be,
with respect to such Eurodollar Loan and ending one, two, three or six months
thereafter, as selected by the Borrower in its notice of borrowing or notice of
conversion, as the case may be, given with respect thereto; and (b) thereafter,
each period commencing on the last day of the next preceding Interest Period
applicable to such Eurodollar Loan and ending one, two, three or six months
thereafter, as selected by the Borrower by irrevocable notice to the
Administrative Agent not less than three Business Days prior to the last day of
the then current Interest Period with respect thereto; provided that, all of the
foregoing provisions relating to Interest Periods are subject to the following:
(i) if any Interest Period would otherwise end on a
day that is not a Business Day, such Interest Period shall be extended
to the next succeeding Business Day unless the result of such extension
would be to carry such Interest Period into another calendar month in
which event such Interest Period shall end on the immediately preceding
Business Day;
(ii) the Borrower may not select an Interest Period
under a particular Facility that would extend beyond the Revolving
Termination Date or beyond the date final payment is due on the Tranche
A Term Loans, the Tranche B Term Loans or the Tranche C Term Loans, as
the case may be;
(iii) any Interest Period that begins on the last
Business Day of a calendar month (or on a day for which there is no
numerically corresponding day in the calendar
<PAGE> 20
15
month at the end of such Interest Period) shall end on the last
Business Day of a calendar month; and
(iv) the Borrower shall select Interest Periods so as not to
require a payment or prepayment of any Eurodollar Loan during an
Interest Period for such Loan.
"Investments": as defined in Section 7.8.
"Issuing Lender": Chase, Chase Manhattan Bank (Delaware) or
any other Lender which agrees to act as an Issuing Lender hereunder, in its
capacity as issuer of any Letter of Credit.
"Joint Venture": any Person in which the Borrower and/or its
Subsidiaries hold less than a majority of the Capital Stock, and which does not
constitute a Subsidiary of the Borrower, whether direct or indirect.
"L/C Fee Payment Date": the last day of each March, June,
September and December and the last day of the Revolving Commitment Period.
"L/C Obligations": at any time, an amount equal to the sum of
(a) the aggregate then undrawn and unexpired amount of the then outstanding
Letters of Credit and (b) the aggregate amount of drawings under Letters of
Credit that have not then been reimbursed pursuant to Section 3.5.
"L/C Participants": the collective reference to all the
Revolving Lenders other than the Issuing Lender.
"Lenders": as defined in the preamble hereto.
"Letters of Credit": as defined in Section 3.1(a).
"Lien": any mortgage, pledge, hypothecation, assignment,
deposit arrangement, encumbrance, lien (statutory or other), charge or other
security interest or any preference, priority or other security agreement or
preferential arrangement of any kind or nature whatsoever (including any
conditional sale or other title retention agreement and any capital lease having
substantially the same economic effect as any of the foregoing).
"Loan": any loan made by any Lender pursuant to this
Agreement.
"Loan Documents": this Agreement, the Security Documents and
the Notes.
"Loan Parties": the Borrower and each Subsidiary of the
Borrower that is a party to a Loan Document.
"Majority Facility Lenders": with respect to any Facility, the
holders of more than 50% of the aggregate unpaid principal amount of the Term
Loans or the Total Revolving
<PAGE> 21
16
Extensions of Credit, as the case may be, outstanding under such Facility (or,
in the case of the Revolving Facility, prior to any termination of the Revolving
Commitments, the holders of more than 50% of the Total Revolving Commitments).
"Material Adverse Effect": a material adverse effect on (a)
the Transaction or (b) the business, property, operations or condition
(financial or otherwise) of the Borrower and its Subsidiaries taken as a whole,
after giving effect to the Spin-Off Transactions.
"Materials of Environmental Concern": any gasoline or
petroleum (including crude oil or any fraction thereof) or petroleum products or
any hazardous or toxic substances, materials or wastes, defined or regulated as
such in or under any Environmental Law, including asbestos, polychlorinated
biphenyls and urea-formaldehyde insulation.
"Mortgaged Properties": the real properties listed on Schedule
1.1B, as to which the Administrative Agent for the benefit of the Lenders shall
be granted a Lien pursuant to the Mortgages, and any other real properties
required to be mortgaged pursuant to Section 6.10.
"Mortgages": each of the mortgages and deeds of trust made by
any Loan Party in favor of, or for the benefit of, the Administrative Agent for
the benefit of the Lenders, substantially in the form of Exhibit D (with such
changes thereto as shall be advisable under the law of the jurisdiction in which
such mortgage or deed of trust is to be recorded), as the same may be amended,
supplemented or otherwise modified from time to time.
"Multiemployer Plan": a Plan that is a multiemployer plan as
defined in Section 4001(a)(3) of ERISA.
"Net Cash Proceeds": (a) in connection with any Asset Sale or
any Recovery Event, the proceeds thereof in the form of cash and Cash
Equivalents (including any such proceeds received by way of deferred payment of
principal pursuant to a note or installment receivable or purchase price
adjustment receivable or otherwise, but only as and when received) of such Asset
Sale or Recovery Event, net of attorneys? fees, accountants? fees, investment
banking fees, amounts required to be applied to the repayment of Indebtedness
secured by a Lien expressly permitted hereunder on any asset that is the subject
of such Asset Sale or Recovery Event (other than any Lien pursuant to a Security
Document) and other fees and expenses actually incurred in connection therewith
and net of taxes paid or reasonably estimated to be payable as a result thereof
(after taking into account any available tax credits or deductions and any tax
sharing arrangements) and (b) in connection with any issuance or sale of Capital
Stock or any incurrence of Indebtedness, the cash proceeds received from such
issuance or incurrence, net of attorneys? fees, investment banking fees,
accountants? fees, underwriting discounts and commissions and other fees and
expenses actually incurred in connection therewith.
"Non-Excluded Taxes": as defined in Section 2.19(a).
"Non-U.S. Lender": as defined in Section 2.19(d).
"Notes": the collective reference to any promissory note
evidencing Loans.
<PAGE> 22
17
"Obligations": the unpaid principal of and interest on
(including interest accruing after the maturity of the Loans and Reimbursement
Obligations and interest accruing after the filing of any petition in
bankruptcy, or the commencement of any insolvency, reorganization or like
proceeding, relating to the Borrower, whether or not a claim for post-filing or
post-petition interest is allowed in such proceeding) the Loans and all other
obligations and liabilities of the Borrower to the Administrative Agent or to
any Lender (or, in the case of Hedge Agreements, any affiliate of any Lender),
whether direct or indirect, absolute or contingent, due or to become due, or now
existing or hereafter incurred, which may arise under, out of, or in connection
with, this Agreement, any other Loan Document, the Letters of Credit, any Hedge
Agreement entered into with any Lender or any affiliate of any Lender or any
other document made, delivered or given in connection herewith or therewith,
whether on account of principal, interest, reimbursement obligations, fees,
indemnities, costs, expenses (including all fees, charges and disbursements of
counsel to the Administrative Agent or to any Lender that are required to be
paid by the Borrower pursuant hereto) or otherwise.
"Other Taxes": any and all present or future stamp or
documentary taxes or any other excise or property taxes, charges or similar
levies arising from any payment made hereunder (exclusive of any franchise tax
or any tax assessment on the overall net income of a recipient) or from the
execution, delivery or enforcement of, or otherwise with respect to, this
Agreement or any other Loan Document.
"Packaging": as defined in the recitals hereto.
"Packaging Business": as defined in the Distribution
Agreement.
"Participant": as defined in Section 10.6(b).
"PBGC": the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA (or any successor).
"PCA": as defined in the recitals hereto.
"PCA IPO": as defined in the recitals hereto.
"Permitted Receivables Financing": (a) any sale by the
Borrower or a Domestic Subsidiary of accounts receivable to a Finance Subsidiary
intended to be (and which shall be treated for the purposes hereof as) a true
sale transaction with customary limited recourse based upon the collectibility
of the receivables sold and the corresponding sale or pledge of such accounts
receivable (or an interest therein) by the Finance Subsidiary, in each case
without any guarantee by the Borrower or any other Subsidiary thereof ,
provided, however, that (i) the terms, conditions and structure (including the
legal and organizational structure of the Finance Subsidiary and the
restrictions imposed on its activities) of and the documentation incident to any
such transactions entered into after the date hereof must be reasonably
acceptable to the Administrative Agent and (b) any sale or financing by any
Foreign Subsidiary to or with local buyers or lenders of accounts receivable in
the ordinary course of business, in each case without any guarantee by the
Borrower or any Domestic Subsidiary. The aggregate principal amount of
<PAGE> 23
18
the receivables sold or financed and which remain uncollected in all
transactions described in the preceding clauses (a) and (b) will not exceed
$150,000,000 at any time and from time to time.
"Person": an individual, partnership, corporation, limited
liability company, business trust, joint stock company, trust, unincorporated
association, joint venture, Governmental Authority or other entity of whatever
nature.
"Plan": at a particular time, any employee benefit plan that
is covered by ERISA and in respect of which the Borrower or a Commonly
Controlled Entity is (or, if such plan were terminated at such time, would under
Section 4069 of ERISA be deemed to be) an "employer" as defined in Section 3(5)
of ERISA.
"Pricing Grid": the pricing grid attached hereto as Annex A.
"Pro Forma Balance Sheet": as defined in Section 4.1(a).
"Properties": as defined in Section 4.17(a).
"Recovery Event": any settlement of or payment in respect of
any property or casualty insurance claim or any condemnation proceeding relating
to any asset of the Borrower or any of its Subsidiaries.
"Refunded Swingline Loans": as defined in Section 2.7.
"Refunding Date": as defined in Section 2.7.
"Register": as defined in Section 10.6(e).
"Regulation U": Regulation U of the Board as in effect from
time to time.
"Reimbursement Obligation": the obligation of the Borrower to
reimburse the Issuing Lender pursuant to Section 3.5 for amounts drawn under
Letters of Credit.
"Reinvestment Deferred Amount": with respect to any
Reinvestment Event, the aggregate Net Cash Proceeds received by the Borrower or
any of its Subsidiaries in connection therewith that are not applied to prepay
the Term Loans or reduce the Term Commitments pursuant to Section 2.11(b) as a
result of the delivery of a Reinvestment Notice.
"Reinvestment Event": any Asset Sale or Recovery Event in
respect of which the Borrower has delivered a Reinvestment Notice and for which
the Borrower or a Subsidiary has received the Net Cash Proceeds.
"Reinvestment Notice": a written notice executed by a
Responsible Officer stating that no Event of Default has occurred and is
continuing and that the Borrower (directly or indirectly through a Subsidiary)
intends and expects to use all or a specified portion of the Net Cash Proceeds
of an Asset Sale or Recovery Event to acquire assets useful in its business.
<PAGE> 24
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"Reinvestment Prepayment Amount": with respect to any
Reinvestment Event, the Reinvestment Deferred Amount relating thereto less any
amount expended prior to the relevant Reinvestment Prepayment Date to acquire
assets useful in the Borrower's business.
"Reinvestment Prepayment Date": with respect to any
Reinvestment Event, the earlier of (a) the date occurring 12 months after such
Reinvestment Event and (b) the date on which the Borrower shall have determined
not to acquire assets useful in the Borrower's business with all or any portion
of the relevant Reinvestment Deferred Amount.
"Reorganization": with respect to any Multiemployer Plan, the
condition that such plan is in reorganization within the meaning of Section 4241
of ERISA.
"Reportable Event": any of the events set forth in Section
4043(b) of ERISA, other than those events as to which the thirty day notice
period is waived under subsections .27, .28, .29, .30, .31, .32, .34 or .35 of
PBGC Reg. sec. 4043.
"Required Lenders": at any time, the holders of more than 50%
of (a) until the Funding Date, the Commitments then in effect and (b)
thereafter, the sum of (i) the aggregate unpaid principal amount of the Term
Loans then outstanding and (ii) the Total Revolving Commitments then in effect
or, if the Revolving Commitments have been terminated, the Total Revolving
Extensions of Credit then outstanding.
"Requirement of Law": as to any Person, the Certificate of
Incorporation and By-Laws or other organizational or governing documents of such
Person, and any law, treaty, rule or regulation or determination of an
arbitrator or a court or other Governmental Authority, in each case applicable
to or binding upon such Person or any of its property or to which such Person or
any of its property is subject.
"Responsible Officer": the chief executive officer, president
or chief financial officer of the Borrower or any other applicable Loan Party,
but in any event, with respect to financial matters, the chief financial
officer, Treasurer and Controller of the Borrower or such Loan Party, as the
case may be.
"Restricted Payments": as defined in Section 7.6.
"Revolving Commitment": as to any Lender, the obligation of
such Lender, if any, to make Revolving Loans and participate in Swingline Loans
and Letters of Credit in an aggregate principal and/or face amount not to exceed
the amount set forth under the heading "Revolving Commitment" opposite such
Lender's name on Schedule 1.1A or in the Assignment and Acceptance pursuant to
which such Lender became a party hereto, as the same may be changed from time to
time pursuant to the terms hereof. The original amount of the Total Revolving
Commitments is $500,000,000.
"Revolving Commitment Period": the period from and including
the Funding Date to the Revolving Termination Date.
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"Revolving Extensions of Credit": as to any Revolving Lender
at any time, an amount equal to the sum of (a) the aggregate principal amount of
all Revolving Loans held by such Lender then outstanding, (b) such Lender's
Revolving Percentage of the L/C Obligations then outstanding and (c) such
Lender's Revolving Percentage of the aggregate principal amount of Swingline
Loans then outstanding.
"Revolving Lender": each Lender that has a Revolving
Commitment or that holds Revolving Loans.
"Revolving Loans": as defined in Section 2.4(a).
"Revolving Percentage": as to any Revolving Lender at any
time, the percentage which such Lender's Revolving Commitment then constitutes
of the Total Revolving Commitments (or, at any time after the Revolving
Commitments shall have expired or terminated, the percentage which the aggregate
principal amount of such Lender's Revolving Loans then outstanding constitutes
of the aggregate principal amount of the Revolving Loans then outstanding).
"Revolving Termination Date": the date which is the sixth
anniversary of the Funding Date.
"SEC": the Securities and Exchange Commission, any successor
thereto and any analogous Governmental Authority.
"Security Documents": the collective reference to the
Guarantee and Collateral Agreement and all other security documents hereafter
delivered to the Administrative Agent granting a Lien on any property of any
Person to secure the obligations and liabilities of any Loan Party under any
Loan Document.
"Senior Subordinated Note Indenture": the Indenture to be
entered into by the Borrower and certain of its Subsidiaries in connection with
the issuance of the Senior Subordinated Notes, which shall contain the terms set
forth in the Preliminary Offering Memorandum therefor, with such changes as are
approved by the Administrative Agent, such approval not to unreasonably
withheld, together with all instruments and other agreements entered into by the
Borrower or such Subsidiaries in connection therewith, as the same may be
amended, supplemented or otherwise modified from time to time in accordance with
Section 7.9.
"Senior Subordinated Notes": the subordinated notes of the
Borrower issued on the Funding Date pursuant to the Senior Subordinated Note
Indenture.
"Signing Date": the date on which the conditions precedent set
forth in Section 5.1 shall have been satisfied.
"Single Employer Plan": any Plan that is covered by Title IV
of ERISA, but that is not a Multiemployer Plan.
<PAGE> 26
21
"Solvent": when used with respect to any Person, means that,
as of any date of determination, (a) the amount of the "present fair saleable
value" of the assets of such Person will, as of such date, exceed the amount of
all "liabilities of such Person, contingent or otherwise", as of such date, as
such quoted terms are determined in accordance with applicable federal and state
laws governing determinations of the insolvency of debtors, (b) the present fair
saleable value of the assets of such Person will, as of such date, be greater
than the amount that will be required to pay the liability of such Person on its
debts as such debts become absolute and matured, (c) such Person will not have,
as of such date, an unreasonably small amount of capital with which to conduct
its business, and (d) such Person will be able to pay its debts as they mature.
For purposes of this definition, (i) "debt" means liability on a "claim," and
(ii) "claim" means any (x) right to payment, whether or not such a right is
reduced to judgment, liquidated, unliquidated, fixed, contingent, matured,
unmatured, disputed, undisputed, legal, equitable, secured or unsecured or (y)
right to an equitable remedy for breach of performance if such breach gives rise
to a right to payment, whether or not such right to an equitable remedy is
reduced to judgment, fixed, contingent, matured or unmatured, disputed,
undisputed, secured or unsecured.
"SPC": as defined in Section 10.6(d).
"Specified Change of Control": a "Change of Control" as
defined in the Senior Subordinated Note Indenture.
"Spin-Off": as defined in the recitals hereto.
"Spin-Off Documents": collectively (i) the Distribution
Agreement and all schedules, exhibits and annexes thereto and all side letters
and agreements affecting the terms thereof or entered into in connection
therewith and (ii) the Ancillary Agreements (as defined in the Distribution
Agreement as in effect on the date hereof, in each case as amended, supplemented
or otherwise modified from time to time in accordance with Section 7.15.
"Spin-Off SEC Filings": the collective reference to the Form
S-4 Filing and the Form 10 Filing.
"Spin-Off Transactions": as defined in the recitals hereto.
"Stub Debt": as defined in subsection 2.11(a)(iv)
"Subsidiary": as to any Person, a corporation, partnership,
limited liability company or other entity of which shares of stock or other
ownership interests having ordinary voting power (other than stock or such other
ownership interests having such power only by reason of the happening of a
contingency) to elect a majority of the board of directors or other managers of
such corporation, partnership or other entity are at the time owned, or the
management of which is otherwise controlled, directly or indirectly through one
or more intermediaries, or both, by such Person. Unless otherwise qualified (i)
all references to a "Subsidiary" or to "Subsidiaries" in this Agreement shall
refer to a Subsidiary or Subsidiaries of the Borrower and (ii) each Finance
Subsidiary shall be deemed not to be a Subsidiary of the Borrower.
<PAGE> 27
22
"Subsidiary Guarantor": each Subsidiary of the Borrower other
than any Excluded Subsidiary.
"Swingline Commitment": the obligation of the Swingline Lender
to make Swingline Loans pursuant to Section 2.6 in an aggregate principal amount
at any one time outstanding not to exceed $50,000,000.
"Swingline Lender": Chase, in its capacity as the lender of
Swingline Loans.
"Swingline Loans": as defined in Section 2.6.
"Swingline Participation Amount": as defined in Section 2.7.
"Syndication Agent": as defined in the preamble hereto.
"Term Commitments": the collective reference to the Tranche A
Term Commitments, the Tranche B Term Commitments and the Tranche C Term
Commitments of the Lenders.
"Term Lenders": the collective reference to the Tranche A Term
Lenders, the Tranche B Term Lenders and the Tranche C Term Lenders.
"Term Loans": the collective reference to the Tranche A Term
Loans, Tranche B Term Loans and Tranche C Term Loans.
"Total Revolving Commitments": at any time, the aggregate
amount of the Revolving Commitments then in effect.
"Total Revolving Extensions of Credit": at any time, the
aggregate amount of the Revolving Extensions of Credit of the Revolving Lenders
outstanding at such time.
"Tranche A Final Maturity Date": the date which is the sixth
anniversary of the Funding Date.
"Tranche A Term Commitment": as to any Lender, the obligation
of such Lender, if any, to make a Tranche A Term Loan to the Borrower hereunder
in a principal amount not to exceed the amount set forth under the heading
"Tranche A Term Commitment" opposite such Lender's name on Schedule 1.1A. The
original aggregate amount of the Tranche A Term Commitments is $450,000,000.
"Tranche A Term Lender": each Lender that has a Tranche A Term
Commitment or is the holder of a Tranche A Term Loan.
"Tranche A Term Loan": as defined in Section 2.1.
<PAGE> 28
23
"Tranche A Term Percentage": as to any Tranche A Term Lender
at any time, the percentage which such Lender's Tranche A Term Commitment then
constitutes of the aggregate Tranche A Term Commitments (or, at any time after
the Funding Date, the percentage which the aggregate principal amount of such
Lender's Tranche A Term Loans then outstanding constitutes of the aggregate
principal amount of the Tranche A Term Loans then outstanding).
"Tranche B Final Maturity Date": the date which is the eighth
anniversary of the Funding Date.
"Tranche B Term Commitment": as to any Lender, the obligation
of such Lender, if any, to make a Tranche B Term Loan to the Borrower hereunder
in a principal amount not to exceed the amount set forth under the heading
"Tranche B Term Commitment" opposite such Lender's name on Schedule 1.1A. The
original aggregate amount of the Tranche B Term Commitments is $300,000,000.
"Tranche B Term Lender": each Lender that has a Tranche B Term
Commitment or that holds a Tranche B Term Loan.
"Tranche B Term Loan": as defined in Section 2.1.
"Tranche B Term Percentage": as to any Tranche B Term Lender
at any time, the percentage which such Lender's Tranche B Term Commitment then
constitutes of the aggregate Tranche B Term Commitments (or, at any time after
the Funding Date, the percentage which the aggregate principal amount of such
Lender's Tranche B Term Loans then outstanding constitutes of the aggregate
principal amount of the Tranche B Term Loans then outstanding); provided, that
solely for purposes of calculating the amount of each installment of Tranche B
Term Loans (other than the last installment) payable to a Tranche B Term Lender,
such Term Lender's Tranche B Term Percentage shall be calculated without giving
effect to any portion of any prior mandatory or optional prepayment attributable
to such Term Lender's Tranche B Term Loans that shall have been declined by such
Term Lender (or, in the case of any Term Lender that shall have acquired its
Tranche B Term Loans by assignment from another Person, by such other Person).
"Tranche C Final Maturity Date": the date which is eight and
one-half years after the Funding Date.
"Tranche C Term Commitment": as to any Lender, the obligation
of such Lender, if any, to make a Tranche C Term Loan to the Borrower hereunder
in a principal amount not to exceed the amount set forth under the heading
"Tranche C Term Commitment" opposite such Lender's name on Schedule 1.1A. The
original aggregate amount of the Tranche C Term Commitments is $300,000,000.
"Tranche C Term Lender": each Lender that has a Tranche C Term
Commitment or that holds a Tranche C Term Loan.
"Tranche C Term Loan": as defined in Section 2.1.
<PAGE> 29
24
"Tranche C Term Percentage": as to any Tranche C Term Lender
at any time, the percentage which such Lender's Tranche C Term Commitment then
constitutes of the aggregate Tranche C Term Commitments (or, at any time after
the Funding Date, the percentage which the aggregate principal amount of such
Lender's Tranche C Term Loans then outstanding constitutes of the aggregate
principal amount of the Tranche C Term Loans then outstanding); provided, that
solely for purposes of calculating the amount of each installment of Tranche C
Term Loans (other than the last installment) payable to a Tranche C Term Lender,
such Term Lender's Tranche C Term Percentage shall be calculated without giving
effect to any portion of any prior mandatory or optional prepayment attributable
to such Term Lender's Tranche C Term Loans that shall have been declined by such
Term Lender (or, in the case of any Term Lender that shall have acquired its
Tranche C Term Loans by assignment from another Person, by such other Person).
"Transaction": the collective reference to (i) the Spin-Off
and the other Spin-Off Transactions (exclusive of the PCA IPO), (ii) the
issuance of the Senior Subordinated Notes and the use of the proceeds thereof
and (iii) the entering into, and creating security interests in Collateral
under, the Loan Documents and the use of the proceeds of the Loans.
"Transferee": any Assignee or Participant.
"Type": as to any Loan, its nature as an ABR Loan or a
Eurodollar Loan.
"United States": the United States of America.
"Wholly Owned Subsidiary": as to any Person, any other Person
all of the Capital Stock of which (other than directors' qualifying shares
required by law) is owned by such Person directly and/or through other Wholly
Owned Subsidiaries.
"Wholly Owned Subsidiary Guarantor": any Subsidiary Guarantor
that is a Wholly Owned Subsidiary of the Borrower.
1.2 Other Definitional Provisions. (a) Unless otherwise
specified therein, all terms defined in this Agreement shall have the defined
meanings when used in the other Loan Documents or any certificate or other
document made or delivered pursuant hereto or thereto.
(b) As used herein and in the other Loan Documents, and any
certificate or other document made or delivered pursuant hereto or thereto, (i)
accounting terms relating to the Borrower and its Subsidiaries not defined in
Section 1.1 and accounting terms partly defined in Section 1.1, to the extent
not defined, shall have the respective meanings given to them under GAAP, (ii)
the words "include," "includes" and "including" shall be deemed to be followed
by the phrase "without limitation," (iii) the word "incur" shall be construed to
mean incur, create, issue, assume, become liable in respect of or suffer to
exist (and the words "incurred" and "incurrence" shall have correlative
meanings), and (iv) the words "asset" and "property" shall be construed to have
the same meaning and effect and to refer to any and all tangible and intangible
assets and properties, including cash, Capital Stock, securities, revenues,
accounts, leasehold interests and contract rights.
<PAGE> 30
25
(c) The words "hereof," "herein" and "hereunder" and words of
similar import when used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement, and Section,
Schedule and Exhibit references are to this Agreement unless otherwise
specified.
(d) The meanings given to terms defined herein shall be
equally applicable to both the singular and plural forms of such terms.
SECTION 2. AMOUNT AND TERMS OF COMMITMENTS
2.1 Term Commitments. Subject to the terms and conditions
hereof, (a) each Tranche A Term Lender severally agrees to make a term loan (a
"Tranche A Term Loan") to the Borrower on the Funding Date in an amount
requested by the Borrower not to exceed the amount of the Tranche A Term
Commitment of such Lender, (b) each Tranche B Term Lender severally agrees to
make a term loan (a "Tranche B Term Loan") to the Borrower on the Funding Date
in an amount requested by the Borrower not to exceed the amount of the Tranche B
Term Commitment of such Lender and (c) each Tranche C Term Lender severally
agrees to make a term loan (a "Tranche C Term Loan") to the Borrower on the
Funding Date in an amount requested by the Borrower not to exceed the amount of
the Tranche C Term Commitment of such Lender. The Term Loans may from time to
time be Eurodollar Loans or ABR Loans, as determined by the Borrower and
notified to the Administrative Agent in accordance with Sections 2.2 and 2.12.
2.2 Procedure for Term Loan Borrowing. The Borrower shall give
the Administrative Agent irrevocable notice (which notice must be received by
the Administrative Agent prior to 10:00 a.m., New York City time, one Business
Day prior to the anticipated Funding Date in the case of ABR Loans or three
Business Days prior to the anticipated Funding Date in the case of Eurodollar
Loans) requesting that the Term Lenders make the Term Loans on the Funding Date
and specifying the amount to be borrowed. Upon receipt of such notice the
Administrative Agent shall promptly notify each Term Lender thereof. Not later
than 12:00 Noon, New York City time, on the Funding Date each Term Lender shall
make available to the Administrative Agent at the Funding Office an amount in
immediately available funds equal to the Term Loan or Term Loans to be made by
such Lender. The Administrative Agent shall credit the account of the Borrower
on the books of such office of the Administrative Agent with the aggregate of
the amounts made available to the Administrative Agent by the Term Lenders in
immediately available funds. The proceeds of the Term Loans will then be
promptly made available to the Borrower by the Administrative Agent by wire
transfer in accordance with written instructions provided to the Administrative
Agent by the Borrower.
2.3 Repayment of Term Loans. (a) The Tranche A Term Loan of
each Tranche A Lender shall be payable in 18 consecutive equal quarterly
installments, commencing on September 30, 2001, with the last installment being
made on the Revolving Termination Date, each of which installments shall be in
an amount equal to such Lender's Tranche A Term Percentage multiplied by the
amount of $25,000,000.
<PAGE> 31
26
(b) The Tranche B Term Loan of each Tranche B Term Lender
shall be payable in 26 consecutive quarterly installments, commencing on
September 30, 2001, each of which shall be in an amount equal to such Lender's
Tranche B Term Percentage multiplied by the amount set forth below opposite such
installment:
<TABLE>
<CAPTION>
Installment Amount Installment Amount
<S> <C> <C> <C>
September 30, 2001 $750,000 March 31, 2005 $750,000
December 31, 2001 $750,000 June 30, 2005 $750,000
September 30, 2005 $750,000
March 31, 2002 $750,000 December 31, 2005 $750,000
June 30, 2002 $750,000
September 30, 2002 $750,000 March 31, 2006 $750,000
December 31, 2002 $750,000 June 30, 2006 $750,000
September 30, 2006 $750,000
March 31, 2003 $750,000 December 31, 2006 $750,000
June 30, 2003 $750,000
September 30, 2003 $750,000 March 31, 2007 $70,875,000
December 31, 2003 $750,000 June 30, 2007 $70,875,000
September 30, 2007 $70,875,000
March 31, 2004 $750,000 Tranche B Final Maturity Date $70,875,000
June 30, 2004 $750,000
September 30, 2004 $750,000
December 31, 2004 $750,000
</TABLE>
(c) The Tranche C Term Loan of each Tranche C Term Lender
shall be payable in 28 consecutive quarterly installments, commencing on
September 30, 2001, each of which shall be in an amount equal to such Lender's
Tranche C Term Percentage multiplied by the amount set forth below opposite such
installment:
<TABLE>
<CAPTION>
Installment Amount Installment Amount
<S> <C> <C> <C>
September 30, 2001 $750,000 March 31, 2005 $750,000
December 31, 2001 $750,000 June 30, 2005 $750,000
September 30, 2005 $750,000
March 31, 2002 $750,000 December 31, 2005 $750,000
June 30, 2002 $750,000
September 30, 2002 $750,000 March 31, 2006 $750,000
December 31, 2002 $750,000 June 30, 2006 $750,000
September 30, 2006 $750,000
</TABLE>
<PAGE> 32
27
<TABLE>
<S> <C> <C>
March 31, 2003 $750,000 December 31, 2006 $750,000
June 30, 2003 $750,000
September 30, 2003 $750,000 March 31, 2007 $750,000
December 31, 2003 $750,000 June 30, 2007 $750,000
September 30, 2007 $750,000
March 31, 2004 $750,000 December 31, 2007 $750,000
June 30, 2004 $750,000
September 30, 2004 $750,000 March 31, 2008 $140,250,000
December 31, 2004 $750,000 Tranche C Final Maturity Date $140,250,000
</TABLE>
(d) In the event the Tranche A Term Commitments, Tranche B
Term Commitments or Tranche C Term Commitments are reduced on or prior to the
Funding Date in accordance with Section 2.11(a) or (b), each of the applicable
principal installment amounts set forth in this Section 2.3 shall be ratably
reduced.
2.4 Revolving Commitments. (a) Subject to the terms and
conditions hereof, each Revolving Lender severally agrees to make revolving
credit loans ("Revolving Loans") to the Borrower from time to time at the
Borrower's request during the Revolving Commitment Period in an aggregate
principal amount at any one time outstanding which, when added to such Lender's
Revolving Percentage of the sum of (i) the L/C Obligations then outstanding and
(ii) the aggregate principal amount of the Swingline Loans then outstanding does
not exceed the amount of such Lender's Revolving Commitment. During the
Revolving Commitment Period the Borrower may use the Revolving Commitments by
borrowing, prepaying the Revolving Loans in whole or in part, and reborrowing,
all in accordance with the terms and conditions hereof. The Revolving Loans may
from time to time be Eurodollar Loans or ABR Loans, as determined by the
Borrower and notified to the Administrative Agent in accordance with Sections
2.5 and 2.12.
(b) The Borrower shall repay all outstanding Revolving Loans
on the Revolving Termination Date.
2.5 Procedure for Revolving Loan Borrowing. The Borrower may
borrow under the Revolving Commitments during the Revolving Commitment Period on
any Business Day, provided that the Borrower shall give the Administrative Agent
irrevocable notice (which notice must be received by the Administrative Agent
(a) prior to 12:00 Noon, New York City time, three Business Days prior to the
requested Borrowing Date, in the case of Eurodollar Loans, or (b) prior to 12:00
Noon, New York City time one Business Day prior to the requested Borrowing Date
(or, if same day borrowing is requested, prior to 10:00 a.m., New York City
time, on the requested Borrowing Date), in the case of ABR Loans), specifying
(i) the amount and Type of Revolving Loans to be borrowed, (ii) the requested
Borrowing Date and (iii) in the case of Eurodollar Loans, the respective amounts
of each such Type of Loan and the respective lengths of the initial Interest
Period therefor. Each borrowing under the Revolving Commitments shall be in an
amount equal to (x) in the case of ABR Loans, $1,000,000 or a whole multiple
thereof (or, if the then aggregate Available Revolving Commitments are less than
$1,000,000, such lesser amount) and (y) in the case of Eurodollar Loans,
$5,000,000 or a whole multiple of
<PAGE> 33
28
$1,000,000 in excess thereof; provided, that the Swingline Lender may request,
on behalf of the Borrower, borrowings under the Revolving Commitments that are
ABR Loans in other amounts pursuant to Section 2.7. Upon receipt of any such
notice from the Borrower, the Administrative Agent shall promptly notify each
Revolving Lender thereof. Each Revolving Lender will make the amount of its pro
rata share of each borrowing available to the Administrative Agent for the
account of the Borrower at the Funding Office prior to 12:00 Noon, New York City
time, on the Borrowing Date requested by the Borrower in funds immediately
available to the Administrative Agent. Such borrowing will then be made
available to the Borrower by the Administrative Agent crediting the account of
the Borrower on the books of such office with the aggregate of the amounts made
available to the Administrative Agent by the Revolving Lenders and in like funds
as received by the Administrative Agent.
2.6 Swingline Commitment. (a) Subject to the terms and
conditions hereof, the Swingline Lender agrees to make a portion of the credit
otherwise available to the Borrower under the Revolving Commitments from time to
time during the Revolving Commitment Period by making swing line loans
("Swingline Loans") to the Borrower; provided that (i) the aggregate principal
amount of Swingline Loans outstanding at any time shall not exceed the Swingline
Commitment then in effect (notwithstanding that the Swingline Loans outstanding
at any time, when aggregated with the Swingline Lender's other outstanding
Revolving Loans hereunder, may exceed the Swingline Commitment then in effect)
and (ii) the Borrower shall not request, and the Swingline Lender shall not
make, any Swingline Loan if, after giving effect to the making of such Swingline
Loan, the aggregate amount of the Available Revolving Commitments would be less
than zero. During the Revolving Commitment Period, the Borrower may use the
Swingline Commitment by borrowing, repaying and reborrowing, all in accordance
with the terms and conditions hereof. Swingline Loans shall be ABR Loans only.
(b) The Borrower shall repay all outstanding Swingline Loans
on the Revolving Termination Date.
2.7 Procedure for Swingline Borrowing; Refunding of Swingline
Loans. (a) Whenever the Borrower desires that the Swingline Lender make
Swingline Loans it shall give the Swingline Lender irrevocable telephonic notice
confirmed promptly in writing (which telephonic notice must be received by the
Swingline Lender not later than 1:00 p.m., New York City time, on the proposed
Borrowing Date), specifying (i) the amount to be borrowed and (ii) the requested
Borrowing Date (which shall be a Business Day during the Revolving Commitment
Period). Each borrowing under the Swingline Commitment shall be in an amount
equal to $100,000 or a whole multiple of $100,000 in excess thereof. Not later
than 3:00 p.m., New York City time, on the Borrowing Date specified in a notice
in respect of Swingline Loans, the Swingline Lender shall make available to the
Administrative Agent at the Funding Office an amount in immediately available
funds equal to the amount of the Swingline Loan to be made by the Swingline
Lender. The Administrative Agent shall make the proceeds of such Swingline Loan
available to the Borrower on such Borrowing Date by depositing such proceeds in
the account of the Borrower with the Administrative Agent on such Borrowing Date
in immediately available funds.
<PAGE> 34
29
(b) The Swingline Lender, at any time and from time to time in
its sole and absolute discretion may, on behalf of the Borrower (which hereby
irrevocably directs the Swingline Lender to act on its behalf), on one Business
Day's notice given by the Swingline Lender no later than 12:00 Noon, New York
City time, request each Revolving Lender to make, and each Revolving Lender
hereby agrees to make, a Revolving Loan, in an amount equal to such Revolving
Lender's Revolving Percentage of the aggregate amount of the Swingline Loans
(the "Refunded Swingline Loans") outstanding on the date of such notice, to
repay the Swingline Lender. Each Revolving Lender shall make the amount of such
Revolving Loan available to the Administrative Agent at the Funding Office in
immediately available funds, not later than 10:00 a.m., New York City time, one
Business Day after the date of such notice. The proceeds of such Revolving Loans
shall be immediately made available by the Administrative Agent to the Swingline
Lender for application by the Swingline Lender to the repayment of the Refunded
Swingline Loans. The Borrower irrevocably authorizes the Swingline Lender to
charge the Borrower's accounts with the Administrative Agent (up to the amount
available in each such account) in order to immediately pay the amount of such
Refunded Swingline Loans to the extent amounts received from the Revolving
Lenders are not sufficient to repay in full such Refunded Swingline Loans.
(c) If prior to the time a Revolving Loan would have otherwise
been made pursuant to Section 2.7(b), one of the events described in Section
8(f) shall have occurred and be continuing with respect to the Borrower or if
for any other reason, as determined by the Swingline Lender in its sole
discretion, Revolving Loans may not be made as contemplated by Section 2.7(b),
each Revolving Lender shall, on the date such Revolving Loan was to have been
made pursuant to the notice referred to in Section 2.7(b) (the "Refunding
Date"), purchase for cash an undivided participating interest in the then
outstanding Swingline Loans by paying to the Swingline Lender an amount (the
"Swingline Participation Amount") equal to (i) such Revolving Lender's Revolving
Percentage times (ii) the sum of the aggregate principal amount of Swingline
Loans then outstanding that were to have been repaid with such Revolving Loans.
(d) Whenever, at any time after the Swingline Lender has
received from any Revolving Lender such Lender's Swingline Participation Amount,
the Swingline Lender receives any payment on account of the Swingline Loans, the
Swingline Lender will distribute to such Lender its Swingline Participation
Amount (appropriately adjusted, in the case of interest payments, to reflect the
period of time during which such Lender's participating interest was outstanding
and funded and, in the case of principal and interest payments, to reflect such
Lender's pro rata portion of such payment if such payment is not sufficient to
pay the principal of and interest on all Swingline Loans then due); provided,
however, that in the event that such payment received by the Swingline Lender is
required to be returned, such Revolving Lender will return to the Swingline
Lender any portion thereof previously distributed to it by the Swingline Lender.
(e) Each Revolving Lender's obligation to make the Loans
referred to in Section 2.7(b) and to purchase participating interests pursuant
to Section 2.7(c) shall be absolute and unconditional and shall not be affected
by any circumstance, including (i) any setoff, counterclaim, recoupment, defense
or other right that such Revolving Lender or the Borrower may have against the
Swingline Lender, the Borrower or any other Person for any reason
<PAGE> 35
30
whatsoever; (ii) the occurrence or continuance of a Default or an Event of
Default or the failure to satisfy any of the other conditions specified in
Section 5; (iii) any adverse change in the condition (financial or otherwise) of
the Borrower; (iv) any breach of this Agreement or any other Loan Document by
the Borrower, any other Loan Party or any other Revolving Lender; or (v) any
other circumstance, happening or event whatsoever, whether or not similar to any
of the foregoing.
2.8 Commitment Fees, etc. (a) The Borrower agrees to pay to
the Administrative Agent for the account of each Lender a commitment fee for the
period from and including the Signing Date to the last day of the Revolving
Commitment Period, computed at the Commitment Fee Rate on the average daily
unused portion of (i) the Revolving Commitment, the Tranche A Term Commitment,
the Tranche B Term Commitment and the Tranche C Term Commitment of such Lender
prior to the Funding Date and (ii) the Available Revolving Commitment of such
Lender thereafter, in each case during the period for which payment is made,
payable on the Funding Date and thereafter quarterly in arrears on the last day
of each March, June, September and December and on the Revolving Termination
Date, commencing on the first of such dates to occur after the Funding Date.
(b) The Borrower agrees to pay to the Administrative Agent the
fees in the amounts and on the dates previously agreed to in writing by the
Borrower and the Administrative Agent.
2.9 Termination or Reduction of Commitments. (a) The Borrower
shall have the right prior to the Funding Date, upon not less than three
Business Days'R notice to the Administrative Agent, to terminate the Tranche A
Term Commitments, the Tranche B Term Commitments and/or the Tranche C Term
Commitments or, from time to time, to reduce the amount of the Tranche A Term
Commitments, Tranche B Term Commitments or Tranche C Term Commitments. Any such
reduction shall be in an amount equal to $1,000,000 or a whole multiple thereof
and shall permanently reduce the applicable Commitments then in effect.
(b) The Borrower shall have the right, upon not less than
three Business Days' notice to the Administrative Agent, to terminate the
Revolving Commitments or, from time to time, to reduce the amount of the
Revolving Commitments; provided that no such termination or reduction of
Revolving Commitments shall be permitted if, after giving effect thereto and to
any prepayments of the Revolving Loans and Swingline Loans made on the effective
date thereof, the Total Revolving Extensions of Credit would exceed the Total
Revolving Commitments. Any such reduction shall be in an amount equal to
$1,000,000, or a whole multiple thereof, and shall reduce permanently the
Revolving Commitments then in effect.
2.10 Optional Prepayments. The Borrower may at any time and
from time to time prepay the Loans, in whole or in part, without premium or
penalty (except as set forth below), upon irrevocable notice delivered to the
Administrative Agent at least three Business Days prior thereto in the case of
Eurodollar Loans and at least one Business Day prior thereto in the case of ABR
Loans, which notice shall specify the date and amount of prepayment and whether
the prepayment is of Eurodollar Loans or ABR Loans; provided, that if a
Eurodollar Loan is prepaid on any day other than the last day of the Interest
Period applicable thereto, the
<PAGE> 36
31
Borrower shall also pay any amounts owing pursuant to Section 2.20 provided,
however, that the Tranche B Term Loans and the Tranche C Term Loans may only be
prepaid at a price equal to (i) 102% of the principal amount thereof prior to
the first anniversary of the Funding Date and (ii) 101% of the principal amount
thereof on or after the first anniversary and prior to the second anniversary of
the Funding Date. Upon receipt of any such notice the Administrative Agent shall
promptly notify each relevant Lender thereof. If any such notice is given, the
amount specified in such notice shall be due and payable on the date specified
therein, together with (except in the case of Revolving Loans that are ABR Loans
and Swingline Loans) accrued interest to such date on the amount prepaid.
Partial prepayments of Term Loans and Revolving Loans shall be in an aggregate
principal amount of $1,000,000 or a whole multiple thereof. Partial prepayments
of Swingline Loans shall be in an aggregate principal amount of $100,000 or a
whole multiple thereof. Any optional prepayments of the Term Loans shall be
applied to the Tranche A Term Loans, Tranche B Term Loans and Tranche C Term
Loans, ratably based on the respective outstanding principal amounts thereof,
subject to Section 2.11(e).
2.11 Mandatory Prepayments and Commitment Reductions. (a) (i)
If any Capital Stock or Indebtedness shall be issued or incurred by the Borrower
or any of its Subsidiaries after the Funding Date (excluding (A) any Capital
Stock issued by the Borrower in connection with employee compensation
arrangements, and (B) any Indebtedness incurred in accordance with Section 7.2),
an amount equal to the Applicable Prepayment Percentage of the Net Cash Proceeds
thereof shall be applied on the date of such issuance or incurrence toward the
prepayment of the Term Loans as set forth in Section 2.11(d).
(ii) Notwithstanding the foregoing paragraph (i), if the PCA
IPO occurs on or prior to the Funding Date, the Borrower shall be entitled to
retain and hold in escrow for such purpose a portion of the Net Cash Proceeds
thereof required to satisfy any tax liabilities in connection therewith within
12 months of the Funding Date and the balance of any such Net Cash Proceeds held
in escrow for such tax liabilities not used to pay taxes due to the PCA IPO
within 12 months of the Funding Date shall be applied first, to repay any
outstanding Revolving Loans (without reducing the Total Revolving Commitments)
and, second, to reduce the Tranche A Term Commitments, the Tranche B Term
Commitments and the Tranche C Term Commitments, ratably based on the respective
principal amounts thereof.
(iii) Notwithstanding the foregoing paragraph (i), if the
Senior Subordinated Notes are issued in an aggregate principal amount in excess
of $500,000,000, then the Net Cash Proceeds of such excess shall be applied to
reduce the Term Commitments on the Funding Date (or, if such issuance occurs
after the Funding Date, to repay Term Loans on such later date) as follows: 50%
of such amount shall be applied to reduce the Tranche A Term Commitments (or
prepay Tranche A Term Loans); 25% of such amount shall be applied to reduce the
Tranche B Term Commitments (or prepay Tranche B Term Loans); and 25% of such
amount shall be applied to reduce the Tranche C Term Commitments (or prepay
Tranche C Term Loans) unless the Required Lenders agree to a different
allocation.
(iv) Notwithstanding the foregoing paragraph (i), if any
indebtedness with respect to the existing publicly traded notes and debentures
of the Borrower intended to be paid in full and canceled or realigned through
the Spin-Off is not paid in full and canceled or realigned (such
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remaining indebtedness, the "Stub Debt") on the Funding Date, then the
Term Commitments shall be reduced on the Funding Date in an aggregate amount
equal to the aggregate amount of the Stub Debt in excess of $150,000,000 as
follows: 50% of such amount shall be applied to reduce the Tranche A Term
Commitments; 25% of such amount shall be applied to reduce the Tranche B Term
Commitments; and 25% of such amount shall be applied to reduce the Tranche C
Term Commitments unless the Required Lenders agree to a different allocation.
(b) (i) If on any date on or after the Funding Date the
Borrower or any of its Subsidiaries shall receive Net Cash Proceeds from any
Asset Sale or Recovery Event then, unless a Reinvestment Notice shall be
delivered in respect thereof, the Applicable Prepayment Percentage of such Net
Cash Proceeds shall be applied on such date toward the prepayment of the Term
Loans as set forth in Section 2.11(d); provided that, notwithstanding the
foregoing, on each Reinvestment Prepayment Date, an amount equal to the
Reinvestment Prepayment Amount with respect to the relevant Reinvestment Event
shall be applied toward the prepayment of the Term Loans as set forth in Section
2.11(d).
(ii) If the Borrower or any of its Subsidiaries (other than
the Packaging Business) shall receive Net Cash Proceeds from Asset Sales and
Recovery Events (other than in connection with the corporate restructuring of
the Borrower as part of the Spin-Off Transactions set forth in the Distribution
Agreement) during the period from July 8, 1999 to but excluding the Funding Date
in excess of $50,000,000, then on each date on which any such excess Net Cash
Proceeds are received, unless a Reinvestment Notice shall be delivered in
respect thereof, such Net Cash Proceeds shall be applied on such date to reduce
the Tranche A Term Commitments, the Tranche B Term Commitments and the Tranche C
Term Commitments, ratably based on the respective principal amounts thereof;
provided that, notwithstanding the foregoing, on each Reinvestment Prepayment
Date, an amount equal to the Reinvestment Prepayment Amount with respect to the
Reinvestment Event shall be applied toward reduction of the Tranche A Term
Commitments, Tranche B Term Commitments or Tranche C Term Commitments, as
provided above, or, if after the Funding Date, to the prepayment of the Term
Loans as set forth in Section 2.11(d).
(c) If, for any fiscal year of the Borrower commencing with
the fiscal year ending December 31, 2000, there shall be Excess Cash Flow, the
Borrower shall, on the relevant Excess Cash Flow Application Date, apply the
Applicable Prepayment Percentage of such Excess Cash Flow toward the prepayment
of the Term Loans as set forth in Section 2.11(d). Each such prepayment shall be
made on a date (an "Excess Cash Flow Application Date") no later than five days
after the earlier of (i) the date on which the financial statements of the
Borrower referred to in Section 6.1(a), for the fiscal year with respect to
which such prepayment is made, are required to be delivered to the Lenders and
(ii) the date such financial statements are actually delivered.
(d) The application of any prepayment pursuant to Section 2.11
shall be made within any Facility, first, to ABR Loans and second, to Eurodollar
Loans. Each prepayment of the Loans under Section 2.11 shall be accompanied by
accrued interest to the date of such prepayment on the amount prepaid. Except as
provided in Sections 2.11(a)(iii) and 2.11(a)(iv), prepayments of the Term Loans
shall be applied as set forth in Section 2.17(b).
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33
(e) Notwithstanding anything to the contrary in Section 2.10,
2.11(d) or 2.17, with respect to the amount of any optional prepayment described
in Section 2.10 (at the Borrower's option) or with respect to the amount of any
mandatory prepayment described in Section 2.11, in each case that would be
allocated to Tranche B Term Loans or Tranche C Term Loans (such amounts, the
"Tranche B Prepayment Amount" and the "Tranche C Prepayment Amount,"
respectively), at any time when Tranche A Term Loans remain outstanding, the
Borrower will, in lieu of applying such amount to the prepayment of Tranche B
Term Loans and Tranche C Term Loans, respectively, as provided in paragraph (d)
above, on the date specified in Section 2.11 for such prepayment, give the
Administrative Agent telephonic notice (promptly confirmed in writing)
requesting that the Administrative Agent prepare and provide to each Tranche B
Term Lender and Tranche C Term Lender a notice (each, a "Prepayment Option
Notice") as described below. As promptly as practicable after receiving such
notice from the Borrower, the Administrative Agent will send to each Tranche B
Term Lender and Tranche C Term Lender a Prepayment Option Notice, which shall be
in the form of Exhibit G, and shall include an offer by the Borrower to prepay
on the date (each an "Applicable Prepayment Date") that is five Business Days
after the date of the Prepayment Option Notice, the relevant Term Loans of such
Lender by an amount equal to the portion of the Prepayment Amount indicated in
such Lender's Prepayment Option Notice as being applicable to such Lender's
Tranche B Term Loans or Tranche C Term Loans, as the case may be. Each Tranche B
Term Lender and Tranche C Term Lender shall give notice to the Administrative
Agent prior to the Applicable Prepayment Date if it elects to accept such
prepayment, and each Tranche B Term Lender and Tranche C Term Lender which has
not notified the Administrative Agent of whether or not it elects to accept such
prepayment shall be deemed to have accepted such prepayment. On the Applicable
Prepayment Date (i) the Borrower shall pay to the relevant Tranche B Term
Lenders and Tranche C Term Lenders the aggregate amount necessary to prepay that
portion of the outstanding relevant Term Loans in respect of which such Lenders
have accepted prepayment as described above and (ii) the Borrower shall pay to
the Tranche A Term Lenders an amount equal to the portion of the Tranche B
Prepayment Amount and the Tranche C Prepayment Amount not accepted by the
relevant Lenders, and such amount shall be applied to the prepayment of the
Tranche A Term Loans.
2.12 Conversion and Continuation Options. (a) The Borrower may
elect from time to time to convert Eurodollar Loans to ABR Loans by giving the
Administrative Agent at least two Business Days' prior irrevocable notice of
such election, provided that any such conversion of Eurodollar Loans may only be
made on the last day of an Interest Period with respect thereto. The Borrower
may elect from time to time to convert ABR Loans to Eurodollar Loans by giving
the Administrative Agent at least three Business Days' prior irrevocable notice
of such election (which notice shall specify the length of the initial Interest
Period therefor), provided that no ABR Loan under a particular Facility may be
converted into a Eurodollar Loan when any Event of Default has occurred and is
continuing and the Administrative Agent or the Majority Facility Lenders in
respect of such Facility have determined in its or their sole discretion not to
permit such conversions. Upon receipt of any such notice the Administrative
Agent shall promptly notify each relevant Lender thereof.
(b Any Eurodollar Loan which is a Term Loan shall be continued
as such upon the expiration of the then current Interest Period with respect
thereto unless the Borrower gives
<PAGE> 39
34
irrevocable notice to the Administrative Agent, in accordance with the
applicable provisions of the term "Interest Period" set forth in Section 1.1, of
a different length of the next Interest Period to be applicable to such Loans or
elects to convert such Loan to an ABR Loan, provided that no Eurodollar Loan
under a particular Facility may be continued as such when any Event of Default
has occurred and is continuing and the Administrative Agent has or the Majority
Facility Lenders in respect of such Facility have determined in its or their
sole discretion not to permit such continuations, and provided, further, that if
such continuation is not permitted pursuant to the preceding proviso such Loans
shall be automatically converted to ABR Loans on the last day of such then
expiring Interest Period. Any Eurodollar Loan which is a Revolving Loan may be
continued as such upon the expiration of the then current Interest Period with
respect thereto by the Borrower giving irrevocable notice to the Administrative
Agent, in accordance with the applicable provisions of the term "Interest
Period" set forth in Section 1.1, of the length of the next Interest Period to
be applicable to such Loans, provided that no Eurodollar Loan under a particular
Facility may be continued as such when any Event of Default has occurred and is
continuing and the Administrative Agent has or the Majority Facility Lenders in
respect of such Facility have determined in its or their sole discretion not to
permit such continuations, and provided, further, that if the Borrower shall
fail to give any required notice as described above in this paragraph or if such
continuation is not permitted pursuant to the preceding proviso such Loans shall
be automatically converted to ABR Loans on the last day of such then expiring
Interest Period. Upon receipt of any such notice the Administrative Agent shall
promptly notify each relevant Lender thereof.
2.13 Limitations on Eurodollar Tranches. Notwithstanding
anything to the contrary in this Agreement, all borrowings, conversions and
continuations of Eurodollar Loans hereunder and all selections of Interest
Periods hereunder shall be in such amounts and be made pursuant to such
elections so that, (a) after giving effect thereto, the aggregate principal
amount of the Eurodollar Loans comprising each Eurodollar Tranche shall be equal
to $5,000,000 or a whole multiple of $1,000,000 in excess thereof and (b) no
more than twenty (20) Eurodollar Tranches shall be outstanding at any one time.
2.14 Interest Rates and Payment Dates. (a) Each Eurodollar
Loan shall bear interest for each day during each Interest Period with respect
thereto at a rate per annum equal to the Eurodollar Rate determined for such day
plus the Applicable Margin.
(b) Each ABR Loan shall bear interest at a rate per annum
equal to the ABR plus the Applicable Margin.
(c) (i) If all or a portion of the principal amount of any
Loan or Reimbursement Obligation shall not be paid when due (whether at the
stated maturity, by acceleration or otherwise), all outstanding Loans and
Reimbursement Obligations (whether or not overdue) shall bear interest at a rate
per annum equal to (x) in the case of the Loans, the rate that would otherwise
be applicable thereto pursuant to the foregoing provisions of this Section plus
2% or (y) in the case of Reimbursement Obligations, the rate applicable to ABR
Loans under the Revolving Facility plus 2%, and (ii) if all or a portion of any
interest payable on any Loan or Reimbursement Obligation or any commitment fee
or other amount payable hereunder shall not be paid when due (whether at the
stated maturity, by acceleration or otherwise), such overdue
<PAGE> 40
35
amount shall bear interest at a rate per annum equal to the rate then applicable
to ABR Loans under the relevant Facility plus 2% (or, in the case of any such
other amounts that do not relate to a particular Facility, the rate then
applicable to ABR Loans under the Revolving Facility plus 2%), in each case,
with respect to clauses (i) and (ii) above, from the date of such non-payment
until such amount is paid in full (as well after as before judgment).
(d) Interest shall be payable in arrears on each Interest
Payment Date, provided that interest accruing pursuant to paragraph (c) of this
Section shall be payable from time to time on demand.
2.15 Computation of Interest and Fees. (a) Interest and fees
payable pursuant hereto shall be calculated on the basis of a 360-day year for
the actual days elapsed, except that, with respect to ABR Loans the rate of
interest on which is calculated on the basis of the Prime Rate, the interest
thereon shall be calculated on the basis of a 365- (or 366-, as the case may be)
day year for the actual days elapsed. The Administrative Agent shall as soon as
practicable notify the Borrower and the relevant Lenders of each determination
of a Eurodollar Rate. Any change in the interest rate on a Loan resulting from a
change in the ABR or the Eurocurrency Reserve Requirements shall become
effective as of the opening of business on the day on which such change becomes
effective. The Administrative Agent shall as soon as practicable notify the
Borrower and the relevant Lenders of the effective date and the amount of each
such change in interest rate.
(b) Each determination of an interest rate by the
Administrative Agent pursuant to any provision of this Agreement shall be
conclusive and binding on the Borrower and the Lenders in the absence of
manifest error. The Administrative Agent shall, at the request of the Borrower,
deliver to the Borrower a statement showing the quotations used by the
Administrative Agent in determining any interest rate pursuant to Section
2.14(a).
2.16 Inability to Determine Interest Rate. If prior to the
first day of any Interest Period:
(a) the Administrative Agent shall have determined (which
determination shall be conclusive and binding upon the Borrower) that,
by reason of circumstances affecting the relevant market, adequate and
reasonable means do not exist for ascertaining the Eurodollar Rate for
such Interest Period, or
(b) the Administrative Agent shall have received notice from
the Majority Facility Lenders in respect of the relevant Facility that
the Eurodollar Rate determined or to be determined for such Interest
Period will not adequately and fairly reflect the cost to such Lenders
(as conclusively certified by such Lenders) of making or maintaining
their affected Loans during such Interest Period,
the Administrative Agent shall give telecopy or telephonic notice thereof to the
Borrower and the relevant Lenders as soon as practicable thereafter. If such
notice is given (x) any Eurodollar Loans under the relevant Facility requested
to be made on the first day of such Interest Period shall be made as ABR Loans,
(y) any Loans under the relevant Facility that were to have been
<PAGE> 41
36
converted on the first day of such Interest Period to Eurodollar Loans shall be
continued as ABR Loans and (z) any outstanding Eurodollar Loans under the
relevant Facility shall be converted, on the last day of the then-current
Interest Period, to ABR Loans. Until such notice has been withdrawn by the
Administrative Agent, no further Eurodollar Loans under the relevant Facility
shall be made or continued as such, nor shall the Borrower have the right to
convert Loans under the relevant Facility to Eurodollar Loans.
2.17 Pro Rata Treatment and Payments. (a) Each borrowing by
the Borrower from the Lenders hereunder, each payment by the Borrower on account
of any commitment fee and any reduction of the Commitments of the Lenders shall
be made pro rata according to the respective Tranche A Term Percentages, Tranche
B Term Percentages, Tranche C Term Percentages or Revolving Percentages, as the
case may be, of the relevant Lenders (except as otherwise provided in Sections
2.11(a) and (b)).
(b) Each payment (including each prepayment) by the Borrower
on account of principal of and interest on the Term Loans shall be made pro rata
according to the respective outstanding principal amounts of the Term Loans then
held by the Term Lenders (except as otherwise provided in Section 2.11(e)).
Except as otherwise provided in Section 2.11, the amount of each principal
prepayment of the Term Loans shall be applied to reduce the then remaining
installments of the Tranche A Term Loans, Tranche B Term Loans and Tranche C
Term Loans, as the case may be, pro rata based upon the then remaining principal
amount thereof provided, however, that the Tranche B Term Loans and the Tranche
C Term Loans may only be prepaid at a price equal to (i) 102% of the principal
amount thereof prior to the first anniversary of the Funding Date and (ii) 101%
of the principal amount thereof on or after the first anniversary and prior to
the second anniversary of the Funding Date. Amounts prepaid on account of the
Term Loans may not be reborrowed.
(c) Each payment (including each prepayment) by the Borrower
on account of principal of and interest on the Revolving Loans shall be made pro
rata according to the respective outstanding principal amounts of the Revolving
Loans then held by the Revolving Lenders.
(d) All payments (including prepayments) to be made by the
Borrower hereunder, whether on account of principal, interest, fees or
otherwise, shall be made without setoff or counterclaim and shall be made prior
to 12:00 Noon, New York City time, on the due date thereof to the Administrative
Agent, for the account of the Lenders, at the Funding Office, in Dollars and in
immediately available funds. The Administrative Agent shall distribute such
payments to the Lenders promptly upon receipt in like funds as received. If any
payment hereunder (other than payments on the Eurodollar Loans) becomes due and
payable on a day other than a Business Day, such payment shall be extended to
the next succeeding Business Day. If any payment on a Eurodollar Loan becomes
due and payable on a day other than a Business Day, the maturity thereof shall
be extended to the next succeeding Business Day unless the result of such
extension would be to extend such payment into another calendar month, in which
event such payment shall be made on the immediately preceding Business Day. In
the case of any extension of any payment of principal pursuant to the preceding
two sentences, interest thereon shall be payable at the then applicable rate
during such extension.
<PAGE> 42
37
(e) Unless the Administrative Agent shall have been notified
in writing by any Lender prior to a borrowing that such Lender will not make the
amount that would constitute its share of such borrowing available to the
Administrative Agent, the Administrative Agent may assume that such Lender is
making such amount available to the Administrative Agent, and the Administrative
Agent may, in reliance upon such assumption, make available to the Borrower a
corresponding amount. If such amount is not made available to the Administrative
Agent by the required time on the Borrowing Date therefor, such Lender shall pay
to the Administrative Agent, on demand, such amount with interest thereon at a
rate equal to the daily average Federal Funds Effective Rate for the period
until such Lender makes such amount immediately available to the Administrative
Agent. A certificate of the Administrative Agent submitted to any Lender with
respect to any amounts owing under this paragraph shall be conclusive in the
absence of manifest error. If such Lender's share of such borrowing is not made
available to the Administrative Agent by such Lender within three Business Days
of such Borrowing Date, the Administrative Agent shall also be entitled to
recover such amount with interest thereon at the rate per annum applicable to
ABR Loans under the relevant Facility, on demand, from the Borrower.
(f) Unless the Administrative Agent shall have been notified
in writing by the Borrower prior to the date of any payment being made hereunder
that the Borrower will not make such payment to the Administrative Agent, the
Administrative Agent may assume that the Borrower is making such payment, and
the Administrative Agent may, but shall not be required to, in reliance upon
such assumption, make available to the Lenders their respective pro rata shares
of a corresponding amount. If such payment is not made to the Administrative
Agent by the Borrower within three Business Days of such required date, the
Administrative Agent shall be entitled to recover, on demand, from each Lender
to which any amount which was made available pursuant to the preceding sentence,
such amount with interest thereon at the rate per annum equal to the daily
average Federal Funds Effective Rate. Nothing herein shall be deemed to limit
the rights of the Administrative Agent or any Lender against the Borrower.
2.18 Requirements of Law. (a) If the adoption of or any change
in any Requirement of Law or in the interpretation or application thereof or
compliance by any Lender with any request or directive (whether or not having
the force of law) from any central bank or other Governmental Authority made
subsequent to the date hereof:
(i) shall subject any Lender to any tax of any kind whatsoever
with respect to this Agreement, any Letter of Credit, any Application
or any Eurodollar Loan made by it, or change the basis of taxation of
payments to such Lender in respect thereof (except for Non-Excluded
Taxes covered by Section 2.19 and changes in the rate of tax on the
overall net income of such Lender);
(ii) shall impose, modify or hold applicable any reserve,
special deposit, compulsory loan or similar requirement against assets
held by, deposits or other liabilities in or for the account of,
advances, loans or other extensions of credit by, or any other
acquisition of funds by, any office of such Lender that is not
otherwise included in the determination of the Eurodollar Rate
hereunder; or
<PAGE> 43
38
(iii) shall impose on such Lender any other condition;
and the result of any of the foregoing is to increase the cost to such Lender,
by an amount that such Lender deems to be material, of making, converting into,
continuing or maintaining Eurodollar Loans or issuing or participating in
Letters of Credit, or to reduce any amount receivable hereunder in respect
thereof, then, in any such case, the Borrower shall promptly pay such Lender,
upon its demand and delivery of the calculation of such amount, any additional
amounts necessary to compensate such Lender for such increased cost or reduced
amount receivable. If any Lender becomes entitled to claim any additional
amounts pursuant to this paragraph, it shall promptly notify the Borrower (with
a copy to the Administrative Agent) of the event by reason of which it has
become so entitled together with a calculation of such amount claimed.
(b) If any Lender shall have determined that the adoption of
or any change in any Requirement of Law regarding capital adequacy or in the
interpretation or application thereof or compliance by such Lender or any
corporation controlling such Lender with any request or directive regarding
capital adequacy (whether or not having the force of law) from any Governmental
Authority made subsequent to the date hereof shall have the effect of reducing
the rate of return on such Lender's or such corporation's capital as a
consequence of its obligations hereunder or under or in respect of any Letter of
Credit to a level below that which such Lender or such corporation could have
achieved but for such adoption, change or compliance (taking into consideration
such Lender's or such corporation's policies with respect to capital adequacy)
by an amount deemed by such Lender to be material, then from time to time, after
submission by such Lender to the Borrower (with a copy to the Administrative
Agent) of a written request therefor, the Borrower shall pay to such Lender such
additional amount or amounts as will compensate such Lender for such reduction;
provided that the Borrower shall not be required to compensate a Lender pursuant
to this paragraph for any amounts incurred more than three months prior to the
date that such Lender notifies the Borrower of such Lender's intention to claim
compensation therefor; and provided further that, if the circumstances giving
rise to such claim have a retroactive effect, then such three-month period shall
be extended to include the period of such retroactive effect.
(c) A certificate as to any additional amounts payable
pursuant to this Section submitted by any Lender to the Borrower (with a copy to
the Administrative Agent) shall be conclusive in the absence of manifest error.
The obligations of the Borrower pursuant to this Section shall survive the
termination of this Agreement and the payment of the Loans and all other amounts
payable hereunder.
2.19 Taxes. (a) All payments made by the Borrower under this
Agreement shall be made free and clear of, and without deduction or withholding
for or on account of, any present or future income, stamp or other taxes,
levies, imposts, duties, charges, fees, deductions or withholdings, now or
hereafter imposed, levied, collected, withheld or assessed by any Governmental
Authority, excluding income taxes and franchise taxes (imposed on the overall
net income of the recipient) imposed on the Administrative Agent or any Lender
as a result of a present or former connection between the Administrative Agent
or such Lender and the jurisdiction of the Governmental Authority imposing such
tax or any political subdivision or
<PAGE> 44
39
taxing authority thereof or therein (other than any such connection arising
solely from the Administrative Agent or such Lender having executed, delivered
or performed its obligations or received a payment under, or enforced, this
Agreement or any other Loan Document). If any such non-excluded taxes, levies,
imposts, duties, charges, fees, deductions or withholdings ("Non-Excluded
Taxes") or Other Taxes are required to be withheld from any amounts payable to
the Administrative Agent or any Lender hereunder, the amounts so payable to the
Administrative Agent or such Lender shall be increased to the extent necessary
to yield to the Administrative Agent or such Lender (after payment of all
Non-Excluded Taxes and Other Taxes) interest or any such other amounts payable
hereunder at the rates or in the amounts specified in this Agreement, provided,
however, that the Borrower shall not be required to increase any such amounts
payable to any Lender with respect to any Non-Excluded Taxes (i) that are
attributable to such Lender's failure to comply with the requirements of
paragraph (d) or (e) of this Section or (ii) that are United States withholding
taxes imposed on amounts payable to such Lender at the time the Lender becomes a
party to this Agreement, except to the extent that such Lender's assignor (if
any) was entitled, at the time of assignment, to receive additional amounts from
the Borrower with respect to such Non-Excluded Taxes pursuant to this paragraph.
(b) In addition, the Borrower shall pay any Other Taxes to the
relevant Governmental Authority in accordance with applicable law.
(c) Whenever any Non-Excluded Taxes or Other Taxes are payable
by the Borrower, as promptly as possible thereafter the Borrower shall send to
the Administrative Agent for its own account or for the account of the relevant
Lender, as the case may be, a certified copy of an original official receipt
received by the Borrower showing payment thereof. If the Borrower fails to pay
any Non-Excluded Taxes or Other Taxes when due to the appropriate taxing
authority or fails to remit to the Administrative Agent the required receipts or
other required documentary evidence, the Borrower shall indemnify the
Administrative Agent and the Lenders for any incremental taxes, interest or
penalties that may become payable by the Administrative Agent or any Lender as a
result of any such failure.
(d) Each Lender (or Transferee) that is not a citizen or
resident of the United States of America, a corporation, partnership or other
entity created or organized in or under the laws of the United States of America
(or any jurisdiction thereof), or any estate or trust that is subject to federal
income taxation regardless of the source of its income (a "Non-U.S. Lender")
shall deliver to the Borrower and the Administrative Agent (or, in the case of a
Participant, to the Lender from which the related participation shall have been
purchased) two copies of either U.S. Internal Revenue Service Form 1001 or Form
4224, or, in the case of a Non-U.S. Lender claiming exemption from U.S. federal
withholding tax under Section 871(h) or 881(c) of the Code with respect to
payments of "portfolio interest," a statement substantially in the form of
Exhibit H and a Form W-8, or any subsequent versions thereof or successors
thereto, properly completed and duly executed by such Non-U.S. Lender claiming
complete exemption from, or a reduced rate of, U.S. federal withholding tax on
all payments by the Borrower under this Agreement and the other Loan Documents.
Such forms shall be delivered by each Non-U.S. Lender on or before the date it
becomes a party to this Agreement (or, in the case of any Participant, on or
before the date such Participant purchases the related participation). In
addition, each Non-U.S. Lender shall deliver such forms promptly upon the
obsolescence or
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40
invalidity of any form previously delivered by such Non-U.S. Lender.
Each Non-U.S. Lender shall promptly notify the Borrower at any time it
determines that it is no longer in a position to provide any previously
delivered certificate to the Borrower (or any other form of certification
adopted by the U.S. taxing authorities for such purpose). Notwithstanding any
other provision of this paragraph, a Non-U.S. Lender shall not be required to
deliver any form pursuant to this paragraph that such Non-U.S. Lender is not
legally able to deliver.
(e) A Lender that is entitled to an exemption from or
reduction of non-U.S. withholding tax under the law of the jurisdiction in which
the Borrower is located, or any treaty to which such jurisdiction is a party,
with respect to payments under this Agreement shall deliver to the Borrower
(with a copy to the Administrative Agent), at the time or times prescribed by
applicable law or reasonably requested by the Borrower, such properly completed
and executed documentation prescribed by applicable law as will permit such
payments to be made without withholding or at a reduced rate, provided that such
Lender is legally entitled to complete, execute and deliver such documentation
and in such Lender's judgment such completion, execution or submission would not
materially prejudice the legal position of such Lender.
(f) The agreements in this Section shall survive the
termination of this Agreement and the payment of the Loans and all other amounts
payable hereunder.
2.20 Indemnity. The Borrower agrees to indemnify each Lender
and to hold each Lender harmless from any loss or expense that such Lender may
sustain or incur as a consequence of (a) default by the Borrower in making a
borrowing of, conversion into or continuation of Eurodollar Loans after the
Borrower has given a notice requesting the same in accordance with the
provisions of this Agreement, (b) default by the Borrower in making any
prepayment of or conversion from Eurodollar Loans after the Borrower has given a
notice thereof in accordance with the provisions of this Agreement or (c) the
making of a prepayment of Eurodollar Loans on a day that is not the last day of
an Interest Period with respect thereto. Such indemnification may include an
amount equal to the excess, if any, of (i) the amount of interest that would
have accrued on the amount so prepaid, or not so borrowed, converted or
continued, for the period from the date of such prepayment or of such failure to
borrow, convert or continue to the last day of such Interest Period (or, in the
case of a failure to borrow, convert or continue, the Interest Period that would
have commenced on the date of such failure) in each case at the applicable rate
of interest for such Loans provided for herein (excluding, however, the
Applicable Margin included therein, if any) over (ii) the amount of interest (as
reasonably determined by such Lender) that would have accrued to such Lender on
such amount by placing such amount on deposit for a comparable period with
leading banks in the interbank eurodollar market. A certificate as to any
amounts payable pursuant to this Section submitted to the Borrower by any Lender
shall be conclusive in the absence of manifest error. This covenant shall
survive the termination of this Agreement and the payment of the Loans and all
other amounts payable hereunder.
2.21 Change of Lending Office. Each Lender agrees that, upon
the occurrence of any event giving rise to the operation of Section 2.18 or
2.19(a) with respect to such Lender, it will, if requested by the Borrower, use
reasonable efforts (subject to overall policy considerations of such Lender) to
designate another lending office for any Loans affected by such event with the
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41
object of avoiding the consequences of such event; provided, that such
designation is made on terms that, in the sole judgment of such Lender, cause
such Lender and its lending office(s) to suffer no economic, legal or regulatory
disadvantage, and provided, further, that nothing in this Section shall affect
or postpone any of the obligations of any Borrower or the rights of any Lender
pursuant to Section 2.18 or 2.19(a).
2.12 Replacement of Lenders. The Borrower shall be permitted
to replace any Lender that (a) requests reimbursement for amounts owing pursuant
to Section 2.18 or 2.19(a) or (b) defaults in its obligation to make Loans
hereunder, with a replacement financial institution; provided that (i) such
replacement does not conflict with any Requirement of Law, (ii) no Event of
Default shall have occurred and be continuing at the time of such replacement,
(iii) prior to any such replacement, such Lender shall have taken no action
under Section 2.21 so as to eliminate the continued need for payment of amounts
owing pursuant to Section 2.18 or 2.19(a), (iv) the replacement financial
institution shall purchase, at par, all Loans and other amounts owing to such
replaced Lender on or prior to the date of replacement, (v) the Borrower shall
be liable to such replaced Lender under Section 2.20 if any Eurodollar Loan
owing to such replaced Lender shall be purchased other than on the last day of
the Interest Period relating thereto, (vi) the replacement financial
institution, if not already a Lender, shall be reasonably satisfactory to the
Administrative Agent, (vii) the replaced Lender shall be obligated to make such
replacement in accordance with the provisions of Section 10.6 (provided that the
Borrower shall be obligated to pay the registration and processing fee referred
to therein), (viii) until such time as such replacement shall be consummated,
the Borrower shall pay all additional amounts (if any) required pursuant to
Section 2.18 or 2.19(a), as the case may be, and (ix) any such replacement shall
not be deemed to be a waiver of any rights that the Borrower, the Administrative
Agent or any other Lender shall have against the replaced Lender.
SECTION 3. LETTERS OF CREDIT
3.1 L/C Commitment. (a) Subject to the terms and conditions
hereof, the Issuing Lender, in reliance on the agreements of the other Revolving
Lenders set forth in Section 3.4(a), agrees to issue letters of credit ("Letters
of Credit") for the account of the Borrower on any Business Day during the
Revolving Commitment Period in such form as may be approved from time to time by
the Issuing Lender; provided that the Issuing Lender shall have no obligation to
issue any Letter of Credit if, after giving effect to such issuance, the
aggregate amount of the Available Revolving Commitments would be less than zero.
Each Letter of Credit shall (i) be denominated in Dollars and (ii) expire no
later than the earlier of (x) the first anniversary of its date of issuance and
(y) the date that is five Business Days prior to the Revolving Termination Date,
provided that any Letter of Credit with a one-year term may provide for the
renewal thereof for additional one-year periods (which shall in no event extend
beyond the date referred to in clause (y) above). Notwithstanding the foregoing,
the aggregate undrawn amount of outstanding Letters of Credit and unpaid
Reimbursement Obligations shall not exceed $250,000,000 at any time.
(b) The Issuing Lender shall not at any time be obligated to
issue any Letter of Credit hereunder if such issuance would conflict with, or
cause the Issuing Lender or any L/C Participant to exceed any limits imposed by,
any applicable Requirement of Law.
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42
3.2 Procedure for Issuance of Letter of Credit. The Borrower
may from time to time request that the Issuing Lender issue a Letter of Credit
by delivering to the Issuing Lender at its address for notices specified herein
an Application therefor, completed to the satisfaction of the Issuing Lender,
and such other certificates, documents and other papers and information as the
Issuing Lender may request. Upon receipt of any Application, the Issuing Lender
will process such Application and the certificates, documents and other papers
and information delivered to it in connection therewith in accordance with its
customary procedures and shall promptly issue the Letter of Credit requested
thereby (but in no event shall the Issuing Lender be required to issue any
Letter of Credit earlier than three Business Days after its receipt of the
Application therefor and all such other certificates, documents and other papers
and information relating thereto) by issuing the original of such Letter of
Credit to the beneficiary thereof or as otherwise may be agreed to by the
Issuing Lender and the Borrower. The Issuing Lender shall furnish a copy of such
Letter of Credit to the Borrower promptly following the issuance thereof. The
Issuing Lender shall promptly furnish to the Administrative Agent, which shall
in turn promptly furnish to the Lenders, notice of the issuance of each Letter
of Credit (including the amount thereof).
3.3 Fees and Other Charges. (a) The Borrower will pay a fee on
all outstanding Letters of Credit at a per annum rate equal to the Applicable
Margin then in effect with respect to Eurodollar Loans under the Revolving
Facility, shared ratably among the Revolving Lenders and payable quarterly in
arrears on each L/C Fee Payment Date after the issuance date. In addition, the
Borrower shall pay to the Issuing Lender for its own account a fronting fee in
an amount per annum separately agreed with the Issuing Lender on the undrawn and
unexpired amount of each Letter of Credit, payable quarterly in arrears on each
L/C Fee Payment Date after the issuance date.
(b) In addition to the foregoing fees, the Borrower shall pay
or reimburse the Issuing Lender for such normal and customary costs and expenses
as are incurred or charged by the Issuing Lender in issuing, negotiating,
effecting payment under, amending or otherwise administering any Letter of
Credit.
3.4 L/C Participations. (a) The Issuing Lender irrevocably
agrees to grant and hereby grants to each L/C Participant, and, to induce the
Issuing Lender to issue Letters of Credit hereunder, each L/C Participant
irrevocably agrees to accept and purchase and hereby accepts and purchases from
the Issuing Lender, on the terms and conditions hereinafter stated, for such L/C
Participant's own account and risk an undivided interest equal to such L/C
Participant's Revolving Percentage in the Issuing Lender's obligations and
rights under each Letter of Credit issued hereunder and the amount of each draft
paid by the Issuing Lender thereunder. Each L/C Participant unconditionally and
irrevocably agrees with the Issuing Lender that, if a draft is paid under any
Letter of Credit for which the Issuing Lender is not reimbursed in full by the
Borrower in accordance with the terms of this Agreement, such L/C Participant
shall pay to the Issuing Lender upon demand at the Issuing Lender's address for
notices specified herein an amount equal to such L/C Participant's Revolving
Percentage of the amount of such draft, or any part thereof, that is not so
reimbursed.
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43
(b) If any amount required to be paid by any L/C Participant
to the Issuing Lender pursuant to Section 3.4(a) in respect of any unreimbursed
portion of any payment made by the Issuing Lender under any Letter of Credit is
paid to the Issuing Lender within three Business Days after the date such
payment is due, such L/C Participant shall pay to the Issuing Lender on demand
an amount equal to the product of (i) such amount, times (ii) the daily average
Federal Funds Effective Rate during the period from and including the date such
payment is required to the date on which such payment is immediately available
to the Issuing Lender, times (iii) a fraction the numerator of which is the
number of days that elapse during such period and the denominator of which is
360. If any such amount required to be paid by any L/C Participant pursuant to
Section 3.4(a) is not made available to the Issuing Lender by such L/C
Participant within three Business Days after the date such payment is due, the
Issuing Lender shall be entitled to recover from such L/C Participant, on
demand, such amount with interest thereon calculated from such due date at the
rate per annum applicable to ABR Loans under the Revolving Facility. A
certificate of the Issuing Lender submitted to any L/C Participant with respect
to any amounts owing under this Section shall be conclusive in the absence of
manifest error.
(c) Whenever, at any time after the Issuing Lender has made
payment under any Letter of Credit and has received from any L/C Participant its
pro rata share of such payment in accordance with Section 3.4(a), the Issuing
Lender receives any payment related to such Letter of Credit (whether directly
from the Borrower or otherwise, including proceeds of collateral applied thereto
by the Issuing Lender), or any payment of interest on account thereof, the
Issuing Lender will distribute to such L/C Participant its pro rata share
thereof; provided, however, that in the event that any such payment received by
the Issuing Lender shall be required to be returned by the Issuing Lender, such
L/C Participant shall return to the Issuing Lender the portion thereof
previously distributed by the Issuing Lender to it.
3.5 Reimbursement Obligation of the Borrower. The Borrower
agrees to reimburse the Issuing Lender on each date on which the Issuing Lender
notifies the Borrower of the date and amount of a draft presented under any
Letter of Credit and paid by the Issuing Lender for the amount of (a) such draft
so paid and (b) any taxes, fees, charges or other costs or expenses incurred by
the Issuing Lender in connection with such payment. Each such payment shall be
made to the Issuing Lender at its address for notices specified herein in lawful
money of the United States and in immediately available funds. Interest shall be
payable on any and all amounts remaining unpaid by the Borrower under this
Section from the date such amounts become payable (whether at stated maturity,
by acceleration or otherwise) until payment in full at the rate set forth in (i)
until the second Business Day following the date of the applicable drawing,
Section 2.14(b) and (ii) thereafter, Section 2.14(c).
3.6 Obligations Absolute. The Borrower's obligations under
this Section 3 shall be absolute and unconditional under any and all
circumstances and irrespective of any setoff, counterclaim or defense to payment
that the Borrower may have or may have had against the Issuing Lender, any
beneficiary of a Letter of Credit or any other Person. The Borrower also agrees
with the Issuing Lender that the Issuing Lender shall not be responsible for,
and the Borrower's Reimbursement Obligations under Section 3.5 shall not be
affected by, among other things, the validity or genuineness of documents or of
any endorsements thereon, even though
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44
such documents shall in fact prove to be invalid, fraudulent or forged,
or any dispute between or among the Borrower and any beneficiary of
any Letter of Credit or any other party to which such Letter of Credit may be
transferred or any claims whatsoever of the Borrower against any beneficiary of
such Letter of Credit or any such transferee. The Issuing Lender shall not be
liable for any error, omission, interruption or delay in transmission, dispatch
or delivery of any message or advice, however transmitted, in connection with
any Letter of Credit, except for errors or omissions found by a final and
nonappealable decision of a court of competent jurisdiction to have resulted
from the gross negligence or willful misconduct of the Issuing Lender. The
Borrower agrees that any action taken or omitted by the Issuing Lender under or
in connection with any Letter of Credit or the related drafts or documents, if
done in the absence of gross negligence or willful misconduct and in accordance
with the standards of care specified in the Uniform Commercial Code of the State
of New York, shall be binding on the Borrower and shall not result in any
liability of the Issuing Lender to the Borrower. The foregoing shall not be
construed to excuse the Issuing Lender from liability to the Borrower to the
extent of any direct damages (as opposed to consequential damages, claims in
respect of which are hereby waived by the Borrower to the extent permitted by
applicable law) suffered by the Borrower that are caused by the Issuing Lender's
failure to exercise the agreed standard of care (as set forth in Section 3.7
below) in determining whether drafts and other documents presented under a
Letter of Credit comply with the terms thereof. The parties hereto expressly
agree that the Issuing Bank shall have exercised the agreed standard of care in
the absence of gross negligence or wilful misconduct on the part of the Issuing
Lender.
3.7 Letter of Credit Payments. If any draft shall be presented
for payment under any Letter of Credit, the Issuing Lender shall promptly notify
the Borrower of the date and amount thereof. The responsibility of the Issuing
Lender to the Borrower in connection with any draft presented for payment under
any Letter of Credit shall, in addition to any payment obligation expressly
provided for in such Letter of Credit, be limited to determining that the
documents (including each draft) delivered under such Letter of Credit in
connection with such presentment are substantially in conformity with such
Letter of Credit.
3.8 Applications. To the extent that any provision of any
Application related to any Letter of Credit is inconsistent with the provisions
of this Section 3, the provisions of this Section 3 shall apply.
SECTION 4. REPRESENTATIONS AND WARRANTIES
To induce the Administrative Agent and the Lenders to enter
into this Agreement and to make the Loans and issue or participate in the
Letters of Credit, the Borrower hereby represents and warrants to the
Administrative Agent and each Lender that (it being agreed that prior to the
Funding Date the only representations and warranties that will be made by the
Borrower are the following, which will be made on the Signing Date: Sections 4.3
through 4.21, inclusive, with references to the Borrower and its Subsidiaries
therein being deemed to refer to the Borrower and its Subsidiaries as they will
exist after giving effect to the Spin-Off):
4.1 Financial Condition. (a) The unaudited pro forma
consolidated balance sheet of the Borrower as at June 30, 1999 (including the
notes thereto) (the "Pro Forma Balance
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45
Sheet") included in the Form S-4 Filing has been prepared giving effect
(as if such events had occurred on such date) to (i) the consummation of
the Spin-Off Transactions (other than the PCA IPO), (ii) the Loans to be
made and the Senior Subordinated Notes to be issued on the Funding
Date and the use of proceeds thereof and (iii) the payment of estimated fees and
expenses in connection with the foregoing. The Pro Forma Balance Sheet has been
prepared based on the best information available to the Borrower as of the date
of delivery thereof, and presents fairly on a pro forma basis the estimated
financial position of the Borrower and its consolidated Subsidiaries as at June
30, 1999, assuming that the events specified in the preceding sentence had
actually occurred at such date and based upon the assumptions and adjustments in
the notes accompanying the Pro Forma Balance Sheet.
(b) The audited consolidated balance sheets of the Borrower as
at December 31, 1998 and December 31, 1997, and the related consolidated
statements of income and of cash flows for the fiscal years ended on such dates,
reported on by and accompanied by an unqualified report from Arthur Andersen LLP
and reflecting the Packaging Business as a discontinued operation, present
fairly the consolidated financial condition of the Borrower as at such date, and
the consolidated results of its operations and its consolidated cash flows for
the respective fiscal years then ended. The unaudited consolidated balance sheet
of the Borrower as at June 30, 1999 (and, if available as of the Funding Date,
as at September 30, 1999), and the related unaudited consolidated statements of
income and cash flows for the six-month (and, if applicable, nine-month) period
ended on such date, present fairly the consolidated financial condition of the
Borrower as at such date, and the consolidated results of its operations and its
consolidated cash flows for the six-month (and, if applicable, nine-month)
period then ended (subject to normal year-end audit adjustments and reflecting
the Packaging Business as a discontinued operation). All such financial
statements, including the related schedules and notes thereto, have been
prepared in accordance with GAAP applied consistently throughout the periods
involved (except as approved by the aforementioned firm of accountants and
disclosed therein). The Borrower and its Subsidiaries (after giving effect to
the Spin-Off Transactions) do not have any material Guarantee Obligations,
contingent liabilities and liabilities for taxes, or any long-term leases or
unusual forward or long-term commitments, including any interest rate or foreign
currency swap or exchange transaction or other obligation in respect of
derivatives, that are not reflected in the most recent financial statements
referred to in this paragraph, other than income taxes payable in connection
with the PCA IPO. During the period from June 30, 1999 (or, if applicable,
September 30, 1999) to and including the date hereof there has been no
Disposition (other than as contemplated by the Spin-Off Transactions) by the
Borrower of any material part of its business or property.
4.2 No Change. Since December 31, 1998 there has been no
development or event that has had or would reasonably be expected to have a
Material Adverse Effect.
4.3 Corporate Existence; Compliance with Law. Each of the
Borrower and its Subsidiaries (a) is duly organized, validly existing and in
good standing under the laws of the jurisdiction of its organization, (b) has
the corporate power and authority, and the legal right, to own and operate its
property, to lease the property it operates as lessee and to conduct the
business in which it is currently engaged, (c) is duly qualified as a foreign
corporation and in good standing under the laws of each jurisdiction where its
ownership, lease or operation of
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property or the conduct of its business requires such qualification and (d) is
in compliance with all Requirements of Law except, in the case of clauses (c)
and (d), to the extent that the failure to be qualified or comply would not,
in the aggregate, reasonably be expected to have a Material Adverse Effect.
4.4 Corporate Power; Authorization; Enforceable Obligations.
Each Loan Party has the corporate power and authority, and the legal right, to
make, deliver and perform the Loan Documents to which it is a party and, in the
case of the Borrower, to borrow hereunder. Each Loan Party has taken all
necessary corporate action to authorize the execution, delivery and performance
of the Loan Documents to which it is a party and, in the case of the Borrower,
to authorize the borrowings on the terms and conditions of this Agreement. No
consent or authorization of, filing with, notice to or other act by or in
respect of, any Governmental Authority or any other Person is required in
connection with the Transaction and the borrowings hereunder or with the
execution, delivery, performance, validity or enforceability of this Agreement
or any of the Loan Documents, except (i) consents, authorizations, filings and
notices described in Schedule 4.4, which consents, authorizations, filings and
notices have been obtained or made and are in full force and effect or will have
been obtained or made and be in full force and effect on the Funding Date and
(ii) the filings referred to in Section 4.19. Each Loan Document has been duly
executed and delivered on behalf of each Loan Party party thereto. This
Agreement constitutes, and each other Loan Document upon execution will
constitute, a legal, valid and binding obligation of each Loan Party party
thereto, enforceable against each such Loan Party in accordance with its terms,
except as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors? rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law).
4.5 No Legal Bar. The execution, delivery and performance of
this Agreement and the other Loan Documents, the issuance of Letters of Credit,
the borrowings hereunder and the use of the proceeds thereof will not violate
any Requirement of Law or any Contractual Obligation of the Borrower or any of
its Subsidiaries and will not result in, or require, the creation or imposition
of any Lien on any of their respective properties or revenues pursuant to any
Requirement of Law or any such Contractual Obligation (other than the Liens
created by the Security Documents). No Requirement of Law or Contractual
Obligation applicable to the Borrower or any of its Subsidiaries would
reasonably be expected to have a Material Adverse Effect.
4.6 Litigation. No litigation, investigation or proceeding of
or before any arbitrator or Governmental Authority is pending or, to the
knowledge of the Borrower, threatened by or against the Borrower or any of its
Subsidiaries or against any of their respective properties or revenues (a) with
respect to any of the Loan Documents or any of the transactions contemplated
hereby or thereby, or (b) that would reasonably be expected to have a Material
Adverse Effect.
4.7 No Default. Neither the Borrower nor any of its
Subsidiaries is in default under or with respect to any of its Contractual
Obligations in any respect that would reasonably
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47
be expected to have a Material Adverse Effect. No Default or Event of Default
has occurred and is continuing.
4.8 Ownership of Property; Liens. Each of the Borrower and its
Subsidiaries (other than Foreign Subsidiaries, as to which no representation is
made) has title in fee simple to, or a valid leasehold interest in, all its real
property, and good title to, or a valid leasehold interest in, all its other
property, and none of such property is subject to any Lien except as permitted
by Section 7.3.
4.9 Intellectual Property. The Borrower and each of its
Subsidiaries owns, or is licensed to use, all Intellectual Property necessary
for the conduct of its business as currently conducted. No material claim has
been asserted and is pending by any Person challenging or questioning the use of
any Intellectual Property or the validity or effectiveness of any Intellectual
Property, nor does the Borrower know of any valid basis for any such claim. The
use of Intellectual Property by the Borrower and its Subsidiaries does not
infringe on the rights of any Person in any material respect.
4.10 Taxes. Each of the Borrower and each of its Subsidiaries
has filed or caused to be filed all Federal, state and other material tax
returns that are required to be filed and has paid all taxes shown to be due and
payable on said returns or on any assessments made against it or any of its
property and all other taxes, fees or other charges imposed on it or any of its
property by any Governmental Authority (other than any the amount or validity of
which are currently being contested in good faith by appropriate proceedings and
with respect to which reserves in conformity with GAAP have been provided on the
books of the Borrower or its Subsidiaries, as the case may be); no tax Lien has
been filed, and, to the knowledge of the Borrower, no claim is being asserted,
with respect to any such tax, fee or other charge.
4.11 Federal Regulations. No part of the proceeds of any Loans
will be used for "buying" or "carrying" any "margin stock" within the respective
meanings of each of the quoted terms under Regulation U as now and from time to
time hereafter in effect or for any purpose that violates the provisions of the
Regulations of the Board. If requested by any Lender or the Administrative
Agent, the Borrower will furnish to the Administrative Agent and each Lender a
statement to the foregoing effect in conformity with the requirements of FR Form
G-3 or FR Form U-1, as applicable, referred to in Regulation U.
4.12 Labor Matters. Except as, in the aggregate, would not
reasonably be expected to have a Material Adverse Effect: (a) there are no
strikes or other labor disputes against the Borrower or any of its Subsidiaries
pending or, to the knowledge of the Borrower, threatened; (b) hours worked by
and payment made to employees of the Borrower and its Subsidiaries have not been
in violation of the Fair Labor Standards Act or any other applicable Requirement
of Law dealing with such matters; and (c) all payments due from the Borrower or
any of its Subsidiaries on account of employee health and welfare insurance have
been paid or accrued as a liability on the books of the Borrower or the relevant
Subsidiary.
4.13 ERISA. Neither a Reportable Event which could give rise
to a material liability nor an "accumulated funding deficiency" (within the
meaning of Section 412 of the
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48
Code or Section 302 of ERISA) has occurred during the five-year period prior
to the date on which this representation is made or deemed made with respect
to any Plan, and each Plan has complied in all material respects with the
applicable provisions of ERISA and the Code. No termination of a Single
Employer Plan has occurred, and no Lien in favor of the PBGC or a Plan has
arisen, during such five-year period. The present value of all accrued
benefits under each Single Employer Plan (based on those assumptions used
to fund such Plans) did not, as of the last annual valuation date prior to
the date on which this representation is made or deemed made, exceed the
value of the assets of such Plan allocable to such accrued benefits by an
amount which would reasonably be expected to have a Material Adverse
Effect. Neither the Borrower nor any Commonly Controlled Entity has had a
complete or partial withdrawal from any Multiemployer Plan that has
resulted or would reasonably be expected to result in a material liability
under ERISA, and neither the Borrower nor any Commonly Controlled Entity
would become subject to any material liability under ERISA if the Borrower
or any such Commonly Controlled Entity were to withdraw completely from
all Multiemployer Plans as of the valuation date most closely preceding
the date on which this representation is made or deemed made. No such
Multiemployer Plan is in Reorganization or Insolvent.
4.14 Investment Company Act; Other Regulations. No Loan Party
is an "investment company," or a company "controlled" by an "investment
company," within the meaning of the Investment Company Act of 1940, as amended.
No Loan Party is subject to regulation under any Requirement of Law (other than
Regulation X of the Board) that limits its ability to incur Indebtedness.
4.15 Subsidiaries. Except as disclosed to the Administrative
Agent by the Borrower in writing from time to time after the Signing Date, (a)
Schedule 4.15 sets forth the name and jurisdiction of incorporation of each
Subsidiary and, as to each such Subsidiary, the percentage of each class of
Capital Stock owned by any Loan Party and (b) there are no outstanding
subscriptions, options, warrants, calls, rights or other agreements or
commitments (other than stock options granted to employees or directors and
directors? qualifying shares) of any nature relating to any Capital Stock of the
Borrower or any Subsidiary, except as created by the Loan Documents.
4.16 Use of Proceeds. The proceeds of the Term Loans shall be
used to refinance certain existing Indebtedness of the Borrower and its
Subsidiaries, to pay fees and expenses relating to the Transaction and for
general corporate purposes. The proceeds of the Revolving Loans and the
Swingline Loans, and the Letters of Credit, shall be used for general corporate
purposes.
4.17 Environmental Matters. Except as, in the aggregate, would
not reasonably be expected to have a Material Adverse Effect:
(a) the facilities and properties owned, leased or operated by
the Borrower or any of its Subsidiaries (the "Properties") do not
contain, and have not previously contained, any Materials of
Environmental Concern in amounts or concentrations or under
circumstances that constitute or constituted a violation of, or could
give rise to liability under, any Environmental Law;
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49
(b) neither the Borrower nor any of its Subsidiaries has
received or is aware of any written notice of violation, alleged
violation, non-compliance, liability or potential liability regarding
environmental matters or compliance with Environmental Laws with regard
to any of the Properties or the business operated by the Borrower or
any of its Subsidiaries (the "Business"), nor does the Borrower have
knowledge or reason to believe that any such notice will be received or
is being threatened;
(c) Materials of Environmental Concern have not been
transported or disposed of from the Properties in violation of, or in a
manner or to a location that could give rise to liability under, any
Environmental Law, nor have any Materials of Environmental Concern been
generated, treated, stored or disposed of at, on or under any of the
Properties in violation of, or in a manner that could give rise to
liability under, any applicable Environmental Law;
(d) no judicial proceeding or governmental or administrative
action is pending or, to the knowledge of the Borrower, threatened,
under any Environmental Law to which the Borrower or any Subsidiary is
or will be named as a party with respect to the Properties or the
Business, nor are there any consent decrees or other decrees, consent
orders, administrative orders or other orders, or other administrative
or judicial requirements outstanding under any Environmental Law with
respect to the Properties or the Business;
(e) there has been no release or threat of release of
Materials of Environmental Concern at or from the Properties, or
arising from or related to the operations of the Borrower or any
Subsidiary in connection with the Properties or otherwise in connection
with the Business, in violation of or in amounts or in a manner that
could give rise to liability under Environmental Laws;
(f) the Properties and all operations at the Properties are in
compliance, and have in the last five years been in compliance, with
all applicable Environmental Laws, and there is no contamination at,
under or about the Properties or violation of any Environmental Law
with respect to the Properties or the Business; and
(g) neither the Borrower nor any of its Subsidiaries has
assumed any liability of any other Person under Environmental Laws.
4.18 Accuracy of Information, etc. No statement or information
contained in this Agreement, any other Loan Document, the Confidential
Information Memorandum or any other document, certificate or written statement
(including the Spin-Off SEC filings) furnished by or on behalf of any Loan Party
to the Administrative Agent or the Lenders, or any of them, for use in
connection with the transactions contemplated by this Agreement or the other
Loan Documents, contained as of the date such statement, information, document
or certificate was so furnished (or, in the case of the Confidential Information
Memorandum, as of the date of this Agreement), any untrue statement of a
material fact or omitted to state a material fact necessary to make the
statements contained herein or therein, when taken as a whole, not materially
misleading. The projections and pro forma financial information contained in the
materials referenced above are based upon good faith estimates and assumptions
believed by management
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of the Borrower to be reasonable at the time made, it being recognized by the
Lenders that such financial information as it relates to future events is not to
be viewed as fact and that actual results during the period or periods covered
by such financial information may differ from the projected results set forth
therein by a material amount. As of the Funding Date, the representations and
warranties contained in the Spin-off Documents and the Spin-Off SEC Filings are
true and correct in all material respects. There is no fact known to any Loan
Party that would reasonably be expected to have a Material Adverse Effect that
has not been expressly disclosed herein, in the other Loan Documents, in the
Confidential Information Memorandum or in any other documents, certificates and
statements furnished to the Administrative Agent and the Lenders for use in
connection with the transactions contemplated hereby and by the other Loan
Documents.
4.19 Security Documents. (a) The Guarantee and Collateral
Agreement is effective to create in favor of the Administrative Agent, for the
benefit of the Lenders, a legal, valid and enforceable security interest in the
Collateral described therein and proceeds thereof. In the case of the Pledged
Stock described in the Guarantee and Collateral Agreement, when stock
certificates representing such Pledged Stock are delivered to the Administrative
Agent, and in the case of the other Collateral described in the Guarantee and
Collateral Agreement, when financing statements and other filings specified on
Schedule 4.19(a) in appropriate form are filed in the offices specified on
Schedule 4.19(a), the Guarantee and Collateral Agreement shall constitute a
fully perfected Lien on, and security interest in, all right, title and interest
of the Loan Parties in such Collateral and the proceeds thereof, as security for
the Obligations (as defined in the Guarantee and Collateral Agreement), in each
case prior and superior in right to any other Person (except, in the case of
Collateral other than Pledged Stock, Liens permitted by Section 7.3).
(b) Each of the Mortgages is effective to create in favor of
the Administrative Agent, for the benefit of the Lenders, a legal, valid and
enforceable Lien on the Mortgaged Properties described therein and proceeds
thereof, and when the Mortgages are filed in the offices specified on Schedule
4.19(b), each such Mortgage shall constitute a fully perfected Lien on, and
security interest in, all right, title and interest of the Loan Parties in the
Mortgaged Properties and the proceeds thereof, as security for the Obligations
(as defined in the relevant Mortgage), in each case prior and superior in right
to any other Person. As of the Funding Date, Schedule 1.1B lists each of the
real properties in the United States owned in fee simple by the Borrower or any
of its Subsidiaries having a value, in the reasonable opinion of the Borrower,
in excess of $1,000,000.
4.20 Solvency. Each Loan Party is, and after giving effect to
the Spin-Off and the other Transactions and the incurrence of all Indebtedness
and obligations being incurred in connection herewith and therewith will be and
will continue to be, Solvent.
4.21 Year 2000 Matters. Any reprogramming required to permit
the proper functioning (but only to the extent that such proper functioning
would otherwise be impaired by the occurrence of the year 2000) in and following
the year 2000 of computer systems and other equipment containing embedded
microchips, in either case owned or operated by the Borrower or
<PAGE> 56
51
any of its Subsidiaries or used or relied upon in the conduct of their business
(including any such systems and other equipment supplied by others or with which
the computer systems of the Borrower or any of its Subsidiaries interface), and
the testing of all such systems and other equipment as so reprogrammed, will be
completed by October 31, 1999 to the extent the failure to so reprogram and test
would reasonably be expected to have a Material Adverse Effect. The costs to the
Borrower and its Subsidiaries that have not been incurred as of the date hereof
for such reprogramming and testing and for the other reasonably foreseeable
consequences to them of any improper functioning of other computer systems and
equipment containing embedded microchips due to the occurrence of the year 2000
would not reasonably be expected to result in a Default or Event of Default or
to have a Material Adverse Effect. Except for any reprogramming referred to
above, the computer systems of the Borrower and its Subsidiaries are and, with
ordinary course upgrading and maintenance, will continue for the term of this
Agreement to be, sufficient for the conduct of their business as currently
conducted.
4.22 Senior Indebtedness. The Obligations constitute "Senior
Debt" of the Borrower under and as defined in the Senior Subordinated Note
Indenture and the obligations of each Subsidiary Guarantor under the Guarantee
and Collateral Agreement constitute "Guarantor Senior Debt" of such Subsidiary
Guarantor under and as defined in the Senior Subordinated Note Indenture.
4.23 Certain Documents. Prior to the Effective Date, the
Borrower will have delivered to the Administrative Agent a complete and correct
copy of the Spin-off Documents, the Spin-Off SEC Filings and the Senior
Subordinated Note Indenture including any amendments, supplements or
modifications with respect to any of the foregoing.
SECTION 5. CONDITIONS PRECEDENT
5.1 Conditions to Signing Date. The agreement of each Lender
to execute this Agreement is subject to the fulfillment on or before September
30, 1999 of the following conditions precedent:
(a) Credit Agreement. The Administrative Agent shall have
received this Agreement, executed and delivered by the Borrower.
(b) Lien Searches. The Administrative Agent shall have
received the results of a recent lien search in each of the
jurisdictions where assets of the Loan Parties are located, and such
search shall reveal no liens on any of the assets of the Borrower or
its Subsidiaries except for liens permitted by Section 7.3 or which
will be discharged on or prior to the Funding Date.
(c) Environmental Audit. The Administrative Agent shall have
received available environmental information requested by the
Administrative Agent with respect to the real properties of the
Borrower and its Subsidiaries specified by the Administrative Agent.
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(d) Fees. The Lenders and the Administrative Agent shall have
received all fees required to be paid, and all expenses for which
invoices have been presented (including the reasonable fees and
expenses of legal counsel), on or before the Signing Date.
(e) Legal Opinions. The Administrative Agent shall have
received the executed legal opinion of Jenner & Block, counsel to the
Borrower and the other Loan Parties, substantially in the form of
Exhibit F, and such legal opinion shall cover such other matters
incident to the transactions contemplated by this Agreement as the
Administrative Agent may reasonably require.
The Administrative Agent shall solely determine when the conditions to the
Signing Date have been fulfilled and will provide immediate notification thereof
to the Borrower and the Lenders.
5.2 Conditions to Effective Date. The occurrence of the
Effective Date is subject to the fulfillment on or before November 30, 1999 of
the following conditions precedent:
(a) Signing Date. The Signing Date shall
have occurred.
(b) Financial Statements. The Lenders shall have
received the financial statements of the Borrower referred to in
Section 4.1 (which may be delivered in the form included in the Form
S-4 Filing) and such financial statements shall not be materially
different from the financial statements included in the Form S-4 Filing
unless such material differences are satisfactory to all the Lenders.
(c) Fees. The Lenders and the Administrative Agent
shall have received all fees required to be paid, and all expenses
for which invoices have been presented (including the reasonable
fees and expenses of legal counsel), on or before the Effective Date.
(d) Solvency Opinion. The Administrative Agent shall
have received a satisfactory solvency opinion from an independent
valuation firm satisfactory to the Administrative Agent which shall
document the solvency of the Borrower and its Subsidiaries after giving
effect to the Transaction and the other transactions contemplated
hereby.
(e) Tax Status. The Borrower shall have received a
tax ruling from the Internal Revenue Service or an opinion from its
outside legal counsel to the effect that the Spin-Off will be free
of federal income taxes payable by the Borrower.
The Administrative Agent will, after consultation with the Lenders, determine
when the conditions to the Effective Date have been met and will provide
immediate written notification thereof to the Borrower and the Lenders.
5.3 Conditions to Initial Extensions of Credit on Funding
Date. The agreement of each Lender to make the initial extension of credit
requested to be made by it is subject to the
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53
satisfaction, prior to or concurrently with the making of such extension of
credit on the Funding Date (but in any event no later than November 30, 1999),
of the following conditions precedent:
(a) Effective Date. The Effective Date shall have
occurred.
(b) Guarantee and Collateral Agreement. The
Administrative Agent shall have received (i) the Guarantee and
Collateral Agreement, executed and delivered by the Borrower and each
Subsidiary Guarantor and (ii) an Acknowledgment and Consent in the form
attached to the Guarantee and Collateral Agreement, executed and
delivered by each Issuer (as defined therein), if any, that is not a
Loan Party.
(c) Senior Subordinated Notes. The Borrower shall
have issued at least $500,000,000 of Senior Subordinated Notes and
shall have received the net proceeds thereof. The Senior Subordinated
Notes will be issued at par or at a discount not to exceed 1/4%.
(d) Spin-Off. The Administrative Agent shall have
received a certificate from a Responsible Officer of the Borrower
certifying that, to the best of such Responsible Officer's knowledge
after due inquiry, the Spin-Off and other Spin-Off Transactions have
been consummated (or shall be consummated substantially simultaneously
on the Funding Date) on substantially the terms set forth in the
Spin-Off SEC Filings, as filed with the SEC on the date hereof, and
without giving effect to any material amendments thereto (other than
any amendment to the extent relating to the Packaging Business) unless
approved by the Required Lenders (which approval will not be
unreasonably withheld or delayed) . The consolidated financial
condition of the Borrower on the Funding Date shall not be materially
different from that set forth in the Pro Forma Balance Sheet.
(e) Approvals. All governmental and third party
approvals necessary in connection with the Transaction, the continuing
operations of the Borrower and its Subsidiaries and the transactions
contemplated hereby shall have been obtained and be in full force and
effect, and all applicable waiting periods shall have expired without
any action being taken or threatened by any competent authority that
would restrain, prevent or otherwise impose adverse conditions on the
Transaction or the financing contemplated hereby.
(f) Fees. The Lenders and the Administrative Agent
shall have received all fees required to be paid, and all expenses for
which invoices have been presented (including the reasonable
fees and expenses of legal counsel), on or before the Funding Date.
(g) Closing Certificate. The Administrative Agent
shall have received, with a counterpart for each Lender, a certificate
of each Loan Party, dated the Funding Date, substantially in the form
of Exhibit C, with appropriate insertions and attachments.
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54
(h) Legal Opinions. The Administrative Agent shall
have received the following executed legal opinions:
(i) the legal opinion of Jenner & Block, counsel to
the Borrower and the other Loan Parties, in form and substance
reasonably satisfactory to the Administrative Agent and its counsel;
(ii) the legal opinion of special New York counsel
to the Borrower and the other Loan Parties, in form and substance
reasonably satisfactory to the Administrative Agent and its counsel;
(iii) the legal opinion of the General Counsel of
the Borrower and the other Loan Parties, in form and substance
reasonably satisfactory to the Administrative Agent and its
counsel; and
(iv) to the extent consented to by the relevant
counsel, each legal opinion, if any, delivered in connection with the
Spin-Off Documents, accompanied by a reliance letter in favor of the
Lenders.
Each such legal opinion shall cover such other matters incident to the
transactions contemplated by this Agreement as the Administrative Agent
may reasonably require.
(i) Pledged Stock; Stock Powers. The Administrative
Agent shall have received the certificates representing the shares of
Capital Stock pledged pursuant to the Guarantee and Collateral
Agreement, together with an undated stock power for each such
certificate executed in blank by a duly authorized officer of the
pledgor thereof and executed Uniform Commercial Code Financing
Statements covering such Capital Stock.
(j) Filings, Registration and Recordings. Each
document (including any Uniform Commercial Code financing statement)
required by the Security Documents or under law or reasonably requested
by the Administrative Agent to be filed, registered or recorded in
order to create in favor of the Administrative Agent, for the benefit
of the Lenders, a perfected Lien on the Collateral described therein,
prior and superior in right to any other Person (other than with
respect to Liens expressly permitted by Section 7.3), shall be in
proper form for filing, registration or recordation.
(k) Mortgages, etc. (i) The Administrative Agent
shall have received a Mortgage with respect to each Mortgaged Property,
executed and delivered by a duly authorized officer of each party
thereto.
(ii) If requested by the Administrative Agent, the
Administrative Agent shall have received, and the title
insurance company issuing the policy referred to in clause
(iii) below (the "Title Insurance Company") shall have
received, maps or plats of an as-built survey of the sites of
the Mortgaged Properties certified to the Administrative Agent
and the Title Insurance Company in a manner satisfactory to
them, dated a date satisfactory to the Administrative Agent
and the Title Insurance
<PAGE> 60
55
Company by an independent professional licensed land surveyor
satisfactory to the Administrative Agent and the Title
Insurance Company.
(iii) The Administrative Agent shall have received in
respect of each Mortgaged Property a mortgagee's title
insurance policy (or policies) or marked up unconditional
binder for such insurance. Each such policy shall (A) be in an
amount satisfactory to the Administrative Agent; (B) be issued
at ordinary rates; (C) insure that the Mortgage insured
thereby creates a valid first Lien on such Mortgaged Property
free and clear of all defects and encumbrances, except those
defects and encumbrances which would not materially detract
from the value of the Mortgaged Property or the present use
thereof; (D) name the Administrative Agent for the benefit of
the Lenders as the insured thereunder; (E) be in the form of
ALTA Loan Policy - 1970 (Amended 10/17/70 and 10/17/84) (or
equivalent policies); (F) contain such endorsements and
affirmative coverage as the Administrative Agent may
reasonably request and (G) be issued by title companies
satisfactory to the Administrative Agent (including any such
title companies acting as co-insurers or reinsurers, at the
option of the Administrative Agent). The Administrative Agent
shall have received evidence satisfactory to it that all
premiums in respect of each such policy, all charges for
mortgage recording tax, and all related expenses, if any, have
been paid.
(iv) If requested by the Administrative Agent, the
Administrative Agent shall have received (A) a policy of flood
insurance that (1) covers any parcel of improved real property
that is encumbered by any Mortgage (2) is written in an amount
not less than the outstanding principal amount of the
indebtedness secured by such Mortgage that is reasonably
allocable to such real property or the maximum limit of
coverage made available with respect to the particular type of
property under the National Flood Insurance Act of 1968,
whichever is less, and (3) has a term ending not later than
the maturity of the Indebtedness secured by such Mortgage and
(B) confirmation that the Borrower has received the notice
required pursuant to Section 208(e)(3) of Regulation H of the
Board.
(v) The Administrative Agent shall have received a
copy of all recorded documents referred to, or listed as
exceptions to title in, the title policy or policies referred
to in clause (iii) above and a copy of all other material
documents affecting the Mortgaged Properties.
(l) Availability. On the Funding Date the aggregate
Available Revolving Commitments (calculated by excluding Letters of
Credit outstanding on the Funding Date) shall be at least the lesser of
(i) $500,000,000 and (ii) $350,000,000 plus the aggregate amount of
Stub Debt less the aggregate amount of optional reductions of the Term
Commitments made by the Borrower on or prior to the Funding Date, in
each case, adjusted downward as agreed by the Borrower and the
Administrative Agent to be appropriate to take into account the daily
working capital needs of the Automotive Business on the Funding Date.
<PAGE> 61
56
(m) Permitted Receivables Financings. The Borrower
and its Subsidiaries shall have no Permitted Receivables Financings
in effect.
5.4 Conditions to Each Extension of Credit. The agreement of
each Lender to make any extension of credit requested to be made by it on any
date (including its initial extension of credit) is subject to the satisfaction
of the following conditions precedent:
(a) Representations and Warranties. Each of the
representations and warranties made by any Loan Party in or pursuant to
the Loan Documents shall be true and correct on and as of such date as
if made on and as of such date.
(b) No Default. No Default or Event of Default shall have
occurred and be continuing on such date or after giving effect to the
extensions of credit requested to be made on such date.
Each borrowing by and issuance of a Letter of Credit on behalf of the Borrower
hereunder shall constitute a representation and warranty by the Borrower as of
the date of such extension of credit that the conditions contained in this
Section 5.4 have been satisfied.
SECTION 6. AFFIRMATIVE COVENANTS
The Borrower hereby agrees that, so long as the Commitments
remain in effect, any Letter of Credit remains outstanding or any Loan or other
amount is owing to any Lender or the Administrative Agent hereunder, the
Borrower shall and shall cause each of its Subsidiaries to (it being agreed that
prior to the Funding Date the Borrower and its Subsidiaries shall only be
required to comply with Sections 6.2(d), 6.2(f), 6.4, 6.7 and 6.8):
6.1 Financial Statements. Furnish to the Administrative Agent
and each Lender:
(a) as soon as available, but in any event within 90 days
after the end of each fiscal year of the Borrower, a copy of the
audited consolidated balance sheet of the Borrower and its consolidated
Subsidiaries as at the end of such year and the related audited
consolidated statements of income and of cash flows (or such other
similar or additional statement then required by the SEC for annual
reports filed pursuant to the Exchange Act) for such year, setting
forth in each case in comparative form the figures for the previous
year, reported on without a "going concern" or like qualification or
exception, or qualification arising out of the scope of the audit, or
other material qualification or exception, by Arthur Andersen LLP or
other independent certified public accountants of nationally recognized
standing; and
(b) as soon as available, but in any event not later than 45
days after the end of each of the first three quarterly periods of each
fiscal year of the Borrower, the unaudited consolidated balance sheet
of the Borrower and its consolidated Subsidiaries as at the end of such
quarter and the related unaudited consolidated statements of income and
of cash flows (or such other or similar or additional statement then
required by the SEC for quarterly reports filed pursuant to the
Exchange Act) for such quarter and the portion of
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the fiscal year through the end of such quarter, setting forth in each
case in comparative form the figures for the previous year, certified
by a Responsible Officer as being fairly stated in all material
respects (subject to normal year-end audit adjustments).
All such financial statements shall be complete and correct in all material
respects and shall be prepared in reasonable detail and in accordance with GAAP
applied consistently throughout the periods reflected therein and with prior
periods (except as approved by such accountants or officer, as the case may be,
and disclosed therein).
6.2 Certificates; Other Information. Furnish to the
Administrative Agent and each Lender (or, in the case of clause (f), to the
relevant Lender):
(a) concurrently with the delivery of the financial statements
referred to in Section 6.1(a), a certificate of the independent
certified public accountants reporting on such financial statements
stating that in making the examination necessary therefor no knowledge
was obtained of any Event of Default arising as a result of
non-compliance with Section 7.1, except as specified in such
certificate;
(b) within 10 days after the delivery of any financial
statements pursuant to Section 6.1, (i) a certificate of a Responsible
Officer stating that, to the best of each such Responsible Officer's
knowledge, each Loan Party during such period has observed or performed
all of its covenants and other agreements, and satisfied every
condition, contained in this Agreement and the other Loan Documents to
which it is a party to be observed, performed or satisfied by it, and
that such Responsible Officer has obtained no knowledge of any Default
or Event of Default except as specified in such certificate and (ii) in
the case of quarterly or annual financial statements, a Compliance
Certificate containing all information and calculations necessary for
determining compliance by the Borrower and its Subsidiaries with the
provisions of this Agreement referred to therein as of the last day of
the fiscal quarter or fiscal year of the Borrower, as the case may be;
(c) within 60 days after the end of each of the first three
(3) fiscal quarters of the Borrower, a narrative discussion and
analysis of the financial condition and results of operations of the
Borrower and its Subsidiaries for such fiscal quarter and for the
period from the beginning of the then current fiscal year to the end
of such fiscal quarter, as compared to the comparable periods of the
previous year (or such other or similar additional statement then
required by the SEC for quarterly reports filed pursuant to the
Exchange Act);
(d) no later than three (3) Business Days prior to the
effectiveness thereof, copies of substantially final drafts of any
proposed amendment, supplement, waiver or other modification with
respect to the Senior Subordinated Note Indenture or the Spin-off
Documents;
(e) promptly upon the mailing thereof, copies of all financial
statements and reports that the Borrower sends to the holders of any
class of its debt securities or public
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equity securities and, within five days after the same are filed,
copies of all financial statements and reports that the Borrower may
make to, or file with, the SEC; and
(f) promptly, such additional financial and other information
as any Lender may from time to time reasonably request.
6.3 Payment of Obligations. Pay, discharge or otherwise
satisfy at or before maturity or before they become delinquent, as the case
may be, all its material obligations of whatever nature, except where the
amount or validity thereof is currently being contested in good faith by
appropriate proceedings and in conformity with GAAP with respect thereto
have been provided on the books of the Borrower or its Subsidiaries, as the case
may be.
6.4 Maintenance of Existence; Compliance. (a)(i) Preserve,
renew and keep in full force and effect its corporate existence and (ii) take
all reasonable action to maintain all rights, privileges and franchises
necessary or desirable in the normal conduct of the Business, except, in each
case, as otherwise permitted by Section 7.4 and except, in the case of
clause (ii) above, to the extent that failure to do so would not reasonably be
expected to have a Material Adverse Effect; and (b) comply with all Contractual
Obligations and Requirements of Law except to the extent that failure
to comply therewith could not, in the aggregate, reasonably be expected
to have a Material Adverse Effect.
6.5 Maintenance of Property; Insurance. (a) Keep all property
useful and necessary in its business in good working order and condition,
ordinary wear and tear excepted and (b) maintain with financially sound and
reputable insurance companies insurance on all its property in at least such
amounts and against at least such risks (but including in any event public
liability, product liability and business interruption) as are usually insured
against in the same general area by companies engaged in the same or a similar
business.
6.6 Inspection of Property; Books and Records; Discussions.
(a) Keep proper books of records and accounts in which full, true and correct
entries in conformity with GAAP and all Requirements of Law shall be made of all
dealings and transactions in relation to its business and activities and (b)
permit representatives of any Lender, upon prior written notice, to make
reasonable visits to and inspections of any of its properties and examine and
make abstracts from any of its books and records at any reasonable time and as
often as may reasonably be desired and to discuss the business, operations,
properties and financial and other condition of the Borrower and its
Subsidiaries with officers of the Borrower and its Subsidiaries.
6.7 Notices. Promptly give notice to the Administrative Agent
and each Lender of:
(a) the occurrence of any Default or Event of Default upon
obtaining knowledge thereof;
(b) any (i) default or event of default under any Contractual
Obligation of the Borrower or any of its Subsidiaries or (ii)
litigation, investigation or proceeding that may exist at any time
between the Borrower or any of its Subsidiaries and any Governmental
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Authority, that in either case, if not cured or if adversely
determined, as the case may be, would reasonably be expected to have a
Material Adverse Effect;
(c) any litigation or proceeding affecting the Borrower or
any of its Subsidiaries in which the amount involved is $15,000,000 or
more and not covered by insurance or in which injunctive or similar
relief is sought;
(d) the following events, as soon as possible and in any event
within 30 days after the Borrower knows or has reason to know thereof:
(i) the occurrence of any Reportable Event with respect to any Plan, a
failure to make any required contribution to a Plan, the creation of
any Lien in favor of the PBGC or a Plan or any withdrawal from, or the
termination, Reorganization or Insolvency of, any Multiemployer Plan or
(ii) the institution of proceedings or the taking of any other action
by the PBGC or the Borrower or any Commonly Controlled Entity or any
Multiemployer Plan with respect to the withdrawal from, or the
termination, Reorganization or Insolvency of, any Plan; and
(e) any development or event that has had or would reasonably
be expected to have a Material Adverse Effect.
Each notice pursuant to this Section 6.7 shall be accompanied by a statement of
a Responsible Officer setting forth details of the occurrence referred to
therein and stating what action the Borrower or the relevant Subsidiary proposes
to take with respect thereto.
6.8 Environmental Laws. (a) Comply in all material respects
with, and ensure compliance in all material respects by all tenants and
subtenants, if any, with, all applicable Environmental Laws, and obtain and
comply in all material respects with and maintain, and ensure that all tenants
and subtenants obtain and comply in all material respects with and maintain,
any and all licenses, approvals, notifications, registrations or permits
required by applicable Environmental Laws.
(b) Conduct and complete all investigations, studies, sampling
and testing, and all remedial, removal and other actions required under
Environmental Laws and promptly comply in all material respects with all lawful
orders and directives of all Governmental Authorities regarding Environmental
Laws.
6.9 Interest Rate Protection. In the case of the Borrower,
within 180 days after the Funding Date, enter into Hedge Agreements to the
extent necessary to provide interest rate protection for at least 50% of the
aggregate principal amount of all Funded Debt of the Borrower and its
Subsidiaries through the use of interest rate swaps, caps, floors or other
appropriate hedging arrangements is subject to either a fixed interest rate or
interest rate protection for a period of not less than three years, which Hedge
Agreements shall have terms and conditions reasonably satisfactory to the
Administrative Agent.
6.10 Additional Collateral, etc. (a) With respect to any
property acquired after the Funding Date by the Borrower or any of its
Subsidiaries (other than an Excluded Subsidiary) (other than (x) any property
described in paragraph (b), (c) or (d) below and (y) any property
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subject to a Lien expressly permitted by Section 7.3(g)) as to which the
Administrative Agent, for the benefit of the Lenders, does not have a perfected
Lien, promptly (i) execute and deliver to the Administrative Agent such
amendments to the Guarantee and Collateral Agreement or such other documents
as the Administrative Agent deems necessary or advisable to grant to the
Administrative Agent, for the benefit of the Lenders, a security interest in
such property and (ii) take all actions necessary or advisable to grant to
the Administrative Agent, for the benefit of the Lenders, a perfected
first priority security interest in such property, including the filing
of Uniform Commercial Code financing statements in such jurisdictions
as may be required by the Guarantee and Collateral Agreement or by law
or as may be requested by the Administrative Agent.
(b) With respect to any fee interest in any real property
having a value (together with improvements thereof) of at least $1,000,000
acquired after the Funding Date by the Borrower or any of its Subsidiaries
(other than (x) any such real property subject to a Lien expressly permitted by
Section 7.3(g) and (z) real property acquired by any Excluded Subsidiary),
promptly (i) execute and deliver a first priority Mortgage, in favor of the
Administrative Agent, for the benefit of the Lenders, covering such real
property, (ii) if requested by the Administrative Agent, provide the Lenders
with (x) title and extended coverage insurance covering such real property in an
amount at least equal to the purchase price of such real property (or such other
amount as shall be reasonably specified by the Administrative Agent) as well as
a current ALTA survey thereof, together with a surveyor's certificate and (y)
any consents or estoppels reasonably deemed necessary or advisable by the
Administrative Agent in connection with such mortgage or deed of trust, each of
the foregoing in form and substance reasonably satisfactory to the
Administrative Agent and (iii) if requested by the Administrative Agent, deliver
to the Administrative Agent legal opinions relating to the matters described
above, which opinions shall be in form and substance, and from counsel,
reasonably satisfactory to the Administrative Agent.
(c) With respect to any new Subsidiary (other than a Foreign
Subsidiary) created or acquired after the Funding Date by the Borrower or any of
its Subsidiaries (which, for the purposes of this paragraph (c), shall include
any existing Subsidiary that ceases to be an Excluded Subsidiary), promptly (i)
execute and deliver to the Administrative Agent such amendments to the Guarantee
and Collateral Agreement as the Administrative Agent deems necessary or
advisable to grant to the Administrative Agent, for the benefit of the Lenders,
a perfected first priority security interest in the Capital Stock of such new
Subsidiary that is owned by the Borrower or any of its Subsidiaries, (ii)
deliver to the Administrative Agent the certificates representing such Capital
Stock, together with undated stock powers, in blank, executed and delivered by a
duly authorized officer of the Borrower or such Subsidiary, as the case may be,
and take such other action as may be necessary or, in the opinion of the
Administrative Agent, desirable to perfect the Administrative Agent's security
interest therein, (iii) cause such new Subsidiary (other than Excluded
Subsidiaries) (A) to become a party to the Guarantee and Collateral Agreement
and (B) to deliver to the Administrative Agent a certificate of such Subsidiary,
substantially in the form of Exhibit C, with appropriate insertions and
attachments, and (iv) if requested by the Administrative Agent, deliver to the
Administrative Agent legal opinions relating to the matters described above,
which opinions shall be in form and substance, and from counsel, reasonably
satisfactory to the Administrative Agent.
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(d) With respect to any new Foreign Subsidiary created or
acquired after the Funding Date by the Borrower or any of its Subsidiaries,
promptly (i) execute and deliver to the Administrative Agent such amendments to
the Guarantee and Collateral Agreement as the Administrative Agent deems
necessary or advisable to grant to the Administrative Agent, for the benefit of
the Lenders, a perfected first priority security interest in the Capital Stock
of such new Subsidiary that is owned by the Borrower or any of its Subsidiaries
(provided that in no event shall more than 65% of the total outstanding Capital
Stock of any such new Subsidiary be required to be so pledged, provided,
further, that the Borrower shall not be obligated to pledge the Capital Stock of
a Foreign Subsidiary to the extent such pledge would violate the laws of the
jurisdiction of such Foreign Subsidiary's organization), (ii) deliver to the
Administrative Agent the certificates representing such Capital Stock, together
with undated stock powers, in blank, executed and delivered by a duly authorized
officer of the Borrower or such Subsidiary, as the case may be, and take such
other action as may be necessary or, in the opinion of the Administrative Agent,
desirable to perfect the Administrative Agent's security interest therein, and
(iii) if requested by the Administrative Agent, deliver to the Administrative
Agent legal opinions relating to the matters described above, which opinions
shall be in form and substance, and from counsel, reasonably satisfactory to the
Administrative Agent.
SECTION 7. NEGATIVE COVENANTS
The Borrower hereby agrees that, so long as the Commitments
remain in effect, any Letter of Credit remains outstanding or any Loan or other
amount is owing to any Lender or the Administrative Agent hereunder, the
Borrower shall not, and shall not permit any of its Subsidiaries to, directly or
indirectly (it being agreed that prior to the Funding Date the Borrower and its
Subsidiaries shall only be required to comply with Section 7.15):
7.1 Financial Condition Covenants.
(a) Consolidated Leverage Ratio. Permit the Consolidated
Leverage Ratio as at the last day of any period of four consecutive fiscal
quarters of the Borrower ending with any fiscal quarter during any fiscal year
set forth below, commencing with the fiscal quarter ending on or about March 31,
2000, to exceed the ratio set forth below opposite such fiscal year:
<TABLE>
<CAPTION>
Consolidated
Fiscal Year Leverage Ratio
----------- --------------
<S> <C>
2000 4.75
2001 4.25
2002 3.75
2003 3.50
2004 3.50
2005 3.50
2006 3.50
2007 3.50
2008 3.50
</TABLE>
<PAGE> 67
62
(b) Consolidated Interest Coverage Ratio. Permit the
Consolidated Interest Coverage Ratio for any period of four consecutive fiscal
quarters of the Borrower ending with any fiscal quarter during any fiscal year
set forth below, commencing with the fiscal quarter ending on or about March 31,
2000, to be less than the ratio set forth below opposite such fiscal year:
<TABLE>
<CAPTION>
Consolidated Interest
Fiscal Year Coverage Ratio
----------- ---------------------
<S> <C>
2000 2.00
2001 2.25
2002 2.75
2003 3.25
2004 3.50
2005 3.50
2006 3.50
2007 3.50
2008 3.50
</TABLE>
; provided that for the purposes of determining the ratio described for the
periods ending March 31, 2000, June 30, 2000 and September 30, 2000, such
determinations shall be made for the one, two or three consecutive fiscal
quarters, respectively, ending with such fiscal quarter.
(c) Consolidated Fixed Charge Coverage Ratio. Permit the
Consolidated Fixed Charge Coverage Ratio for any period of four consecutive
fiscal quarters of the Borrower ending with any fiscal quarter during any fiscal
year set forth below, commencing with the fiscal quarter ending on or about
December 31, 2000, to be less than the ratio set forth below opposite such
fiscal year:
<TABLE>
<CAPTION>
Consolidated Fixed
Fiscal Year Charge Coverage Ratio
----------- ---------------------
<S> <C>
2000 1.00
2001 1.00
2002 1.25
2003 1.50
2004 1.75
2005 1.75
2006 1.75
2007 1.75
2008 1.75
</TABLE>
7.2 Indebtedness. Create, issue, incur, assume, become liable
in respect of or suffer to exist any Indebtedness, except:
(a) Indebtedness of any Loan Party pursuant to any Loan
Document;
<PAGE> 68
63
(b) Indebtedness of the Borrower to any of its Subsidiaries
and of any Subsidiary to the Borrower or any other Subsidiary of the
Borrower;
(c) Guarantee Obligations incurred in the ordinary course of
business by the Borrower or any of its Subsidiaries of obligations of
any Subsidiary in an aggregate amount not to exceed $50,000,000 at any
time, unless otherwise permitted hereunder;
(d) Indebtedness outstanding on the date hereof (or to become
outstanding after the date hereof) and listed on Schedule 7.2(d) and
any refinancings, refundings, renewals or extensions thereof (without
increasing, or shortening the maturity of, the principal amount
thereof);
(e) Indebtedness (including, without limitation, Capital Lease
Obligations) secured by Liens permitted by Section 7.3(g) or (i) in an
aggregate principal amount not to exceed $75,000,000 at any one time
outstanding;
(f) (i) Indebtedness of the Borrower in respect of the Senior
Subordinated Notes in an aggregate principal amount not to exceed
$750,000,000 and any refinancings, refundings, renewals or extensions
thereof on terms and conditions no more restrictive to the Borrower and
its Subsidiaries unless approved by the Administrative Agent, provided,
that the Borrower shall not, in any case, increase, or shorten the
maturity of, the principal amount thereof, or alter the subordination
provisions thereof without the consent of the Administrative Agent and
(ii) Guarantee Obligations of any Subsidiary Guarantor in respect of
such Indebtedness, provided, that such Guarantee Obligations are
subordinated to the same extent as the obligations of the Borrower in
respect of the Senior Subordinated Notes;
(g) Hedge Agreements in respect of (i) Indebtedness that bears
interest at a floating rate, so long as such agreements are not entered
into for speculative purposes and (ii) currencies as long as such
agreements are entered into to hedge actual exposure and not entered
into for speculative purposes;
(h) additional Indebtedness of Foreign Subsidiaries of the
Borrower under lines of credit in an aggregate principal amount not to
exceed the local currency equivalent of $100,000,000 at any time;
(i) Indebtedness of the Borrower or any of its Subsidiaries in
respect of Stub Debt; and
(j) additional Indebtedness of the Borrower or any of its
Subsidiaries in an aggregate principal amount (for the Borrower and all
Subsidiaries) not to exceed $50,000,000 at any one time outstanding.
7.3 Liens. Create, incur, assume or suffer to exist any Lien
upon any of its property, whether now owned or hereafter acquired, except for:
<PAGE> 69
64
(a) Liens for taxes not yet due or that are being contested in
good faith by appropriate proceedings, provided that adequate reserves
with respect thereto are maintained on the books of any Loan Party or
any Excluded Subsidiary, as the case may be, in conformity with GAAP;
(b) statutory liens of landlords and liens of carriers',
warehousemen's, mechanics', materialmen's, repairmen's or other like
Liens arising in the ordinary course of business that are not overdue
for a period of more than 30 days or that are being contested in good
faith by appropriate proceedings;
(c) pledges or deposits in connection with workers'
compensation, unemployment insurance and other social security
legislation;
(d) deposits to secure the performance of bids, trade
contracts (other than for borrowed money), leases, statutory
obligations, surety and appeal bonds, performance bonds and other
obligations of a like nature incurred in the ordinary course of
business;
(e) easements, rights-of-way, restrictions and other similar
encumbrances incurred in the ordinary course of business that, in the
aggregate, are not substantial in amount and that do not in any case
materially detract from the value of the property subject thereto or
materially interfere with the ordinary conduct of the business of the
Borrower or any of its Subsidiaries;
(f) Liens in existence on the date hereof (or to be entered
into after the date hereof) listed on Schedule 7.3(f), securing
Indebtedness permitted by Section 7.2(d), provided that no such Lien is
spread to cover any additional property after the Funding Date and that
the amount of Indebtedness secured thereby is not increased;
(g) Liens securing Indebtedness incurred pursuant to Section
7.2(e) on property at the time it is acquired by any the Borrower or
any of its Subsidiaries, provided that such Liens do not spread to
cover other properties;
(h) Liens arising solely by virtue of any statutory or common
law provisions related to banker's liens, rights of set-off or similar
rights and remedies as to deposit accounts;
(i) Liens securing Indebtedness of the Borrower or any
Subsidiary incurred pursuant to Section 7.2(e) to finance the
acquisition of fixed or capital assets, provided that (i) such Liens do
not at any time encumber any property other than the property financed
by such Indebtedness and (ii) the amount of Indebtedness secured
thereby is not increased;
(j) Liens created pursuant to the Security Documents;
<PAGE> 70
65
(k) Liens consisting of judgment or judicial attachment Liens
and Liens securing contingent obligations on appeal and other bonds in
connection with court proceedings or judgments up to the aggregate at
any time outstanding of $15,000,000;
(l) any interest or title of a lessor under any lease entered
into by the Borrower or any other Subsidiary in the ordinary course of
its business and covering only the assets so leased;
(m) Permitted Receivables Financings;
(n) Liens not otherwise permitted by this Section so long as
neither (i) the aggregate outstanding principal amount of the
obligations secured thereby nor (ii) the aggregate fair market value
(determined as of the date such Lien is incurred) of the assets subject
thereto exceeds (as to the Borrower and all Subsidiaries) $50,000,000
at any one time; and
(o) Liens on property of Foreign Subsidiaries securing
Indebtedness permitted by Section 7.2(h).
7.4 Fundamental Changes. Enter into any merger, consolidation
or amalgamation, or liquidate, wind up or dissolve itself (or suffer any
liquidation or dissolution), or Dispose of, all or substantially all of its
property or business, except that:
(a) any Subsidiary of the Borrower may be merged or
consolidated with or into the Borrower (provided that the Borrower
shall be the continuing or surviving corporation) or with or into any
Wholly Owned Subsidiary Guarantor (provided that the Wholly Owned
Subsidiary Guarantor shall be the continuing or surviving corporation);
(b) any Subsidiary of the Borrower may Dispose of any or all
of its assets (upon voluntary liquidation or otherwise) to the Borrower
or any Wholly Owned Subsidiary Guarantor;
(c) any Subsidiary in which the Borrower and its Subsidiaries
own Capital Stock representing less than 80% of the ordinary voting
power of such Subsidiary may be liquidated as long as the proceeds of
such liquidation (after satisfying all Contractual Obligations of such
Subsidiary) are distributed to the holders of the Capital Stock of such
Subsidiary on an approximately ratable basis (based on their respective
equity ownership interests in such Subsidiary); and
(d) the Spin-Off Transactions may be consummated in accordance
with the Spin-Off Documents.
7.5 Disposition of Property. Dispose of any of its property,
whether now owned or hereafter acquired, or, in the case of any Subsidiary,
issue or sell any shares of such Subsidiary's Capital Stock to any Person,
except:
<PAGE> 71
66
(a) the Disposition of obsolete or worn out property in the
ordinary course of business;
(b) the sale of inventory in the ordinary course of business;
(c) Dispositions permitted by Section 7.4(b);
(d) the sale or issuance of any Subsidiary's Capital Stock to
the Borrower or any Wholly Owned Subsidiary Guarantor;
(e) any Permitted Receivables Financing;
(f) Dispositions listed and described on Schedule 7.5 attached
hereto;
(g) the Disposition of other property not described in clauses
(a) - (f) above for fair market value as long as (i) at least 80% of
the consideration consists of cash and cash equivalents and (ii) the
aggregate fair market value of such property so disposed of does not
exceed the sum of (A) 10% of the Consolidated Total Assets of the
Borrower as determined on the Funding Date plus (B) the proceeds of all
Reinvestment Deferred Amounts with respect to Dispositions reinvested
in the business of the Borrower and its Subsidiaries after the Funding
Date; provided, that neither the Borrower nor any Subsidiary Guarantor
shall make Dispositions, the proceeds of which are reinvested in
Subsidiaries that are not Subsidiary Guarantors, with respect to
property having an aggregate fair market value in excess of 25% of the
Consolidated Total Assets of the Borrower as determined on the Funding
Date;
(h) the Spin-Off Transactions may be consummated in accordance
with the Spin-Off Documents; and
(i) the PCA IPO.
7.6 Restricted Payments. Declare or pay any dividend (other
than dividends payable solely in common stock of the Person making such
dividend) on, or make any payment on account of, or set apart assets for a
sinking or other analogous fund for, the purchase, redemption, defeasance,
retirement or other acquisition of, any Capital Stock of the Borrower or any
Subsidiary, whether now or hereafter outstanding, or make any other distribution
in respect thereof, either directly or indirectly, whether in cash or property
or in obligations of the Borrower or any Subsidiary (collectively, "Restricted
Payments"), except that:
(a) any Subsidiary may make Restricted Payments to the
Borrower or any Subsidiary;
(b) the Borrower may purchase the Borrower's common stock or
common stock options from present or former officers or employees of
the Borrower or any Subsidiary, provided, that the aggregate amount of
payments under this paragraph after the Funding Date (net of any
proceeds received by the Borrower after the Funding Date in connection
<PAGE> 72
67
with resales of any common stock or common stock options so purchased)
shall not exceed $10,000,000;
(c) the Borrower and its Subsidiaries may make Restricted
Payments required in order to consummate the Spin-Off;
(d) the Borrower may pay tax liabilities within 12 months of
the Funding Date arising from the PCA IPO;
(e) the Borrower may pay dividends in the fourth quarter of
fiscal year 1999 in an aggregate amount not to exceed $2,500,000; and
(f) so long as no Default or Event of Default shall have
occurred and be continuing or would result therefrom, the Borrower may
pay dividends and repurchase its Capital Stock in any fiscal year
(beginning with fiscal year 2000) in an aggregate amount not to exceed
$15,000,000.
7.7 Capital Expenditures. Make or commit to make any Capital
Expenditure, except (a) Capital Expenditures of the Borrower and its
Subsidiaries in the ordinary course of business, together with any Investments
in Joint Ventures in excess of $25,000,000 under subsection 7.8(h), not
exceeding (a) $75,000,000 from the Funding Date through December 31, 1999 and
(b) $275,000,000 per fiscal year thereafter; provided, that (i) up to 50% of any
such amount not so expended in the period for which it is permitted may be
carried over for expenditure in the next succeeding fiscal year only and (ii)
Capital Expenditures made pursuant to this clause (a) during any fiscal year
(beginning with fiscal year 2000) shall be deemed made, first, in respect of
amounts permitted for such fiscal year as provided above and, second, in respect
of amounts carried over from the prior fiscal year pursuant to subclause (i)
above and (b) Capital Expenditures made with the proceeds of any Reinvestment
Deferred Amount.
7.8 Investments. Make any advance, loan, extension of credit
(by way of guaranty or otherwise) or capital contribution to, or purchase any
Capital Stock, bonds, notes, debentures or other debt securities of, or any
assets constituting a business unit of, or make any other investment in, any
Person (all of the foregoing, "Investments"), except:
(a) extensions of trade credit in the ordinary course of
business;
(b) investments in Cash Equivalents;
(c) Guarantee Obligations permitted by Section 7.2;
(d) loans and advances to employees of the Borrower or any
Subsidiary of the Borrower in the ordinary course of business
(including for travel, entertainment and relocation expenses) in an
aggregate amount for the Borrower or any Subsidiary of the Borrower not
to exceed $10,000,000 at any one time outstanding;
<PAGE> 73
68
(e) the Spin-off Transactions consummated substantially in
accordance with the Spin-Off Documents;
(f) Investments made by the Borrower or any of its
Subsidiaries in the Borrower or any of its Subsidiaries with the
proceeds of any Reinvestment Deferred Amount;
(g) intercompany Investments by the Borrower or any of its
Subsidiaries in the Borrower or any Person that, prior to such
investment, is a Subsidiary;
(h) Investments in Joint Ventures in an aggregate amount not
to exceed (x) $8,000,000 from the Funding Date through December 31,
1999 and (y) $50,000,000 in each fiscal year thereafter; provided, that
(i) up to 50% of any such amount not so invested in the period for
which it is permitted may be carried over for investment in the next
succeeding fiscal year only and (ii) Investments made pursuant to this
clause (h) during any fiscal year (beginning with fiscal year 2000)
shall be deemed made, first, in respect of amounts permitted for such
fiscal year as provided above and, second, in respect of amounts
carried over from the prior fiscal year pursuant to subclause (i)
above; provided, further, that any such Investments in excess of
$25,000,000 together with any Capital Expenditures shall not exceed the
amounts permitted under Section 7.7;
(i) Investments in existence on the date hereof listed on
Schedule 7.8(i), provided that no such Investment is increased except
as permitted by the other provisions of this Section 7.8; and
(j) in addition to Investments otherwise expressly permitted
by this Section, Investments by the Borrower or any of its Subsidiaries
in an aggregate amount (valued at cost) not to exceed $25,000,000
during the term of this Agreement.
7.9 Optional Payments and Modifications of Senior Subordinated
Notes. (a) Make or offer to make any optional or voluntary payment, prepayment,
repurchase or redemption of or otherwise optionally or voluntarily defease or
segregate funds with respect to the Senior Subordinated Notes, (b) amend,
modify, waive or otherwise change, or consent or agree to any amendment,
modification, waiver or other change to, any of the terms of the Senior
Subordinated Notes or the Senior Subordinated Indenture (other than any such
amendment, modification, waiver or other change that (i) would extend the
maturity or reduce the amount of any payment of principal thereof or reduce the
rate or extend any date for payment of interest thereon and (ii) does not
involve the payment of a consent fee), or (c) designate any Indebtedness (other
than obligations of the Loan Parties pursuant to the Loan Documents) as
"Designated Senior Debt" for the purposes of the Senior Subordinated Note
Indenture.
7.10 Transactions with Affiliates. Enter into or suffer to
exist any transaction, including any purchase, sale, lease or exchange of
property, the rendering of any service or the payment of any management,
advisory or similar fees, with any non-consolidated Affiliate unless such
transaction is upon fair and reasonable terms no less favorable to the Borrower
or such Subsidiary, as the case may be, than it would obtain in a comparable
arm's length transaction with a Person that is not a non-consolidated Affiliate.
<PAGE> 74
69
7.11 Sales and Leasebacks. Enter into or suffer to exist any
arrangement with any Person providing for the leasing by the Borrower or any
Subsidiary of real or personal property that has been or is to be sold or
transferred by the Borrower or such Subsidiary to such Person or to any other
Person to whom funds have been or are to be advanced by such Person on the
security of such property or rental obligations of the Borrower or such
Subsidiary.
7.12 Changes in Fiscal Periods. Permit the fiscal year of the
Borrower to end on a day other than December 31 or change the Borrower's method
of determining fiscal quarters.
7.13 Negative Pledge Clauses. Enter into or suffer to exist or
become effective any agreement that prohibits or limits the ability of the
Borrower or any of its Subsidiaries to create, incur, assume or suffer to exist
any Lien upon any of its property or revenues, whether now owned or hereafter
acquired, to secure its obligations under the Loan Documents to which it is a
party other than (a) this Agreement and the other Loan Documents, (b) any
agreements governing any purchase money Liens or Capital Lease Obligations
otherwise permitted hereby (in which case, any prohibition or limitation shall
only be effective against the assets financed thereby), (c) customary
non-assignment provisions of any contract and (d) customary restrictions on the
creation of Liens on any property or assets arising under a security agreement
governing a Lien permitted under this Agreement.
7.14 Lines of Business. Enter into any business, either
directly or through any Subsidiary, except for those businesses in which the
Borrower and its Subsidiaries are engaged on the date of this Agreement (after
giving effect to the Spin-Off) or that are reasonably related thereto.
7.15 Amendments to Spin-Off Documents. Amend, supplement or
otherwise modify the terms and conditions of the Spin-Off Documents or any other
documents delivered in connection therewith except for any such amendment,
supplement or modification that could not reasonably be expected to have a
Material Adverse Effect or to adversely affect the ability of the Borrower and
its Subsidiaries to perform their respective obligations under the Credit
Documents or the Spin-off Documents.
SECTION 8. EVENTS OF DEFAULT
If any of the following events shall occur and be continuing:
(a) the Borrower shall fail to pay any principal of any Loan
or Reimbursement Obligation when due in accordance with the terms
hereof; or the Borrower shall fail to pay any interest on any Loan or
Reimbursement Obligation, or any other amount payable hereunder or
under any other Loan Document, within five days after any such interest
or other amount becomes due in accordance with the terms hereof; or
(b) any representation or warranty made or deemed made by any
Loan Party herein or in any other Loan Document or that is contained in
any certificate, document or financial or other written statement
furnished by it at any time under or in connection
<PAGE> 75
70
with this Agreement or any such other Loan Document shall prove to have
been inaccurate in any material respect on or as of the date made or
deemed made; or
(c) any Loan Party shall default in the observance or
performance of any agreement contained in clause (i) or (ii) of Section
6.4(a) (with respect to the Borrower only), Section 6.7(a) or Section 7
of this Agreement or Sections 5.5 and 5.7(b) of the Guarantee and
Collateral Agreement; or
(d) any Loan Party shall default in the observance or
performance of any other agreement contained in this Agreement or any
other Loan Document (other than as provided in paragraphs (a) through
(c) of this Section), and such default shall continue unremedied for a
period of 30 days after notice to the Borrower from the Administrative
Agent or the Required Lenders; or
(e) the Borrower or any of its Subsidiaries shall (i) default
in making any payment of any principal of any Indebtedness (including
any Guarantee Obligation, but excluding the Loans) on the scheduled or
original due date with respect thereto; or (ii) default in making any
payment of any interest on any such Indebtedness beyond the period of
grace, if any, provided in the instrument or agreement under which such
Indebtedness was created; or (iii) default in the observance or
performance of any other agreement or condition relating to any such
Indebtedness or contained in any instrument or agreement evidencing,
securing or relating thereto, or any other event shall occur or
condition exist, the effect of which default or other event or
condition is to cause, or to permit the holder or beneficiary of such
Indebtedness (or a trustee or agent on behalf of such holder or
beneficiary) to cause, with the giving of notice if required, such
Indebtedness to become due prior to its stated maturity or (in the case
of any such Indebtedness constituting a Guarantee Obligation) to become
payable; provided, that a default, event or condition described in
clause (i), (ii) or (iii) of this paragraph (e) shall not at any time
constitute an Event of Default unless, at such time, one or more
defaults, events or conditions of the type described in clauses (i),
(ii) and (iii) of this paragraph (e) shall have occurred and be
continuing with respect to Indebtedness the aggregate outstanding
principal amount of which exceeds in the aggregate $50,000,000 for the
Borrower and its Subsidiaries; or an event of default shall occur and
be continuing under the Senior Subordinated Note Indenture; or
(f) (i) the Borrower or any of its Subsidiaries shall commence
any case, proceeding or other action (A) under any existing or future
law of any jurisdiction, domestic or foreign, relating to bankruptcy,
insolvency, reorganization or relief of debtors, seeking to have an
order for relief entered with respect to it, or seeking to adjudicate
it a bankrupt or insolvent, or seeking reorganization, arrangement,
adjustment, winding-up, liquidation, dissolution, composition or other
relief with respect to it or its debts, or (B) seeking appointment of a
receiver, trustee, custodian, conservator or other similar official for
it or for all or any substantial part of its assets, or the Borrower or
any of its Subsidiaries shall make a general assignment for the benefit
of its creditors; or (ii) there shall be commenced against the Borrower
or any of its Subsidiaries any case, proceeding or other action of a
nature referred to in clause (i) above that (A) results in the
<PAGE> 76
71
entry of an order for relief or any such adjudication or appointment or
(B) remains undismissed, undischarged or unbonded for a period of 60
days; or (iii) there shall be commenced against the Borrower or any of
its Subsidiaries any case, proceeding or other action seeking issuance
of a warrant of attachment, execution, distraint or similar process
against all or any substantial part of its assets that results in the
entry of an order for any such relief that shall not have been vacated,
discharged, or stayed or bonded pending appeal within 60 days from the
entry thereof; or (iv) the Borrower or any of its Subsidiaries shall
take any action in furtherance of, or indicating its consent to,
approval of, or acquiescence in, any of the acts set forth in clause
(i), (ii), or (iii) above; or (v) the Borrower or any of its
Subsidiaries shall generally not, or shall be unable to, or shall admit
in writing its inability to, pay its debts as they become due; or
(g) (i) any Person shall engage in any "prohibited
transaction" (as defined in Section 406 of ERISA or Section 4975 of the
Code) involving any Plan, (ii) any "accumulated funding deficiency" (as
defined in Section 302 of ERISA), whether or not waived, shall exist
with respect to any Plan or any Lien in favor of the PBGC or a Plan
shall arise on the assets of the Borrower or any Commonly Controlled
Entity, (iii) a Reportable Event shall occur with respect to, or
proceedings shall commence to have a trustee appointed, or a trustee
shall be appointed, to administer or to terminate, any Single Employer
Plan, which Reportable Event or commencement of proceedings or
appointment of a trustee is, in the reasonable opinion of the Required
Lenders, likely to result in the termination of such Plan for purposes
of Title IV of ERISA, (iv) any Single Employer Plan shall terminate for
purposes of Title IV of ERISA, (v) the Borrower or any Commonly
Controlled Entity shall, or in the reasonable opinion of the Required
Lenders is likely to, incur any liability in connection with a
withdrawal from, or the Insolvency or Reorganization of, a
Multiemployer Plan or (vi) any other event or condition shall occur or
exist with respect to a Plan; and in each case in clauses (i) through
(vi) above, such event or condition, together with all other such
events or conditions, if any, could, in the sole judgment of the
Required Lenders, reasonably be expected to have a Material Adverse
Effect; or
(h) one or more judgments or decrees shall be entered against
the Borrower or any of its Subsidiaries involving in the aggregate for
the Borrower and its Subsidiaries a liability (not paid or fully
covered by insurance as to which the relevant insurance company has
acknowledged coverage) of $75,000,000 or more, and all such judgments
or decrees shall not have been vacated, discharged, stayed or bonded
pending appeal within 30 days from the entry thereof; or
(i) any of the Security Documents shall cease, for any reason,
to be in full force and effect, or any Loan Party or any Affiliate of
any Loan Party shall so assert, or any Lien created by any of the
Security Documents shall cease to be enforceable and of the same effect
and priority purported to be created thereby if the aggregate value of
the affected Collateral is more than $5,000,000; or
<PAGE> 77
72
(j) the guarantee contained in Section 2 of the Guarantee and
Collateral Agreement shall cease, for any reason, to be in full force
and effect or any Loan Party shall so assert; or
(k) (i) any "person" or "group" (as such terms are used in
Sections 13(d) and 14(d) of the Exchange Act), shall become, or obtain
rights (whether by means or warrants, options or otherwise) to become,
the "beneficial owner" (as defined in Rules 13(d)-3 and 13(d)-5 under
the Exchange Act), directly or indirectly, of more than 25% of the
outstanding common stock of the Borrower; or (ii) the board of
directors of the Borrower shall cease to consist of a majority of
Continuing Directors; or (iii) a Specified Change of Control shall
occur; or
(l) the Senior Subordinated Notes or any guarantee thereof
shall cease, for any reason, to be validly subordinated to the
Obligations or the obligations of the Subsidiary Guarantors under the
Guarantee and Collateral Agreement, as the case may be, as provided in
the Senior Subordinated Note Indenture, or any Loan Party, any
Affiliate of any Loan Party, the trustee in respect of the Senior
Subordinated Notes or the holders of at least 25% in aggregate
principal amount of the Senior Subordinated Notes shall so assert;
then, and in any such event, (A) if such event is an Event of Default specified
in clause (i) or (ii) of paragraph (f) above with respect to the Borrower,
automatically the Commitments shall immediately terminate and the Loans
hereunder (with accrued interest thereon) and all other amounts owing under this
Agreement and the other Loan Documents (including all amounts of L/C
Obligations, whether or not the beneficiaries of the then outstanding Letters of
Credit shall have presented the documents required thereunder) shall immediately
become due and payable, and (B) if such event is any other Event of Default,
either or both of the following actions may be taken: (i) with the consent of
the Required Lenders, the Administrative Agent may, or upon the request of the
Required Lenders, the Administrative Agent shall, by notice to the Borrower
declare the Revolving Commitments to be terminated forthwith, whereupon the
Revolving Commitments shall immediately terminate; and (ii) with the consent of
the Required Lenders, the Administrative Agent may, or upon the request of the
Required Lenders, the Administrative Agent shall, by notice to the Borrower,
declare the Loans hereunder (with accrued interest thereon) and all other
amounts owing under this Agreement and the other Loan Documents (including all
amounts of L/C Obligations, whether or not the beneficiaries of the then
outstanding Letters of Credit shall have presented the documents required
thereunder) to be due and payable forthwith, whereupon the same shall
immediately become due and payable. With respect to all Letters of Credit with
respect to which presentment for honor shall not have occurred at the time of an
acceleration pursuant to this paragraph, the Borrower shall at such time deposit
in a cash collateral account opened by the Administrative Agent an amount equal
to the aggregate then undrawn and unexpired amount of such Letters of Credit.
Amounts held in such cash collateral account shall be applied by the
Administrative Agent to the payment of drafts drawn under such Letters of
Credit, and the unused portion thereof after all such Letters of Credit shall
have expired or been fully drawn upon, if any, shall be applied to repay other
obligations of the Borrower hereunder and under the other Loan Documents. After
all such Letters of Credit shall have expired or been fully drawn upon, all
Reimbursement Obligations shall have been satisfied
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and all other obligations of the Borrower hereunder and under the other Loan
Documents shall have been paid in full, the balance, if any, in such cash
collateral account shall be returned to the Borrower (or such other Person as
may be lawfully entitled thereto). Except as expressly provided above in this
Section, presentment, demand, protest and all other notices of any kind are
hereby expressly waived by the Borrower.
SECTION 9. THE AGENTS
9.1 Appointment. Each Lender hereby irrevocably designates and
appoints the Administrative Agent as the agent of such Lender under this
Agreement and the other Loan Documents, and each such Lender irrevocably
authorizes the Administrative Agent, in such capacity, to take such action on
its behalf under the provisions of this Agreement and the other Loan Documents
and to exercise such powers and perform such duties as are expressly delegated
to the Administrative Agent by the terms of this Agreement and the other Loan
Documents, together with such other powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary elsewhere in this Agreement, the
Administrative Agent shall not have any duties or responsibilities, except those
expressly set forth herein, or any fiduciary relationship with any Lender, and
no implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or any other Loan Document or
otherwise exist against the Administrative Agent.
9.2 Delegation of Duties. The Administrative Agent may execute
any of its duties under this Agreement and the other Loan Documents by or
through agents or attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. The Administrative Agent shall
not be responsible for the negligence or misconduct of any agents or attorneys
in-fact selected by it with reasonable care.
9.3 Exculpatory Provisions. Neither any Agent nor any of their
respective officers, directors, employees, agents, attorneys-in-fact or
affiliates shall be (i) liable for any action lawfully taken or omitted to be
taken by it or such Person under or in connection with this Agreement or any
other Loan Document (except to the extent that any of the foregoing are found by
a final and nonappealable decision of a court of competent jurisdiction to have
resulted from its or such Person's own gross negligence or willful misconduct)
or (ii) responsible in any manner to any of the Lenders for any recitals,
statements, representations or warranties made by any Loan Party or any officer
thereof contained in this Agreement or any other Loan Document or in any
certificate, report, statement or other document referred to or provided for in,
or received by the Agents under or in connection with, this Agreement or any
other Loan Document or for the value, validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement or any other Loan Document or
for any failure of any Loan Party a party thereto to perform its obligations
hereunder or thereunder. The Agents shall not be under any obligation to any
Lender to ascertain or to inquire as to the observance or performance of any of
the agreements contained in, or conditions of, this Agreement or any other Loan
Document, or to inspect the properties, books or records of any Loan Party.
9.4 Reliance by Administrative Agent. The Administrative Agent
shall be entitled to rely, and shall be fully protected in relying, upon any
instrument, writing, resolution,
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notice, consent, certificate, affidavit, letter, telecopy, telex or teletype
message, statement, order or other document or conversation believed by it to be
genuine and correct and to have been signed, sent or made by the proper Person
or Persons and upon advice and statements of legal counsel (including counsel to
the Borrower), independent accountants and other experts selected by the
Administrative Agent. The Administrative Agent may deem and treat the payee of
any Note as the owner thereof for all purposes unless a written notice of
assignment, negotiation or transfer thereof shall have been filed with the
Administrative Agent. The Administrative Agent shall be fully justified in
failing or refusing to take any action under this Agreement or any other Loan
Document unless it shall first receive such advice or concurrence of the
Required Lenders (or, if so specified by this Agreement, all Lenders) as it
deems appropriate or it shall first be indemnified to its satisfaction by the
Lenders against any and all liability and expense that may be incurred by it by
reason of taking or continuing to take any such action. The Administrative Agent
shall in all cases be fully protected in acting, or in refraining from acting,
under this Agreement and the other Loan Documents in accordance with a request
of the Required Lenders (or, if so specified by this Agreement, all Lenders),
and such request and any action taken or failure to act pursuant thereto shall
be binding upon all the Lenders and all future holders of the Loans.
9.5 Notice of Default. The Administrative Agent shall not be
deemed to have knowledge or notice of the occurrence of any Default or Event of
Default hereunder unless the Administrative Agent has received notice from a
Lender, the Borrower referring to this Agreement, describing such Default or
Event of Default and stating that such notice is a "notice of default". In the
event that the Administrative Agent receives such a notice, the Administrative
Agent shall give notice thereof to the Lenders. The Administrative Agent shall
take such action with respect to such Default or Event of Default as shall be
reasonably directed by the Required Lenders (or, if so specified by this
Agreement, all Lenders); provided that unless and until the Administrative Agent
shall have received such directions, the Administrative Agent may (but shall not
be obligated to) take such action, or refrain from taking such action, with
respect to such Default or Event of Default as it shall deem advisable in the
best interests of the Lenders.
9.6 Non-Reliance on Agents and Other Lenders. Each Lender
expressly acknowledges that neither the Agents nor any of their respective
officers, directors, employees, agents, attorneys-in-fact or affiliates have
made any representations or warranties to it and that no act by any Agent
hereinafter taken, including any review of the affairs of a Loan Party or any
affiliate of a Loan Party, shall be deemed to constitute any representation or
warranty by any Agent to any Lender. Each Lender represents to the Agents that
it has, independently and without reliance upon any Agent or any other Lender,
and based on such documents and information as it has deemed appropriate, made
its own appraisal of and investigation into the business, operations, property,
financial and other condition and creditworthiness of the Loan Parties and their
affiliates and made its own decision to make its Loans hereunder and enter into
this Agreement. Each Lender also represents that it will, independently and
without reliance upon any Agent or any other Lender, and based on such documents
and information as it shall deem appropriate at the time, continue to make its
own credit analysis, appraisals and decisions in taking or not taking action
under this Agreement and the other Loan Documents, and to make such
investigation as it deems necessary to inform itself as to the business,
operations, property, financial and other condition and creditworthiness of the
Loan Parties and their affiliates. Except
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for notices, reports and other documents expressly required to be furnished to
the Lenders by the Administrative Agent hereunder, the Administrative Agent
shall not have any duty or responsibility to provide any Lender with any credit
or other information concerning the business, operations, property, condition
(financial or otherwise), prospects or creditworthiness of any Loan Party or any
affiliate of a Loan Party that may come into the possession of the
Administrative Agent or any of its officers, directors, employees, agents,
attorneys-in-fact or affiliates.
9.7 Indemnification. The Lenders agree to indemnify each Agent
in its capacity as such (to the extent not reimbursed by the Borrower and
without limiting the obligation of the Borrower to do so), ratably according to
their respective Aggregate Exposure Percentages in effect on the date on which
indemnification is sought under this Section (or, if indemnification is sought
after the date upon which the Commitments shall have terminated and the Loans
shall have been paid in full, ratably in accordance with such Aggregate Exposure
Percentages immediately prior to such date), from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind whatsoever that may at any time
(whether before or after the payment of the Loans) be imposed on, incurred by or
asserted against such Agent in any way relating to or arising out of, the
Commitments, this Agreement, any of the other Loan Documents or any documents
contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby or any action taken or omitted by such Agent
under or in connection with any of the foregoing; provided that no Lender shall
be liable for the payment of any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements that are found by a final and nonappealable decision of a court of
competent jurisdiction to have resulted from such Agent's gross negligence or
willful misconduct. The agreements in this Section shall survive the payment of
the Loans and all other amounts payable hereunder.
9.8 Agent in Its Individual Capacity. Each Agent and its
affiliates may make loans to, accept deposits from and generally engage in any
kind of business with any Loan Party as though such Agent was not an Agent. With
respect to its Loans made or renewed by it and with respect to any Letter of
Credit issued or participated in by it, each Agent shall have the same rights
and powers under this Agreement and the other Loan Documents as any Lender and
may exercise the same as though it were not an Agent, and the terms "Lender" and
"Lenders" shall include each Agent in its individual capacity.
9.9 Successor Administrative Agent. The Administrative Agent
may resign as Administrative Agent upon 20 days' notice to the Lenders and the
Borrower. If the Administrative Agent shall resign as Administrative Agent under
this Agreement and the other Loan Documents, then the Required Lenders shall
appoint from among the Lenders a successor agent for the Lenders, which
successor agent shall (unless an Event of Default under Section 8(a) or Section
8(f) with respect to the Borrower shall have occurred and be continuing) be
subject to approval by the Borrower (which approval shall not be unreasonably
withheld or delayed), whereupon such successor agent shall succeed to the
rights, powers and duties of the Administrative Agent, and the term
"Administrative Agent" shall mean such successor agent effective upon such
appointment and approval, and the former Administrative Agent's rights,
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powers and duties as Administrative Agent shall be terminated, without any other
or further act or deed on the part of such former Administrative Agent or any of
the parties to this Agreement or any holders of the Loans. If no successor agent
has accepted appointment as Administrative Agent by the date that is 20 days
following a retiring Administrative Agent's notice of resignation, the retiring
Administrative Agent's resignation shall nevertheless thereupon become effective
and the Lenders shall assume and perform all of the duties of the Administrative
Agent hereunder until such time, if any, as the Required Lenders appoint a
successor agent as provided for above. After any retiring Administrative Agent's
resignation as Administrative Agent, the provisions of this Section 9 shall
inure to its benefit as to any actions taken or omitted to be taken by it while
it was Administrative Agent under this Agreement and the other Loan Documents.
9.10 Co-Documentation Agents and Syndication Agent. Neither
the Co-Documentation Agents nor the Syndication Agent shall have any duties or
responsibilities hereunder in their capacities as such.
SECTION 10. MISCELLANEOUS
10.1 Amendments and Waivers. Neither this Agreement, any other
Loan Document, nor any terms hereof or thereof may be amended, supplemented or
modified except in accordance with the provisions of this Section 10.1. The
Required Lenders and each Loan Party party to the relevant Loan Document may,
or, with the written consent of the Required Lenders, the Administrative Agent
and each Loan Party party to the relevant Loan Document may, from time to time,
(a) enter into written amendments, supplements or modifications hereto and to
the other Loan Documents for the purpose of adding any provisions to this
Agreement or the other Loan Documents or changing in any manner the rights of
the Lenders or of the Loan Parties hereunder or thereunder or (b) waive, on such
terms and conditions as the Required Lenders or the Administrative Agent, as the
case may be, may specify in such instrument, any of the requirements of this
Agreement or the other Loan Documents or any Default or Event of Default and its
consequences; provided, however, that no such waiver and no such amendment,
supplement or modification shall (i) eliminate or reduce any voting rights under
this Section 10.1, forgive the principal amount or extend the final scheduled
date of maturity of any Loan or extend any L/C Participant's interest in the
Issuing Lender's obligations and rights under any Letter of Credit beyond the
Revolving Termination Date, extend the scheduled date of any amortization
payment in respect of any Term Loan, reduce the stated rate of any interest or
fee payable hereunder (except (x) in connection with the waiver of applicability
of any post-default increase in interest rates and (y) that any amendment or
modification in the financial definitions in this Agreement shall not constitute
a reduction in the rate of interest or commitment fee for purposes of this
clause (i)) or extend the scheduled date of any payment thereof, or increase the
amount or extend the expiration date of any Lender's Revolving Commitment, in
each case without the consent of each Lender directly affected thereby; (ii)
reduce any percentage specified in the definition of Required Lenders, consent
to the assignment or transfer by the Borrower of any of its rights and
obligations under this Agreement and the other Loan Documents, release all or
substantially all of the Collateral or release all or substantially all of the
Subsidiary Guarantors from their obligations under the Guarantee and Collateral
Agreement, in each case without the consent of all Lenders; (iii) amend, modify
or waive any provision of Section 2.17 without the consent of the Majority
Facility Lenders in respect of each Facility adversely affected thereby;
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(iv) reduce the amount of Net Cash Proceeds or Excess Cash Flow required to be
applied to prepay Loans under this Agreement without the consent of the Majority
Facility Lenders under each Facility adversely affected thereby; (v) reduce the
percentage specified in the definition of Majority Facility Lenders with respect
to any Facility without the consent of all Lenders under such Facility; (vi)
amend, modify or waive (A) the second proviso of the first sentence of Section
2.10, (B) the proviso of Section 2.17(b) or (C) Section 2.11(e), in each case
without the consent of the Majority Facility Lenders of the Tranche B Facility
and the Tranche C Facility; (vii) amend, modify or waive any provision of
Section 9 without the consent of the Administrative Agent; (viii) amend, modify
or waive any provision of Section 2.6 or 2.7 without the consent of the
Swingline Lender; (ix) amend, modify or waive any provision of Section 3 without
the consent of the Issuing Lender; (x) or amend, modify or waive any provision
of Section 5.2(b) without the consent of each Lender directly affected thereby
(it being agreed that, with the consent of the Required Lenders, additional
extensions of credit and tranches and increases in the amount of the Facilities
may be added to this Agreement and may share in any payments, prepayments,
Collateral and voting rights on a pro rata basis and corresponding amendments to
the Loan Documents may be made); provided further that prior to the Funding Date
the amounts of the Facilities may be reallocated with the written consent of the
Required Lenders. Any such waiver and any such amendment, supplement or
modification shall apply equally to each of the Lenders and shall be binding
upon the Loan Parties, the Lenders, the Administrative Agent and all future
holders of the Loans. In the case of any waiver, the Loan Parties, the Lenders
and the Administrative Agent shall be restored to their former position and
rights hereunder and under the other Loan Documents, and any Default or Event of
Default waived shall be deemed to be cured and not continuing; but no such
waiver shall extend to any subsequent or other Default or Event of Default, or
impair any right consequent thereon.
10.2 Notices. All notices, requests and demands to or upon the
respective parties hereto to be effective shall be in writing (including by
telecopy), and, unless otherwise expressly provided herein, shall be deemed to
have been duly given or made when delivered, or three Business Days after being
deposited in the mail, postage prepaid, or, in the case of telecopy notice, when
received, addressed as follows in the case of the Borrower and the
Administrative Agent, and as set forth in an administrative questionnaire
delivered to the Administrative Agent in the case of the Lenders, or to such
other address as may be hereafter notified by the respective parties hereto:
The Borrower: Tenneco Automotive Inc.
500 North Field Drive
Lake Forest, IL 60045
Attention: Paul Novas
Telecopy: 847-482-5176
Telephone: 847-482-5000
with a copy to: Tenneco Automotive Inc.
500 North Field Drive
Lake Forest, IL 60045
Attention: Timothy Donovan
Telecopy: 847-482-5030
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Telephone: 847-482-5000
The Administrative Agent: 270 Park Avenue
New York, New York 10017
Attention: Randolph Cates
Telecopy: 212-270-1403
Telephone: 212-270-8997
with a copy to: One Chase Manhattan Plaza, 8th Floor
New York, New York 10005
Attention: Janet Belden
Telecopy: 212-552-5658
Telephone: 212-552-7277
provided that any notice, request or demand to or upon the Administrative Agent
or the Lenders shall not be effective until received.
10.3 No Waiver; Cumulative Remedies. No failure to exercise
and no delay in exercising, on the part of the Administrative Agent or any
Lender, any right, remedy, power or privilege hereunder or under the other Loan
Documents shall operate as a waiver thereof; nor shall any single or partial
exercise of any right, remedy, power or privilege hereunder preclude any other
or further exercise thereof or the exercise of any other right, remedy, power or
privilege. The rights, remedies, powers and privileges herein provided are
cumulative and not exclusive of any rights, remedies, powers and privileges
provided by law.
10.4 Survival of Representations and Warranties. All
representations and warranties made hereunder, in the other Loan Documents and
in any document, certificate or statement delivered pursuant hereto or in
connection herewith shall survive the execution and delivery of this Agreement
and the making of the Loans and other extensions of credit hereunder.
10.5 Payment of Expenses and Taxes. The Borrower agrees (a) to
pay or reimburse the Administrative Agent for all its out-of-pocket costs and
expenses incurred in connection with the development, preparation and execution
of, and any amendment, supplement or modification to, this Agreement and the
other Loan Documents and any other documents prepared in connection herewith or
therewith, and the consummation of the transactions contemplated hereby and
thereby, including the reasonable fees and disbursements of counsel to the
Administrative Agent and filing and recording fees and expenses, (b) to pay or
reimburse each Lender and the Administrative Agent for all its costs and
expenses incurred in connection with the enforcement or preservation of any
rights under this Agreement, the other Loan Documents and any such other
documents, including the fees and disbursements of counsel (including the
allocated fees and expenses of in-house counsel) to each Lender and of counsel
to the Administrative Agent, (c) to pay, indemnify, and hold each Lender and the
Administrative Agent harmless from, any and all recording and filing fees and
any and all liabilities with respect to, or resulting from any delay in paying,
stamp, excise and other taxes, if any, that may be payable or determined to be
payable in connection with the execution and delivery of, or consummation or
administration of any of the transactions contemplated by, or any amendment,
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supplement or modification of, or any waiver or consent under or in respect of,
this Agreement, the other Loan Documents and any such other documents, and (d)
to pay, indemnify, and hold each Lender and the Administrative Agent and their
respective officers, directors, trustees, employees, affiliates, agents and
controlling persons (each, an "Indemnitee") harmless from and against any and
all other liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature
whatsoever with respect to the execution, delivery, enforcement, performance and
administration of this Agreement, the other Loan Documents and any such other
documents, including any of the foregoing relating to the use of proceeds of the
Loans or the violation of, noncompliance with or liability under, any
Environmental Law applicable to the operations of the Borrower or any of its
Subsidiaries or any of the Properties and the reasonable fees and expenses of
legal counsel in connection with claims, actions or proceedings by any
Indemnitee against any Loan Party under any Loan Document (all the foregoing in
this clause (d), collectively, the "Indemnified Liabilities"), provided, that
the Borrower shall have no obligation hereunder to any Indemnitee with respect
to Indemnified Liabilities to the extent such Indemnified Liabilities are found
by a final and nonappealable decision of a court of competent jurisdiction to
have resulted from the gross negligence or willful misconduct of such
Indemnitee. Without limiting the foregoing, and to the extent permitted by
applicable law, the Borrower agrees not to assert and to cause its Subsidiaries
not to assert, and hereby waives and agrees to cause its Subsidiaries to so
waive, all rights for contribution or any other rights of recovery with respect
to all claims, demands, penalties, fines, liabilities, settlements, damages,
costs and expenses of whatever kind or nature, under or related to Environmental
Laws, that any of them might have by statute or otherwise against any
Indemnitee. All amounts due under this Section 10.5 shall be payable promptly
after written demand therefor. The agreements in this Section 10.5 shall survive
repayment of the Loans and all other amounts payable hereunder.
10.6 Successors and Assigns; Participations and Assignments.
(a) This Agreement shall be binding upon and inure to the benefit of the
Borrower, the Lenders, the Administrative Agent, all future holders of the Loans
and their respective successors and assigns, except that the Borrower may not
assign or transfer any of its rights or obligations under this Agreement without
the prior written consent of each Lender (except in a transaction permitted by
Section 7.4).
(b) Any Lender may, without the consent of the Borrower or the
Administrative Agent, in accordance with applicable law, at any time sell to one
or more banks, financial institutions or other entities (each, a "Participant")
participating interests in any Loan owing to such Lender, any Commitment of such
Lender or any other interest of such Lender hereunder and under the other Loan
Documents. In the event of any such sale by a Lender of a participating interest
to a Participant, such Lender's obligations under this Agreement to the other
parties to this Agreement shall remain unchanged, such Lender shall remain
solely responsible for the performance thereof, such Lender shall remain the
holder of any such Loan for all purposes under this Agreement and the other Loan
Documents, and the Borrower and the Administrative Agent shall continue to deal
solely and directly with such Lender in connection with such Lender's rights and
obligations under this Agreement and the other Loan Documents. In no event shall
any Participant under any such participation have any right to approve any
amendment or waiver of any provision of any Loan Document, or any consent to any
departure by any Loan Party
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therefrom, except to the extent that such amendment, waiver or consent would
reduce the principal of, or interest on, the Loans or any fees payable
hereunder, or postpone the date of the final maturity of the Loans, in each case
to the extent subject to such participation. The Borrower agrees that if amounts
outstanding under this Agreement and the Loans are due or unpaid, or shall have
been declared or shall have become due and payable upon the occurrence of an
Event of Default, each Participant shall, to the maximum extent permitted by
applicable law, be deemed to have the right of setoff in respect of its
participating interest in amounts owing under this Agreement to the same extent
as if the amount of its participating interest were owing directly to it as a
Lender under this Agreement, provided that, in purchasing such participating
interest, such Participant shall be deemed to have agreed to share with the
Lenders the proceeds thereof as provided in Section 10.7(a) as fully as if it
were a Lender hereunder. The Borrower also agrees that each Participant shall be
entitled to the benefits of Sections 2.18, 2.19 and 2.20 with respect to its
participation in the Commitments and the Loans outstanding from time to time as
if it was a Lender; provided that, in the case of Section 2.19, such Participant
shall have complied with the requirements of said Section and provided, further,
that no Participant shall be entitled to receive any greater amount pursuant to
any such Section than the transferor Lender would have been entitled to receive
in respect of the amount of the participation transferred by such transferor
Lender to such Participant had no such transfer occurred.
(c) Any Lender (an "Assignor") may, in accordance with
applicable law, at any time and from time to time assign to any Lender, any
affiliate of any Lender or any Approved Fund or, with the consent of the
Borrower and the Administrative Agent (which, in each case, shall not be
unreasonably withheld or delayed), to an additional bank, financial institution
or other entity (an "Assignee") all or any part of its rights and obligations
under this Agreement pursuant to an Assignment and Acceptance, executed by such
Assignee, such Assignor and any other Person whose consent is required pursuant
to this paragraph, and delivered to the Administrative Agent for its acceptance
and recording in the Register; provided that (i) no such assignment to an
Assignee (other than any Lender, any affiliate of any Lender or any Approved
Fund) shall be in an aggregate principal amount of less than $5,000,000 (other
than in the case of an assignment of all of a Lender's interests under this
Agreement) and (ii) after giving effect to any such assignment, such Lender and
its affiliates (including any Approved Funds) shall retain Commitments and Term
Loans in an aggregate principal amount of $5,000,000 (other than in the case of
an assignment of all of a Lender's interests under this Agreement), in each case
unless otherwise agreed by the Borrower and the Administrative Agent. For
purposes of the proviso contained in the preceding sentence, the amount
described therein shall be aggregated in respect of each Lender and its related
Approved Funds, if any (other than in the case of an assignment of all of a
Lender's interests under this Agreement). Any such assignment need not be
ratable as among the Facilities. Upon such execution, delivery, acceptance and
recording, from and after the effective date determined pursuant to such
Assignment and Acceptance, (x) the Assignee thereunder shall be deemed a party
hereto and, to the extent provided in such Assignment and Acceptance, have the
rights and obligations of a Lender hereunder with a Commitment and/or Loans as
set forth therein, and (y) the Assignor thereunder shall, to the extent provided
in such Assignment and Acceptance, be released from its obligations under this
Agreement (and, in the case of an Assignment and Acceptance covering all of an
Assignor's rights and obligations under this Agreement, such Assignor shall
cease to be a party hereto). Notwithstanding any provision of this Section 10.6,
the consent of the Borrower shall not be required for any assignment that
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occurs when an Event of Default pursuant to Sections 8(a) or 8(f) shall have
occurred and be continuing with respect to the Borrower.
(d) Notwithstanding anything to the contrary contained herein,
any Lender which is a bank (a "Granting Bank") may grant to a special purpose
funding vehicle (an "SPC"), identified as such in writing from time to time by
the Granting Bank to the Administrative Agent and the Borrower, the option to
provide to the Borrower all or any part of any Loan which such Granting Bank
would otherwise be obligated to make to the Borrower pursuant to this Agreement;
provided, that (i) nothing herein shall constitute a commitment by any SPC to
make any Loan and (ii) if an SPC elects not to exercise such option or otherwise
fails to provide all or any part of such Loan, the Granting Bank shall be
obligated to make such Loan pursuant to the terms hereof. The making of a Loan
by an SPC hereunder shall utilize the Commitment of the Granting Bank to the
same extent, and as if, such Loan were made by such Granting Bank. Each party
hereto hereby agrees that no SPC shall be liable for any indemnity or similar
payment obligation hereunder (all liability for which shall remain with the
Granting Bank). In furtherance of the foregoing, each party hereto agrees (which
agreement shall survive termination of this Agreement) that in the event of any
such grant by a Granting Bank to an SPC of the option to provide to the Borrower
all or any part of its Loan, (i) such Granting Bank's obligations under this
Agreement to the other parties to this Agreement shall remain unchanged and such
Granting Bank shall remain solely responsible for the performance of such
obligations under this Agreement and the other Loan Documents, (ii) such
Granting Bank shall remain the holder of such Loan for all purposes under this
Agreement and the other Loan Documents and nothing contained in this Section
10.6(d) is intended to excuse the Granting Bank from the full performance of its
obligations hereunder and thereunder or otherwise diminish the duties and
liabilities of the Granting Bank under this Agreement or the other Loan
Documents (other than it being understood that any payment obligation on the
part of such Granting Bank to make a Loan hereunder shall, if such Loan is made
by any SPC, be deemed to have been satisfied upon the making of such Loan by
such SPC), (iii) the Borrower and the Administrative Agent shall continue to
deal solely and directly with such Granting Bank in connection with such
Granting Bank's rights and obligations under this Agreement and the other Loan
Documents, (iv) in no event shall any SPC have any right to approve any
amendment or waiver of any provision of any Loan Document, or any consent to any
departure by any Loan Party therefrom, or be included in any determination of
the Required Lenders or the Majority Facility Lenders hereunder for any purpose,
(v) prior to the date that is one year and one day after the payment in full of
all outstanding commercial paper or other senior Indebtedness of any SPC, it
will not institute against, or join any other Person in instituting against,
such SPC any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings under the laws of the United States or any State thereof. In
addition, notwithstanding anything to the contrary contained in this Section
10.6(d), any SPC may (X) with notice to, but without prior written consent of,
the Borrower and the Administrative Agent (subject, however, to the approval of
the financial institution as set forth below), assign all or a portion of its
interests in any Loan to the Granting Bank or to a financial institution
(previously approved in writing by the Borrower and the Administrative Agent)
providing liquidity and/or credit support to or for the account of such SPC to
support the funding or maintenance of the Loans and (Y) subject to Section 10.15
hereof, disclose on a confidential basis any non-public information relating to
its Loans to any rating agency as
<PAGE> 87
82
specifically provided for in Section 10.15 hereof. This Section 10.6 may not be
amended without the prior written consent of the SPC, the Borrower and the
Administrative Agent.
(e) The Administrative Agent shall, on behalf of the Borrower,
maintain at its address referred to in Section 10.2 a copy of each Assignment
and Acceptance delivered to it and a register (the "Register") for the
recordation of the names and addresses of the Lenders and the Commitment of, and
the principal amount of the Loans owing to, each Lender from time to time. The
entries in the Register shall be conclusive, in the absence of manifest error,
and the Borrower, each other Loan Party, the Administrative Agent and the
Lenders shall treat each Person whose name is recorded in the Register as the
owner of the Loans and any Notes evidencing the Loans recorded therein for all
purposes of this Agreement. Any assignment of any Loan, whether or not evidenced
by a Note, shall be effective only upon appropriate entries with respect thereto
being made in the Register (and each Note shall expressly so provide). Any
assignment or transfer of all or part of a Loan evidenced by a Note shall be
registered on the Register only upon surrender for registration of assignment or
transfer of the Note evidencing such Loan, accompanied by a duly executed
Assignment and Acceptance, and thereupon one or more new Notes shall be issued
to the designated Assignee.
(f) Upon its receipt of an Assignment and Acceptance executed
by an Assignor, an Assignee and any other Person whose consent is required by
Section 10.6(c), together with payment to the Administrative Agent of a
registration and processing fee of $3,500 (which shall not be an obligation of
the Borrower), the Administrative Agent shall (i) promptly accept such
Assignment and Acceptance and (ii) record the information contained therein in
the Register on the effective date determined pursuant thereto.
(g) For avoidance of doubt, the parties to this Agreement
acknowledge that the provisions of this Section 10.6 concerning assignments of
Loans and Notes relate only to absolute assignments and that such provisions do
not prohibit assignments creating security interests, including any pledge or
assignment by a Lender of any Loan or Note to any Federal Reserve Bank in
accordance with applicable law.
(h) The Borrower, upon receipt of written notice from the
relevant Lender, agrees to issue Notes to any Lender requiring Notes to
facilitate transactions of the type described in paragraph (g) above.
10.7 Adjustments; Set-off. (a) Except to the extent that this
Agreement expressly provides for payments to be allocated to a particular Lender
or to the Lenders under a particular Facility, if any Lender (a "Benefitted
Lender") shall, at any time after the Loans and other amounts payable hereunder
shall immediately become due and payable pursuant to Section 8, receive any
payment of all or part of the Obligations owing to it, or receive any collateral
in respect thereof (whether voluntarily or involuntarily, by set-off, pursuant
to events or proceedings of the nature referred to in Section 8(f), or
otherwise), in a greater proportion than any such payment to or collateral
received by any other Lender, if any, in respect of the Obligations owing to
such other Lender, such Benefitted Lender shall purchase for cash from the other
Lenders a participating interest in such portion of the Obligations owing to
each such other Lender, or shall provide such other Lenders with the benefits of
any such collateral, as shall be necessary to cause
<PAGE> 88
83
such Benefitted Lender to share the excess payment or benefits of such
collateral ratably with each of the Lenders; provided, however, that if all or
any portion of such excess payment or benefits is thereafter recovered from such
Benefitted Lender, such purchase shall be rescinded, and the purchase price and
benefits returned, to the extent of such recovery, but without interest.
(b) In addition to any rights and remedies of the Lenders
provided by law, each Lender shall have the right, without prior notice to the
Borrower, any such notice being expressly waived by the Borrower to the extent
permitted by applicable law, upon any amount becoming due and payable by the
Borrower hereunder (whether at the stated maturity, by acceleration or
otherwise), to set off and appropriate and apply against such amount any and all
deposits (general or special, time or demand, provisional or final), in any
currency, and any other credits, indebtedness or claims, in any currency, in
each case whether direct or indirect, absolute or contingent, matured or
unmatured, at any time held or owing by such Lender or any branch or agency
thereof to or for the credit or the account of the Borrower, as the case may be.
Each Lender agrees promptly to notify the Borrower and the Administrative Agent
after any such setoff and application made by such Lender, provided that the
failure to give such notice shall not affect the validity of such setoff and
application.
10.8 Counterparts. This Agreement may be executed by one or
more of the parties to this Agreement on any number of separate counterparts,
and all of said counterparts taken together shall be deemed to constitute one
and the same instrument. Delivery of an executed signature page of this
Agreement by facsimile transmission shall be effective as delivery of a manually
executed counterpart hereof. A set of the copies of this Agreement signed by all
the parties shall be lodged with the Borrower and the Administrative Agent.
10.9 Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
10.10 Integration. This Agreement and the other Loan Documents
represent the agreement of the Borrower, the Administrative Agent and the
Lenders with respect to the subject matter hereof, and there are no promises,
undertakings, representations or warranties by the Administrative Agent or any
Lender relative to subject matter hereof not expressly set forth or referred to
herein or in the other Loan Documents.
10.11 GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
10.12 Submission To Jurisdiction; Waivers. The Borrower hereby
irrevocably and unconditionally:
<PAGE> 89
84
(a) submits for itself and its property in any legal action or
proceeding relating to this Agreement and the other Loan Documents to
which it is a party, or for recognition and enforcement of any judgment
in respect thereof, to the non-exclusive general jurisdiction of the
courts of the State of New York, the courts of the United States for
the Southern District of New York, and appellate courts from any
thereof;
(b) consents that any such action or proceeding may be brought
in such courts and waives any objection that it may now or hereafter
have to the venue of any such action or proceeding in any such court or
that such action or proceeding was brought in an inconvenient court and
agrees not to plead or claim the same;
(c) agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof by registered or
certified mail (or any substantially similar form of mail), postage
prepaid, to the Borrower, as the case may be at its address set forth
in Section 10.2 or at such other address of which the Administrative
Agent shall have been notified pursuant thereto;
(d) agrees that nothing herein shall affect the right to
effect service of process in any other manner permitted by law or shall
limit the right to sue in any other jurisdiction; and
(e) waives, to the maximum extent not prohibited by law, any
right it may have to claim or recover in any legal action or proceeding
referred to in this Section any special, exemplary, punitive or
consequential damages.
10.13 Acknowledgments. The Borrower hereby acknowledges that:
(a) it has been advised by counsel in the negotiation,
execution and delivery of this Agreement and the other Loan Documents;
(b) neither the Administrative Agent nor any Lender has any
fiduciary relationship with or duty to the Borrower arising out of or
in connection with this Agreement or any of the other Loan Documents,
and the relationship between Administrative Agent and Lenders, on one
hand, and the Borrower, on the other hand, in connection herewith or
therewith is solely that of debtor and creditor; and
(c) no joint venture is created hereby or by the other Loan
Documents or otherwise exists by virtue of the transactions
contemplated hereby among the Lenders or among the Borrower and the
Lenders.
10.14 Releases of Guarantees and Liens. (a) Notwithstanding
anything to the contrary contained herein or in any other Loan Document, the
Administrative Agent is hereby irrevocably authorized by each Lender (without
requirement of notice to or consent of any Lender except as expressly required
by Section 10.1) to take any action requested by the Borrower having the effect
of releasing any Collateral or guarantee obligations (i) to the extent necessary
to permit consummation of any transaction not prohibited by any Loan Document or
that has been
<PAGE> 90
85
consented to in accordance with Section 10.1 or (ii) under the circumstances
described in paragraph (b) or (c) below.
(b) At such time as the Loans, the Reimbursement Obligations
and the other obligations under the Loan Documents (other than obligations under
or in respect of Hedge Agreements) shall have been paid in full, the Commitments
have been terminated and no Letters of Credit shall be outstanding, the
Collateral shall be released from the Liens created by the Security Documents,
and the Security Documents and all obligations (other than those expressly
stated to survive such termination) of the Administrative Agent and each Loan
Party under the Security Documents shall terminate, all without delivery of any
instrument or performance of any act by any Person.
(c) At such time as (i)the Borrower's senior unsecured
long-term debt rating is at least BAA3 from Moody's Investors Service, Inc. and
BBB- from Standard & Poor's Rating Group or equivalent rating from any successor
rating agency and (ii) the Tranche B Term Loans and the Tranche C Term Loans
have been paid in full, the Liens created by the Security Documents on the
Collateral shall be terminated and the Administrative Agent is hereby
irrevocably authorized by each Lender (without requirement of notice or consent
of any Lender) to take any action requested by the Borrower to release the
Collateral from such Liens.
10.15 Confidentiality. Each of the Administrative Agent and
each Lender agrees to keep confidential all non-public information provided to
it by any Loan Party pursuant to this Agreement that is designated by such Loan
Party as confidential; provided that nothing herein shall prevent the
Administrative Agent or any Lender from disclosing any such information (a) to
the Administrative Agent, any other Lender, any affiliate of any Lender or any
Approved Fund, (b) to any Transferee or prospective Transferee that agrees to
comply with the provisions of this Section, (c) to its employees, directors,
agents, attorneys, accountants and other professional advisors or those of any
of its affiliates, (d) upon the request or demand of any Governmental Authority,
(e) in response to any order of any court or other Governmental Authority or as
may otherwise be required pursuant to any Requirement of Law, (f) if requested
or required to do so in connection with any litigation or similar proceeding,
(g) that has been publicly disclosed, (h) to the National Association of
Insurance Commissioners or any similar organization or any nationally recognized
rating agency that requires access to information about a Lender's investment
portfolio in connection with ratings issued with respect to such Lender, (i) in
connection with the exercise of any remedy hereunder or under any other Loan
Document or (j) to any direct or indirect contractual counterparty in swap
agreements or such contractual counterparty's professional advisor (so long as
such contractual counterparty or professional advisor to such contractual
counterparty agrees to be bound by the provisions of this Section 10.15).
10.16 WAIVERS OF JURY TRIAL. THE BORROWER, THE ADMINISTRATIVE
AGENT AND THE LENDERS HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY
IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.
<PAGE> 91
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered by their proper and duly authorized
officers as of the day and year first above written.
TENNECO INC.
By: /s/ Karen R. Osar
-----------------------------------------
Name: Karen R. Osar
Title: Vice President and Treasurer
THE CHASE MANHATTAN BANK, as
Administrative Agent and as a Lender
By:
-----------------------------------------
Name:
Title:
CITICORP USA, INC., as Syndication Agent
By:
-----------------------------------------
Name:
Title:
<PAGE> 92
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered by their proper and duly authorized
officers as of the day and year first above written.
TENNECO INC.
By:
-----------------------------------------
Name:
Title:
THE CHASE MANHATTAN BANK, as
Administrative Agent and as a Lender
By: /s/ Thomas H. Kozlark
-----------------------------------------
Name: Thomas H. Kozlark
Title: Vice President
CITICORP USA, INC., as Syndication Agent
By:
-----------------------------------------
Name:
Title:
<PAGE> 93
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered by their proper and duly authorized
officers as of the day and year first above written.
TENNECO INC.
By:
-----------------------------------------
Name: Karen R. Osar
Title: Vice President and Treasurer
THE CHASE MANHATTAN BANK, as
Administrative Agent and as a Lender
By:
-----------------------------------------
Name: Thomas H. Kozlark
Title: Vice President
CITICORP USA, INC., as Syndication Agent
By: /s/ Elizabeth A. Palermo
-----------------------------------------
Name: Elizabeth A. Palermo
Title: Managing Director
Attorney-in-fact
<PAGE> 94
COMMERZBANK, AG, New York and Grand Cayman
Branches, as Co-Documentation Agent and as
a Lender
By: /s/ Robert Donohue
-----------------------------------------
Name: Robert Donohue
Title: Senior Vice President
By: /s/ Peter Doyle
-----------------------------------------
Name: Peter Doyle
Title: Assistant Vice President
BANK OF AMERICA, N.A., as Co-Documentation
Agent and as a Lender
By:
-----------------------------------------
Name: Matthew J. Reilly
Title: Vice President
<PAGE> 95
COMMERZBANK, AG, New York and Grand Cayman
Branches, as Co-Documentation Agent and as
a Lender
By:
-----------------------------------------
Name: Robert Donohue
Title: Senior Vice President
By:
-----------------------------------------
Name: Peter Doyle
Title: Assistant Vice President
BANK OF AMERICA, N.A., as Co-Documentation
Agent and as a Lender
By: /s/ Matthew J. Reilly
-----------------------------------------
Name: Matthew J. Reilly
Title: Vice President
<PAGE> 96
ALLSTATE INSURANCE COMPANY
By: /s/ Jerry D. Zinkula
-----------------------------------------
Name: Jerry D. Zinkula
Title: Authorized Signatory
By: /s/ Patricia W. Wilson
-----------------------------------------
Name: Patricia W. Wilson
Title: Authorized Signatory
<PAGE> 97
ALLSTATE LIFE INSURANCE COMPANY
By: /s/ Jerry D. Zinkula
-----------------------------------------
Name: Jerry D. Zinkula
Title: Authorized Signatory
By: /s/ Patricia W. Wilson
-----------------------------------------
Name: Patricia W. Wilson
Title: Authorized Signatory
<PAGE> 98
BALANCED HIGH-YIELD FUND I LTD.
By: BHF (USA) Capital Corporation
As Attorney-In-Fact
By: /s/ Thomas J. Scifo
-----------------------------------------
Name: Thomas J. Scifo
Title: Vice President
By: /s/ Eric Emmert
-----------------------------------------
Name: Eric Emmert
Title: Associate
<PAGE> 99
BHF (USA) CAPITAL CORPORATION
By: /s/ Eric Emmert
-----------------------------------------
Name: Eric Emmert
Title: Associate
By: /s/ Thomas J. Scifo
-----------------------------------------
Name: Thomas J. Scifo
Title: Vice President
<PAGE> 100
BANK OF AMERICA, N.A.
By: /s/ Matthew J. Reilly
-----------------------------------------
Name: Matthew J. Reilly
Title: Vice President
<PAGE> 101
BANK OF HAWAII
By: /s/ Mark C. Joseph
-----------------------------------------
Name: Mark C. Joseph
Title: Vice President
<PAGE> 102
BOEING CAPITAL CORPORATION
By: /s/ James C. Hammersmith
-----------------------------------------
Name: James C. Hammersmith
Title: Senior Documentation Officer
<PAGE> 103
BANK OF MONTREAL
By: /s/ Heather L. Turf
-----------------------------------------
Name: Heather L. Turf
Title: Director
<PAGE> 104
THE BANK OF NEW YORK
By: /s/ John-Paul Marotta
-----------------------------------------
Name: John-Paul Marotta
Title: Vice President
<PAGE> 105
THE BANK OF NOVA SCOTIA
By: /s/ M. D. Smith
-----------------------------------------
Name: M. D. Smith
Title: Agent Operations
<PAGE> 106
BANK ONE, MICHIGAN
By: /s/ Mark L. McClure
-----------------------------------------
Name: Mark L. McClure
Title: Vice President
<PAGE> 107
BANK OF TOKYO-MITSUBISHI TRUST COMPANY
By: /s/ H. Zimmermann
-----------------------------------------
Name: H. Zimmermann
Title: Vice President
<PAGE> 108
CITICORP USA, INC.
By: /s/ Elizabeth A. Palermo
-----------------------------------------
Name: Elizabeth A. Palermo
Title: Managing Director
<PAGE> 109
COMERICA BANK
By: /s/ Michael T. Shea
-----------------------------------------
Name: Michael T. Shea
Title: Vice President
<PAGE> 110
COMMERZBANK AG
NEW YORK AND GRAND CAYMAN BRANCHES
By: /s/ Robert Donohue
-----------------------------------------
Name: Robert Donohue
Title: Senior Vice President
By: /s/ Peter Doyle
-----------------------------------------
Name: Peter Doyle
Title: Assistant Vice President
<PAGE> 111
KZH CNC LLC
By: /s/ Virginia Conway
-----------------------------------------
Name: Virginia Conway
Title: Authorized Agent
<PAGE> 112
KZH CNC LLC
By: /s/ Virginia Conway
-----------------------------------------
Name: Virginia Conway
Title: Authorized Agent
<PAGE> 113
WINGED FOOT FUNDING TRUST
By: /s/ Kelly c. Walker
-----------------------------------------
Name: Kelly c. Walker
Title: Authorized Agent
<PAGE> 114
CREDIT SUISSE FIRST BOSTON
By: /s/ David W. Kratovil
-----------------------------------------
Name: David W. Kratovil
Title: Director
By: /s/ Jeffrey B. Ulmer
-----------------------------------------
Name: Jeffrey B. Ulmer
Title: Vice President
<PAGE> 115
NORTH AMERICAN SENIOR FLOATING RATE FUND
BY: CYPRESS TREE INVESTMENT MANAGEMENT
COMPANY, INC. AS PORTFOLIO MANAGER
By: /s/ Peter K. Merrill
-----------------------------------------
Name: Peter K. Merrill
Title: Managing Director
<PAGE> 116
CYPRESS TREE SENIOR FLOATING RATE FUND
BY: CYPRESS TREE INVESTMENT MANAGEMENT
COMPANY, INC. AS PORTFOLIO MANAGER
By: /s/ Peter K. Merrill
-----------------------------------------
Name: Peter K. Merrill
Title: Managing Director
<PAGE> 117
CYPRESS TREE INVESTMENT FUND, LLC
BY: CYPRESS TREE INVESTMENT MANAGEMENT
COMPANY, INC. ITS MANAGING MEMBER
By: /s/ Peter K. Merrill
-----------------------------------------
Name: Peter K. Merrill
Title: Managing Director
<PAGE> 118
KZH CYPRESSTREE-1 LLC
By: /s/ Peter Chin
-----------------------------------------
Name: Peter Chin
Title: Authorized Agent
<PAGE> 119
THE DAI-ICHI KANGYO BANK, LIMITED
By: /s/ Naoki Yamamori
-----------------------------------------
Name: Naoki Yamamori
Title: Senior Vice President and
Department Head
<PAGE> 120
DRESDNER BANK AG, NEW YORK &
GRAND CAYMAN BRANCHES
By: /s/ Beverly G. Cason
-----------------------------------------
Name: Beverly G. Cason
Title: Vice President
By: /s/ John R. Morrison
-----------------------------------------
Name: John R. Morrison
Title: Vice President
<PAGE> 121
ERSTE BANK DER OESTERREICHISCHEN
SPARKASSEN AG - NEW YORK BRANCH
By: /s/ Rima Terradista
-----------------------------------------
Name: Rima Terradista
Title: Vice President
By: /s/ John S. Runnion
-----------------------------------------
Name: John S. Runnion
Title: First Vice President
<PAGE> 122
FIRST UNION NATIONAL BANK
By: /s/ Kent Davis
-----------------------------------------
Name: Kent Davis
Title: Vice President
<PAGE> 123
FRANKLIN FLOATING RATE TRUST
By: /s/ Chauncey Lufkin
-----------------------------------------
Name: Chauncey Lufkin
Title: Vice President
<PAGE> 124
FREMONT INVESTMENT AND LOAN
By: /s/ Kannika Viravan
-----------------------------
Name: Kannika Viravan
Title: Vice President
<PAGE> 125
THE FUJI BANK, LIMITED
By: /s/ Peter L. Chinnici
---------------------------------------
Name: Peter L. Chinnici
Title: Senior Vice President & Group Head
<PAGE> 126
KZH WATERSIDE LLC
By: /s/ Virginia Conway
------------------------------
Name: Virginia Conway
Title: Authorized Agent
<PAGE> 127
HELLER FINANCIAL, INC.
By: /s/ Scott Ziemke
--------------------------------------
Name: Scott Ziemke
Title: Assistant Vice President
<PAGE> 128
BAYERISCHE HYPO-UND VEREINSBANK AG,
NEW YORK BRANCH
By: /s/ Erich Ebner von Eschenbach
-------------------------------------
Name: Erich Ebner von Eschenbach
Title: Managing Director
By: /s/ Timothy L. Harrod
-------------------------------------
Name: Timothy L. Harrod
Title: Director
<PAGE> 129
IKB DEUTSCHE INDUSTRIEBANK AG,
LUXEMBOURG BRANCH
By: /s/ Edwin Brecht
-------------------------------
Name: Edwin Brecht
Title: Executive Director
By: /s/ Manfred Ziwey
-------------------------------
Name: Manfred Ziwey
Title: Director
<PAGE> 130
THE INDUSTRIAL BANK OF JAPAN, LIMITED,
CHICAGO BRANCH
By: /s/ Walter R. Wolff
------------------------------------
Name: Walter R. Wolff
Title: Joint General Manager
<PAGE> 131
ING (U.S.) CAPITAL LLC
By: /s/ William B. Redmond
------------------------------
Name: William B. Redmond
Title: Vice President
<PAGE> 132
KZH ING - 1 LLC
By: /s/ Virginia Conway
---------------------------------
Name: Virginia Conway
Title: Authorized Agent
<PAGE> 133
KZH ING - 2 LLC
By: /s/ Virginia Conway
---------------------------------
Name: Virginia Conway
Title: Authorized Agent
<PAGE> 134
FLOATING RATE PORTFOLIO
By: INVESCO Senior Secured Management Inc.
as Attorney-in-Fact
By: /s/ Joseph Rotondo
-------------------------------------
Name: Joseph Rotondo
Title: Authorized Signatory
<PAGE> 135
METROPOLITAN LIFE INSURANCE COMPANY
By: /s/ James R. Dingler
----------------------------------
Name: James R. Dingler
Title: Director
<PAGE> 136
THE MITSUBISHI TRUST AND BANKING CORPORATION
By: /s/ Toshihiro Hayashi
---------------------------------------
Name: Toshihiro Hayashi
Title: Senior Vice President
<PAGE> 137
MORGAN STANLEY DEAN WITTER PRIME
INCOME TRUST
By: /s/ Peter Gewirtz
--------------------------------
Name: Peter Gewirtz
Title: Authorized Signatory
<PAGE> 138
NATEXIS BANQUE BFCE
By: /s/ Jordan Sadler
----------------------------------------
Name: Jordan Sadler
Title: Associate
By: /s/ Frank H. Madden, Jr.
----------------------------------------
Name: Frank H. Madden, Jr.
Title: Vice President & Group Manager
<PAGE> 139
NATIONAL CITY BANK
By: /s/ Kenneth R. Ehrhardt
----------------------------------
Name: Kenneth R. Ehrhardt
Title: Vice President
<PAGE> 140
NEW YORK LIFE INSURANCE COMPANY
By: /s/ Anthony R. Malloy
------------------------------
Name: Anthony R. Malloy
Title: Director
<PAGE> 141
ORIX USA CORPORATION
By: /s/ Hiroyuki Miyauchi
--------------------------------
Name: Hiroyuki Miyauchi
Title: Executive Vice President
<PAGE> 142
PPM SPYGLASS FUNDING TRUST
By: /s/ Kelly c. Walker
------------------------------
Name: Kelly c. Walker
Title: Authorized Agent
<PAGE> 143
PRINCIPAL LIFE INSURANCE COMPANY
BY: PRINCIPAL CAPITAL MANAGEMENT,
LLC, A DELAWARE LIMITED LIABILITY
COMPANY, ITS AUTHORIZED SIGNATORY
By: /s/ Jon Heiny
--------------------------------------
Name: Jon Heiny
Title: Counsel
By: /s/ Sarah Pitts
--------------------------------------
Name: Sarah Pitts
Title: Counsel
<PAGE> 144
KEMPER FLOATING RATE FUND
By: /s/ Mark E. Wittnebel
--------------------------------------
Name: Mark E. Wittnebel
Title: Senior Vice President
<PAGE> 145
OLYMPIC FUNDING TRUST, SERIES 1999-1
By: /s/ Kelly C. Walker
---------------------------------
Name: Kelly C. Walker
Title: Authorized Agent
<PAGE> 146
KZH RIVERSIDE 1 LLC
By: /s/ Virginia Conway
---------------------------------------
Name: Virginia Conway
Title: Authorized Agent
<PAGE> 147
SOCIETE GENERALE, NEW YORK BRANCH
By: /s/ Robert Petersen
--------------------------------------
Name: Robert Petersen
Title: Vice President
<PAGE> 148
KZH III LLC
By: /s/ Peter Chin
---------------------------------------
Name: Peter Chin
Title: Authorized Agent
<PAGE> 149
STERLING ASSET MANAGEMENT, L.L.C.
By: /s/ Louis A. Pistecchia
---------------------------------------
Name: Louis A. Pistecchia
Title: Executive Vice President
<PAGE> 150
GALAXY CLO 1999-1, LTD.
BY: SAI INVESTMENT ADVISER, INC.,
ITS COLLATERAL MANAGER
By: /s/ Steve B. Staver
-----------------------------------------------
Name: Steve B. Staver
Title: Authorized Agent
<PAGE> 151
KZH SOLEIL LLC
By: /s/ Virginia Conway
---------------------------------------
Name: Virginia Conway
Title: Authorized Agent
<PAGE> 152
KZH SOLEIL-2 LLC
By: /s/ Virginia Conway
---------------------------------------
Name: Virginia Conway
Title: Authorized Agent
<PAGE> 153
KZH CRESCENT LLC
By: /s/ Peter Chin
---------------------------------------
Name: Peter Chin
Title: Authorized Agent
<PAGE> 154
KZH CRESCENT-2 LLC
By: /s/ Peter Chin
---------------------------------------
Name: Peter Chin
Title: Authorized Agent
<PAGE> 155
KZH CRESCENT-3 LLC
By: /s/ Peter Chin
---------------------------------------
Name: Peter Chin
Title: Authorized Agent
<PAGE> 156
CONTINENTAL ASSURANCE COMPANY
SEPARATE ACCOUNT (E)
By: TCW Asset Management Company
as Attorney-in-Fact
By: /s/ Mark L. Gold
---------------------------------------
Name: Mark L. Gold
Title: Managing Director
By: /s/ Jonathan I. Berg
---------------------------------------
Name: Jonathan I. Berg
Title: Assistant Vice President
<PAGE> 157
SEQUILS I, LTD.
By: TCW Advisors, Inc. as its
Collateral Manager
By: /s/ Mark L. Gold
-----------------------------------
Name: Mark L. Gold
Title: Managing Director
By: /s/ Jonathan I. Berg
-----------------------------------
Name: Jonathan I. Berg
Title: Assistant Vice President
<PAGE> 158
UNITED OF OMAHA LIFE INSURANCE COMPANY
By: TCW Asset Management Company,
its Investment Advisor
By: /s/ Mark L. Gold
---------------------------------------
Name: Mark L. Gold
Title: Managing director
By: /s/ Jonathan I. Berg
---------------------------------------
Name: Jonathan I. Berg
Title: Assistant Vice President
<PAGE> 159
TORONTO-DOMINION (TEXAS), INC.
By: /s/ Alva J. Jones
---------------------------------------
Name: Alva J. Jones
Title: Vice President
<PAGE> 160
VAN KAMPEN SENIOR INCOME TRUST
By: Van Kampen Investment Advisory Corp.
By: /s/ Darvin D. Pierce
---------------------------------------
Name: Darvin D. Pierce
Title: Vice President
<PAGE> 161
VAN KAMPEN SENIOR FLOATING RATE FUND
By: Van Kampen Investment Advisory Corp.
By: /s/ Darvin D. Pierce
---------------------------------------
Name: Darvin D. Pierce
Title: Vice President
<PAGE> 162
VAN KAMPEN CLO I, LIMITED
BY: VAN KAMPEN MANAGEMENT INC.,
as Collateral Manager
By: /s/ Darvin D. Pierce
------------------------------------
Name: Darvin D. Pierce
Title: Vice President
<PAGE> 163
Annex A
PRICING GRID FOR REVOLVING LOANS, SWINGLINE LOANS,
TRANCHE A TERM LOANS AND COMMITMENT FEES
<TABLE>
<CAPTION>
Consolidated Leverage Ratio Applicable Margin Applicable Margin Commitment Fee Rate
for Eurodollar Loans for ABR Loans
<S> <C> <C> <C>
Greater than or equal to 4.5 to 1.0 3.00% 2.00% .500%
Less than 4.5 to 1.0 and greater than or equal 2.75% 1.75% .500%
to 4.0 to 1.0
Less than 4.0 to 1.0 and greater than or equal 2.50% 1.50% .500%
to 3.5 to 1.0
Less than 3.5 to 1.0 and greater than or equal 2.25% 1.25% .375%
to 3.0 to 1.0
Less than 3.0 to 1.0 and greater than or equal 2.00% 1.00% .375%
to 2.5 to 1.0
Less than 2.5 to 1.0 1.75% .75% .375%
</TABLE>
Changes in the Applicable Margin with respect to Revolving Loans, Swingline
Loans and Tranche A Loans or in the Commitment Fee Rate resulting from changes
in the Consolidated Leverage Ratio shall become effective on the date (the
"Adjustment Date") on which financial statements are delivered to the Lenders
pursuant to Section 6.1 (but in any event not later than the 45th day after the
end of each of the first three quarterly periods of each fiscal year or the 90th
day after the end of each fiscal year, as the case may be) and shall remain in
effect until the next change to be effected pursuant to this paragraph. If any
financial statements referred to above are not delivered within the time periods
specified above, then, until such financial statements are delivered, the
Consolidated Leverage Ratio as at the end of the fiscal period that would have
been covered thereby shall for the purposes of this definition be deemed to be
greater than 4.5 to 1.0. In addition, at all times while an Event of Default
shall have occurred and be continuing, the Consolidated Leverage Ratio shall for
the purposes of this definition be deemed to be greater than 4.5 to 1.0. Each
determination of the Consolidated Leverage Ratio pursuant to this pricing grid
shall be made with respect to (or, in the case of Consolidated Total Debt, as at
the end of) the period of four consecutive fiscal quarters of the Borrower
ending at the end of the period covered by the relevant financial statements.
<PAGE> 164
SCHEDULE 1.1A
COMMITMENTS
<TABLE>
<CAPTION>
REVOLVING TRANCHE A TRANCHE B TRANCHE C
INSTITUTION COMMITMENT COMMITMENT COMMITMENT COMMITMENT TOTAL
- ----------- ----------- ----------- ----------- ----------- ------------
<S> <C> <C> <C> <C> <C>
THE CHASE MANHATTAN BANK $50,000,000 $45,000,000 $83,750,000 $83,750,000 $262,500,000
BANK OF AMERICA, N.A. $39,470,000 $35,530,000 $ 2,500,000 $ 2,500,000 $ 80,000,000
CITICORP USA, INC. $39,470,000 $35,530,000 $ 0 $ 0 $ 75,000,000
COMMERZBANK, AG, NEW YORK AND
GRAND CAYMAN BRANCHES $39,470,000 $35,530,000 $ 0 $ 0 $ 75,000,000
TORONTO DOMINION (TEXAS), INC. $23,680,000 $21,320,000 $ 3,750,000 $ 3,750,000 $ 52,500,000
THE BANK OF NOVA SCOTIA $23,680,000 $21,320,000 $ 2,500,000 $ 2,500,000 $ 50,000,000
BANK ONE, MICHIGAN $23,680,000 $21,320,000 $ 2,500,000 $ 2,500,000 $ 50,000,000
FIRST UNION NATIONAL BANK $23,680,000 $21,320,000 $ 2,500,000 $ 2,500,000 $ 50,000,000
BANK OF MONTREAL $23,680,000 $21,320,000 $ 2,500,000 $ 2,500,000 $ 50,000,000
THE BANK OF NEW YORK $23,680,000 $21,320,000 $ 0 $ 0 $ 45,000,000
ING (U.S.) CAPITAL LLC $23,680,000 $21,320,000 $ 0 $ 0 $ 45,000,000
CREDIT SUISSE FIRST BOSTON $23,680,000 $21,320,000 $ 0 $ 0 $ 45,000,000
BANK OF TOKYO-MITSUBISHI TRUST COMPANY $23,680,000 $21,320,000 $ 0 $ 0 $ 45,000,000
</TABLE>
<PAGE> 165
<TABLE>
REVOLVING TRANCHE A TRANCHE B TRANCHE C
INSTITUTION COMMITMENT COMMITMENT COMMITMENT COMMITMENT TOTAL
- ----------- -------------- -------------- ------------ ------------- --------------
<S> <C> <C> <C> <C> <C>
THE INDUSTRIAL BANK OF JAPAN,
LIMITED, CHICAGO BRANCH $23,684,210.53 $21,315,789.47 $ 0.00 $ 0.00 $45,000,000.00
SOCIETE GENERALE,
NEW YORK BRANCH $23,684,210.53 $21,315,789.47 $ 0.00 $ 0.00 $45,000,000.00
THE MITSUBISHI TRUST &
BANKING CORPORATION $10,526,315.79 $ 9,473,684.21 $2,500,000.00 $2,500,000.00 $25,000,000.00
DRESDNER BANK AG, NEW YORK
AND GRAND CAYMAN BRANCHES $10,526,315.79 $ 9,473,684.21 $ 0.00 $ 0.00 $20,000,000.00
COMERICA BANK $10,526,315.79 $ 9,473,684.21 $ 0.00 $ 0.00 $20,000,000.00
BANK OF HAWAII $10,526,315.79 $ 9,473,684.21 $ 0.00 $ 0.00 $20,000,000.00
ERSTE BANK DER
OESTERREICHISCHEN
SPARKASSEN AG--NEW YORK BRANCH $ 7,894,736.84 $ 7,105,263.16 $ 0.00 $ 0.00 $15,000,000.00
IKB DEUTSCHE INDUSTRIEBANK AG,
LUXEMBOURG BRANCH $ 5,263,157.89 $ 4,736,842.11 $2,500,000.00 $2,500,000.00 $15,000,000.00
NATEXIS BANQUE BFCE $ 5,263,157.89 $ 4,736,842.11 $2,500,000.00 $2,500,000.00 $15,000,000.00
NATIONAL CITY BANK $ 5,263,157.89 $ 4,736,842.11 $ 0.00 $ 0.00 $10,000,000.00
THE FUJI BANK, LIMITED $ 5,263,157.89 $ 4,736,842.11 $ 0.00 $ 0.00 $10,000,000.00
</TABLE>
<PAGE> 166
<TABLE>
REVOLVING TRANCHE A TRANCHE B TRANCHE C
INSTITUTION COMMITMENT COMMITMENT COMMITMENT COMMITMENT TOTAL
- ----------- ---------- ---------- -------------- -------------- --------------
<S> <C> <C> <C> <C> <C>
BAYERISCHE HYPO-UND VEREINSBANK
AG, NEW YORK BRANCH $0.00 $0.00 $15,000,000.00 $15,000,000.00 $30,000,000.00
METROPOLITAN LIFE
INSURANCE COMPANY $0.00 $0.00 $15,000,000.00 $15,000,000.00 $30,000,000.00
FRANKLIN FLOATING
RATE TRUST $0.00 $0.00 $15,000,000.00 $15,000,000.00 $30,000,000.00
GALAXY CLO 1999-1, LTD $0.00 $0.00 $10,000,000.00 $10,000,000.00 $20,000,000.00
MERRILL LYNCH SENIOR
FLOATING RATE FUND $0.00 $0.00 $ 7,500,000.00 $ 7,500,000.00 $15,000,000.00
BOEING CAPITAL CORPORATION $0.00 $0.00 $ 7,500,000.00 $ 7,500,000.00 $15,000,000.00
VAN KAMPEN SENIOR FLOATING RATE $0.00 $0.00 $ 7,500,000.00 $ 7,500,000.00 $15,000,000.00
ORIX USA CORPORATION $0.00 $0.00 $ 6,250,000.00 $ 6,250,000.00 $12,500,000.00
PRINCIPAL LIFE INSURANCE COMPANY $0.00 $0.00 $ 6,250,000.00 $ 6,250,000.00 $12,500,000.00
MORGAN STANLEY DEAN WITTER
PRIME INCOME TRUST $0.00 $0.00 $ 5,000,000.00 $ 5,000,000.00 $10,000,000.00
KZH WATERSIDE LLC $0.00 $0.00 $ 5,000,000.00 $ 5,000,000.00 $10,000,000.00
STERLING ASSET
MANAGEMENT, L.L.C. $0.00 $0.00 $ 5,000,000.00 $ 5,000,000.00 $10,000,000.00
</TABLE>
<PAGE> 167
<TABLE>
<CAPTION>
REVOLVING TRANCHE A TRANCHE B TRANCHE C
INSTITUTION COMMITMENT COMMITMENT COMMITMENT COMMITMENT TOTAL
- ----------- ---------- ---------- ---------- ---------- -----------
<S> <C> <C> <C> <C> <C>
DAI-ICHI KANGYO BANK $0 $0 $5,000,000 $5,000,000 $10,000,000
NEW YORK LIFE INSURANCE COMPANY $0 $0 $5,000,000 $5,000,000 $10,000,000
HELLER FINANCIAL, INC. $0 $0 $5,000,000 $5,000,000 $10,000,000
KZH SOLEIL LLC $0 $0 $5,000,000 $5,000,000 $10,000,000
KZH SOLEIL-2 LLC $0 $0 $5,000,000 $5,000,000 $10,000,000
SEQUILS I, LTD. $0 $0 $4,750,000 $4,750,000 $ 9,500,000
OLYMPIC FUNDING TRUST, SERIES 1999-1 $0 $0 $4,375,000 $4,375,000 $ 8,750,000
ALLSTATE LIFE INSURANCE COMPANY $0 $0 $4,000,000 $4,000,000 $ 8,000,000
VAN KAMPEN SENIOR INCOME TRUST $0 $0 $4,000,000 $4,000,000 $ 8,000,000
VAN KAMPEN CLO I, LIMITED $0 $0 $3,500,000 $3,500,000 $ 7,000,000
BALANCED HIGH YIELD FUND I, LTD. $0 $0 $3,000,000 $3,000,000 $ 6,000,000
KZH CRESCENT-2 LLC $0 $0 $2,750,000 $2,750,000 $ 5,500,000
MERRILL LYNCH SENIOR FLOATING
RATE FUND II, INC. $0 $0 $2,500,000 $2,500,000 $ 5,000,000
</TABLE>
<PAGE> 168
<TABLE>
<CAPTION>
REVOLVING TRANCHE A TRANCHE B TRANCHE C
INSTITUTION COMMITMENT COMMITMENT COMMITMENT COMMITMENT TOTAL
- ----------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
KZH ING-2 LLC $0 $0 $2,500,000 $2,500,000 $5,000,000
KZH CNC LLC $0 $0 $2,500,000 $2,500,000 $5,000,000
WINGED FOOT FUNDING TRUST $0 $0 $2,500,000 $2,500,000 $5,000,000
FREMONT INVESTMENT AND LOAN $0 $0 $2,500,000 $2,500,000 $5,000,000
PPM SPYGLASS FUNDING TRUST $0 $0 $2,500,000 $2,500,000 $5,000,000
KZH CRESCENT LLC $0 $0 $2,000,000 $2,000,000 $4,000,000
KZH III LLC $0 $0 $2,000,000 $2,000,000 $4,000,000
BHF (USA) CAPITAL CORPORATION $0 $0 $2,000,000 $2,000,000 $4,000,000
KZH CRESCENT-3 LLC $0 $0 $2,000,000 $2,000,000 $4,000,000
FLOATING RATE PORTFOLIO $0 $0 $1,500,000 $1,500,000 $3,000,000
KEMPER FLOATING RATE FUND $0 $0 $1,250,000 $1,250,000 $2,500,000
ALLSTATE INSURANCE COMPANY $0 $0 $1,000,000 $1,000,000 $2,000,000
KZH ING - 1 LLC $0 $0 $1,000,000 $1,000,000 $2,000,000
UNITED OF OMAHA LIFE INSURANCE COMPANY $0 $0 $1,000,000 $1,000,000 $2,000,000
</TABLE>
<PAGE> 169
<TABLE>
<CAPTION>
REVOLVING TRANCHE A TRANCHE B TRANCHE C
INSTITUTION COMMITMENT COMMITMENT COMMITMENT COMMITMENT TOTAL
- ----------- ------------ ------------ ------------ ------------ --------------
<S> <C> <C> <C> <C> <C>
NORTH AMERICAN SENIOR FLOATING
RATE FUND $ 0 $ 0 $ 1,000,000 $ 1,000,000 $ 2,000,000
KZH CYPRESSTREE-1 LLC $ 0 $ 0 $ 500,000 $ 500,000 $ 1,000,000
CYPRESSTREE SENIOR FLOATING
RATE FUND $ 0 $ 0 $ 500,000 $ 500,000 $ 1,000,000
CONTINENTAL ASSURANCE COMPANY $ 0 $ 0 $ 500,000 $ 500,000 $ 1,000,000
CYPRESSTREE INVESTMENT FUND, LLC $ 0 $ 0 $ 500,000 $ 500,000 $ 1,000,000
------------ ------------ ------------ ------------ --------------
TOTAL $500,000,000 $450,000,000 $300,000,000 $300,000,000 $1,550,000,000
============ ============ ============ ============ ==============
</TABLE>
<PAGE> 170
DRAFT 9/23/99
SCHEDULE 1.1B
MORTGAGED PROPERTY
Manufacturing Plant
121 Meridian Drive
Cozad, NE 69130
Building
1101 Eisenhower
Goshen, Indiana 46526
Building (Pending Sale)
561 Dolphin Rd.
Industrial Park S.
Route 4, Box 15-A
Haleyville, Alabama 35565
Aftermarket Manufacturing Plant
3160 Abbott Lane
Harrisonburg, VA 22801
Aftermarket DC
4500 Early Rd.
Harrisburg, VA 22801
Aftermarket Manufacturing Plant & Returned Goods Center
1601 Highway 49 B North
Paragould, AR 72450
Aftermarket DC
2000 S. Balton St.
Paragould, AR 72450
Aftermarket Manufacturing Plant
P.O. Box 348
S. Highway 15
Seward, NE 68434-0348
Original Equipment Headquarters
1 International Drive
Monroe, MI 48161
<PAGE> 171
Original Equipment Manufacturing Plant
Route 424 (11800 State Route 424)
Napoleon, OH 43545
Milan Engineering Facility & Original Equipment Manufacturing Plant
33 Lockwood Road
Milan, OH 44846
Original Equipment Manufacturing Plant
503 Weatherhead Street
Angola, IN 46703
Original Equipment Manufacturing Plant
200 McIntyre Drive
Hartwell, GA 30643
Manufacturing Plant
645 East Broad Street
P. O. Box 119
Smithville, TN 37166
Original Equipment Manufacturing Plant
929 Anderson Road
Litchfield, MI 49252
Jackson Engineering Facility (JEF)
2701 North Dettman Road
Jackson, MI 49201
Original Equipment Engineering Facility
3901 Willis Road (P.O. Box 157)
Grass Lake, MI 49240
Original Equipment Manufacturing Plant
4825 Hoffman Street
Elkhart, IN 46516
Manufacturing Plant
515 W. Mill Street
Culver, IN 46511
Building
10990 W. Allan Rd.
Hayward, WI 54843
-2-
<PAGE> 172
Building
704 Highway 2S South
Aberdeen, MS 39730
Document Number : 367153
Version : 03
-3-
<PAGE> 173
DRAFT 9/22/99
SCHEDULE 4.4
CONSENTS, AUTHORIZATIONS, FILINGS AND NOTICES
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------
U.S. ENTITY NATURE OF CONSENT, ACTION NECESSARY
AUTHORIZATION, NOTICE
OR FILING
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Securities and Exchange Tenneco Packaging Inc.'s Clearance for filing and to go
Commission Form S-4 Registration effective by SEC.
Statement under the Securities
Act of 1933
- ------------------------------------------------------------------------------------------------------------------------
Securities and Exchange Tenneco Packaging Inc.'s Clearance for filing by SEC.
Commission Form 10, General Form for
Registration of Securities
- ------------------------------------------------------------------------------------------------------------------------
Internal Revenue Service IRS Letter Ruling of August Continued effectiveness at IRS
20, 1999 letter ruling to the effect that
the Spin-off will be tax free to
Tenneco and its stockholders.
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------
FOREIGN ENTITY NATURE OF CONSENT, ACTION NECESSARY
AUTHORIZATION,
NOTICE OR FILING
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Various Foreign Governments Foreign Governmental Obtain consent.
Consents by Various Foreign
Authorities
- ------------------------------------------------------------------------------------------------------------------------
Various Foreign Lenders Consents by Various Foreign Obtain consent.
Lenders to Various Tenneco
Inc. Foreign Subsidiaries
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 174
SCHEDULE 4.15
SUBSIDIARIES
Draft 9/24/99
<TABLE>
<S> <C>
TENNECO INC. (DELAWARE) (to be renamed Tenneco Automotive Inc.)
Tenneco Automotive Inc. (to be renamed)...........................................................100 %
Beijing Monroe Automobile Shock Absorber Company Ltd. (Peoples
Republic of China)........................................................................51
(Tenneco Automotive Inc. owns 51%; and Beijing Automotive Industry
Corporation, an unaffiliated company, owns 49%)
Dalian Walker-Gillet Muffler Co. Ltd. (Peoples Republic of China)..............................55
(Tenneco Automotive Inc. owns 55%; and non-affiliates own 45%)
McPherson Strut Company Inc. (Delaware).......................................................100
Precision Modular Assembly Corp. (Delaware)...................................................100
Shanghai Walker Exhaust Company, Ltd. (Peoples Republic of China)..............................55
(Tenneco Automotive Inc. owns 55%; and Shanghai Tractor and Internal
Combustion Engine Company, Ltd., an unaffiliated company, owns 45%)
Tenneco Asheville Inc. (Delaware).............................................................100
Tenneco Asia Inc. (Delaware)..................................................................100
Tenneco Automotive Foreign Sales Corporation Limited (Jamaica)................................100
Tenneco Automotive Japan Ltd. (Japan).........................................................100
Tenneco Automotive Nederlands B.V. (Netherlands)..............................................100
Tenneco Automotive RSA Company (Delaware).....................................................100
Tenneco Automotive Trading Company (Delaware).................................................100
Tenneco Brake, Inc. (Delaware)................................................................100
Tenneco Europe Limited (Delaware).............................................................100
Wimetal S. A. (France)....................................................................*1
(Tenneco Europe Limited owns 1 share; Walker Limited owns 1 share;
Walker France S.A. owns 99%; and each of David Zerhusen, Howard
van Schoyck, Daniel Barth, Daniel Bellanger, Herman Weltens and
Theo Bonneu, affiliated persons, owns 1 share)
Tenneco Inc. (Nevada).........................................................................100
Tenneco International Finance Limited (United Kingdom)1/......................................100
Tenneco International Holding Corp. (Delaware)................................................100
Monroe Australia Pty. Limited (Australia)................................................100
Monroe Springs (Australia) Pty. Ltd. (Australia).....................................100
Monroe Superannuation Pty. Ltd. (Australia)..........................................100
Walker Australia Pty. Limited (Australia)............................................100
Tenneco Automotive Europe N.V. (Belgium).................................................100
Monroe Amortisor Imalat Ve Ticaret A.S. (Turkey)......................................99.85
(Tenneco Automotive Europe N.V. owns 99.85%; and various
unaffiliated individual stockholders own 0.15%)
Monroe Packaging N.V. (Belgium).......................................................99.9
(Tenneco Automotive Europe N.V. owns 99.9%; and Tenneco
Automotive France S.A. owns 0.1%)
Tenneco Automotive Europe Coordination Center N.V. (Belgium)..........................99.9
(Tenneco Automotive Europe N.V. owns 99.9%; and Tenneco
Automotive France S.A. owns 0.1%)
</TABLE>
* = less than
-1-
<PAGE> 175
<TABLE>
<S> <C>
SUBSIDIARIES OF TENNECO INC.
SUBSIDIARIES OF TENNECO AUTOMOTIVE INC.
SUBSIDIARIES OF TENNECO INTERNATIONAL HOLDING CORP.
Tenneco Automotive Italia S.r.l. (Italy)..................................................85
(Tenneco International Holding Corp. owns 85%; and Tenneco
Automotive France S.A. owns 15%)
Tenneco Automotive Polska Sp. z.O.O........................................................1
(Tenneco International Holding Corp. owns 1%; and Tenneco Global Holdings
Inc. owns 99%)
Tenneco Romania Srl (Romania)..............................................................0.14
(Tenneco International Holding Corp. owns 0.14%; and Tenneco Global
Holdings Inc. owns 99.86%)
Tenneco Automotive Sverige A.B. (Sweden).................................................100
Tenneco Canada Inc. (Ontario)............................................................100
Tenneco Global Holdings Inc. (Delaware)..................................................100
Fric-Rot S.A.I.C. (Argentina).........................................................55
(Tenneco Global Holdings Inc. owns 55%; Maco Inversiones S.A.
owns 44.85%; and unaffiliated parties own .15%)
Maco Inversiones S.A. (Argentina)....................................................100
Fric-Rot S.A.I.C. (Argentina).....................................................44.85
(Maco Inversiones S.A. owns 44.85%; Tenneco Global Holdings
Inc. owns 55%; and unaffiliated parties own .15%)
Monroe Springs (New Zealand) Pty. Ltd. (New Zealand).................................100
Monroe Czechia s.r.o. (Czech Republic)...............................................100
Tenneco Automotive Iberica, S.A. (Spain).............................................100
Tenneco Automotive Polska Sp. z.O.O. (Poland).........................................99
(Tenneco Global Holdings Inc. owns 99%; and Tenneco International
Holding Corp. owns 1%)
Tenneco Romania Srl (Romania).........................................................99.86
(Tenneco Global Holdings Inc. owns 99.86%; and Tenneco International
Holding Corp. owns 0.14%)
Tenneco Mauritius Limited (Mauritius)................................................100
Hydraulics Limited (India)........................................................51
(Tenneco Mauritius Limited owns 51% and Bangalore Union
Services Limited, an unaffiliated company, owns 49%)
Renowned Automotive Products Manufacturers Ltd. (India)......................83
(Hydraulics Limited owns 83%; and non-affiliates own 17%)
Tenneco Automotive India Private Limited (India).................................100
Walker Exhaust India Private Limited (India)...............................*100
(Tenneco Automotive India Private Limited owns
less than 100%; and an unaffiliated party owns
the balance)
Tenneco Holdings Danmark A/S (Denmark)...................................................100
Gillet Exhaust Technologie (Proprietary) Limited (South Africa)......................100
Gillet Lazne Belohrad, s.r.o. (Czech Republic)..................................... 100
Kinetic Ltd. (Australia).............................................................>99
(Tenneco Holdings Danmark A/S owns 99%+; and unaffiliated
entities own less than 1%)
</TABLE>
* = less than
1/ In dissolution.
-2-
<PAGE> 176
<TABLE>
<S> <C>
SUBSIDIARIES OF TENNECO INC.
SUBSIDIARIES OF TENNECO AUTOMOTIVE INC.
SUBSIDIARIES OF TENNECO INTERNATIONAL HOLDING CORP.
SUBSIDIARIES OF TENNECO HOLDINGS DANMARK A/S
Tenneco Automotive Holdings South Africa Pty. Ltd. (South Africa).....................51
(Tenneco Holdings Danmark A/S owns 51%; and an unaffiliated
party owns 49%)
Armstrong Hydraulics South Africa (Pty.) Ltd. (South Africa).....................100
Armstrong Properties (Pty.) Ltd. (South Africa)..................................100
Monroe Manufacturing (Pty.) Ltd. (South Africa)..................................100
Smiths Industrial (SWA) (Pty.) Ltd. (South Africa)...............................100
Tenneco Automotive Port Elizabeth (Proprietary) Limited
(South Africa)...................................................................100
Tenneco Automotive Portugal - Componentes para Automovel, S.A.
(Portugal).......................................................................100
Walker Danmark A/S (Denmark).........................................................100
Tenneco Automotive France S.A. (France).................................................*100
(Tenneco International Holding Corp. owns 470,371 shares; Daniel
Bellanger owns 16 shares; Robert Bellanger owns 8 shares; and
each of Walker Europe, Inc., Alain Bellanger, Theodore
Bonneu, Roy Kolotylo and David Zerhusen owns 1 share)
Gillet Tubes Technologies G.T.T. (France)............................................100
Monroe Packaging N.V. (Belgium)........................................................0.01
(Tenneco Automotive Europe N.V. owns 99.9%; and Tenneco
Automotive France S.A. owns 0.1%)
Tenneco Automotive Europe Coordination Center N.V. (Belgium)...........................0.01
(Tenneco Automotive Europe N.V. owns 99.9%; and Tenneco
Automotive France S.A. owns 0.1%)
Tenneco Automotive Italia S.r.l. (Italy)..............................................15
(Tenneco International Holding Corp. owns 85%; and Tenneco
Automotive France S.A. owns 15%)
Walker France Constructeurs S.A.R.L. (France)........................................100
Wimetal S.A. (France).................................................................99
(Tenneco Automotive France S.A. owns 99%; Tenneco Europe Limited
owns 1 share, Walker Limited owns 1 share; and each of David Zerhusen,
Howard van Schoyck, Daniel Barth, Daniel Bellanger, Herman Weltens
and Theo Bonneu, affiliated persons, owns 1 share)
The Pullman Company (Delaware)................................................................100
Autopartes Walker S.A. de C.V. (Mexico).................................................100
Consorcio Terranova S.A. de C.V. (Mexico).............................................99.99
(Autopartes Walker S.A. de C.V. owns 99.99%; and Josan
Latinamericana S.A. de C.V., an unaffiliated company, owns 0.01%)
Monroe-Mexico S.A. de C.V. (Mexico)..................................................100
Tenneco Automotive Servicios de Mexico, S.A. de C.V. (Mexico)......................0.01
(Monroe-Mexico, S.A. de C.V. owns 1 share; and Proveedora
Walker S. de R.L. de C.V. owns 49,999 shares)
</TABLE>
* = less than
1/ In dissolution.
-3-
<PAGE> 177
<TABLE>
<S> <C>
SUBSIDIARIES OF TENNECO INC.
SUBSIDIARIES OF TENNECO AUTOMOTIVE INC.
SUBSIDIARIES OF THE PULLMAN COMPANY
SUBSIDIARIES OF AUTOPARTES WALKER S.A. DE C.V. (MEXICO)
Proveedora Walker S. de R.L. de C.V. (Mexico) ........................................99.99
(Autopartes Walker S.A. de C.V.owns 99.99%; and Pullmex S. de
R.L. de C.V. owns .01%)
Pullmex S. de R.L. de C.V. (Mexico)................................................0.01
(Proveedora Walker S. de R.L. de C.V. owns 0.01% and
Autopartes Walker S.A. de C.V. owns 99.99%)
Tenneco Automotive Servicios de Mexico, S.A. de C.V. (Mexico).....................99.99
(Proveedora Walker S. de R.L. de C.V. owns 49,999 shares, and
Monroe-Mexico, S.A. de C.V. owns 1 share)
Pullmex S. de R.L. de C.V.............................................................99.99
(Autopartes Walker S.A. de C.V. owns 99.9%; and Proveedora
Walker S. de R.L. de C.V. owns 0.1%)
Proveedora Walker S. de R.L. de C.V. (Mexico) .....................................0.01
(Pullmex S. de R.L. de C.V. owns 0.01%; and Autopartes
Walker S.A. de C.V. owns 99.99%)
Clevite Industries Inc. (Delaware).......................................................100
Peabody International Corporation (Delaware).............................................100
Barasset Corporation (Ohio)..........................................................100
Peabody Galion Corporation (Delaware)................................................100
Peabody Gordon-Piatt, Inc. (Delaware)................................................100
Peabody N.E., Inc. (Delaware)........................................................100
Peabody World Trade Corporation (Delaware)...........................................100
Peabody-Myers Corporation (Illinois).................................................100
Pullman Canada Ltd. (Canada)..........................................................61
(Peabody International Corporation owns 61%; and The Pullman
Company owns 39%)
Pullman Canada Ltd. (Canada)..............................................................39
(The Pullman Company owns 39%; and Peabody International
Corporation owns 61%)
Pullman Standard Inc. (Delaware).........................................................100
Tenneco Brazil Ltda. (Brazil)............................................................100
Tenneco Automotive Brasil Ltda. (Brazil).............................................100
Thompson and Stammers Dunmow (Number 6) Limited (United Kingdom)..............................100
Thompson and Stammers Dunmow (Number 7) Limited (United Kingdom)..............................100
TMC Texas Inc. (Delaware).....................................................................100
Walker Electronic Silencing Inc. (Delaware)...................................................100
Walker Europe, Inc. (Delaware)................................................................100
Tenneco Automotive France S.A. (France)...................................................*1
(Tenneco International Holding Corp. owns 470,371 shares; Daniel
Ballenger owns 16 shares; Robert Bellanger owns 8 shares; and
each of Walker Europe, Inc., Alain Bellanger, Theodore
Bonneu, Roy Kolotylo and David Zerhusen owns 1 share)
Walker Limited (United Kingdom)...............................................................100
</TABLE>
* = less than
1/ In dissolution.
-4-
<PAGE> 178
<TABLE>
<S> <C>
SUBSIDIARIES OF TENNECO INC.
SUBSIDIARIES OF TENNECO AUTOMOTIVE INC.
SUBSIDIARIES OF WALKER LIMITED (UNITED KINGDOM)
Gillet Torsmaskiner UK Limited (United Kingdom)...........................................50
(Walker Limited owns 100 A Ordinary Shares, 50% of total equity; and
AB Torsmaskiner, an unaffiliated company, owns 100 B Ordinary
Shares, 50% of total equity)
Exhaust Systems Technology Limited (United Kingdom)...................................99.99
(Gillet Torsmaskiner UK Limited owns 99.99%; and Heinrich
Gillet GmbH & Co. KG owns .01%)
Tenneco Automotive UK Limited (United Kingdom)...........................................100
Gillet Exhaust Manufacturing Limited (United Kingdom)................................100
Gillet Pressings Cardiff Limited (United Kingdom)....................................100
Walker (UK) Limited (United Kingdom).................................................100
J.W. Hartley (Motor Trade) Limited (United Kingdom)..............................100
Tenneco - Walker (U.K.) Ltd. (United Kingdom)....................................100
Tenneco Management (Europe) Limited (United Kingdom).....................................100
Wimetal S. A. (France)....................................................................*1
(Walker Limited owns 1 share; Tenneco Europe Limited owns 1
share; Tenneco Automotive France S.A. owns 99%; and each of
David Zerhusen, Howard van Schoyck, Daniel Barth, Daniel
Bellanger, Herman Weltens and Theo Bonneu, affiliated
persons, owns 1 share)
Walker Manufacturing Company (Delaware).......................................................100
Ced's Inc. (Illinois)....................................................................100
Walker Norge A/S (Norway).....................................................................100
Tenneco Deutschland Holdinggesellschaft mbH (Germany)..............................................99.97
(Tenneco Inc. owns 99.97%; and Atlas Vermoegensverwaltung, an
unaffiliated company, owns 0.03%)
GILLET Unternehmesverwaltungs GmbH (Germany)..................................................100
Heinrich Gillet GmbH & Co. KG (Germany)....................................................0.1
(GILLET Unternehmesverwaltungs GmbH owns 0.1%; and Tenneco
Deutschland Holdinggesellschaft mbH owns 99.9%. The
subsidiaries of Heinrich Gillet GmbH & Co. KG are listed
below.)
Heinrich Gillet GmbH & Co. KG (Germany)........................................................99.9
(Tenneco Deutschland Holdinggesellschaft mbH owns 99.9%; and
GILLET Unternehmesverwaltungs GmbH owns 0.1%)
ELGIRA Montagebetrieb fur Abgasanlagen Rastatt GmbH (Germany).............................50
(Heinrich Gillet GmbH & Co. KG owns 50%; and an unaffiliated
party owns 50%)
Exhaust Systems Technology Limited (United Kingdom)........................................0.01
(Heinrich Gillet GmbH & Co. KG owns 0.01%; and Gillet Torsmaskiner
UK Limited owns 99.99%)
Gillet-Abgassysteme Zickau Gmbh (Germany)................................................100
Elagest AB (Sweden)...................................................................50
(Gillet-Abgassysteme Zickau GmbH owns 50%; and an
unaffiliated party owns 50%)
</TABLE>
* = less than
1/ In dissolution.
-5-
<PAGE> 179
<TABLE>
<S> <C>
SUBSIDIARIES OF TENNECO INC.
SUBSIDIARIES OF TENNECO DEUTSCHLAND HOLDINGGESELLSCHAFT MBH
SUBSIDIARIES OF HEINRICH GILLET GMBH & CO. KG
Mastra-Gillet Industria e Comercio Ltda. (Brazil).........................................50
(Heinrich Gillet GmbH & Co. KG owns 50%; and Mastra Industria e
Comercio Ltda., an unaffiliated company, owns 50%)
Montagewerk Abgastechnik Emden GmbH (Germany).............................................50
(Heinrich Gillet GmbH & Co. KG owns 50%; and an unaffiliated
party owns 50%)
Tenneco Automotive Deutschland GmbH (Germany).................................................100
WALKER GILLET (Europe) GmbH (Germany).........................................................100
</TABLE>
1/ In dissolution.
-6-
<PAGE> 180
SCHEDULE 4.19(a)
UCC FILING JURISDICTIONS
<TABLE>
<CAPTION>
=================================== =========================================== ===== ======== =========== ========
FIXTURE
JURISDICTION NAMES TO SEARCH UCC TAX LIEN JUDGMENT FILING
=================================== =========================================== ===== ======== =========== ========
<S> <C> <C> <C> <C> <C>
ALABAMA S/S Tenneco Automotive Inc. f/k/a Monroe Auto X N/A N/A N/A
Equipment Company
------------------------------------------------------------------------------------------
Walker Manufacturing Company X N/A N/A N/A
- -------------------------------------------------------------------------------------------------------------------------------
WINSTON COUNTY, AL Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Walker Manufacturing Company X X X X
- -------------------------------------------------------------------------------------------------------------------------------
ARKANSAS S/S Tenneco Automotive Inc. f/k/a Monroe Auto X N/A N/A N/A
Equipment Company
------------------------------------------------------------------------------------------
Monroe Auto Equipment Company X N/A N/A N/A
- -------------------------------------------------------------------------------------------------------------------------------
GREENE COUNTY, AR Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Monroe Auto Equipment Company X X X X
- -------------------------------------------------------------------------------------------------------------------------------
CALIFORNIA S/S Tenneco Automotive Inc. f/k/a Monroe Auto X N/A N/A N/A
Equipment Company
------------------------------------------------------------------------------------------
Monroe Auto Equipment Company X N/A N/A N/A
------------------------------------------------------------------------------------------
Walker Manufacturing Company X N/A N/A N/A
------------------------------------------------------------------------------------------
Rancho Industries X N/A N/A N/A
- -------------------------------------------------------------------------------------------------------------------------------
LOS ANGELES COUNTY, CA Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Walker Manufacturing Company X X X X
------------------------------------------------------------------------------------------
Rancho Industries X X X X
- -------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 181
<TABLE>
<CAPTION>
=================================== =========================================== ===== ======== =========== ========
FIXTURE
JURISDICTION NAMES TO SEARCH UCC TAX LIEN JUDGMENT FILING
=================================== =========================================== ===== ======== =========== ========
<S> <C> <C> <C> <C> <C>
MARIN COUNTY, CA Tenneco Automotive Inc. f/k/a Monroe Auto X X X N/A
Equipment Company
------------------------------------------------------------------------------------------
Monroe Auto Equipment Company X X X N/A
- -------------------------------------------------------------------------------------------------------------------------------
CONNECTICUT S/S Tenneco Automotive Inc. f/k/a Monroe Auto X N/A N/A N/A
Equipment Company
------------------------------------------------------------------------------------------
Monroe Auto Equipment Company X N/A N/A N/A
------------------------------------------------------------------------------------------
The Pullman Company X N/A N/A N/A
- -------------------------------------------------------------------------------------------------------------------------------
MILFORD COUNTY, CT Tenneco Automotive Inc. f/k/a Monroe Auto X X X N/A
Equipment Company
------------------------------------------------------------------------------------------
Monroe Auto Equipment Company X X X N/A
- -------------------------------------------------------------------------------------------------------------------------------
LITCHFIELD COUNTY, CT Tenneco Automotive Inc. f/k/a Monroe Auto X X X N/A
Equipment Company
------------------------------------------------------------------------------------------
The Pullman Company X X X N/A
- -------------------------------------------------------------------------------------------------------------------------------
DELAWARE S/S Tenneco Automotive Inc. f/k/a Monroe Auto X N/A N/A N/A
Equipment Company
------------------------------------------------------------------------------------------
Walker Manufacturing Company X N/A N/A N/A
- -------------------------------------------------------------------------------------------------------------------------------
NEW CASTLE COUNTY, DE Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Walker Manufacturing Company X X X X
- -------------------------------------------------------------------------------------------------------------------------------
FLORIDA S/S Tenneco Automotive Inc. f/k/a Monroe Auto X N/A N/A N/A
Equipment Company
------------------------------------------------------------------------------------------
Monroe Auto Equipment Company X N/A N/A N/A
------------------------------------------------------------------------------------------
Walker Manufacturing Company X N/A N/A N/A
- -------------------------------------------------------------------------------------------------------------------------------
BROWARD COUNTY, FL Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Walker Manufacturing Company X X X X
- -------------------------------------------------------------------------------------------------------------------------------
</TABLE>
-2-
<PAGE> 182
<TABLE>
<CAPTION>
=================================== =========================================== ===== ======== =========== ========
FIXTURE
JURISDICTION NAMES TO SEARCH UCC TAX LIEN JUDGMENT FILING
=================================== =========================================== ===== ======== =========== ========
<S> <C> <C> <C> <C> <C>
DADE COUNTY, FL Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Monroe Auto Equipment Company X X X X
- -------------------------------------------------------------------------------------------------------------------------------
HILLSBOROUGH COUNTY, FL Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Walker Manufacturing Company X X X X
- -------------------------------------------------------------------------------------------------------------------------------
GEORGIA S/S Tenneco Automotive Inc. f/k/a Monroe Auto X N/A N/A N/A
Equipment Company
------------------------------------------------------------------------------------------
Monroe Auto Equipment Company X N/A N/A N/A
- -------------------------------------------------------------------------------------------------------------------------------
HART COUNTY, GA Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Monroe Auto Equipment Company X X X X
- -------------------------------------------------------------------------------------------------------------------------------
ILLINOIS S/S Tenneco Automotive Inc. f/k/a Monroe Auto X X N/A N/A
Equipment Company
------------------------------------------------------------------------------------------
Monroe Auto Equipment Company X X N/A N/A
------------------------------------------------------------------------------------------
Walker Manufacturing Company X X N/A N/A
------------------------------------------------------------------------------------------
Ced's Inc. X X N/A N/A
- -------------------------------------------------------------------------------------------------------------------------------
DUPAGE COUNTY, IL Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Ced's Inc. X X X X
- -------------------------------------------------------------------------------------------------------------------------------
WILL COUNTY, IL Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Walker Manufacturing Company X X X X
------------------------------------------------------------------------------------------
Monroe Auto Equipment Company X X X X
- -------------------------------------------------------------------------------------------------------------------------------
</TABLE>
-3-
<PAGE> 183
<TABLE>
<CAPTION>
=================================== =========================================== ===== ======== =========== ========
FIXTURE
JURISDICTION NAMES TO SEARCH UCC TAX LIEN JUDGMENT FILING
=================================== =========================================== ===== ======== =========== ========
<S> <C> <C> <C> <C> <C>
LAKE COUNTY, IL Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Monroe Auto Equipment Company X X X X
- -------------------------------------------------------------------------------------------------------------------------------
INDIANA S/S Tenneco Automotive Inc. f/k/a Monroe Auto X N/A N/A N/A
Equipment Company
------------------------------------------------------------------------------------------
Monroe Auto Equipment Company X N/A N/A N/A
------------------------------------------------------------------------------------------
Walker Manufacturing Company X N/A N/A N/A
------------------------------------------------------------------------------------------
Clevite Industries X N/A N/A N/A
------------------------------------------------------------------------------------------
The Pullman Company X N/A N/A N/A
- -------------------------------------------------------------------------------------------------------------------------------
NOBLE COUNTY, IN Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Walker Manufacturing Company X X X X
- -------------------------------------------------------------------------------------------------------------------------------
STEUBEN COUNTY, IN Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Monroe Auto Equipment Company X X X X
------------------------------------------------------------------------------------------
Clevite Industries Inc. X X X X
- -------------------------------------------------------------------------------------------------------------------------------
MARSHALL COUNTY, IN Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Walker Manufacturing Company X X X X
- -------------------------------------------------------------------------------------------------------------------------------
ELKHART COUNTY, IN Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Walker Manufacturing Company X X X X
- -------------------------------------------------------------------------------------------------------------------------------
MARYLAND S/S Tenneco Automotive Inc. f/k/a Monroe Auto X N/A N/A N/A
Equipment Company
------------------------------------------------------------------------------------------
Walker Electronic Silencing X N/A N/A N/A
- -------------------------------------------------------------------------------------------------------------------------------
</TABLE>
-4-
<PAGE> 184
<TABLE>
<CAPTION>
=================================== =========================================== ===== ======== =========== ========
FIXTURE
JURISDICTION NAMES TO SEARCH UCC TAX LIEN JUDGMENT FILING
=================================== =========================================== ===== ======== =========== ========
<S> <C> <C> <C> <C> <C>
ANNE ARUNDEL COUNTY, MD Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Walker Electronic Silencing X X X X
- -------------------------------------------------------------------------------------------------------------------------------
MICHIGAN S/S Tenneco Automotive Inc. f/k/a Monroe Auto X N/A N/A N/A
Equipment Company
------------------------------------------------------------------------------------------
Monroe Auto Equipment Company X N/A N/A N/A
------------------------------------------------------------------------------------------
Walker Manufacturing Company X N/A N/A N/A
------------------------------------------------------------------------------------------
Clevite Industries Inc. X N/A N/A N/A
- -------------------------------------------------------------------------------------------------------------------------------
OAKLAND COUNTY, MI Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Monroe Auto Equipment Company X X X X
------------------------------------------------------------------------------------------
Clevite Industries Inc. X X X X
- -------------------------------------------------------------------------------------------------------------------------------
CALHOUN COUNTY, MI Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Walker Manufacturing Company X X X X
- -------------------------------------------------------------------------------------------------------------------------------
MACOMB COUNTY, MI Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
- -------------------------------------------------------------------------------------------------------------------------------
JACKSON COUNTY, MI Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Walker Manufacturing Company X X X X
- -------------------------------------------------------------------------------------------------------------------------------
HILLSDALE COUNTY, MI Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Walker Manufacturing Company X X X X
- -------------------------------------------------------------------------------------------------------------------------------
MONROE COUNTY, MI Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Monroe Auto Equipment Company X X X X
- -------------------------------------------------------------------------------------------------------------------------------
</TABLE>
-5-
<PAGE> 185
<TABLE>
<CAPTION>
=================================== =========================================== ===== ======== =========== ========
FIXTURE
JURISDICTION NAMES TO SEARCH UCC TAX LIEN JUDGMENT FILING
=================================== =========================================== ===== ======== =========== ========
<S> <C> <C> <C> <C> <C>
MISSISSIPPI S/S Tenneco Automotive Inc. f/k/a Monroe Auto X X N/A N/A
Equipment Company
------------------------------------------------------------------------------------------
Walker Manufacturing Company X X N/A N/A
- -------------------------------------------------------------------------------------------------------------------------------
MONROE COUNTY, MS Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Walker Manufacturing Company X X X X
- -------------------------------------------------------------------------------------------------------------------------------
MISSOURI S/S Tenneco Automotive Inc. f/k/a Monroe Auto X N/A N/A N/A
Equipment Company
- -------------------------------------------------------------------------------------------------------------------------------
JACKSON COUNTY, MO Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
- -------------------------------------------------------------------------------------------------------------------------------
NEBRASKA S/S Tenneco Automotive Inc. f/k/a Monroe Auto X N/A N/A N/A
Equipment Company
------------------------------------------------------------------------------------------
Monroe Auto Equipment Company X N/A N/A N/A
------------------------------------------------------------------------------------------
Walker Manufacturing Company X N/A N/A N/A
- -------------------------------------------------------------------------------------------------------------------------------
DAWSON COUNTY, NE Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Monroe Auto Equipment Company X X X X
- -------------------------------------------------------------------------------------------------------------------------------
SEWARD COUNTY, NE Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Walker Manufacturing Company X X X X
- -------------------------------------------------------------------------------------------------------------------------------
NORTH CAROLINA S/S Tenneco Automotive Inc. f/k/a Monroe Auto X X N/A N/A
Equipment Company
------------------------------------------------------------------------------------------
Monroe Auto Equipment Company X X N/A N/A
- -------------------------------------------------------------------------------------------------------------------------------
WAKE COUNTY, NC Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Monroe Auto Equipment Company X X X X
- -------------------------------------------------------------------------------------------------------------------------------
</TABLE>
-6-
<PAGE> 186
<TABLE>
<CAPTION>
=================================== =========================================== ===== ======== =========== ========
FIXTURE
JURISDICTION NAMES TO SEARCH UCC TAX LIEN JUDGMENT FILING
=================================== =========================================== ===== ======== =========== ========
<S> <C> <C> <C> <C> <C>
OHIO S/S Tenneco Automotive Inc. f/k/a Monroe Auto X N/A N/A N/A
Equipment Company
------------------------------------------------------------------------------------------
Monroe Auto Equipment Company X N/A N/A N/A
------------------------------------------------------------------------------------------
The Pullman Company X N/A N/A N/A
------------------------------------------------------------------------------------------
Clevite Industries Inc. X N/A N/A N/A
- -------------------------------------------------------------------------------------------------------------------------------
LUCAS COUNTY, OH Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Monroe Auto Equipment Company X X X X
- -------------------------------------------------------------------------------------------------------------------------------
HURON COUNTY, OH Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Monroe Auto Equipment Company X X X X
- -------------------------------------------------------------------------------------------------------------------------------
CUYAHOGA COUNTY, OH Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Monroe Auto Equipment Company X X X X
------------------------------------------------------------------------------------------
The Pullman Company X X X X
- -------------------------------------------------------------------------------------------------------------------------------
RICHLAND COUNTY, OH Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Monroe Auto Equipment Company X X X X
------------------------------------------------------------------------------------------
The Pullman Company X X X X
- -------------------------------------------------------------------------------------------------------------------------------
ERIE COUNTY, OH Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Monroe Auto Equipment Company X X X X
------------------------------------------------------------------------------------------
Clevite Industries Inc. X X X X
- -------------------------------------------------------------------------------------------------------------------------------
</TABLE>
-7-
<PAGE> 187
<TABLE>
<CAPTION>
=================================== =========================================== ===== ======== =========== ========
FIXTURE
JURISDICTION NAMES TO SEARCH UCC TAX LIEN JUDGMENT FILING
=================================== =========================================== ===== ======== =========== ========
<S> <C> <C> <C> <C> <C>
HENRY COUNTY, OH Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Monroe Auto Equipment Company X X X X
------------------------------------------------------------------------------------------
Clevite Industries Inc. X X X X
- -------------------------------------------------------------------------------------------------------------------------------
SOUTH CAROLINA S/S Tenneco Automotive Inc. f/k/a Monroe Auto X N/A N/A N/A
Equipment Company
------------------------------------------------------------------------------------------
Monroe Auto Equipment Company X N/A N/A N/A
- -------------------------------------------------------------------------------------------------------------------------------
ANDERSON COUNTY, SC Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Monroe Auto Equipment Company X X X X
- -------------------------------------------------------------------------------------------------------------------------------
TENNESSEE S/S Tenneco Automotive Inc. f/k/a Monroe Auto X N/A N/A N/A
Equipment Company
------------------------------------------------------------------------------------------
Walker Manufacturing Company X N/A N/A N/A
- -------------------------------------------------------------------------------------------------------------------------------
DEKALB COUNTY, TN Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Walker Manufacturing Company X X X X
- -------------------------------------------------------------------------------------------------------------------------------
TEXAS S/S Tenneco Automotive Inc. f/k/a Monroe Auto X N/A N/A N/A
Equipment Company
------------------------------------------------------------------------------------------
Monroe Auto Equipment Company X N/A N/A N/A
------------------------------------------------------------------------------------------
Tenneco Business Services, Inc. X N/A N/A N/A
------------------------------------------------------------------------------------------
Pullmex, S.A. X N/A N/A N/A
- -------------------------------------------------------------------------------------------------------------------------------
DALLAS COUNTY, TX Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Monroe Auto Equipment Company X X X X
- -------------------------------------------------------------------------------------------------------------------------------
</TABLE>
-8-
<PAGE> 188
<TABLE>
<CAPTION>
=================================== =========================================== ===== ======== =========== ========
FIXTURE
JURISDICTION NAMES TO SEARCH UCC TAX LIEN JUDGMENT FILING
=================================== =========================================== ===== ======== =========== ========
<S> <C> <C> <C> <C> <C>
DENTON COUNTY, TX Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Monroe Auto Equipment Company X X X X
- -------------------------------------------------------------------------------------------------------------------------------
HARRIS COUNTY, TX Tenneco Business Services, Inc. X X X X
- -------------------------------------------------------------------------------------------------------------------------------
HIDALGO COUNTY, TX Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Monroe Auto Equipment Company X X X X
------------------------------------------------------------------------------------------
Pullmex, S.A. X X X X
- -------------------------------------------------------------------------------------------------------------------------------
MONTGOMERY COUNTY, TX Tenneco Business Services, Inc. X X X X
- -------------------------------------------------------------------------------------------------------------------------------
VIRGINIA S/S Tenneco Automotive Inc. f/k/a Monroe Auto X X N/A N/A
Equipment Company
------------------------------------------------------------------------------------------
Monroe Auto Equipment Company X X N/A N/A
------------------------------------------------------------------------------------------
Walker Manufacturing Company X X N/A N/A
- -------------------------------------------------------------------------------------------------------------------------------
ROANOKE (INDEPENDENT CITY) Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Monroe Auto Equipment Company X X X X
- -------------------------------------------------------------------------------------------------------------------------------
VIRGINIA BEACH (INDEPENDENT CITY) Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
- -------------------------------------------------------------------------------------------------------------------------------
HARRISONBURG (INDEPENDENT CITY) Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Walker Manufacturing Company X X X X
- -------------------------------------------------------------------------------------------------------------------------------
WISCONSIN S/S Tenneco Automotive Inc. f/k/a Monroe Auto X N/A N/A N/A
Equipment Company
------------------------------------------------------------------------------------------
Walker Manufacturing Company X N/A N/A N/A
- -------------------------------------------------------------------------------------------------------------------------------
</TABLE>
-9-
<PAGE> 189
<TABLE>
<CAPTION>
=================================== =========================================== ===== ======== =========== ========
FIXTURE
JURISDICTION NAMES TO SEARCH UCC TAX LIEN JUDGMENT FILING
=================================== =========================================== ===== ======== =========== ========
<S> <C> <C> <C> <C> <C>
SAWYER COUNTY, WI Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Walker Manufacturing Company X X X X
- -------------------------------------------------------------------------------------------------------------------------------
RACINE COUNTY, WI Tenneco Automotive Inc. f/k/a Monroe Auto X X X X
Equipment Company
------------------------------------------------------------------------------------------
Walker Manufacturing Company X X X X
- -------------------------------------------------------------------------------------------------------------------------------
</TABLE>
Notes: Monroe Auto Equipment Company changed its name to Tenneco Automotive Inc.
effective 10/31/96.
Walker Manufacturing Company and Monroe Auto Equipment (Company) both
operated as divisions of Tenneco Automotive Inc. until 10/21/98.
Rancho Industries is a division of Tenneco Automotive Inc. in California
only.
-10-
<PAGE> 190
DRAFT 9/23/99
SCHEDULE 4.19(b)
MORTGAGE FILING JURISDICTIONS
FACILITY: Paragould, Arkansas
ADDRESS: 1601 Highway 49B North
Paragould, Arkansas 72450
COUNTY SITUATED IN: Greene
OWNED BY: Monroe
FACILITY: Aberdeen, Mississippi
ADDRESS: 704 Highway South
Aberdeen, Mississippi 39730
COUNTY SITUATED IN: Monroe
OWNED BY: Walker
FACILITY: Harrisonburg, VA
ADDRESS: 4500 Early Road
Harrisonburg, VA 22801
COUNTY SITUATED IN: Harrisonburg (City)
OWNED BY: Walker
FACILITY: Harrisonburg, VA
ADDRESS: 3160 Abbot Lane
Harrisonburg, VA 22801
COUNTY SITUATED IN: Harrisonburg (City)
OWNED BY: Walker
FACILITY: Seward, NE
ADDRESS: P.O. Box 348 - S. Highway 15
Seward, NE 68434
COUNTY SITUATED IN: Seward
OWNED BY: Walker
FACILITY: Monroe, Michigan
ADDRESS: 13910 Lake Drive
Monroe, Michigan 48161
COUNTY SITUATED IN: Monroe
OWNED BY: Monroe Lodge
<PAGE> 191
DRAFT 9/23/99
FACILITY: Monroe, Michigan
ADDRESS: 1 International Drive
Monroe, Michigan 48161
COUNTY SITUATED IN: Monroe
OWNED BY: Monroe
FACILITY: Cozad, Nebraska
ADDRESS: 121 Meridian Dr.
Cozad, Nebraska 68434
COUNTY SITUATED IN: Dawson
OWNED BY: Monroe
FACILITY: Napolean, Ohio
ADDRESS: Route 424
Napolean, Ohio 43545
COUNTY SITUATED IN: Henry
OWNED BY: Monroe-Clevite
FACILITY: Milan, Ohio
ADDRESS: 33 Lockwood Rd.
Milan, Ohio 44848
COUNTY SITUATED IN: Ashland
OWNED BY: Monroe-Clevite
FACILITY: Angola, Indiana
ADDRESS: 503 Weatherhead St.
Angola, Indiana 46703
COUNTY SITUATED IN: Stueben
OWNED BY: Monroe-Clevite
FACILITY: Hartwell, Georgia
ADDRESS: 200 McIntyre Dr.
Hartwell, Georgia 30643
COUNTY SITUATED IN: Hart
OWNED BY: Monroe
FACILITY: Smithville, Tennessee
ADDRESS: 645 Eat Broad St.
Smithsville, Tennessee 37166
COUNTY SITUATED IN: Dekalb
OWNED BY: Walker
-2-
<PAGE> 192
DRAFT 9/23/99
FACILITY: Litchfield, Michigan
ADDRESS: 929 Anderson Road
Litchfield, Michigan 49252
COUNTY SITUATED IN: Hillsdale
OWNED BY: Walker
FACILITY: Jackson Engineering Facility
ADDRESS: 2701 North Dettman Road
Jackson, Michigan 49201
COUNTY SITUATED IN: Jackson
OWNED BY: Walker
FACILITY: Grass Lake, Michigan
ADDRESS: 3901 Willis Road
Grass Lake, Michigan 49240
COUNTY SITUATED IN: Jackson
OWNED BY: Walker
FACILITY: Elkhart, Indiana
ADDRESS: 4825 Hoffman St.
Elkhart, Indiana 46515
COUNTY SITUATED IN: Elkhart
OWNED BY: Walker
FACILITY: Culver, Indiana
ADDRESS: 515 W. Mill St.
Culver, Indiana 46511
COUNTY SITUATED IN: Marshall
OWNED BY: Walker
FACILITY: Norwalk, Ohio
ADDRESS: 206 Republic
Norwalk, Ohio 44857
COUNTY SITUATED IN: Huron
OWNED BY: Monroe
-3-
<PAGE> 193
SCHEDULE 7.2(D)
DOMESTIC INDEBTEDNESS
Capital Lease Obligations of Clevite Industries, Inc. aggregating $1,226,031.
Guaranties by Tenneco Inc. of Indebtedness of Foreign Subsidiaries listed
on Schedule 7.2(d) (Foreign Indebtedness)
Letters of Credit on attached list.
Guaranty by Tenneco Inc. of the Tenneco Automotive Inc. plant lease for the
Ligonier, Indiana facility.
Guaranty by Tenneco Inc. of the Tenneco lease for the Lake Forest, Illinois
facility.
Guaranties by Tenneco Inc. of Environmental obligations relating to the
following facilities:
<TABLE>
<S> <C>
Buckeye........................................................$100,000
Harrisonburg...................................................$293,290
Paragould-Finch Road Landfill, Paragrould, AR................$2,800,000
121 Meridian Street, Cozad, Nebraska...........................$412,000
</TABLE>
Guaranties of Speedy Muffler King Leases on attached list by Tenneco Automotive
Inc.
Guaranty by Tenneco Automotive of obligations to Vanstar Corporation for
services provided to Foreign Subsidiaries.
<PAGE> 194
<TABLE>
<C> <C> <C> <C> <C> <C>
$2,226,000.00 $2,056,330.00 $32,981,717.00 $3,313,297.00
BofA (Continental) Chase NationsBank Chase Manhattan Letters of Credit, originally issued
#7224604 P.26216 #130995 by Manufacturers or Chemical
PCA Travellers of Illinois Cigna, et al
Michigan environmental Astro Valoovi WCGI/Auto Insurance/Surety Leases Miscellaneous
$2,226,000.00 $1,000,000.00 $29,481,717.00
G149925 P290 101 (T245911) G235675
Bank of America NationsBank Gulf Insurance Charter Financial CIBC (import bond)
C7340834 #120796 $250,000.00 $34,312.50 $25,000.00
Citibank, as Agent Inc.
Lake Forest HQ lease "employee benefits" G155402 T252405 G132797
$1,056,330 $3,000,000.00 Liberty Mutual Charter Financial State of NJ
$700,000.00 $60,488.75 $750,000.00
Chase
P.395778 G166933 P132 797 (T 247 389)
Inc. & Greenmoni National Surety Charter Financial
Vermont Ins. Comm $1,000,000.00 $204,856.25
Equity guarantee
$500,000.00 T249948
Cargill Leasing
$288,639.50
As of June 16, 1999
$40,577,344.00
</TABLE>
<PAGE> 195
Co 0116
38A(3)
INFORMATION PROVIDED FROM RITA WALSH (VIRGINIA KEARNS - TA LEGAL SECRETARY)
BY SPEEDY CAR-X OFFICES IN CHICAGO, ILLINOIS
<TABLE>
<CAPTION>
LOCATION CONTRACT CONTRACT #MOS MONTHLY TOTAL GRAND TOTAL
START END LEFT PMT LEASE
- ------------ -------- -------- ---- ------- ------- -----------
<S> <C> <C> <C> <C> <C> <C>
674 NORWALK 09/01/86 08/31/91 0 4.583 0
09/01/91 08/31/96 0 5.125 0
09/01/96 08/31/01 20 6.067 121.333
1912 REISTERTOWN, PA 02/21/86 02/20/91 0 1.667 0
02/21/91 02/20/96 0 1.833 0
02/21/96 02/20/01 26 2.017 52.433
02/21/01 02/20/05 60 2.218 133.100
02/21/06 02/20/11 50 2.440 146.410
02/21/11 02/20/16 60 2.684 161.060
1913 RADALLSTOWN, MD 03/13/87 03/12/92 0 4.708 0
03/13/92 03/12/97 0 5.415 0
03/13/97 03/12/02 39 6.227 242.844
03/13/02 03/12/07 60 7.161 429.647
03/13/07 03/12/12 60 8.235 494.094
03/13/12 03/12/17 60 9.470 568.208
2104 PONTIAC, MI 09/01/73 09/01/85 0 0 0
09/02/85 09/01/90 0 0 0
09/02/90 09/01/95 0 0 0
10/01/95 09/30/95 0 2.500 0
10/01/96 09/30/97 0 2.500 0
10/01/97 09/30/98 0 2.600 0
2108 WESTLAND, MI 06/14/73 06/14/86 0 0 0
06/15/65 06/14/90 0 0 0
06/15/90 06/14/95 0 0 0
06/15/95 06/30/96 0 0 0
06/01/96 06/01/01 31 3.100 98.100
2110 TAYLOR, MI 07/01/74 06/30/86 0 0 0
07/01/86 06/30/91 0 0 0
07/01/91 06/30/96 0 0 0
07/01/96 09/01/01 31 3.000 93.000
2935 E ORANGE, NJ 02/01/85 01/31/87 0 1.775 0
02/01/87 01/31/90 0 2.041 0
01/01/90 01/31/95 0 2.763 0
02/01/95 01/31/00 13 2.952 38.374
02/01/00 01/31/05 60 3.394 203.665
02/01/05 01/31/10 60 3.904 234.215
3133 VALLEY STREAM, NY 03/01/86 02/28/90 0 1.500 0
03/01/90 01/28/95 0 1.800 0
03/01/95 02/28/00 14 2.160 30.240
03/01/00 02/28/05 60 2.592 156.520
03/01/05 02/28/10 60 3.110 186.624
3135 SMITHTOWN, NY 05/01/86 04/30/90 0 1.667 0
05/01/90 04/30/95 0 1.917 0
05/01/95 04/30/00 16 2.204 35.287
05/01/00 04/30/06 60 2.756 165.315
05/01/05 04/30/10 60 3.444 206.640
05/01/10 04/30/15 60 4.305 258.300
3136 CNTRCH 03/01/85 02/28/90 0 2.000 0
03/01/90 02/28/95 0 2.300 0
03/01/95 02/28/00 14 2.645 37.030
03/01/00 02/28/05 60 2.439 206.310
03/01/06 02/28/10 60 Appraised 0
3136 WHITE PLAINS, NY 06/01/86 02/28/90 0 6.700 0
03/01/90 02/28/93 0 9.300 0
03/01/93 02/28/95 0 9.500 0
03/01/96 09/29/00 21 11.833 248.493
3140 UTICA, MI 05/01/85 04/30/91 0 3.000 0
05/01/91 04/30/96 0 3.600 0
</TABLE>
<PAGE> 196
<TABLE>
<S> <C> <C> <C> <C> <C>
06/01/96 04/30/01 28 4.320 120.960
05/01/01 04/30/06 60 5.616 336.980
05/01/05 04/30/11 60 7.301 438.048
3141 BETH PAGE, NY 12/15/86 12/14/91 0 4.000 0
12/15/91 12/14/96 0 4.850 0
12/15/96 12/14/01 35 5.650 203.400
3142 DEER PARK, NY 07/01/87 06/03/92 0 2.750 0
07/01/92 06/03/97 0 2.300 0
07/01/97 06/03/92 41 3.950 161.950
07/01/02 06/03/07 50 4.750 285.000
3143 CORONA, NY 10/01/67 06/03/91 0 2.200 0
07/01/91 06/03/98 0 2.530 0
07/01/96 06/03/01 17 2.910 49.462
07/01/01 06/03/06 60 3.348 200.756
3750 MONROEVILLE, PA 07/15/85 07/14/91 0 4.000 0
07/15/91 07/14/96 0 4.400 0
07/15/96 07/14/01 31 4.850 150.360
07/16/01 07/14/06 60 5.335 320.100
07/15/06 07/14/11 60 5.870 352.200
07/15/11 07/14/16 60 5.450 387.600
3812 CRANSTON, RI 08/22/86 09/21/85 0 3.292 0
09/22/88 09/21/91 0 3.628 0
09/22/81 09/21/96 0 4.000 0
09/22/96 09/21/01 33 4.600 151.800
09/22/01 09/21/06 60 5.520 331.200
09/22/06 09/21/11 60 5.624 397.440
4913 BROOKFIELD, WI 01/12/83 11/30/92 0 3.333 0
12/01/92 11/30/97 0 3.750 0
12/01/97 11/30/02 0 4.167 0
----------
18,431,440
</TABLE>
<PAGE> 197
SCHEDULE 7.2(D) DRAFT 09/24/99
(FOREIGN INDEBTEDNESS)
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
COUNTRY ENTITY BANK LIMIT(1) LIMIT(2) PURPOSE LIEN
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1 Argentina Fric Rot Galicia Bank ARS 500K 500 Overdraft Right of set-off, right to
S.A.I.C. facility -- preferential payment or other
Working Capital encumbrance on deposits or
other assets in bank's
possession from time to
time(3)
- --- -------------- ---------------- ---------------- ------------- ------ ---------------- ------------------------------
2 Australia Monroe Westpac Banking AUD 250K 160 Overdraft Right of set-off, right to
Australia/ Corp facility preferential payment or other
Monroe Springs encumbrance on deposits or
Australia/Walker other assets in bank's
Australia possession from time to
time(3)
- --- -------------- ---------------- ---------------- ------------- ------ ---------------- ------------------------------
3 Australia Monroe Westpac Banking AUD 13.5M 8,659 Standby Right of set-off, right to
Australia/ Corp overdraft preferential payment or other
Monroe Springs facility encumbrance on deposits or
Australia/Walker other assets in bank's
Australia possession from time to
time(3)
- --- -------------- ---------------- ---------------- ------------- ------ ---------------- ------------------------------
4 Australia Monroe Westpac Banking AUD 1.6M 1,026 Guarantee Right of set-off, right to
Australia/ Corp facility preferential payment or other
Monroe Springs encumbrance on deposits or
Australia/Walker other assets in bank's
Australia possession from time to
time(3)
- --- -------------- ---------------- ---------------- ------------- ------ ---------------- ------------------------------
5 Australia Monroe Westpac Banking AUD 247K 158 Long term lease Right of set-off, right to
Australia/ Corp facility preferential payment or other
Monroe Springs encumbrance on deposits or
Australia/Walker other assets in bank's
Australia possession from time to
time(3)
- --- -------------- ---------------- ---------------- ------------- ------ ---------------- ------------------------------
6 Australia Monroe Westpac Banking AUD 300K 192 Trade finance Right of set-off, right to
Australia/ Corp facility preferential payment or other
Monroe Springs encumbrance on deposits or
Australia/Walker other assets in bank's
Australia possession from time to
time(3)
- --- -------------- ---------------- ---------------- ------------- ------ ---------------- ------------------------------
7 Belgium Tenneco Artesia BEF 155M 3,983 Short term Right of set-off, right to
Automotive credit facility preferential payment or other
Europe NV -- Working encumbrance on deposits or
Capital other assets in bank's
possession from time to
time(3)
- --- -------------- ---------------- ---------------- ------------- ------ ---------------- ------------------------------
8 Belgium Tenneco Bank Brussels BEF 150M 3,855 Short term Right of set-off, right to
Automotive Lambert credit facility preferential payment or other
Europe NV -- Working Capital encumbrance on deposits or
other assets in bank's
possession from time to
time(3)
- --- -------------- ---------------- ---------------- ------------- ------ ---------------- ------------------------------
</TABLE>
<PAGE> 198
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
COUNTRY ENTITY BANK LIMIT(1) LIMIT(2) PURPOSE LIEN
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
9 Belgium Tenneco A.S.L.K. BEF 25M 642 Short term Right of set-off, right to
Automotive credit facility preferential payment or other
Europe NV - Working encumbrance on deposits or
Capital other assets in bank's
possession from time to
time(3)
-------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
10 Brazil Tenneco HSBC Bamerindus Drawn: BRL 1.31M 700 Overdraft Right of set-off, right to
Automotive facility - preferential payment or other
Brazil Ltda Working Capital encumbrance on deposits or
other assets in bank's
possession from time to
time(3)
-------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
11 Brazil Tenneco HSBC Bamerindus BRL 5M 2,671 Short term Right of set-off, right to
Automotive credit facility preferential payment or other
Brazil Ltda - Working encumbrance on deposits or
Capital other assets in bank's
possession from time to
time(3)
-------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
12 Brazil Tenneco Banco ABC Brasil BRL 10M 5,342 Short term Right of set-off, right to
Automotive credit facility preferential payment or other
Brazil Ltda encumbrance on deposits or
other assets in bank's
possession from time to
time(3)
-------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
13 Brazil Tenneco Banco Real S/A BRL 450K 240 Overdraft -- Right of set-off, right to
Automotive Working Capital preferential payment or other
Brazil Ltda encumbrance on deposits or
other assets in bank's
possession from time to
time(3)
-------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
14 Brazil Tenneco Banco Real S/A BRL 3.6M 1,923 Short term Right of set-off, right to
Automotive credit facility preferential payment or other
Brazil Ltda - Working encumbrance on deposits or
Capital other assets in bank's
possession from time to
time(3)
-------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
15 Brazil Tenneco Banco Real BRL 7M 3,739 Short term Right of set-off, right to
Automotive Investimentos credit facility preferential payment or other
Brazil Ltda encumbrance on deposits or
other assets in bank's
possession from time to
time(3)
-------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
16 Brazil Tenneco Dresdner Bank BRL 7M 3,739 Short term Right of set-off, right to
Automotive credit facility preferential payment or other
Brazil Ltda encumbrance on deposits or
other assets in bank's
possession from time to
time(3)
-------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
17 Brazil Tenneco Unibanco BRL 5M 2,671 Short term Right of set-off, right to
Automotive credit preferential payment or other
Brazil Ltda encumbrance on deposits or
other assets in bank's
possession from time to
time(3)
-------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
18 Brazil Tenneco Banco Sudameris BRL 1.3M 694 Export Line Right of set-off, right to
Automotive preferential payment or other
Brazil Ltda encumbrance on deposits or
other assets in bank's
possession from time to
time(3)
-------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
19 Brazil Tenneco Citibank BRL 395K 211 BNDES Financing Right of set-off, right to
Automotive preferential payment or other
Brazil Ltda encumbrance on deposits or
other assets in bank's
possession from time to
time(3)
-------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
20 Canada TCI-Automotive Bank of Montreal USD 10M# 10,000 Undocumented Right of set-off, right to
line, advised preferential payment or other
limit, includes encumbrance on deposits or
drawings in CAD other assets in bank's
and USD possession from time to
time(3)
-------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
</TABLE>
2
<PAGE> 199
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
COUNTRY ENTITY BANK LIMIT(1) LIMIT(2) PURPOSE LIEN
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
21 China Beijing Monroe Finance Bureau, RMB 750K 91 Short term Right of set-off, right to
Shock Absorber China working capital preferential payment or other
Company loan encumbrance on deposits or
other assets in bank's
possession from time to
time(3)
-------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
22 China Beijing Monroe Industrial & Drawn: RMB 9.1M 1,099 Short term Pledge over assets
Shock Absorber Commercial Bank working capital
Company of China loan
-------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
23 China Beijing Monroe Dai-ichi Kangyo USD 1.5M 1,500 Short term Right of set-off, right to
Shock Absorber Bank working capital preferential payment or other
Company loan supported encumbrance on deposits or
by Tenneco Inc. other assets in bank's
guarantee possession from time to
time(3)
-------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
24 China Beijing Monroe Localization RMB 5M 604 Long term capex Right of set-off, right to
Shock Absorber loan/Planning loan preferential payment or other
Company committee encumbrance on deposits or
other assets in bank's
possession from time to
time(3)
-------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
25 China Beijing Monroe Localization Drawn: RMB 6M 725 Long term capex Right of set-off, right to
Shock Absorber loan/CBC loan preferential payment or other
Company encumbrance on deposits or
other assets in bank's
possession from time to
time(3)
-------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
26 China Dalian Walker- Industrial & Drawn: RMB 12.3M 1,486 Short term Pledge over assets
Gillet Auto Commercial Bank, working capital
Muffler Company China loan
-------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
27 Czech Republic Monroe Czechia Komercni Banka CZK 20M 570 Overdraft Right of set-off, right to
Liberec facility -- preferential payment or other
Working Capital encumbrance on deposits or
other assets in bank's
possession from time to
time(3)
-------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
28 Denmark Walker Danmark Den Danske Bank DKK 20M 2,794 Overdraft Right of set-off, right to
A/S facility -- preferential payment or other
Working Capital encumbrance on deposits or
other assets in bank's
possession from time to
time(3)
-------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
29 Denmark Walker Danmark Den Danske Bank DKK 3.8M 531 Multi-currency Right of set-off, right to
A/S overdraft preferential payment or other
facility encumbrance on deposits or
(EUR/DEM/NLG) other assets in bank's
possession from time to
time(3)
-------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
30 France Gillet Tubes SODIEST Drawn: FRF 2.99M 472 Long term loan, Right of set-off, right to
Technologies (Development matures May 2002 preferential payment or other
Agency) Capital encumbrance on deposits or
Expenditure other assets in bank's
Finance possession from time to
time(3)
-------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
31 France Gillet Tubes SODIEST Drawn: FRF 330K 52 Long term loan, Right of set-off, right to
Technologies (Development matures January preferential payment or other
Agency) 2001 Capital encumbrance on deposits or
Expenditure other assets in bank's
Finance possession from time to
time(3)
-------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
32 France Wimetal Banque Nationale FRF 150M 23,685 Bill discounting Without recourse discounting
de Paris -- Working facility
Capital
-------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
33 France Wimetal Sogenal FRF 40M 6,316 Overdraft Right of set-off, right to
facility preferential payment or other
encumbrance on deposits or
other assets in bank's
possession from time to
time(3)
-------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
</TABLE>
3
<PAGE> 200
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
COUNTRY ENTITY BANK LIMIT(1) LIMIT(2) PURPOSE LIEN
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
34 France Wimetal Sogenal FRF 150M 23,685 Bill discounting Without recourse discounting
facility -- facility
without
recourse
- --- -------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
35 Germany Tenneco Commerzbank, DEM 16.3M 8,631 German cashpool Right of set-off, right to
Deutschland Neustadt overdraft preferential payment or other
Holdings facility (plus encumbrance on deposits or
Gesellschaft mbH DEM 8.9 million other assets in bank's
daylight possession from time to
overdraft), time(3)
guaranteed by
Tenneco Inc.
- --- -------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
36 Germany Heinrich Gillet Commerzbank See #36 Overdraft Right of set-off, right to
GmbH & Co. KG (ledger balance) preferential payment or other
Part of German encumbrance on deposits or
cashpool other assets in bank's
possession from time to
time(3)
- --- -------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
37 Germany Tenneco Commerzbank See #36 Overdraft Right of set-off, right to
Automotive (ledger balance) preferential payment or other
Deutschland Part of German encumbrance on deposits or
cashpool other assets in bank's
possession from time to
time(3)
- --- -------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
38 India Hydraulics Ltd Citibank INR 25M 575 Working Capital Right of set-off, right to
facility, preferential payment or other
guaranteed by encumbrance on deposits or
Tenneco Inc. other assets in bank's
possession from time to
time(3)
- --- -------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
39 India Hydraulics Ltd Citibank Drawn: INR 35M 805 Working Capital Right of set-off, right to
facility, preferential payment or other
guaranteed by encumbrance on deposits or
Tenneco Inc. other assets in bank's
possession from time to
time(3)
- --- -------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
40 India Hydraulics Ltd Bank of America INR 150M 3,450 Long term loan Right of set-off, right to
supported by preferential payment or other
Tenneco Inc. encumbrance on deposits or
guarantee, other assets in bank's
matures in June possession from time to
2000 time(3)
- --- -------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
41 India Hydraulics Ltd Bank of America INR 225M 5,175 Short term Right of set-off, right to
working capital preferential payment or other
loan, Tenneco encumbrance on deposits or
Inc. guarantee other assets in bank's
possession from time to
time(3)
- --- -------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
42 India Renowned Auto Various INR 5.2M 120 Long term Right of set-off, right to
Products loan -- Working preferential payment or other
Manufacturers Capital encumbrance on deposits or
other assets in bank's
possession from time to
time(3)
- --- -------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
43 India Renowned Auto SIPCOT INR 5,140 0 Term loan -- Right of set-off, right to
Products matures June preferential payment or other
Manufacturers 2000 Sales Tax encumbrance on deposits or
Financing other assets in bank's
possession from time to
time(3)
- --- -------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
44 India Renowned Auto SIPCOT INR 3.8M 87 Term loan, Right of set-off, right to
Products matures June preferential payment or other
Manufacturers 2000 Working encumbrance on deposits or
Capital other assets in bank's
possession from time to
time(3)
- --- -------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
45 India Walker Exhaust Bank of America INR 110M 2,530 Term loan Right of set-off, right to
India Pvt. Ltd. supported by preferential payment or other
Tenneco Inc. encumbrance on deposits or
guarantee other assets in bank's
possession from time to
time(3)
- --- -------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
</TABLE>
4
<PAGE> 201
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
COUNTRY ENTITY BANK LIMIT(1) LIMIT(2) PURPOSE LIEN
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
46 India Walker Exhaust Bank of America INR 35M 805 Short term Right of set-off, right to
India Pvt. Ltd working capital preferential payment or other
loan supported encumbrance on deposits or
by Tenneco Inc. other assets in bank's
guarantee possession from time to
time(3)
-------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
47 Italy Tenneco Credito Italiano ITL 180M 4,140 Overdraft Right of set-off, right to
Automotive SpA facility -- preferential payment or other
Italia Srl Working Capital encumbrance on deposits or
other assets in bank's
possession from time to
time(3)
-------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
48 New Zealand Monroe Springs Westpac Banking NZD 250K 130 Overdraft Right of set-off, right to
New Zealand Corp facility -- preferential payment or other
Working Capital encumbrance on deposits or
other assets in bank's
possession from time to
time(3)
-------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
49 Poland Tenneco Citibank, Poland PLN 35M 8,550 Short term Right of set-off, right to
Automotive credit facility preferential payment or other
Polska supported by encumbrance on deposits or
Tenneco Inc. other asset in bank's
guarantee -- possession from time to
Working Capital time(3)
-------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
50 Singapore Tenneco Asia Bank of America, SGD 500K 294 Overdraft Right of set-off, right to
Singapore facility preferential payment or other
supported by encumbrance on deposits or
Tenneco Inc. other assets in bank's
letter of possession from time to
comfort time(3)
-------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
51 Singapore Tenneco Citibank, USD 1M 1,000 Overdraft Right of set-off, right to
Automotive Asia Singapore facility preferential payment or other
(T.A.T.C) supported by encumbrance on deposits or
Tenneco Inc. other assets in bank's
guarantee possession from time to
time(3)
-------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
52 South Africa Armstrong First National ZAR 10M 1,643 Short term Right of set-off, right to
Hydraulics Bank working capital preferential payment or other
line supported encumbrance on deposits or
by Tenneco other assets in bank's
Automotive possession from time to
Holdings SA time(3)
guarantee
-------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
53 South Africa Armstrong ABSA Bank ZAR 9M 1,479 Short term Right of set-off, right to
Hydraulics working capital preferential payment or other
facility encumbrance on deposits or
other assets in bank's
possession from time to
time(3)
-------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
54 Spain Tenneco Banco Santander ESP 3.3BN 20,543 Long term Secured by underlying assets
Automotive capital lease --
Iberica matures Sept
2009 (to be
signed before
Spin-Off)
-------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
55 Spain Tenneco Banco Santander ESP 150M 933 Guarantee Right of set-off, right to
Automotive facility preferential payment or other
Iberica encumbrance on deposits or
other assets in bank's
possession from time to
time(3)
-------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
56 Spain Tenneco Banco Santander ESP 178M 1,108 Finance lease Secured by underlying asset
Automotive for plant
Iberica machinery
-------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
57 Sweden Tenneco Sparbanken SEK 5M 604 Overdraft Right of set-off, right to
Automotive facility -- preferential payment or other
Sweden Working Capital encumbrance on deposits or
other assets in bank's
possession from time to
time(3)
-------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
</TABLE>
5
<PAGE> 202
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
COUNTRY ENTITY BANK LIMIT(1) LIMIT(2) PURPOSE LIEN
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
58 Turkey Monroe Amortisor Iktisat Bankasi TRL 85BN 184 Overdraft -- Right of set-off, right to
Working Capital preferential payment or other
encumbrance on deposits or
other assets in bank's
possession from time to
time(3)
- --- -------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
59 Turkey Monroe Amortisor Is Bankasi TRL 100BN 217 Short term Right of set-off, right to
credit facility preferential payment or other
(overdraft/ encumbrance on deposits or
guarantees) other assets in bank's
supported by possession from time to
TMEL letter of time(3)
comfort
- --- -------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
60 UK Tenneco Walker Barclays Bank GBP 2.5M 4,051 Overdraft Right of set-off, right to
UK facility -- cross preferential payment or other
guarantee Part encumbrance on deposits or
of UK cashpool other assets in bank's
possession from time to
time(3)
- --- -------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
61 UK Tenneco Barclays Bank GBP 500K 810 Overdraft Right of set-off, right to
Automotive UK facility -- cross preferential payment or other
Ltd guarantee Part encumbrance on deposits or
of UK cashpool other assets in bank's
possession from time to
time(3)
- --- -------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
62 UK Tenneco Europe Bank of America GBP 100K 162 Overdraft Right of set-off, right to
Ltd facility preferential payment or other
encumbrance on deposits or
other assets in bank's
possession from time to
time(3)
- --- -------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
63 UK Tenneco Bank of America, USD 25M 25,000 Credit facility Right of set-off, right to
Management London supported by preferential payment or other
(Europe) Limited Tenneco Inc. encumbrance on deposits or
guarantee other assets in bank's
possession from time to
time(3)
- --- -------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
64 UK Tenneco KBC Bank, London USD 25M 25,000 Credit facility Right of set-off, right to
Management supported by preferential payment or other
(Europe) Limited Tenneco Inc. encumbrance on deposits or
comfort letter other assets in bank's
possession from time to
time(3)
- --- -------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
65 France Tenneco Banque Nationale FRF 100M 15,790 Credit facility Right of set-off, right to
Management de Paris, Laval supported by preferential payment or other
(Europe) Limited Tenneco Inc. encumbrance on deposits or
comfort letter other assets in bank's
possession from time to
time(3)
- --- -------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
66 UK Tenneco Banque Nationale USD 25M 25,000 Credit facility Right of set-off, right to
Management de Paris, London supported by preferential payment or other
(Europe) Limited Tenneco Inc. encumbrance on deposits or
comfort letter other assets in bank's
possession from time to
time(3)
- --- -------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
67 UK Tenneco Barclays Bank GBP 2M 3,240 Overdraft -- Right of set-off, right to
Management Plc, London Cross Guarantee preferential payment or other
(Europe) Limited Part of UK encumbrance on deposits or
cashpool other assets in bank's
possession from time to
time(3)
- --- -------------- ---------------- ---------------- ---------------- ------ ---------------- ------------------------------
</TABLE>
TOTAL: 276,771
(1) In local currency.
(2) In U.S. dollars (000), using the following exchange rates as of
September 20, 1999:
6
<PAGE> 203
<TABLE>
<S> <C> <C>
1 ARS = 1.0002 USD
1 AUD = .6414 USD
1 BEF = .0257 USD
1 BRL = .5342 USD
1 CAD = .6764 USD
1 RMD = .1208 USD
1 CZK = .02849 USD
1 DKK = .1397 USD
1 FRF = .1579 USD
1 DEM = .5295 USD
1 INR = .02300 USD
1 ITL = .0005349 USD
1 NZD = .5218 USD
1 PLN = .2443 USD
1 PTE = .005166 USD
1 SGD = .5872 USD
1 ZAR = .1643 USD
1 ESP = .006225 USD
1 SEK = .1207 USD
1 TRL = .00000217 USD
1 GBP = 1.6202 USD
</TABLE>
3 Under applicable law the various rights may or may not constitute Liens.
7
<PAGE> 204
SCHEDULE 7.3(F)
DOMESTIC LIENS
<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Arkansas S/S Tenneco Automotive Connell Equipment Leasing Co. 1167585 01/19/1999 Forklifts, Cascade Fork
One International Drive 45 Cardinal Drive Positioner
Monroe, MI 48161 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
Arkansas S/S Tenneco Automotive Connell Equipment Leasing Co. 1173103 02/22/1999 Deka batteries, chargers
One International Drive 45 Cardinal Drive
Monroe, MI 48161 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
Arkansas S/S Monroe Auto Equipment Hyster Credit Co. 934421 12/02/1994 One Hyster S40XL2 S/N
Company P. O. Box 4366 C187V06515P
1601 Hwy 49-B North Portland, OR 97208
Paragould, AR 72450
- ------------------------------------------------------------------------------------------------------------------------------------
Arkansas S/S Monroe Auto Equipment Hyster Credit Co. 944097 02/09/1995 One Hyster E30XL S/N
Company P. O. Box 4366 C114V03686K
1601 Hwy 49-B North Portland, OR 97208
Paragould, AR 72450
- ------------------------------------------------------------------------------------------------------------------------------------
Arkansas S/S Monroe Auto Equipment Caterpillar Financial 998407 01/22/1996 2 Lift Trucks and Fork
Company Services Corporation Positioners as enumerated
One International Drive 4975 Preston Park, Suite 280 thereon
Monroe, MI 48161 Plano, TX 75093
- ------------------------------------------------------------------------------------------------------------------------------------
Arkansas S/S Monroe Auto Equipment Caterpillar Financial 1003395 02/26/1996 1 Lift Truck as enumerated
Company Services Corporation thereon
One International Drive 4975 Preston Park, Suite 280
Monroe, MI 48161 Plano, TX 75093
- ------------------------------------------------------------------------------------------------------------------------------------
Arkansas S/S Monroe Auto Equipment Caterpillar Financial 1003396 02/26/1996 1 Lift Truck and Fork
Company Services Corporation Positioner as enumerated
One International Drive 4975 Preston Park, Suite 280 thereon
Monroe, MI 48161 Plano, TX 75093
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
1
<PAGE> 205
<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Arkansas S/S Monroe Auto Equipment Caterpillar Financial 1018748 05/21/1996 1 Cascade Fork Positioner
Company Services Corporation Model 100F-HB-B041, S/N
One International Drive 4975 Preston Park, Suite 280 100F-HB-001-00054S
Monroe, MI 48161 Plano, TX 75093
- ---------------------------------------------------------------------------------------------------------------------------------
Arkansas S/S Monroe Auto Equipment Caterpillar Financial 1018749 05/21/1996 1 Caterpillar Lift Truck
Company Services Corporation equipped with 2 batteries
One International Drive 4975 Preston Park, Suite 280 and one charger
Monroe, MI 48161 Plano, TX 75093
- ---------------------------------------------------------------------------------------------------------------------------------
Arkansas S/S Monroe Auto Equipment Caterpillar Financial 1029129 07/24/1996 1 Caterpillar Lift Truck
Company Services Corporation S/N 6EM01280
One International Drive 4975 Preston Park, Suite 280
Monroe, MI 48161 Plano, TX 75093
- ---------------------------------------------------------------------------------------------------------------------------------
Arkansas S/S Monroe Auto Equipment Hyster Credit Company 1067979 04/08/1997 Six Hyster S60XM's
Company PO Box 4366
One International Drive Portland, OR 97208
Monroe, MI 48161
- ---------------------------------------------------------------------------------------------------------------------------------
Arkansas S/S Monroe Auto Equipment Hyster Credit Company 1094652 09/22/1997 Two Hyster S60XM's
Company PO Box 4366
One International Drive Portland, OR 97208
Monroe, MI 48161
- ---------------------------------------------------------------------------------------------------------------------------------
Arkansas S/S Monroe Auto Equipment Caterpillar Financial 1123359 03/30/1998 1 Caterpillar Lift Truck
Company Services Corporation equipped with One Brudi
One International Drive 4975 Preston Park, Suite 280 Fork Positioner
Monroe, MI 48161 Plano, TX 75093
- ---------------------------------------------------------------------------------------------------------------------------------
Arkansas S/S Tenneco Inc. d/b/a Hyster Credit Company 1160505 11/20/1998 1 Hyster S40XM
Monroe Auto Equipment PO Box 4366
Co. Portland, OR 97208
1601 Hwy 49B
Paragould, AR 72450
- ---------------------------------------------------------------------------------------------------------------------------------
Greene County, AR Tenneco Automotive Inc. Connell Equipment Leasing Co. 73 01/19/1999 Forklifts, Cascade Fork
One International Drive 45 Cardinal Drive Positioner
Monroe, MI 48161 Westfield, NJ 07090
- ---------------------------------------------------------------------------------------------------------------------------------
Greene County, AR Tenneco Automotive Connell Equipment Leasing Co. 254 02/22/1999 Deka batteries, chargers
One International Drive 45 Cardinal Drive
Monroe, MI 48161 Westfield, NJ 07090
- ---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
2
<PAGE> 206
<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Greene County, AR Tenneco Inc. d/b/a Hyster Credit Company 2061 11/20/1998 One Hyster S40XM
Monroe Auto P. O. Box 4366 S/N D187V12130V
Equipment Company Portland, OR 97208
1601 Hwy 49B
Paragould, AR 72450
- ------------------------------------------------------------------------------------------------------------------------------------
Greene County, AR Monroe Auto Equipment Caterpillar Financial 1597 09/14/1994 1 Caterpillar lift truck
Company Services Corporation equipped with 2 batteries
One International Drive 4975 Preston Park, Suite 280 and 1 charger
Monroe, MI 48161 Plano, TX 75093
- ------------------------------------------------------------------------------------------------------------------------------------
Greene County, AR Monroe Auto Equipment Hyster Credit Company 2197 11/30/1994 One Hyster S40XL2
Company P. O. Box 4366 S/N C187V06515P
1601 Hwy 49-B North Portland, OR 97208
Paragould, AR 72450
- ------------------------------------------------------------------------------------------------------------------------------------
Greene County, AR Monroe Auto Equipment Hyster Credit Company 261 02/08/1995 One Hyster E30XL
Company P. O. Box 4366 S/N C114V03686K
1601 Hwy 49-B North Portland, OR 97208
Paragould, AR 72450
- ------------------------------------------------------------------------------------------------------------------------------------
Greene County, AR Monroe Auto Equipment Caterpillar Financial 135 01/22/1996 2 Caterpillar lift trucks
Company Services Corporation equipped with 2 Fork
One International Drive 4975 Preston Park, Suite 280 Positioners
Monroe, MI 48161 Plano, TX 75093
- ------------------------------------------------------------------------------------------------------------------------------------
Greene County, AR Monroe Auto Equipment Caterpillar Financial 330 02/23/1996 1 Caterpillar lift truck
Company Services Corporation equipped with 2 batteries
One International Drive 4975 Preston Park, Suite 280 and 1 charger
Monroe, MI 48161 Plano, TX 75093
- ------------------------------------------------------------------------------------------------------------------------------------
Greene County, AR Monroe Auto Equipment Caterpillar Financial 331 02/23/1999 1 Caterpillar lift truck
Company Services Corporation equipped with fork
One International Drive 4975 Preston Park, Suite 280 positioner and 3
Monroe, MI 48161 Plano, TX 75093 Caterpillar lift trucks
- ------------------------------------------------------------------------------------------------------------------------------------
Greene County, AR Monroe Auto Equipment Caterpillar Financial 873 05/20/1996 1 Caterpillar lift truck
Company Services Corporation equipped with 2 batteries
One International Drive 4975 Preston Park, Suite 280 and 1 charger
Monroe, MI 48161 Plano, TX 75093
- ------------------------------------------------------------------------------------------------------------------------------------
Greene County, AR Monroe Auto Equipment Caterpillar Financial 874 05/20/1996 1 Cascade Fork Positioner
Company Services Corporation Model 100F-HB-B041 S/N
One International Drive 4975 Preston Park, Suite 280 100F-HB-001-00054S
Monroe, MI 48161 Plano, TX 75093
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
3
<PAGE> 207
<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Greene County, AR Monroe Auto Equipment Hyster Credit Company 568 04/07/1997 Six Hyster S60XM
Company P. O. Box 4366
One International Drive Portland, OR 97208
Monroe, MI 48161
- ------------------------------------------------------------------------------------------------------------------------------------
Greene County, AR Monroe Auto Equipment Hyster Credit Company 1537 09/18/1997 Two Hyster S60XM
Company P. O. Box 4366
One International Drive Portland, OR 97208
Monroe, MI 48161
- ------------------------------------------------------------------------------------------------------------------------------------
Greene County, AR Monroe Auto Equipment Caterpillar Financial 594 03/31/1998 1 Caterpillar Lift Truck
Company Services Corporation equipped with 1 Brudi Fork
One International Drive 4975 Preston Park, Suite 280 Positioner
Monroe, MI 48161 Plano, TX 75093
- ------------------------------------------------------------------------------------------------------------------------------------
Greene County, AR Wayne Griffin - #28976 Donald Purcell & Edwin Bird 89-258 04/16/1990 Default Judgment against
and d/b/a Garnishee in the amount of
Monroe Auto Equipment Purcell & Bird Radiology $87.00
Co., Inc.
Rt #8 Box 365
Paragould, AR 82450
- ------------------------------------------------------------------------------------------------------------------------------------
California S/S Tenneco Automotive Inc. Nissan Motor Acceptance Corp. 9802760404 01/22/1998 8 Barretts SG-124DF Serial
17150 Margay 990 W. 190th Street nos. 37-62457, 37-62476,
Carson, CA 90746 Torrance, CA 90502 37-62477, 38-62504,
38-62505, 38-62506,
38-62507 and 38-62508
- ------------------------------------------------------------------------------------------------------------------------------------
California S/S Tenneco Automotive Inc. Toyota Motor Credit Corp. 9802860645 01/23/1998 One used Drexel Model
17150 Margay P. O. Box 3457 SLT30, S/N 22576-2-47,
Carson, CA 90746 Torrance, CA 90510 88/205" Mast, 42" Forks,
Exide Battery and Exide
Charger
- ------------------------------------------------------------------------------------------------------------------------------------
California S/S Tenneco Automotive Inc. Toyota Motor Credit Corp. 9805460383 02/17/1998 One new Toyota Forklift
17150 Margay P. O. Box 3457 Model 42-6FGCU30, S/N:
Carson, CA 90746 Torrance, CA 90510 61218; One new Toyota
Forklift Model 42-6FGCU25,
S/N: 69962
- ------------------------------------------------------------------------------------------------------------------------------------
Delaware S/S Monroe Auto Equipment Connell Finance Company, Inc. 9502229 02/13/1995 Forklifts, batteries and
7001 Pencader Drive 45 Cardinal Drive chargers
Newark, DE 19702 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
4
<PAGE> 208
<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
New Castle Monroe Auto Equipment Connell Finance Company, Inc. 25403 10/21/1994 Forklifts, batteries and
County, DE 7001 Pencader Drive 45 Cardinal Drive chargers
Newark, DE 19702 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
Florida S/S Walker Manufacturing Forum Financial Group, Inc. 960000247763 11/25/1996 Equipment Schedule 2220-48;
Company 1475 Richardson Drive, Suite equipment located at 4949
1201 N. Michigan Blvd. 270 Richardson, TX 75080 Distribution Drive, Tampa,
Racine, WI 53402 Assigned to: FL 33605
Colorado National Leasing,
Inc.
950 17th Street, Suite 2400
Denver, CO 80202
- ------------------------------------------------------------------------------------------------------------------------------------
Illinois S/S Walker Manufacturing LaSalle Equipment 3396583 05/04/1995 Computer Equipment per
Company, Limited Partnership Schedule covered under
a division of Tennessee 40 Skokie Blvd., Suite 310 Master Lease #213 dated
Gas Pipeline Company Northbrook, IL 60062 5/1/86 together with
1201 Michigan Blvd. Assigned to: Schedule #33 dated 12/17/93
Racine, WI 53402 Manufacturers Bank 3405264 05/25/1995
1200 N. Ashland Ave. (Assignment)
Chicago, IL 60622
- ------------------------------------------------------------------------------------------------------------------------------------
Illinois S/S Walker Manufacturing Ameritech Credit Corporation 3667213 03/24/1997 Collateral description on
Company, 2550 West Golf Road attachment
a division of Tenneco Rolling Meadows, IL 60008
Automotive Inc.
111 N. Pfingsten Road
Deerfield, IL 60015
- ------------------------------------------------------------------------------------------------------------------------------------
Illinois S/S Walker Manufacturing LaSalle Equipment Limited 3681562 04/23/1997 Computer Equipment per
Company, Partnership Schedule covered under
a division of Tenneco 40 Skokie Blvd., Suite 310 Master Lease #213 dated
Automotive Inc. Northbrook, IL 60062 5/1/86 together with
1201 Michigan Blvd. Schedule #44 dated 3/4/97
Racine, WI 53402
- ------------------------------------------------------------------------------------------------------------------------------------
Illinois S/S Walker Manufacturing LaSalle Equipment Limited 3717237 07/16/1997 Computer Equipment per
Company, Partnership Schedule covered under
a division of Tenneco 40 Skokie Blvd., Suite 310 Master Lease #213 dated
Automotive Inc. Northbrook, IL 60062 5/1/86 together with
1201 Michigan Blvd. Assigned to: 3725008 08/06/1997 Schedule #43 dated 2/24/97
Racine, WI 53402 Manufacturers Bank (Assignment)
1200 N. Ashland Ave.
Chicago, IL 60622
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
5
<PAGE> 209
<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Illinois S/S Walker Manufacturing Forum Financial Services, 3769868 12/03/1997 Equipment Schedule 5010-09
Company, Inc. for computer equipment
a division of Tenneco 1475 Richardson Drive located at Walker Mfg. Co.,
Automotive Inc. Suite 270 335 Crossroads Pkwy., Ste.
1201 Michigan Blvd. Richardson, TX 75080 A, Bolingbrook, IL 60440
Racine, WI 53402 Assigned to:
Texas Central Bank, N.A.
8144 Walnut Hill Ln., #94
Dallas, TX 75231-4316
- ------------------------------------------------------------------------------------------------------------------------------------
Illinois S/S Tenneco Automotive International Software 3597736 10/11/1996 Computer Software
111 Pfingsten Road Finance Corp.
Deerfield, IL 60015 191 Post Road West
Westport, CT 06880
Assigned to:
Sterling Bank & Trust
One Towne Square
17th Floor
Southfield, MI 48076
- ------------------------------------------------------------------------------------------------------------------------------------
Illinois S/S Tenneco Automotive Inc. TMC Texas Inc. 3629475 12/19/1996 Accounts receivables,
111 Pfingsten Road 8401 New Trails Drive receivables and related
Deerfield, IL 60015 The Woodlands, TX 77381 property now or hereafter
Amended to: sold or otherwise
500 North Field Drive 3832254 04/10/1998 transferred to the Secured
Lake Forest, IL 60045 (Amendment) Party - See Exhibit A
Assigned to: Amendment - Address of
Tenneco Automotive RSA 4008393 03/22/1999 Debtor amended
Company (Assignment)
8401 New Trails Drive 4008395 03/22/1999 Collateral Description
The Woodlands, TX 77381 (Amendment) amended - see Exhibit A
- ------------------------------------------------------------------------------------------------------------------------------------
Illinois S/S Tenneco Automotive Ramblin Corp. 3736534 09/08/1997 One New Harris Group
Walker Manufacturing Olympia Centre-Suite 1550 Vertical Hydraulic Baling
355 Crossroads Parkway 737 N. Michigan Avenue Press Selco Model VS-6 --
Suite A Chicago, IL 60611 Serial #099765679
Bolingbrook, IL 60440
- ------------------------------------------------------------------------------------------------------------------------------------
Illinois S/S Tenneco Automotive Inc. AT&T Credit Corporation 3750717 10/14/1997 Equipment under Lease No.
111 Pfingsten Road 2 Gatehall Drive M511233
Deerfield, IL 60015 Parsippany, NJ 07054 3766108 11/20/1997 Lease number amended to:
(Amendment) M114693
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
6
<PAGE> 210
<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Illinois S/S Tenneco Automotive Inc. Somerset Capital Group, Ltd. 3759280 11/04/1997 See Schedule A for
111 Pfingsten Road 1087 Broad Street-Suite 201 collateral description
Deerfield, IL 60015 Bridgeport, CT 06604
Assigned to:
Summit Bank
750 Walnut Avenue
Cranford, NJ 07016
- ------------------------------------------------------------------------------------------------------------------------------------
Illinois S/S Tenneco Automotive Inc. Yale Financial Services, Inc. 3826421 04/01/1998 All equipment now or
500 North Field Drive 15 Junction Road hereafter leased by Lessor
Lake Forest, IL 60045 Flemington, NJ 08822 to Lessee; and all
accessions, additions,
replacements and
substitutions thereto and
therefor and all proceeds,
including insurance
proceeds, thereof.
- ------------------------------------------------------------------------------------------------------------------------------------
Illinois S/S Tenneco Automotive Inc. AT&T Credit Corporation 3827882 04/02/1998 Lease No. M114693, Octel
111 Pfingsten Road 2 Gatehall Drive 350 Voice Mail System and
Deerfield, IL 60015 Parsippany, NJ 07054 all attachments
- ------------------------------------------------------------------------------------------------------------------------------------
Illinois S/S Tenneco Automotive Inc. CoreStates Bank, N.A., as 3872387 06/29/1998 Equipment under Master
500 North Field Drive Agent Lease No. 1931, Supplement
Lake Forest, IL 60045 1339 Chestnut Street No. 1
Widener Building, 11th Floor
Philadelphia, PA 19101-7618
Assigned to: 3914072 09/24/1998
Fleet Bank, N.A. as Agent
1185 Avenue of the Americas
16th Fl
New York, NY 10036
- ------------------------------------------------------------------------------------------------------------------------------------
Illinois S/S Tenneco Automotive Frank Orlando Jr. & Co., Inc. 3891155 08/07/1998 All equipment now leased
(Lessee) 570 Lake Cook Road under Supplement No. 1 to
One International Drive Suite 300 Master Lease Agreement
Monroe, MI 48161 Deerfield, IL 60015 dated June 9, 1998 - See
Exhibit A - Computer
Equipment
- ------------------------------------------------------------------------------------------------------------------------------------
Illinois S/S Tenneco Automotive Inc. Tenneco Automotive RSA 3967821 01/06/1999 See Exhibit A for
500 North Field Drive Company collateral description
Lake Forest, IL 60045 8401 New Trails Drive
The Woodlands, TX 77381
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
7
<PAGE> 211
<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Illinois S/S Tenneco Automotive Inc. Tenneco Automotive RSA 3967822 01/06/1999 See Exhibit A for
500 North Field Drive Company collateral description
Lake Forest, IL 60045 8401 New Trails Drive
The Woodlands, TX 77381
- ------------------------------------------------------------------------------------------------------------------------------------
Illinois S/S Tenneco Automotive Inc. Tenneco Automotive RSA 3983088 02/03/1999 See Exhibit A for
500 North Field Drive Company collateral description
Lake Forest, IL 60045 8401 New Trails Drive
The Woodlands, TX 77381
- ------------------------------------------------------------------------------------------------------------------------------------
Illinois S/S Tenneco Automotive Inc. Tenneco Automotive RSA 3983089 02/03/1999 See Exhibit A for
500 North Field Drive Company collateral description
Lake Forest, IL 60045 8401 New Trails Drive
The Woodlands, TX 77381
- ------------------------------------------------------------------------------------------------------------------------------------
Illinois S/S Tenneco Automotive Inc. Leasing Solutions, Inc. 3992769 02/22/1999 Equipment under Master
500 North Field Drive 10 Almaden Blvd., Suite 1500 Lease Agreement No. 1931,
Lake Forest, IL 60045 San Jose, CA 95113 Supplement No. 2.
- ------------------------------------------------------------------------------------------------------------------------------------
Indiana S/S Tenneco Automotive Connell Equipment Leasing Co. 2123628 05/09/1997 Clark Lift Truck (Sup. #14)
111 Pfingsten Road 45 Cardinal Drive
Deerfield, IL 60015 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
Indiana S/S Tenneco Automotive, Inc. Somerset Capital Group, Inc. 2155255 11/04/1997 See attached equipment
111 Pfingsten Road 1087 Broad Street-Suite 201 Schedule #1 to Master Lease
Deerfield, IL 60015 Bridgeport, CT 06604 dated 09/11/1997
Assigned to:
Summit Bank
750 Walnut Avenue
Cranford, NJ 07016
- ------------------------------------------------------------------------------------------------------------------------------------
Indiana S/S Tenneco Automotive KMH Systems, Inc. 2197467 06/15/1998 (1) Yale GLP060TGNUAE087SS
Walker Manufacturing Co. 7020 SR 930 E S/N E177B19871V
1490 Gerber Street Fort Wayne, IN 46803
Ligonier, IN 46767
- ------------------------------------------------------------------------------------------------------------------------------------
Indiana S/S Tenneco Automotive KMH Systems, Inc. 2201078 07/02/1998 (1) Yale
Walker Manufacturing Co. 7020 SR 930 E GLC080LGNUAE090
1490 Gerber Street Fort Wayne, IN 46803 S/N B818D02344U
Ligonier, IN 46767
- ------------------------------------------------------------------------------------------------------------------------------------
Indiana S/S Tenneco Automotive Inc. Lease Corporation of America 2241781 02/28/1999 See Schedule A (not
1101 S. Eisenhower Drive 340 E Big Beaver Rd. #560 attached)
Goshen, IN 46526 Troy, MI 48083
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
8
<PAGE> 212
<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Indiana S/S Pullman Company DBA Advanta Leasing Corp. 1905809 04/06/1994 Software
Conforma Clad 1020 Laurleoak Road (Expired)
501 Park East Blvd. Voorhees, NJ 08043-1228
New Albany, IN 47150
- ------------------------------------------------------------------------------------------------------------------------------------
Indiana S/S The Pullman Company St. James Leasing Ltd. 1937158 09/09/1994 Equipment listed on
3 Werner Way-Suite 200 323 Riverside Avenue - Suite Schedule A attached for
Lebanon, NJ 08833 300 equipment located at:
Westport, CT 06880 Clevite Elastomers
Assigned to: 503 Weatherhead Street
United Jersey Bank Angola, IN 46703
25 E. Salem Street-Suite 603
Hackensack, NJ 07602
- ------------------------------------------------------------------------------------------------------------------------------------
Indiana S/S The Pullman Company St. James Leasing Ltd. 1940726 09/28/1994 Equipment listed on
3 Werner Way-Suite 200 323 Riverside Avenue - Suite Schedule A attached for
Lebanon, NJ 08833 300 equipment located at:
Westport, CT 06880 Clevite Elastomers
Assigned to: 503 Weatherhead Street
United Jersey Bank Angola, IN 46703
25 E. Salem Street-Suite 603
Hackensack, NJ 07602
- ------------------------------------------------------------------------------------------------------------------------------------
Indiana S/S The Pullman Company St. James Leasing Ltd. 1984955 05/04/1995 Equipment listed on
3 Werner Way, Suite 200 323 Riverside Avenue - Suite Schedule A attached for
Lebanon, NJ 08833 300 equipment located at:
Westport, CT 06880 1996873 06/27/1995 Clevite Elastomers
Assigned to: (Amendment) 503 Weatherhead Street
Charter Financial, Inc. Angola, IN 46703
153 East 53rd Street-55th Additional equipment added
Floor by amendment
New York, NY 10022
- ------------------------------------------------------------------------------------------------------------------------------------
Indiana S/S The Pullman Company St. James Leasing Ltd. 1995191 06/19/1995 Equipment listed on
3 Werner Way, Suite 200 323 Riverside Avenue - Suite Schedule A attached for
Lebanon, NJ 08833 300 equipment located at:
Westport, CT 06880 Clevite Elastomers
Assigned to: 503 Weatherhead Street
Charter Financial, Inc. Angola, IN 46703
153 East 53rd Street-55th
Floor
New York, NY 10022
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
9
<PAGE> 213
<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Indiana S/S The Pullman Company St. James Leasing Ltd. 1995192 06/19/1995 Equipment listed on
3 Werner Way, Suite 200 323 Riverside Avenue - Suite Schedule A attached for
Lebanon, NJ 08833 300 equipment located at:
Westport, CT 06880 Clevite Elastomers
Assigned to: 503 Weatherhead Street
Charter Financial, Inc. Angola, IN 46703
153 East 53rd Street-55th
Floor
New York, NY 10022
- ------------------------------------------------------------------------------------------------------------------------------------
Indiana S/S The Pullman Company, Kimco Leasing 2004539 08/16/1995 Minolta Model 3170 Copy
Inc. 1910 St. Joe Center Road Machine
dba Clevite Elastomers Suite 12
503 Weatherhead Fort Wayne, IN 46825
Angola, IN 46703
- ------------------------------------------------------------------------------------------------------------------------------------
Indiana S/S The Pullman Company, Kimco Leasing 2026611 12/29/1995 Canon 7000 Fax Machine
Inc. 1910 St. Joe Center Road
dba Clevite Elastomers Suite 12
503 Weatherhead Fort Wayne, IN 46825
Angola, IN 46703
- ------------------------------------------------------------------------------------------------------------------------------------
Indiana S/S The Pullman Company St. James Leasing Ltd. 2041185 05/04/1995 Equipment listed on
3 Werner Way, Suite 200 323 Riverside Avenue - Suite Schedule A attached for
Lebanon, NJ 08833 300 equipment located at:
Westport, CT 06880 Clevite Elastomers
Assigned to: 503 Weatherhead Street
Charter Financial, Inc. Angola, IN 46703
153 East 53rd Street-55th
Floor
New York, NY 10022
Assigned to: 2045549 04/03/1996
United Jersey Bank (Assignment)
25 E. Salem Street
Hackensack, NJ 07602
- ------------------------------------------------------------------------------------------------------------------------------------
Indiana S/S The Pullman Company Yale Financial Services, Inc. 2126212 05/22/1997 Forklift GLC050 with
Conforma Clad Division 15 Junction Road sideshifter located at:
1441 S. Miramar Flemington, NJ 08822 501 Park East Blvd.
Indialantic FL 32903 New Albany, IN 47150
- ------------------------------------------------------------------------------------------------------------------------------------
Indiana S/S Walker Manufacturing NBD Leasing Inc. 1914047 05/12/1994 Sharp copier
Company, 251 N. Illinois St. (EXPIRED)
a Division of Tenneco, Indianapolis, IN 46204
Inc.
1490 Gerber Street
Ligonier, IN 46767
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
10
<PAGE> 214
<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Indiana S/S Perfection Raymond Leasing Corporation 1919264 06/06/1994 Fork Trucks and Batteries
Automotive/Goshen 20 South Canal Street (EXPIRED) and Chargers
Industries Greene, NY 13778
1101 S. Eisenhower
Goshen, IN 46526
Amended to Change Name
to:
Walker Manufacturing
Company
- ------------------------------------------------------------------------------------------------------------------------------------
Indiana S/S Walker Manufacturing Texas Central Bank N.A. 1933312 08/19/1994 Equipment Schedule 2220-30;
1201 Michigan Blvd. 8144 Walnut Hill Ln. LB94 equipment located at:
Racine, WI 53402 Dallas, TX 75231-4316 515 West Mill Street
Culver, IN 46511
- ------------------------------------------------------------------------------------------------------------------------------------
Indiana S/S Walker Manufacturing Connell Finance Company, Inc. 1961271 01/17/1995 7 Hyster Forklifts
Company 45 Cardinal Drive (Supplement 1)
1201 Michigan Blvd. Westfield, NJ 07090
Racine, WI 53402
- ------------------------------------------------------------------------------------------------------------------------------------
Indiana S/S Walker Manufacturing Connell Finance Company, Inc. 1967461 02/14/1995 1 Hyster Forklifts
Company 45 Cardinal Drive (Supplement 2)
1201 Michigan Blvd. Westfield, NJ 07090
Racine, WI 53402
- ------------------------------------------------------------------------------------------------------------------------------------
Indiana S/S Walker Manufacturing Texas Central Bank N.A. 1967547 02/14/1995 Equipment Lease Schedule
1201 Michigan Blvd. 8144 Walnut Hill Ln. LB94 2220-37; equipment located
Racine, WI 53402 Dallas, TX 75231-4316 in Ligonier and Culver, IN
- ------------------------------------------------------------------------------------------------------------------------------------
Indiana S/S Walker Manufacturing Connell Finance Company, Inc. 1974634 03/22/1995 1 Cascade Clamp
Company 45 Cardinal Drive (Supplement 3)
1201 Michigan Blvd. Westfield, NJ 07090
Racine, WI 53402
- ------------------------------------------------------------------------------------------------------------------------------------
Indiana S/S Walker Manufacturing Connell Finance Company, Inc. 1977853 04/05/1995 1 Hyster Truck
Company 45 Cardinal Drive (Supplement 4)
1201 Michigan Blvd. Westfield, NJ 07090
Racine, WI 53402
- ------------------------------------------------------------------------------------------------------------------------------------
Indiana S/S Walker Manufacturing Connell Finance Company, Inc. 2099188 03/20/1997 1 Silent Hoist Lift Truck;
Company 45 Cardinal Drive 1 Side Shifter Spreader
1201 Michigan Blvd. Westfield, NJ 07090 (Supplement 10)
Racine, WI 53402
- ------------------------------------------------------------------------------------------------------------------------------------
Indiana S/S Walker Manufacturing NBD Equipment Finance, Inc. 2128406 06/03/1997 1 New Advance Scrubber
Co., Inc. 39555 Orchard Hill Place 6 238 Amp Hr Batteries
a Division of Novi, MI 48375 1 36 V Automatic Charger
Tenneco 2 Mid Lite Grit Bruches
515 W. Mill Street
Culver, IN 46511
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
11
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<TABLE>
<CAPTION>
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- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Indiana S/S Walker Manufacturing Ameritech Credit Corporation 2112653 05/20/1997 All telecommunications and
Company, a 2550 West Golf Road data equipment under Lease
Division of Tenneco Rolling Meadows, IL 60008 001-0000304-000 dated
Automotive Inc. 1/21/1997.
111 N. Pfingsten Road
Deerfield, IL 60015
- ------------------------------------------------------------------------------------------------------------------------------------
Elkhart County, Perfection Associated Material Handling 92082 06/03/1994 2 Raymond Model Reach Fork
IN Automotive/Goshen Industries Inc. (EXPIRED) Trucks; 4 General Mode
Industries 8820 Corporation Drive Batteries; 2 Hertner
1101 S. Eisenhower Drive Indianapolis, IN 46526 Chargers
Goshen, IN 46526 Assigned to: 98942 12/26/1995
Amended to: Raymond Leasing Corporation Amendment
Walker Manufacturing 20 South Canal Street
Company Greene, NY 13778
- ------------------------------------------------------------------------------------------------------------------------------------
Elkhart County, Walker Manufacturing Connell Finance Company, Inc. 02488 11/25/1996 1 Silent Hoist Lift Truck;
IN Company 45 Cardinal Drive 1 Side Shifter Spreader
111 Pfingsten Road Westfield, NJ 07090 (Supplement 10)
Deerfield, IL 60015
- ------------------------------------------------------------------------------------------------------------------------------------
Noble County, IN Walker Manufacturing Connell Finance Company, Inc. 57513 01/13/1995 7 Hyster Forklifts
Company 45 Cardinal Drive (Supplement 1)
1201 Michigan Blvd. Westfield, NJ 07090
Racine, WI 53402
- ------------------------------------------------------------------------------------------------------------------------------------
Noble County, IN Walker Manufacturing Texas Central Bank N.A. 57631 02/10/1995 Equipment Lease Schedule
1201 Michigan Blvd. 8144 Walnut Hill Ln. LB94 2220-37; equipment located
Racine, WI 53402 Dallas, TX 75231-4316 in Ligonier and Culver, IN
- ------------------------------------------------------------------------------------------------------------------------------------
Noble County, IN Walker Manufacturing Connell Finance Company, Inc. 57636 02/13/1995 1 Hyster Forklifts
Company 45 Cardinal Drive (Supplement 2)
1201 Michigan Blvd. Westfield, NJ 07090
Racine, WI 53402
- ------------------------------------------------------------------------------------------------------------------------------------
Noble County, IN Walker Manufacturing Connell Finance Company, Inc. 57782 03/16/1995 1 Cascade Clamp
Company 45 Cardinal Drive (Supplement 3)
1201 Michigan Blvd. Westfield, NJ 07090
Racine, WI 53402
- ------------------------------------------------------------------------------------------------------------------------------------
Noble County, IN Walker Manufacturing Connell Finance Company, Inc. 57877 04/03/1995 1 Hyster Truck
Company 45 Cardinal Drive (Supplement 4)
1201 Michigan Blvd. Westfield, NJ 07090
Racine, WI 53402
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
12
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<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Michigan S/S Walker Manufacturing LaSalle Systems Leasing, Inc. 83698B 03/11/1997 Computer Equipment per
Co., a division 40 Skokie Blvd., Suite 310 Schedule #41 dated
of Tenneco Automotive Northbrook, IL 60062 12/16/1996 to Master Lease
Inc. Assigned to: D320856A 12/30/1997 #213 dated 05/01/86
1201 Michigan Blvd. Manufacturers Bank Assignment
Racine, WI 53402 1200 North Ashland Avenue
Chicago, IL 60622
- ------------------------------------------------------------------------------------------------------------------------------------
Michigan S/S Walker Manufacturing LaSalle Systems Leasing, Inc. 83699B 03/11/1997 Computer Equipment per
Co., a division 40 Skokie Blvd., Suite 310 Schedule #42 dated
of Tenneco Automotive Northbrook, IL 60062 01/24/1997 to Master Lease
Inc. Assigned to: D320856 12/30/1997 #213 dated 05/01/86
1201 Michigan Blvd. Manufacturers Bank Assignment
Racine, WI 53402 1200 North Ashland Avenue
Chicago, IL 60622
- ------------------------------------------------------------------------------------------------------------------------------------
Michigan S/S Monroe Auto Equipment Tenneco Credit Corporation 16925B 12/26/1991 Account receivables
Company 1010 Milam Street
One International Drive Houston, Texas 77002 81199B 12/26/1996
Monroe, Michigan 48161 Assigned to: Continuation
Asset Securitization
Amended to: Cooperative Corp. 84677B 05/02/1997
Monroe Auto Equipment c/o Canadian Imperial Bank Amendment
Company, a division of of Commerce
Tenneco Automotive Inc. 425 Lexington Avenue
New York, NY 10017
Attn: Asset Securitization
Group
- ------------------------------------------------------------------------------------------------------------------------------------
Michigan S/S Monroe Auto Equipment TMC Texas Inc. 81038B 12/18/1996 Account receivables
Company, a 8401 New Trails Drive
division of Tenneco The Woodlands, TX 77387
Automotive Inc.
One International Drive
Monroe, Michigan 48161
- ------------------------------------------------------------------------------------------------------------------------------------
Michigan S/S Tenneco Automotive Inc. Sanwa Business Credit D452001 12/07/1998 6 New 1998 Caterpillar
One International Drive Corporation Forklifts
Monroe, MI 48161 One S. Wacker Drive
Chicago, IL 60606
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
13
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<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Michigan S/S Monroe Auto Equipment Caterpillar Financial C883793 09/14/1994 1 Caterpillar lift truck; 2
Company Services Corporation Batteries and 1 Charger
One International Drive 4975 Preston Park #280
Monroe, Michigan 48161 Plano, TX 75093
- ------------------------------------------------------------------------------------------------------------------------------------
Michigan S/S Monroe Auto Equipment Caterpillar Financial D054996 01/22/1996 2 Caterpillar lift trucks
Company Services Corporation equipped with fork
One International Drive 4975 Preston Park #280 positioners
Monroe, Michigan 48161 Plano, TX 75093
- ------------------------------------------------------------------------------------------------------------------------------------
Michigan S/S Monroe Auto Equipment Caterpillar Financial D067012 02/27/1994 1 Caterpillar lift truck
Company Services Corporation equipped with fork
One International Drive 4975 Preston Park #280 D097755 05/20/1996 positioner and 3
Monroe, Michigan 48161 Plano, TX 75093 Amendment (EXPIRED) Caterpillar lift trucks
- ------------------------------------------------------------------------------------------------------------------------------------
Michigan S/S Monroe Auto Equipment Caterpillar Financial D067013 02/27/1996 1 Caterpillar lift truck
Company Services Corporation equipped with 2 batteries
One International Drive 4975 Preston Park #280 and 1 charger
Monroe, Michigan 48161 Plano, TX 75093
- ------------------------------------------------------------------------------------------------------------------------------------
Michigan S/S Monroe Auto Equipment Caterpillar Financial D097698 05/20/1996 1 Caterpillar lift truck; 2
Company Services Corporation Batteries and 1 Charger
One International Drive 4975 Preston Park #280
Monroe, Michigan 48161 Plano, TX 75093
- ------------------------------------------------------------------------------------------------------------------------------------
Michigan S/S Monroe Auto Equipment Caterpillar Financial D097699 05/20/1996 1 Cascade fork positioner
Company Services Corporation
One International Drive 4975 Preston Park #280
Monroe, Michigan 48161 Plano, TX 75093
- ------------------------------------------------------------------------------------------------------------------------------------
Michigan S/S Monroe Auto Equipment Caterpillar Financial D354675 03/26/1998 1 Caterpillar lift truck
Company Services Corporation equipped with 1 Brudi fork
One International Drive 4975 Preston Park #280 positioner
Monroe, Michigan 48161 Plano, TX 75093
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
14
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<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Michigan S/S Monroe Auto Equipment Caterpillar Financial D044133 12/18/1995 1 Caterpillar lift truck
Company Services Corporation equipped with 1 Cascade
1601 Highway 49 4975 Preston Park #280 D367143 04/27/1998 fork positioner
Paragould, AR 72450 Plano, TX 75093 Amendment Amendment added add'l
debtor: Grady W. Jones Co.
of Memphis, Inc., 3965 Old
Getwell Road, Memphis, TN
38118
- ------------------------------------------------------------------------------------------------------------------------------------
Michigan S/S Tenneco Automotive Inc. Sanwa Business Credit 86192B 07/23/1997 4 Used Caterpillar forklifts
One International Drive Corporation
Monroe, MI 48161 One S. Wacker Drive
Chicago, IL 60606
- ------------------------------------------------------------------------------------------------------------------------------------
Michigan S/S Tenneco Automotive Inc. Sanwa Business Credit D396603 07/19/1998 5 New Caterpillar
One International Drive Corporation forklifts; equipment
Monroe, MI 48161 One S. Wacker Drive located at 121 Meridien,
37th Floor Cozad, NE 69130
Chicago, IL 60606
- ------------------------------------------------------------------------------------------------------------------------------------
Michigan S/S Tenneco Automotive Inc. Sanwa Business Credit D409066 08/12/1998 1 New 1998 Schaff Forklift
One International Drive Corporation
Monroe, MI 48161 One S. Wacker Drive
37th Floor
Chicago, IL 60606
- ------------------------------------------------------------------------------------------------------------------------------------
Michigan S/S Tenneco Automotive Inc. Sanwa Business Credit D447698 11/24/1998 1 New Caterpillar forklift
One International Drive Corporation
Monroe, MI 48161 One S. Wacker Drive
37th Floor
Chicago, IL 60606
- ------------------------------------------------------------------------------------------------------------------------------------
Michigan S/S Tenneco Automotive Connell Equipment Leasing D504579 04/19/1999 8 TCM Forklifts; 1 TCM
1 International Drive 45 Cardinal Drive Forklift; 1 CBI Rotator;
Monroe, MI 48161 Westfield, NJ 07090 Supplement 37 to Lease
- ------------------------------------------------------------------------------------------------------------------------------------
Michigan S/S Walker Manufacturing Forum Financial Services, D287838 10/03/1997 Computer Equipment located
Co., a division Inc. at: Walker Manufacturing
of Tenneco Automotive 1475 Richardson Drive, Suite Co., 2701 North Dettman
1201 Michigan Blvd. 270 Road, Jackson, MS 49201
Racine, WI 53402 Richardson, TX 75080
Assigned to:
Texas Central Bank, N.A.
8144 Walnut Hill Lane, L-B 94
Dallas, TX 75231-4316
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
15
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<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Michigan S/S Tenneco Automotive Inc. Yale Financial Services, Inc. D355143 03/27/1998 All equipment now or
Group 15 Junction Road hereafter leased by Lessor
500 North Field Drive Flemington, NJ 08822 to Lessee...
Deerfield, IL 60045
- -----------------------------------------------------------------------------------------------------------------------------------
Michigan S/S Precision Modular T & W Finance Corp IV C972496 05/19/1995 Lease #1493701 dated
Assembly Corp., a P. O. Box 3028 05/15/1995 -- 1 Lister Iveco
wholly-owned subsidiary Federal Way, WA 98063 AIFO Emergency
of Monroe Auto Assigned to: Generator Set, Model #8281,
Equipment Company, a Corestates Bank S/N 158120
wholly-owned division T & E Dept.
of Tenneco Automotive 1500 Market St., 19th Floor
Inc. Philadelphia, PA 19102
6451 15 Mile Road
Sterling Heights, MI
48312
- -----------------------------------------------------------------------------------------------------------------------------------
Michigan S/S Walker Manufacturing LDI Corporation C907907 11/18/1994 Lease #01053, Schedule #4
Divison of Tenneco 30033 Clemens Road Computer Equipment
3901 Willis Road Westlake, OH 44145
Grass Lake, MI 49240
- -----------------------------------------------------------------------------------------------------------------------------------
Michigan S/S Monroe Auto Equipment Hyster Credit Company C845154 05/23/1994 1 New Hyster Lift Truck,
Company P. O. Box 4366 (EXPIRED) Forks, Battery and Charger
6451 15 Mile Road Portland, OR 97208
Sterling Heights, MI
48312
- -----------------------------------------------------------------------------------------------------------------------------------
Michigan S/S Monroe Auto Equipment Hyster Credit Company C845155 05/23/1994 1 New Hyster Lift Truck,
Company P. O. Box 4366 (EXPIRED) Forks, Battery and Charger
6451 15 Mile Road Portland, OR 97208
Sterling Heights, MI
48312
- -----------------------------------------------------------------------------------------------------------------------------------
Michigan S/S Walker Manufacturing Forum Financial Services, C866715 07/25/1994 Equipment Lease Schedule
1201 Michigan Blvd. Inc. (EXPIRED) 2220-34 for equipment
Racine, WI 53402 1475 Richardson Drive, located at 3901 Willis
Suite 270 Road, Grass Lake, MI 49240
Richardson, TX 75080
Assigned to:
Texas Central Bank, N.A.
8144 Walnut Hill Lane, L-B 94
Dallas, TX 75231-4316
- -----------------------------------------------------------------------------------------------------------------------------------
Michigan S/S Walker Manufacturing Forum Financial Services, C866716 07/25/1994 Equipment Lease Schedule
1201 Michigan Blvd. Inc. (EXPIRED) 2220-30 for equipment
Racine, WI 53402 1475 Richardson Drive, located at 904 Industrial
Suite 270 Road, Marshall, MI 49068
Richardson, TX 75080
Assigned to:
Texas Central Bank, N.A.
8144 Walnut Hill Lane, L-B 94
Dallas, TX 75231-4316
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
16
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<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Michigan S/S Walker Manufacturing LaSalle Systems Leasing, Inc. 45266B 07/26/1994 Computer Equipment per
Co., a division 40 Skokie Blvd., Suite 310 Schedule #35 dated
of Tennessee Gas Northbrook, IL 60062 04/12/1994 to Master Lease
Pipeline Company Assigned to: C878245 09/13/1994 #213 dated 05/01/86
1201 Michigan Blvd. Manufacturers Bank Assignment (EXPIRED)
Racine, WI 53402 1200 North Ashland Avenue
Chicago, IL 60622
- ------------------------------------------------------------------------------------------------------------------------------------
Michigan S/S Walker Manufacturing LaSalle Systems Leasing, Inc. 45267B 07/26/1994 Computer Equipment per
Co., a division 40 Skokie Blvd., Suite 310 Schedule #37 dated
of Tennessee Gas Northbrook, IL 60062 04/04/1994 to Master Lease
Pipeline Company Assigned to: C878246 09/13/1994 #213 dated 05/01/86
1201 Michigan Blvd. Manufacturers Bank Assignment (EXPIRED)
Racine, WI 53402 1200 North Ashland Avenue
Chicago, IL 60622
- ------------------------------------------------------------------------------------------------------------------------------------
Michigan S/S Walker Manufacturing LaSalle Systems Leasing, Inc. 46727B 09/15/1994 Computer Equipment per
Co., a division 40 Skokie Blvd., Suite 310 Schedule #35A dated
of Tennessee Gas Northbrook, IL 60062 08/04/1994 to Master Lease
Pipeline Company Assigned to: #213 dated 05/01/86
1201 Michigan Blvd. LaSalle Equipment Limited
Racine, WI 53402 Partnership
40 Skokie Blvd., Suite 310
Northbrook, IL 60062
- ------------------------------------------------------------------------------------------------------------------------------------
Michigan S/S Walker Manufacturing Forum Financial Services, C930482 01/27/1995 Equipment Lease Schedule
1201 Michigan Blvd. Inc. 2220-37 for equipment
Racine, WI 53402 1475 Richardson Drive, located at 3901 Willis
Suite 270 Road, Grass Lake, MI 49240
Richardson, TX 75080
Assigned to:
Texas Central Bank, N.A.
8144 Walnut Hill Lane, L-B 94
Dallas, TX 75231-4316
- ------------------------------------------------------------------------------------------------------------------------------------
Michigan S/S Walker Manufacturing Connell Finance Company, Inc. D026161 10/26/1995 6 TCM Lift Trucks; 1 CBI
Company 45 Cardinal Drive Rotator (Supplement 6)
1201 Michigan Blvd. Westfield, NJ 07090
Racine, WI 53402
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
17
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<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Michigan S/S Walker Manufacturing Forum Financial Services, D030798 11/08/1995 Equipment Lease Schedule
1201 Michigan Blvd. Inc. 2220-41 for equipment
Racine, WI 53402 1475 Richardson Drive, Suite located at 904 Industrial
270 Road, Marshall, MI 49068
Richardson, TX 75080
Assigned to:
Texas Central Bank, N.A.
8144 Walnut Hill Lane, L-B 94
Dallas, TX 75231-4316
- ------------------------------------------------------------------------------------------------------------------------------------
Michigan S/S Tennessee Gas Pipeline Ameritech Credit Corporation D033356 11/14/1995 Equipment under Lease
Company Div-Walker 2550 West Golf Road #001-0127159-009, 010 and
Manufacturing Company Rolling Meadows, IL 60008 011 dated 12/10/1993
1201 Michigan Blvd.
Racine, WI 53402
- ------------------------------------------------------------------------------------------------------------------------------------
Michigan S/S Walker Manufacturing Co. Forum Financial Services, D150439 10/16/1996 Equipment Lease Schedule
1201 Michigan Blvd. Inc. 2220-45 for equipment
Racine, WI 53402 1475 Richardson Drive, Suite located at 3901 Willis
270 Road, Grass Lake, MI 49240
Richardson, TX 75080 and 929 Anderson Road,
Litchfield, MI 49254
- ------------------------------------------------------------------------------------------------------------------------------------
Michigan S/S Walker Manufacturing Co. Forum Financial Services, D287838 10/03/1997 Equipment Lease Schedule
a Division of Tenneco Inc. 5010-06 for equipment
Automotive 1475 Richardson Drive, Suite located at 2701 North
1201 Michigan Blvd. 270 Dettman Road, Jackson, MI
Racine, WI 53402 Richardson, TX 75080 49201
Assigned to:
Texas Central Bank, N.A.
8144 Walnut Hill Lane, L-B 94
Dallas, TX 75231-4316
- ------------------------------------------------------------------------------------------------------------------------------------
Michigan S/S Walker Manufacturing Englewood Electrical Supply D237860 05/28/1997 Electrical material and
Division Co. supplies for consignment
Tennessee Gas Pipeline Division of WESCO inventor itemized on
929 Anderson Road Distribution, Inc. attachment
Litchfield, MI 49252 Attn: Glenn Stearns
3939 S. Karlov Avenue
Chicago, IL 60632
- ------------------------------------------------------------------------------------------------------------------------------------
Michigan S/S Tennessee Gas Pipeline Tennant Company D276339 09/04/1997 Tennant Model 8400 Power
Co. 701 N. Lilac Sweep/Scrubber
Walker Manufacturing P. O. Box 1452
Co. Div. Minneapolis, MN 55440-1452
929 Anderson Road
Litchfield, MI 49252
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
18
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<TABLE>
<CAPTION>
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- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Michigan S/S Tennessee Gas Pipeline El Camino Resources, Ltd. D074726 03/18/1996 Master Lease No. 2366,
Company acting through 21051 Warner Center Lane Schedule No. 006 -
its Walker Woodland Hills, CA 91367 Equipment located at 3901
Manufacturing Division Willis Road, Grass Lake, MI
Tenneco Building 49240
1010 Milan
Houston, TX 77002
- ------------------------------------------------------------------------------------------------------------------------------------
Michigan S/S Walker Manufacturing Co. Fort Wayne Financial Corp. D410109 08/14/1998 1 Mettler Toledo Panther
929 Anderson Road P. O. Box 25042 S/N 50048595PZ and 1
Litchfield, MI 49252 Fort Wayne, IN 46825 Mettler Toledo Model 2256
Assigned to: S/N 10736651PZ
Fort Wayne National Bank
110 W. Berry Street
Fort Wayne, IN 46802
- ------------------------------------------------------------------------------------------------------------------------------------
Michigan S/S Walker Manufacturing Connell Finance Company, Inc. D067020 02/27/1996 1 KALMAR Lift Truck Model
Company 45 Cardinal Drive No. C100H; S/N 061392A
111 Pfingsten Road Westfield, NJ 07090 (Supplement 8)
Deerfield, IL 60015
- ------------------------------------------------------------------------------------------------------------------------------------
Hillsdale Walker Manufacturing Connell Finance Company, Inc. 98794 01/29/1996 1 KALMAR Lift Truck Model
County, MI Company 45 Cardinal Drive No. C100H; S/N 061392A
111 Pfingsten Road Westfield, NJ 07090 (Supplement 8)
Deerfield, IL 60015
- ------------------------------------------------------------------------------------------------------------------------------------
Hillsdale Tenneco Automotive Inc. Connell Finance Company, Inc. 99431 08/08/1996 1 TCM Lift Truck Model No.
County, MI 111 Pfingsten Road 45 Cardinal Drive FCG25T7T; S/N A15G03226
Deerfield, IL 60015 Westfield, NJ 07090 (Supplement 9)
- ------------------------------------------------------------------------------------------------------------------------------------
Hillsdale Tenneco Automotive Inc. Connell Finance Company, Inc. 99657 11/21/1996 1 TCM Lift Truck Model No.
County, MI 111 Pfingsten Road 45 Cardinal Drive FCG25T7T; S/N A15G03822
Deerfield, IL 60015 Westfield, NJ 07090 (Supplement 11)
- ------------------------------------------------------------------------------------------------------------------------------------
Macomb County, MI Tenneco Automotive Connell Finance Company, Inc. 68363 11/22/1996 1 Yale Lift Truck, Model
6451 15 Mile Road 45 Cardinal Drive No. GLC080LGNGAE085 S/N
Sterling Heights, MI Westfield, NJ 07090 B818D02093T (Supplement 4)
48312
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
19
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<TABLE>
<CAPTION>
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- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Macomb County, MI Tenneco Automotive Connell Finance Company, Inc. 68736 12/10/1996 1 Advance Rider Scrubber,
111 Pfingsten Road 45 Cardinal Drive Model No. 5015P, S/N
Deerfield, IL 60015 Westfield, NJ 07090 1065762 (Supplement 2)
Equipment located at 6451
15 Mile Road, Sterling
Heights, MI 48312
- ------------------------------------------------------------------------------------------------------------------------------------
Macomb County, MI Tenneco Automotive Connell Finance Company, Inc. 68737 12/10/1996 1 Yale Lift Truck, Model
111 Pfingsten Road 45 Cardinal Drive No. GLC060TFNUAE084 S/N
Deerfield, IL 60015 Westfield, NJ 07090 E187V01807T (Supplement 3);
Equipment located at 6451
15 Mile Road, Sterling
Heights, MI 48312
- ------------------------------------------------------------------------------------------------------------------------------------
Mississippi S/S Walker Manufacturing Manufacturers Bank 819121 07/26/1994 Equipment pursuant to Lease
Co., Division of 1200 N. Ashland Ave. (EXPIRED) #213-35 for equipment
Tennessee Gas Pipeline Chicago, IL located at 704
Company Hwy 25 South, Aberdeen, MS
1201 Michigan Blvd.
Racine, WI 53402
- ------------------------------------------------------------------------------------------------------------------------------------
Mississippi S/S Walker Manufacturing Co. Forum Financial Group, Inc. 937927 11/10/1995 Equipment Schedule 2220-41;
1201 Michigan Blvd. 1475 Richardson Drive, Suite equipment located at 704
Racine, WI 53402 270 Hwy 25 South, Aberdeen, MS
Richardson, TX 75080
Assigned to:
Texas Central Bank, N.A.
8144 Walnut Hill Lane
Dallas, TX 75231
- ------------------------------------------------------------------------------------------------------------------------------------
Mississippi S/S Walker Manufacturing Concord Commercial 647412 07/21/92 Schedule 1 (MS) to Lease
Company Corporation 1092874 04/11/1997 #OL-6346 (WI) as more fully
Division of Tennessee 2010 Main Street, Suite 500 (continuation) described on Exhibit A
Gas Pipeline Company Irvine, CA 92714 attached (computer
704 Hwy 25 South equipment).
Aberdeen, MS 39730
- ------------------------------------------------------------------------------------------------------------------------------------
Mississippi S/S Walker Manufacturing Wrenn/Brungart Equipment 1093097 04/14/1997 Equipment (description
Company Co., Inc. unclear)
Walker Mfg. P. O. Box 410050
704 Hwy 25 South Charlotte, NC 28241
Aberdeen, MS 39730
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
20
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<TABLE>
<CAPTION>
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- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Mississippi S/S Walker Manufacturing Co. Forum Financial Group, Inc. 894479 05/24/1995 Equipment Schedule 2220-42;
1201 Michigan Blvd. 1475 Richardson Drive, Suite equipment located at 704
Racine, WI 53402 270 Hwy 25 South, Aberdeen, MS
Richardson, TX 75080
Assigned to:
Texas Central Bank, N.A.
8144 Walnut Hill Lane
Dallas, TX 75231
- ------------------------------------------------------------------------------------------------------------------------------------
Mississippi S/S Walker Manufacturing Co. Forum Financial Group, Inc. 861159 01/27/1995 Equipment Schedule 2220-37;
1201 Michigan Blvd. 1475 Richardson Drive, Suite equipment located at 704
Racine, WI 53402 270 Hwy 25 South, Aberdeen, MS
Richardson, TX 75080
Assigned to:
Texas Central Bank, N.A.
8144 Walnut Hill Lane
Dallas, TX 75231
- ------------------------------------------------------------------------------------------------------------------------------------
Mississippi S/S Walker Manufacturing Co. Forum Financial Group, Inc. 1043929 10/14/1996 Equipment Schedule 2220-45;
1201 Michigan Blvd. 1475 Richardson Drive, Suite equipment located at 704
Racine, WI 53402 270 Hwy 25 South, Aberdeen, MS
Richardson, TX 75080
- ------------------------------------------------------------------------------------------------------------------------------------
Mississippi S/S Walker Manufacturing Co. Forum Financial Group, Inc. 1051973 11/13/1996 Equipment Schedule 2220-48;
1201 Michigan Blvd. 1475 Richardson Drive, Suite equipment located at
Racine, WI 53402 270 Prairie Industrial Park,
Richardson, TX 75080 Building 12-3, Prairie, MS
Assigned to: 39756
Colorado National Leasing,
Inc.
950 17th Street, Suite 2400
Denver, CO 80202
- ------------------------------------------------------------------------------------------------------------------------------------
Mississippi S/S Walker Manufacturing Co. Forum Financial Group, Inc. 857120 01/10/1995 Equipment Schedule 2220-33;
1201 Michigan Blvd. 1475 Richardson Drive, Suite equipment located at
Racine, WI 53402 270 Prairie Industrial Park,
Richardson, TX 75080 Building 12-3, Prairie, MS
Assigned to: 39756
Texas Central Bank, N.A.
8144 Walnut Hill Lane
Dallas, TX 75231
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
21
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<TABLE>
<CAPTION>
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- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Mississippi S/S Walker Manufacturing LaSalle Systems Leasing, Inc. 899281 06/13/1995 Computer Equipment under
Co., a Division 40 Skokie Blvd., Suite 310 Master Lease #213 dated
of Tennessee Gas Northbrook, IL 60062 05/01/1986 together with
Pipeline Company Assigned to: Schedule #39 dated
1201 Michigan Blvd. LaSalle Equipment Limited 05/12/1995
Racine, WI 53402 Partnership
40 Skokie Blvd., Suite 310
Northbrook, IL 60062
Assigned to:
Manufacturers Bank
1200 N. Ashland Avenue
Chicago, IL 60622
- ------------------------------------------------------------------------------------------------------------------------------------
Monroe County, MS Walker Manufacturing Amplicon, Inc. 92-1590 07/20/1992 Schedule 1 to Lease
Company 5 Hutton Centre Drive, Suite #OL-6346 -- Schedule 1
Division of Tennessee 500 amended
Gas Pipeline Santa Ana, CA 92707 Continuation 04/18/1997
Company Assigned to:
704 Highway 25 South Concord Commercial Corp.
Aberdeen, MS 39730 2010 Main Street, Suite 500
Name Amended to: Irvine, CA 92714
Tennessee Gas Pipeline
Company
Walker Manufacturing
Company Division
- ------------------------------------------------------------------------------------------------------------------------------------
Monroe County, MS Walker Manufacturing LaSalle Systems Leasing, 94-1695 07/25/1994 Computer Equipment per
Co., a Division of Inc. (EXPIRED) schedule #35 dated April
Tennessee Gas Pipeline Assigned to: 12, 1994 to Master Lease
Company LaSalle Equipment Limited 213 dated May 1, 1986; copy
1201 Michigan Blvd. Partnership of schedule attached
Racine, WI 53402 40 Skokie Blvd., Suite 310
Northbrook, IL 60062
Assigned to:
Manufacturers Bank
1200 N. Ashland Ave.,
Chicago, IL 60622
- ------------------------------------------------------------------------------------------------------------------------------------
Monroe County, MS Walker Manufacturing Forum Financial Group, Inc. 95-66 01/10/1995 Equipment Schedule 2220-33
1021 Michigan Blvd. Assigned to: -- See attachment
Racine, WI 53402 Texas Central Bank, N.A.
8144 Walnut Hill Lane, LB-94
Dallas, TX 75231-4316
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
22
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<TABLE>
<CAPTION>
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- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Monroe County, MS Walker Manufacturing Forum Financial Group, Inc. 95-205 01/26/1995 Equipment Lease Schedule
1201 Michigan Blvd. Assigned to: 2220-37 for equipment
Racine, WI 53402 Texas Central Bank, N.A. located at 704 Highway 25
8144 Walnut Hill Lane, LB-94 South, Aberdeen, MS 39730
Dallas, TX 75231-4316
- ------------------------------------------------------------------------------------------------------------------------------------
Monroe County, MS Walker Manufacturing Forum Financial Group, Inc. 95-1124 05/24/1995 Equipment Lease Schedule
1201 Michigan Blvd. Assigned to: 2220-42 for equipment
Racine, WI 53402 Texas Central Bank, N.A. located at 704 Highway 25
8144 Walnut Hill Lane, LB-94 South, Aberdeen, MS 39730
Dallas, TX 75231-4316
- ------------------------------------------------------------------------------------------------------------------------------------
Monroe County, MS Walker Manufacturing LaSalle Systems Leasing, 95-1260 06/12/1995 Computer Equipment per
Co., a Division of Inc. schedule #39 dated May 12,
Tennessee Gas Pipeline Assigned to: 1995 to Master Lease 213
Company LaSalle Equipment Limited dated May 1, 1986; copy of
1201 Michigan Blvd. Partnership schedule attached
Racine, WI 53402 40 Skokie Blvd., Suite 310
Northbrook, IL 60062
Assigned to:
Manufacturers Bank
1200 N. Ashland Ave.,
Chicago, IL 60622
- ------------------------------------------------------------------------------------------------------------------------------------
Monroe County, MS Walker Manufacturing Forum Financial Group, Inc. 95-2724 11/03/1995 Equipment Lease Schedule
1201 Michigan Blvd. Assigned to: 2220-41 for equipment
Racine, WI 53402 Texas Central Bank, N.A. located at 704 Highway 25
8144 Walnut Hill Lane, LB-94 South, Aberdeen, MS 39730
Dallas, TX 75231-4316
- ------------------------------------------------------------------------------------------------------------------------------------
Monroe County, MS Walker Manufacturing Forum Financial Group, Inc. 95-2725 11/03/1995 Equipment Lease Schedule
1201 Michigan Blvd. Assigned to: 2220-42 for equipment
Racine, WI 53402 Texas Central Bank, N.A. located at 704 Highway 25
8144 Walnut Hill Lane, LB-94 South, Aberdeen, MS 39730
Dallas, TX 75231-4316
- ------------------------------------------------------------------------------------------------------------------------------------
Monroe County, MS Walker Manufacturing Forum Financial Group, Inc. 96-4021 10/15/1996 Equipment Lease Schedule
1201 Michigan Blvd. 1475 Richardson Drive, Suite 2220-45 for equipment
Racine, WI 53402 270 located at 704 Highway 25
Richardson, TX 75080 South, Aberdeen, MS 39730
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
23
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<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Monroe County, MS Walker Manufacturing Wrenn/Brungart Equipment 97-1091 04/14/1997 Replacement parts consigned
Company Co., Inc. from time to time
704 Highway 25 S P. O. Box 410050
Aberdeen, MS 39730 Charlotte, NC 28241
- ------------------------------------------------------------------------------------------------------------------------------------
Nebraska S/S Monroe Automotive Raymond Leasing Corporation 9995672905 11/07/1995 Equipment, Products of
Equipment Co. 20 South Canal Street Collateral and Proceeds of
121 Meridian Ave. Greene, NY 13778 Collateral
Cozad, NE 69130
- ------------------------------------------------------------------------------------------------------------------------------------
Nebraska S/S Monroe Auto Equipment Midlands Rental & Machinery 9996686856 03/26/1996 Forklift, battery, charger
Company Inc. S/N TM247-1088-8865
One International Drive 4601 F Street
Monroe, MI 48161 Omaha, NE 68117
- ------------------------------------------------------------------------------------------------------------------------------------
Nebraska S/S Monroe Auto Equipment Midlands Rental & Machinery 9996686857 03/26/1996 Forklift, battery, charger
Company Inc. S/N TM###-##-####
One International Drive 4601 F Street
Monroe, MI 48161 Omaha, NE 68117
- ------------------------------------------------------------------------------------------------------------------------------------
Nebraska S/S Tenneco Automotive Connell Equipment Leasing Co. 9997730111 04/28/1997 Equipment
111 Pfingsten Road 45 Cardinal Drive
Deerfield, IL 60015 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
Nebraska S/S Tenneco Automotive Connell Equipment Leasing Co. 9997734912 06/09/1997 Equipment
111 Pfingsten Road 45 Cardinal Drive
Deerfield, IL 60015 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
Nebraska S/S Tenneco Automotive Connell Equipment Leasing Co. 9997735495 06/13/1997 Equipment
111 Pfingsten Road 45 Cardinal Drive
Deerfield, IL 60015 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
Nebraska S/S Tenneco Automotive Connell Equipment Leasing Co. 9997738599 07/17/1997 Equipment
111 Pfingsten Road 45 Cardinal Drive
Deerfield, IL 60015 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
Nebraska S/S Tenneco Automotive Connell Equipment Leasing Co. 9998756596 01/20/1998 Equipment
111 Pfingsten Road 45 Cardinal Drive Other
Deerfield, IL 60015 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
Nebraska S/S Tenneco Automotive Connell Equipment Leasing Co. 9998761784 03/06/1998 Equipment
111 Pfingsten Road 45 Cardinal Drive Other
Deerfield, IL 60015 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
24
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<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Nebraska S/S Tenneco Automotive Connell Equipment Leasing Co. 9998763659 02/23/1998 Equipment
111 Pfingsten Road 45 Cardinal Drive
Deerfield, IL 60015 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
Nebraska S/S Tenneco Automotive Connell Equipment Leasing Co. 9998765924 04/10/1998 Equipment
111 Pfingsten Road 45 Cardinal Drive Other
Deerfield, IL 60015 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
Nebraska S/S Tenneco Automotive Connell Equipment Leasing Co. 9998768395 05/01/1998 Equipment
111 Pfingsten Road 45 Cardinal Drive
Deerfield, IL 60015 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
Nebraska S/S Tenneco Automotive Connell Equipment Leasing Co. 9998768396 05/01/1998 Equipment
111 Pfingsten Road 45 Cardinal Drive
Deerfield, IL 60015 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
Nebraska S/S Tenneco Automotive Connell Equipment Leasing Co. 9998768403 05/01/1998 Equipment
111 Pfingsten Road 45 Cardinal Drive
Deerfield, IL 60015 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
Nebraska S/S Tenneco Automotive Inc. Heubel Material Handling 9998771659 06/02/1998 Equipment
121 Meridian Avenue 2324 South 156th Circle Proceeds of Collateral
Cozad, NE 69130 Omaha, NE 68130 Products of Collateral
- ------------------------------------------------------------------------------------------------------------------------------------
Nebraska S/S Tenneco Automotive Connell Equipment Leasing Co. 9998772842 06/12/1998 Equipment
111 Pfingsten Road 45 Cardinal Drive
Deerfield, IL 60015 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
Nebraska S/S Tenneco Automotive Inc. Sanwa Business Credit 9998775855 07/09/1998 Equipment
121 Meridian Corporation
Cozad, NE 69130 One South Wacker Drive 37th
Floor
Chicago, IL 60606
- ------------------------------------------------------------------------------------------------------------------------------------
Nebraska S/S Tenneco Automotive Connell Equipment Leasing Co. 9998785984 10/26/1998 Equipment
111 Pfingsten Road 45 Cardinal Drive Other
Deerfield, IL 60015 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
Nebraska S/S Tenneco Automotive Inc. Sanwa Business Credit 9998789064 11/25/1998 Equipment
121 Meridian Corporation Other
Cozad, NE 69130 One South Wacker Drive 37th
Floor
Chicago, IL 60606
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
25
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<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Nebraska S/S Tenneco Automotive Inc. Connell Equipment Leasing Co. 9999805540 05/03/1999 10 Exide Batteries; 5 Exide
1 International Drive 45 Cardinal Drive Chargers; Supplement 41 to
Monroe, MI 48161 Westfield, NJ 07090 Lease
- ------------------------------------------------------------------------------------------------------------------------------------
Nebraska S/S Tenneco Automotive Inc. Connell Equipment Leasing Co. 9999806398 05/10/1999 1 MultiShift Battery
1 International Drive 45 Cardinal Drive Handling System, Model No.
Monroe, MI 48161 Westfield, NJ 07090 MSII-40; Supplement 33 to
Lease
- ------------------------------------------------------------------------------------------------------------------------------------
Nebraska S/S Tenneco Automotive Inc. Forum Financial Services, 9999809846 06/10/1999 Equipment Lease Schedule
500 North Field Drive Inc. 5010-23; Equipment located
Lake Forest, IL 60045 1475 Richardson Dr., Suite at Highway #5 South, Rt. 2,
270 Seward, NE
Richardson, TX 75080
- ------------------------------------------------------------------------------------------------------------------------------------
Nebraska S/S Tenneco Automotive Inc. Connell Equipment Leasing Co. 9999810861 06/21/1999 3 Drexel Swing Forklifts; 2
1 International Drive 45 Cardinal Drive Drexel Forklifts;
Monroe, MI 48161 Westfield, NJ 07090 Supplement 47 to Lease
- ------------------------------------------------------------------------------------------------------------------------------------
Nebraska S/S Tenneco Automotive Inc. Connell Equipment Leasing Co. 9999812132 07/01/1999 21 Raymond Easi Order
1 International Drive 45 Cardinal Drive Pickers; Supplement 38 to
Monroe, MI 48161 Westfield, NJ 07090 Lease Agreement
- ------------------------------------------------------------------------------------------------------------------------------------
Nebraska S/S Walker Manufacturing LaSalle Systems Leasing, Inc. 9994628802 07/25/1994 Computer equipment per
Co., Division 40 Skokie Blvd., Suite 310 schedule attached covered
of Tennessee Gas Northbrook, IL 60062 under Master Lease #213
Pipeline Company Assigned to: dated 05/01/1986 together
1201 Michigan Blvd. LaSalle Equipment Limited with Schedule #35 dated
Racine, WI 53402 Partnership 04/12/1994
40 Skokie Blvd., Suite 310
Northbrook, IL 60062 9994633012 09/12/1994
Assigned to: (Assignment) (EXPIRED)
Manufacturers Bank
1200 N. Ashland Ave.,
Chicago, IL 60622
- ------------------------------------------------------------------------------------------------------------------------------------
Nebraska S/S Walker Manufacturing Forum Financial Group, Inc. 9994629649 08/04/1994 Equipment Lease Schedule
1201 Michigan Blvd. 2201 N. Central Expwy #148 (EXPIRED) #2220-30 IBM Printer
Racine, WI 53402 Richardson, TX 75080 located at: Highway 15 and
Assigned to: I-80, Seward, NE 68434
Texas Central Bank N.A.
8144 Walnut Hill Ln LB94
Dallas, TX 75231-4316
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
26
<PAGE> 230
<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Nebraska S/S Walker Manufacturing Forum Financial Group, Inc. 9995643459 01/09/1995 Equipment Schedule 2220-33;
1201 Michigan Blvd. 2201 N. Central Expwy #148 equipment located at
Racine, WI 53402 Richardson, TX 75080 P.O.Box 170, Route 2,
Assigned to: Seward, NE
Texas Central Bank N.A.
8144 Walnut Hill Ln LB94
Dallas, TX 75231-4316
- ------------------------------------------------------------------------------------------------------------------------------------
Nebraska S/S Walker Manufacturing Forum Financial Group, Inc. 9995645381 01/27/1995 Equipment Schedule 2220-37;
1201 Michigan Blvd. 2201 N. Central Expwy #148 computer equipment located
Racine, WI 53402 Richardson, TX 75080 at P. O. Box 170, Route 2,
Assigned to: Seward, NE
Texas Central Bank N.A.
8144 Walnut Hill Ln LB94
Dallas, TX 75231-4316
- ------------------------------------------------------------------------------------------------------------------------------------
Nebraska S/S Walker Manufacturing Forum Financial Group, Inc. 9995649216 03/06/1995 SNAC Interace SYNC RS232
1201 Michigan Blvd. 2201 N. Central Expwy #148 located at P. O. Box 170,
Racine, WI 53402 Richardson, TX 75080 Route 2, Seward, NE 68434
Assigned to:
Colorado National Leasing,
Inc.
950 17th St., Suite 2400
Denver, CO 80202
- ------------------------------------------------------------------------------------------------------------------------------------
Nebraska S/S Walker Manufacturing Forum Financial Group, Inc. 9995658264 05/30/1995 Equipment Schedule 2220-40;
1201 Michigan Blvd. 2201 N. Central Expwy #148 located at Route 2, Seward,
Racine, WI 53402 Richardson, TX 75080 NE 68434
Assigned to:
Texas Central Bank N.A.
8144 Walnut Hill Ln LB94
Dallas, TX 75231-4316
- ------------------------------------------------------------------------------------------------------------------------------------
Nebraska S/S Walker Manufacturing Co. Forum Financial Group, Inc. 9995672717 11/06/1995 Equipment Schedule 2220-41;
1201 Michigan Blvd. 2201 N. Central Expwy #148 computer equipment
Racine, WI 53402 Richardson, TX 75080
Assigned to:
Texas Central Bank N.A.
8144 Walnut Hill Ln LB94
Dallas, TX 75231-4316
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
27
<PAGE> 231
<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Nebraska S/S Walker Manufacturing Co. Forum Financial Group, Inc. 9996707951 10/15/1996 Equipment Schedule 2220-45;
1201 Michigan Blvd. 2201 N. Central Expwy #148 computer equipment
Racine, WI 53402 Richardson, TX 75080
- ------------------------------------------------------------------------------------------------------------------------------------
Nebraska S/S Walker Manufacturing Co. Forum Financial Group, Inc. 9996710808 11/12/1996 Equipment Schedule 2220-48;
1201 Michigan Blvd. 2201 N. Central Expwy #148 computer equipment
Racine, WI 53402 Richardson, TX 75080
Assigned to:
Colorado National Leasing,
Inc.
950 17th Street, Suite 2400
Denver, CO 80202
- ------------------------------------------------------------------------------------------------------------------------------------
Ohio S/S Tenneco Automotive Inc. Somerset Capital Group, Ltd. AP0000325 11/05/1997 See Schedule A for list of
111 Pfingsten Road 1087 Broad Street, Suite 201 Specific Equipment
Deerfield, IL 60015 Bridgeport, CT 06604
Assigned to: Summit Bank
750 Walnut Avenue
Cranford, NJ 07016
- ------------------------------------------------------------------------------------------------------------------------------------
Ohio S/S Tenneco Automotive Inc. Caterpillar Financial AP0076208 08/17/1998 Tennant Scrubber 5700 S/N:
33 Lockwood Road Services Corporation 5700-5235; equipment
Milan, OH 44846 901 Warrenville Road, Suite 19990570115 02/16/1999 location: Route 424 East,
304 Amendment Napoleon, OH 43545
Lisle, IL 60532
- ------------------------------------------------------------------------------------------------------------------------------------
Ohio S/S Tenneco Automotive Inc. Star Bank, N.A. AP0104161 12/04/1998 All equipment now or
33 Lockwood Road Equipment Finance Division hereafter leased under
Milan, OH 44846 425 Walnut St., #8135 Equipment Leasing Agreement
Lessee #305.1857.01 Cincinnati, OH 45202 dated 10/20/98; See
Schedule C-1 attached
- ------------------------------------------------------------------------------------------------------------------------------------
Ohio S/S Tenneco Automotive Inc. Star Bank, N.A. AP0104163 12/04/1998 All equipment now or
33 Lockwood Road Equipment Finance Division hereafter leased under
Milan, OH 44846 425 Walnut St., #8135 Equipment Leasing Agreement
Lessee #305.1857.02 Cincinnati, OH 45202 dated 10/20/98; See
Schedule C-1 attached
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
28
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<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Ohio S/S The Pullman Company St. James Leasing, Ltd. AL21305 08/12/1994 Equipment described in
3 Werner Way - Suite 200 323 Riverside Avenue - Suite Schedule 7 to Lease
Lebanon, NJ 08833 300 Agreement dated 11/28/1989
Westport, CT 06880
Assigned to:
United Jersey Bank
25 E. Salem Street, Suite 603
Hackensack, NJ 07602
- ------------------------------------------------------------------------------------------------------------------------------------
Ohio S/S The Pullman Company St. James Leasing, Ltd. AL31434 09/27/1994 Equipment described in
3 Werner Way - Suite 200 323 Riverside Avenue - Suite Schedule 11 to Lease
Lebanon, NJ 08833 300 Agreement dated 11/28/1989
Westport, CT 06880
Assigned to:
United Jersey Bank
25 E. Salem Street, Suite 603
Hackensack, NJ 07602
- ------------------------------------------------------------------------------------------------------------------------------------
Ohio S/S The Pullman Company St. James Leasing, Ltd. AL36900 10/21/1994 Equipment described in
3 Werner Way - Suite 200 323 Riverside Avenue - Suite Schedule 9 to Lease
Lebanon, NJ 08833 300 Agreement dated 11/28/1989
Westport, CT 06880
Assigned to:
United Jersey Bank
25 E. Salem Street, Suite 603
Hackensack, NJ 07602
- ------------------------------------------------------------------------------------------------------------------------------------
Ohio S/S The Pullman Company St. James Leasing, Ltd. AL79280 04/20/1995 Equipment described in
3 Werner Way - Suite 200 323 Riverside Avenue - Suite Schedule 17 to Lease
Lebanon, NJ 08833 300 Agreement dated 11/28/1989
Westport, CT 06880
Assigned to:
Charter Financial, Inc.
153 East 53rd Street-55th
Floor
New York, NY 10022
- ------------------------------------------------------------------------------------------------------------------------------------
Ohio S/S The Pullman Company, Caterpillar Financial AL80575 04/25/1995 Caterpillar lift truck
Clevite Services Corporation located at Rt. 424,
Elastomers Division 901 Warrenville Road #304 7289506126 07/28/1995 Napoleon, OH 43545
3 Werner Way Lisle, IL 60532 (amendment) Amendment listed serial
Lebanon, NJ 08833 numbers of equipment
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
29
<PAGE> 233
<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Ohio S/S The Pullman Company, Caterpillar Financial AL84985 05/11/1995 Caterpillar lift truck
Clevite Services Corporation located at 33 Lockwood
Elastomers Division 901 Warrenville Road #304 7289506127 07/28/1995 Road, Milan, OH 44846
3 Werner Way Lisle, IL 60532 (amendment) Amendment listed serial
Lebanon, NJ 08833 numbers of equipment
- ------------------------------------------------------------------------------------------------------------------------------------
Ohio S/S The Pullman Company St. James Leasing, Ltd. AL93327 06/14/1995 Equipment described in
3 Werner Way - Suite 200 323 Riverside Avenue - Suite Schedule 21 to Lease
Lebanon, NJ 08833 300 Agreement dated 11/28/1989
Westport, CT 06880
Assigned to:
Charter Financial, Inc.
153 East 53rd Street-55th
Floor
New York, NY 10022
- ------------------------------------------------------------------------------------------------------------------------------------
Ohio S/S The Pullman Company, Caterpillar Financial AM27907 11/08/1995 Caterpillar lift truck
Clevite Services Corporation located at 33 Lockwood
Elastomers Division 901 Warrenville Road #304 Road, Milan, OH 44846
3 Werner Way Lisle, IL 60532
Lebanon, NJ 08833
- ------------------------------------------------------------------------------------------------------------------------------------
Ohio S/S The Pullman Company, Kimco Leasing AM58021 03/19/1996 Fax Machine S/N 51394
Inc. 1910 St. Joe Center Road
dba Clevite Elastomers Suite 12
Route 424 Fort Wayne, IN 46825
Napoleon, OH 43545
- ------------------------------------------------------------------------------------------------------------------------------------
Erie County, OH Tenneco Automotive, Inc. Somerset Capital Group, Ltd. 16717 11/06/1997 Equipment Schedule 1 to
111 Pfingsten Road 1087 Broad Street-Suite 201 Master Lease Agreement
Deerfield, IL 60015 Bridgeport, CT 06604 dated 09/11/1997
Assigned to:
Summit Bank
750 Walnut Avenue
Cranford, NJ 07016
- ------------------------------------------------------------------------------------------------------------------------------------
Erie County, OH Tenneco Automotive Inc. Star Bank, NA 18998 11/12/1998 Equipment leased pursuant
33 Lockwood Drive Equipment Finance Division to Equipment Leasing
Milan, OH 44846 425 Walnut Street, #8135 Agreement # 305-1857-01
Cincinnati, OH 45202 dated 10/20/1998
- ------------------------------------------------------------------------------------------------------------------------------------
Erie County, OH Tenneco Automotive Inc. Star Bank, NA 18999 11/12/1998 Equipment leased pursuant
33 Lockwood Drive Equipment Finance Division to Equipment Leasing
Milan, OH 44846 425 Walnut Street, #8135 Agreement # 305-1857-02
Cincinnati, OH 45202 dated 10/20/1998
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
30
<PAGE> 234
<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Henry County, OH Tenneco Automotive, Inc. Caterpillar Financial 10152 08/17/1998 1 Tennant Scrubber No.
33 Lockwood Drive Services Corporation 5700; Equipment located at:
Milan, OH 44846 901 Warrenville Road, Suite Route 424 East, Napoleon,
304 OH 43545; Amended to
Lisle, IL 61532 include S/N 5700-5235 on
02/16/1999
- ------------------------------------------------------------------------------------------------------------------------------------
Tennessee S/S Tenneco Automotive Inc. Connell Equipment Leasing Co. 983609875 10/19/1998 2 Caterpillar forklifts;
111 Pfingsten Road 45 Cardinal Drive S/Ns 4EM09104, 4EM09105
Deerfield, IL 60015 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
Tennessee S/S Tenneco Automotive Inc. Connell Equipment Leasing Co. 983610941 10/26/1998 2 Caterpillar forklifts;
111 Pfingsten Road 45 Cardinal Drive S/Ns 6EM02267, 6EM02260
Deerfield, IL 60015 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
Tennessee S/S Tenneco Automotive Inc. Connell Equipment Leasing Co. 993000735 01/05/1999 1 Caterpillar forklift; S/N
1 International Drive 45 Cardinal Drive 2EM05977
Monroe, MI 48161 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
Tennessee S/S Walker Manufacturing Forum Financial Group, Inc. 940338206 08/03/1994 Equipment Lease Schedule
1201 Michigan Blvd. 2201 N. Central Expwy #148 (EXPIRED) 2220-30; Equipment located
Racine, WI 53402 Richardson, TX 75080 in Smithville, TN
Assigned to:
Texas Central Bank NA
8144 Walnut Hill Ln, LB94
Dallas, TX 75231-4316
- ------------------------------------------------------------------------------------------------------------------------------------
Tennessee S/S Walker Manufacturing Forum Financial Group, Inc. 950403006 02/27/1995 Equipment Lease Schedule
1201 Michigan Blvd. 2201 N. Central Expwy #148 2220-37; Equipment located
Racine, WI 53402 Richardson, TX 75080 in Smithville, TN
Assigned to:
Texas Central Bank NA
8144 Walnut Hill Ln, LB94
Dallas, TX 75231-4316
- ------------------------------------------------------------------------------------------------------------------------------------
Tennessee S/S Walker Manufacturing Connell Finance Company, Inc. 950434347 05/24/1995 3 Caterpillar lift trucks,
Company 45 Cardinal Drive S/Ns 4EM01384, 4EM00815,
1201 Michigan Blvd. Westfield, NJ 07090 4EM00814
Racine, WI 53402
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
31
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<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Tennessee S/S Walker Manufacturing Forum Financial Group, Inc. 950438432 06/06/1995 Equipment Lease Schedule
1201 Michigan Blvd. 2201 N. Central Expwy #148 2220-43; Equipment located
Racine, WI 53402 Richardson, TX 75080 in Smithville, TN
Assigned to:
Texas Central Bank NA
8144 Walnut Hill Ln, LB94
Dallas, TX 75231-4316
- ------------------------------------------------------------------------------------------------------------------------------------
Tennessee S/S Walker Manufacturing Utilase Systems Inc. 950447635 07/03/1995 GTAW TIG Cell Model
Company 20201 Hoover Road PTS-TIG; GMAW MIG Cell
645 East Broad Street Detroit, MI 48205-1031 Model 1RMWSTP
Smithville, TN 37166
- ------------------------------------------------------------------------------------------------------------------------------------
Tennessee S/S Walker Manufacturing Forum Financial Group, Inc. 950487677 11/03/1995 Equipment Lease Schedule
1201 Michigan Blvd. 2201 N. Central Expwy #148 2220-41; Equipment located
Racine, WI 53402 Richardson, TX 75080 in Smithville, TN
Assigned to:
Texas Central Bank NA
8144 Walnut Hill Ln, LB94
Dallas, TX 75231-4316
- ------------------------------------------------------------------------------------------------------------------------------------
Tennessee S/S Walker Manufacturing Connell Finance Company, Inc. 960507731 01/09/1996 1 Caterpillar lift trucks,
Company 45 Cardinal Drive S/Ns 4EM03358
1201 Michigan Blvd. Westfield, NJ 07090
Racine, WI 53402
- ------------------------------------------------------------------------------------------------------------------------------------
DeKalb County, TN Walker Manufacturing Brad Elliott Johnson 7343 06/27/1997 $7,858.55 which has been
Company, a division of (Judgment) satisfied and released.
Tenneco Inc. and Cigna
Insurance Companies
- ------------------------------------------------------------------------------------------------------------------------------------
DeKalb County, TN Walker Manufacturing, Lisa Pyles 7081 and 11/15/1995 $14,616.00 which has been
Inc., a division of 7082 satisfied and released.
Tenneco Inc. and
Connecticut General
Life Insurance Company
a/k/a Cigna Insurance
Companies
- ------------------------------------------------------------------------------------------------------------------------------------
DeKalb County, TN Tenneco Inc., a Nevada Kimberly Carol Cantrell 7138 02/29/1996 $19,978.72 which has been
corporation, and Cigna satisfied and released.
Insurance Company
- ------------------------------------------------------------------------------------------------------------------------------------
DeKalb County, TN Tenneco Inc., a Nevada Shannon Cantrell 7434 01/27/1998 $13,353.30 which has been
corporation and Cigna satisfied and released.
Insurance Company
- ------------------------------------------------------------------------------------------------------------------------------------
DeKalb County, TN Tenneco, Inc., a Nevada Micheal W. Bowman 7557 09/18/1998 $20,578.00 which has been
corporation d/b/a satisfied and released.
Walker Manufacturing
Company and Cigna
Insurance Company
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
32
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<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Texas S/S Monroe Auto Equipment Hyster Credit Company 95-00026315 02/09/1995 One used Hyster E30XL S/N
Company P. O. Box 4366 C114V03686K
1601 Hwy 49 North Portland, OR 97208
Paragould, AR 72450
- ------------------------------------------------------------------------------------------------------------------------------------
Texas S/S Tenneco Business Forsythe/McCarthur 97-00099751 05/22/1997 Computer equipment under
Services Inc. Associates, Inc. Master Lease #F8628 dated
8401 New Trails Drive 7500 Frontage Road 3/20/1997.
The Woodlands, TX 77381 Skokie, IL 60077
- ------------------------------------------------------------------------------------------------------------------------------------
Virginia S/S Walker Manufacturing LaSalle Systems Leasing, Inc. 940421 7707 04/21/1994 Computer Equipment per
Co., Division of 40 Skokie Blvd., Suite 310 (EXPIRED) schedule attached part of
Tennessee Gas Pipeline Northbrook, IL 60062 Master Lease #213 dated
Company 05/01/1986 with Schedule
1201 Michigan Blvd. #34A dated 02/23/1994
Racine, WI 53402
- ------------------------------------------------------------------------------------------------------------------------------------
Virginia S/S Walker Manufacturing Capital Associates 940502 7241 05/09/1994 Lease #080901-R02 -
Co., Division of International, Inc. (EXPIRED) equipment subject to
Tennessee Gas Pipeline 7175 W. Jefferson Avenue, Renewal No. 2 for Equipment
Company Suite 3000 Schedule No. 1 to Master
1201 Michigan Blvd. Lakewood, CO 80235 Lease dated 09/16/1988
Racine, WI 53402
- ------------------------------------------------------------------------------------------------------------------------------------
Virginia S/S Walker Manufacturing Capital Associates 940531 7055 05/31/1994 Restated Master Lease dated
Company International, Inc. 09/15/1992 #174601-R02
1201 Michigan Boulevard 7175 W. Jefferson Avenue, 970718 7830 07/18/1997 Debtor name changed to:
Racine, WI 53402 Suite 3000 (Amendment) (EXPIRED) Walker Manufacturing
Lakewood, CO 80235 Company, a Division of
Tenneco Automotive Inc.
- ------------------------------------------------------------------------------------------------------------------------------------
Virginia S/S Walker Manufacturing LaSalle Equipment Limited 940725 7704 07/25/1994 Computer equipment as per
Co., Division of Partnership schedule attached - Master
Tennessee Gas Pipeline 40 Skokie Blvd., Suite 310 Lease #213 dated 05/01/1986
Company Northbrook, IL 60062 940912 7720 09/12/1994 together with Schedule #35
1201 Michigan Blvd. Assigned to: (Assignment) (EXPIRED) dated 04/12/1994
Racine, WI 53402 Manufacturers Bank
1200 N. Ashland Ave.
Chicago, IL 60622
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
33
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<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Virginia S/S Walker Manufacturing Forum Financial Group, Inc. 950109 7063 01/09/1995 Equipment Schedule 2220-33
1201 Michigan Boulevard 2201 North Central
Racine, WI 53402 Expressway #148
Richardson, TX 75080
Assigned to:
Texas Central Bank, N.A.
8144 Walnut Hill Ln. LB-94
Dallas, TX 75231-4316
- ------------------------------------------------------------------------------------------------------------------------------------
Virginia S/S Walker Manufacturing Forum Financial Group, Inc. 650306 7352 03/06/1995 See attachment/ Equipment
1201 Michigan Boulevard 2201 North Central Schedule 2220-36 (computer
Racine, WI 53402 Expressway #148 equipment)
Richardson, TX 75080
Assigned to:
Colorado National Leasing,
Inc.
950 17th St., Suite 2400
Denver, CO 80202
- ------------------------------------------------------------------------------------------------------------------------------------
Virginia S/S Walker Manufacturing PaineWebber Preferred Yield 961015 7178 10/15/1996 (copy missing - to follow)
1201 Michigan Boulevard Fund II
Racine, WI 53402 Weehauken, NJ
- ------------------------------------------------------------------------------------------------------------------------------------
Virginia S/S Walker Manufacturing Forum Financial Group, Inc. 961015 7281 10/16/1996 Equipment Lease Schedule
Company 1475 Richardson Drive, Suite 2220-45 (computer
1201 Michigan Boulevard 270 equipment) for location:
Racine, WI 53402 Richardson, TX 75080 3160 Abbott Lane
Harrisonburg, VA
- ------------------------------------------------------------------------------------------------------------------------------------
Virginia S/S Walker Manufacturing LaSalle Systems Leasing, Inc. 970311 7809 03/11/1997 Computer equipment as per
Co., a Division of 40 Skokie Blvd., Suite 310 schedule attached - Master
Tenneco Automotive Inc. Northbrook, IL 60062 Lease #213 dated 05/01/1986
1201 Michigan Blvd. Assigned to: 970404 7802 Filing date together with Schedule #40
Racine, WI 53402 Manufacturers Bank (Assignment) unclear dated 11/14/1996
1200 N. Ashland Ave.
Chicago, IL 60622
- ------------------------------------------------------------------------------------------------------------------------------------
Virginia S/S Tenneco Automotive Inc. Connell Equipment Leasing Co. 970428 7238 04/28/1997 Lift trucks, cascades,
111 Pfingsten Road 45 Cardinal Drive batteries (Sup. #12)
Deerfield, IL 60015 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
34
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<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Virginia S/S Tenneco Automotive Inc. Connell Equipment Leasing Co. 970814 7043 08/14/1997 Lift trucks, cascades,
111 Pfingsten Road 45 Cardinal Drive batteries (Sup. #15)
Deerfield, IL 60015 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
Virginia S/S Tenneco Automotive Inc. Connell Equipment Leasing Co. 981228 7532 12/28/1998 Order pickers, batteries,
1 International Drive 45 Cardinal Drive chargers (Sup. #31)
Monroe, MI 48161 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
Virginia S/S Tenneco Automotive Inc. Yale Financial Services, Inc. 980706 7157 07/06/1998 Leased equipment at
500 North Field Drive 15 Junction Road location: 4500 Early Road
Lake Forest, IL 60045 Flemington, NJ 08822 Harrisonburg, VA 22801
- ------------------------------------------------------------------------------------------------------------------------------------
Virginia S/S Tenneco Automotive Inc. Connell Equipment Leasing Co. 990330 7156 03/30/1999 4 Raymond Forklifts; 8
111 Pfingsten Road 45 Cardinal Drive Exide Batteries; 4 Exide
Deerfield, IL 60015 Westfield, NJ 07090 Chargers
- ------------------------------------------------------------------------------------------------------------------------------------
Virginia S/S Tenneco Automotive Connell Equipment Leasing Co. 990419 7113 04/19/1999 2 Exide Chargers (Sup. #36)
1 International Drive 45 Cardinal Drive
Monroe, MI 48161 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
Virginia S/S Tenneco Automotive Connell Equipment Leasing Co. 990419 7114 04/19/1999 Original filing is missing
1 International Drive 45 Cardinal Drive in the jurisdiction.
Monroe, MI 48161 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
Virginia S/S Tenneco Automotive Connell Equipment Leasing Co. 990419 7577 04/19/1999 1 Multi Shifter Battery
1 International Drive 45 Cardinal Drive Handling System (Sup. #35)
Monroe, MI 48161 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
Virginia S/S Tenneco Automotive Connell Equipment Leasing Co. 990503 7210 05/03/1999 1 Exide Battery; 1 Exide
1 International Drive 45 Cardinal Drive Charger (Sup. #40)
Monroe, MI 48161 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
Virginia S/S Tenneco Automotive Connell Equipment Leasing Co. 990518 7157 05/18/1999 12 GNB Batteries; 5 GNB
1 International Drive 45 Cardinal Drive Batteries (Sup. #44)
Monroe, MI 48161 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
Virginia S/S Tenneco Automotive Connell Equipment Leasing Co. 990518 7158 05/18/1999 2 Yale Forklifts; 10 Yale
1 International Drive 45 Cardinal Drive Forklifts (Sup. #39)
Monroe, MI 48161 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
35
<PAGE> 239
<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Virginia S/S Tenneco Automotive Connell Equipment Leasing Co. 990518 7159 05/18/1999 2 GNB Chargers (Sup. #43)
1 International Drive 45 Cardinal Drive
Monroe, MI 48161 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
Virginia S/S Tenneco Automotive The Summit Group, Inc. 990528 7101 05/28/1999 9406-720 AS/400 720-2063 -
Incorporated 4215 Edison Lakes Parkway Serial #00219BM7852-4OZ
4500 Early Road Mishawaka, IN 46546-5106 Model - Serial #42N5624)
Harrisonburg, VA 22801
- ------------------------------------------------------------------------------------------------------------------------------------
Virginia S/S Tenneco Automotive Connell Equipment Leasing Co. 990607 7346 06/07/1999 10 Install 90" Overhead
1 International Drive 45 Cardinal Drive Guards on Yale Model
Monroe, MI 48161 Westfield, NJ 07090 ESCO30ABN24TE083
(Sup. #42)
- ------------------------------------------------------------------------------------------------------------------------------------
Virginia S/S Tenneco Automotive Connell Equipment Leasing Co. 990609 7055 06/09/1999 2 GNB Batteries Model No.
1 International Drive 45 Cardinal Drive 24-95-21 (Sup. #45)
Monroe, MI 48161 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
Independent City Walker Manufacturing Michael G. McCray (Plaintiff) 62/79 05/12/1998 Judgment in the sum of
- - Harrisonburg, Company $63,564 which includes
VA Tenneco Automotive Inc. interest thereon from the
(Defendants) 17th day of May 1995 until
paid and costs of proceeding
- ------------------------------------------------------------------------------------------------------------------------------------
Independent City Tenneco Automotive Inc. Connell Equipment Leasing Co. 47538 04/28/1997 2 Yale Lift Trucks, 2
- - Harrisonburg, 111 Pfingsten Road 45 Cardinal Drive Cascades, 6 Exide
VA Deerfield, IL 60015 Westfield, NJ 07090 Batteries, 2 Exide Chargers
- ------------------------------------------------------------------------------------------------------------------------------------
Independent City Tenneco Automotive Inc. Connell Equipment Leasing Co. 48004 08/14/1997 3 Yale Forklifts, 3 Cascade
- - Harrisonburg, 111 Pfingsten Road 45 Cardinal Drive Fork Positioners, 9 Exide
VA Deerfield, IL 60015 Westfield, NJ 07090 Batteries, 3 Exide Chargers
- ------------------------------------------------------------------------------------------------------------------------------------
Independent City Tenneco Automotive Inc. Yale Financial Services, Inc. 49418 07/10/1998 All of the equipment now or
- - Harrisonburg, 500 North Field Drive 15 Junction Road hereafter leased by Lessor
VA Lake Forest, IL 60045 Flemington, NJ 08822 to Lessee; located at 4500
Early Road, Harrisonburg, VA
- ------------------------------------------------------------------------------------------------------------------------------------
Independent City Tenneco Automotive Inc. Connell Equipment Leasing Co. 50125 01/04/1999 19 Raymond Order Pickers, 7
- - Harrisonburg, 1 International Drive 45 Cardinal Drive Raymond Order Pickers
VA Monroe, MI 48161 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
36
<PAGE> 240
<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Independent City Tenneco Automotive Inc. Connell Equipment Leasing Co. 50410 03/30/1999 4 Raymond Forklifts, 8
- - Harrisonburg, VA 1 International Drive 45 Cardinal Drive Exide Batteries, 4 Exide
Monroe, MI 48161 Westfield, NJ 07090 Chargers
- ---------------------------------------------------------------------------------------------------------------------------------
Independent City Walker Manufacturing Co IBM Corporation 42461 10/20/1993 IBM Equipment
- - Harrisonburg, VA 3160 Abbot Lane Dept. C4E MS 222
Harrisonburg, VA 250 Harbor Drive
22801-9750 Stamford, CT 06904
- ---------------------------------------------------------------------------------------------------------------------------------
Independent City Walker Manufacturing Co IBM Corporation 42478 10/26/1993 IBM Equipment
- - Harrisonburg, VA 3160 Abbot Lane Dept. C4E MS 222
Harrisonburg, VA 250 Harbor Drive
22801-9750 Stamford, CT 06904
- ---------------------------------------------------------------------------------------------------------------------------------
Independent City Tennessee Gas Pipeline Amplicon, Inc. 42511 11/02/1993 Schedule 6 to Lease No.
- - Harrisonburg, VA Company 5 Hutton Centre Drive, OL-6346 (VA)(WI)
Walker Manufacturing Ste. 500
Company Division Santa Ana, CA 92707
1201 Michigan Blvd. Assigned to: Amended by: Filed:
Racine, WI 53402 Deutsche Credit Corporation 42511 01/25/1994
2333 Waukegan Road (EXPIRED)
Deerfield, IL 60015
- ---------------------------------------------------------------------------------------------------------------------------------
Independent City Walker Manufacturing LaSalle Systems Leasing, inc. 42755 01/19/1994 Computer Equipment per
- - Harrisonburg, VA Co., a Division 40 Skokie Blvd., Suite 310 schedule attached covered
of Tennessee Gas Northbrook, IL 60062 under Master Lease #213
Pipeline Company Assigned to: dated 5/1/1986 together
1201 Michigan Blvd. LaSalle Equipment Limited with Schedule #34 dated
Racine, WI 53402 Partnership 12/03/1993
40 Skokie Blvd., Suite 310
Northbrook, IL 60062
Assigned to: Assignment Filed:
Manufacturers Bank 42755 03/08/1994
1200 N. Ashland Avenue (EXPIRED)
Chicago, IL 60622
- ---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
37
<PAGE> 241
<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Independent City Walker Manufacturing LaSalle Systems Leasing, inc. 43210 04/22/1994 Computer Equipment per
- - Harrisonburg, VA Co., a Division 40 Skokie Blvd., Suite 310 (EXPIRED) schedule attached covered
of Tennessee Gas Northbrook, IL 60062 under Master Lease #213
Pipeline Company Assigned to: dated 5/1/1986 together
1201 Michigan Blvd. LaSalle Equipment Limited with Schedule #34A dated
Racine, WI 53402 Partnership 02/23/1994
40 Skokie Blvd., Suite 310
Northbrook, IL 60062
- ------------------------------------------------------------------------------------------------------------------------------------
Independent City Walker Manufacturing Capital Associates 43259 05/04/1994 Lease #080901-R02;
- - Harrisonburg, VA Co., a Division International, Inc. (EXPIRED) Equipment described on
of Tennessee Gas 7175 W. Jefferson Avenue, attachment to UCC-1
Pipeline Company Suite 3000
1201 Michigan Blvd. Lakewood, CO 80235
Racine, WI 53402
- ------------------------------------------------------------------------------------------------------------------------------------
Independent City Walker Manufacturing Capital Associates 43391 06/06/1994 Lease #174601-R02;
- - Harrisonburg, VA Co., a Division International, Inc. Amended by: Filed on: Equipment described on
of Tennessee Gas 7175 W. Jefferson Avenue, 43391 01/22/1998 attachment to UCC-1
Pipeline Company Suite 3000 (EXPIRED)
1201 Michigan Blvd. Lakewood, CO 80235
Racine, WI 53402
- ------------------------------------------------------------------------------------------------------------------------------------
Independent City Walker Manufacturing LaSalle Systems Leasing, inc. 43588 08/01/1994 Computer Equipment per
- - Harrisonburg, VA Co., a Division 40 Skokie Blvd., Suite 310 schedule attached covered
of Tennessee Gas Northbrook, IL 60062 under Master Lease #213
Pipeline Company Assigned to: dated 5/1/1986 together
1201 Michigan Blvd. LaSalle Equipment Limited with Schedule #35 dated
Racine, WI 53402 Partnership 04/12/1994
40 Skokie Blvd., Suite 310
Northbrook, IL 60062
Assigned to: Assignment Filed:
Manufacturers Bank 43588 09/13/1994
1200 N. Ashland Avenue (EXPIRED)
Chicago, IL 60622
- ------------------------------------------------------------------------------------------------------------------------------------
Independent City Walker Manufacturing Forum Financial Group, Inc. 44103 01/19/1995 Equipment Schedule 2220-33
- - Harrisonburg, VA 1201 Michigan Blvd. 2201 North Central
Racine, WI 53402 Expressway, Ste 148
Richardson, TX 75080
Assigned to:
Texas Central Bank, N.A.
8144 Walnut Hill Lane, LB-94
Dallas, TX 75231-4316
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
38
<PAGE> 242
<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Independent City Walker Manufacturing Forum Financial Group, Inc. 46552 10/11/1996 Equipment Schedule 2220-45
- - Harrisonburg, VA 1201 Michigan Blvd. 1475 Richardson Drive, Suite
Racine, WI 53402 270
Richardson, TX 75080
- ------------------------------------------------------------------------------------------------------------------------------------
Independent City Walker Manufacturing LaSalle Systems Leasing, inc. 47286 03/11/1997 Computer Equipment per
- - Harrisonburg, VA Co., a Division 40 Skokie Blvd., Suite 310 schedule attached covered
of Tennessee Gas Northbrook, IL 60062 under Master Lease #213
Pipeline Company Assigned to: Assignment Filed: dated 5/1/1986 together
1201 Michigan Blvd. Manufacturers Bank 47286 04/07/1997 with Schedule #40 dated
Racine, WI 53402 1200 N. Ashland Avenue 11/14/1996
Chicago, IL 60622
- ------------------------------------------------------------------------------------------------------------------------------------
Independent City Tenneco Automotive Connell Equipment Leasing Co. 50482 04/19/1999 1 Multi Shifter Battery
- - Harrisonburg, VA 1 International Drive 45 Cardinal Drive Handling System (Sup. #35)
Monroe, MI 48161 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
Independent City Tenneco Automotive Connell Equipment Leasing Co. 50485 04/20/1999 2 Exide Chargers (Sup. #36)
- - Harrisonburg, VA 1 International Drive 45 Cardinal Drive
Monroe, MI 48161 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
Independent City Tenneco Automotive Connell Equipment Leasing Co. 50505 04/22/1999 11 Raymond Easi Order
- - Harrisonburg, VA 1 International Drive 45 Cardinal Drive Pickers; 22 Exide
Monroe, MI 48161 Westfield, NJ 07090 Batteries; 9 Exide Chargers
(Sup. #34)
- ------------------------------------------------------------------------------------------------------------------------------------
Independent City Tenneco Automotive Connell Equipment Leasing Co. 50539 04/30/1999 1 Exide Battery and 1 Exide
- - Harrisonburg, VA 1 International Drive 45 Cardinal Drive Charger (Sup. #40)
Monroe, MI 48161 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
Independent City Tenneco Automotive Connell Equipment Leasing Co. 50600 05/17/1999 2 GNB Chargers (Sup. #43)
- - Harrisonburg, VA 1 International Drive 45 Cardinal Drive
Monroe, MI 48161 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
Independent City Tenneco Automotive Connell Equipment Leasing Co. 50604 05/17/1999 2 Yale Forklifts; 10 Yale
- - Harrisonburg, VA 1 International Drive 45 Cardinal Drive Forklifts (Sup. #39)
Monroe, MI 48161 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
Independent City Tenneco Automotive Connell Equipment Leasing Co. 50605 05/17/1999 12 GNB Batteries; 5 GNB
- - Harrisonburg, VA 1 International Drive 45 Cardinal Drive Batteries (Sup. #44)
Monroe, MI 48161 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
39
<PAGE> 243
<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Independent City Tenneco Automotive The Summit Group, Inc. 50655 05/28/1999 9406-720 AS/400 720-2063 -
- - Harrisonburg, VA Incorporated 4215 Edison Lake Parkway Serial #00219BM7852; 4OZ
4500 Early Road Mishawaka, IN 46546-5106 Modem - Serial #42N5624
Harrisonburg, VA 22801
- ------------------------------------------------------------------------------------------------------------------------------------
Independent City Tenneco Automotive Connell Equipment Leasing Co. 50694 06/07/1999 2 GNB Batteries (Sup. #45)
- - Harrisonburg, VA 1 International Drive 45 Cardinal Drive
Monroe, MI 48161 Westfield, NJ 07090
- ------------------------------------------------------------------------------------------------------------------------------------
Independent City Tenneco Automotive Connell Equipment Leasing Co. 50696 06/07/1999 10 Install 90" Overhead
- - Harrisonburg, VA 1 International Drive 45 Cardinal Drive Guards on Yale Model (Sup.
Monroe, MI 48161 Westfield, NJ 07090 42)
- ------------------------------------------------------------------------------------------------------------------------------------
Wisconsin S/S Walker Manufacturing Forum Financial Services, 1668948 05/05/1997 Schedule #5010-03
1201 Michigan Blvd. Inc.
Racine, WI 53402 1475 Richardson Drive,
Suite 270
Richardson, TX 75080
Assigned to: 1693405 08/11/1997
Texas Central Bank, N.A. Assignment
8144 Walnut Hill Lane,
Ste 180
Dallas, Texas 7231
- ------------------------------------------------------------------------------------------------------------------------------------
Wisconsin S/S Walker Manufacturing LaSalle Systems Leasing, Inc. 1666264 04/24/1997 Master Lease #213 dated
Co., a division 40 Skokie Blvd., Suite 310 05/01/1986 Schedule #44
of Tenneco Automotive, Northbrook, IL 60062 dated 03/04/1997
Inc. Assigned to:
1201 Michigan Blvd. LaSalle Equipment Limited
Racine, WI 53402 Partnership
40 Skokie Blvd., Suite 310
Northbrook, IL 60062
- ------------------------------------------------------------------------------------------------------------------------------------
Wisconsin S/S Walker Manufacturing LaSalle Systems Leasing, Inc. 1654648 03/11/1997 Master Lease #213 dated
Co., a division 40 Skokie Blvd., Suite 310 05/01/1986 Schedule #40
of Tenneco Automotive, Northbrook, IL 60062 dated 11/14/1996
Inc. Assigned to: 1666252 04/24/1997
1201 Michigan Blvd. Manufacturers Bank Assignment
Racine, WI 53402 1200 North Ashland Avenue
Chicago, IL 60622
- ------------------------------------------------------------------------------------------------------------------------------------
Wisconsin S/S Walker Manufacturing LaSalle Systems Leasing, Inc. 1654647 03/11/1997 Master Lease #213 dated
Co., a division 40 Skokie Blvd., Suite 310 05/01/1986 Schedule #41
of Tenneco Automotive, Northbrook, IL 60062 dated 12/16/1996
Inc.
1201 Michigan Blvd.
Racine, WI 53402
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
40
<PAGE> 244
<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Wisconsin S/S Walker Manufacturing LaSalle Systems Leasing, Inc. 1654646 03/11/1997 Master Lease #213 dated
Co., a division 40 Skokie Blvd., Suite 310 05/01/1986 Schedule #42
of Tenneco Automotive, Northbrook, IL 60062 dated 01/24/1997
Inc.
1201 Michigan Blvd.
Racine, WI 53402
- ------------------------------------------------------------------------------------------------------------------------------------
Wisconsin S/S Walker Manufacturing Capital Associates 1432623 05/31/1994 Master Lease dated
Company International, Inc. 09/15/1992 Schedule 1
1201 Michigan Blvd. 7175 W. Jefferson Ave. #4000 Lease #174601-R01 & R02
Racine, WI 53402 Lakewood, CO 80235 1687792 07/18/1997
Amended to: Amendment (EXPIRED)
Walker Manufacturing
Company, a
division of Tenneco
Automotive Inc.
111 Pfingsten Road
Deerfield, IL 60015
- ------------------------------------------------------------------------------------------------------------------------------------
Wisconsin S/S Walker Manufacturing Tenneco Credit Corporation 1248481 12/26/1991 Account receivables
Company 1010 Milam Street
1201 Michigan Boulevard Houston, Texas 77002
Racine, WI 53402 Assigned to: Asset
Amended to: Securitization 1635911 12/19/1996
Walker Manufacturing Cooperative Corporation Amendment
Company, a c/o Canadian Imperial Bank
division of Tenneco of Commerce 1637223 12/26/1996
Automotive Inc. 425 Lexington Avenue Continuation
New York, NY 10017
- ------------------------------------------------------------------------------------------------------------------------------------
Wisconsin S/S Walker Manufacturing Amplicon, Inc. 1295190 08/03/1992 Schedule 1 (MS) to Lease
Company/ 5 Hutton Centre Drive, Suite #OL-6346
Division of Tennessee 500
Gas Pipeline Santa Ana, CA 92707 1325564 01/11/1993
Company Assigned to: Assignment
1201 Michigan Blvd. Concord Commercial 1325565 01/11/1993
Racine, WI 53402 Corporation Amendment
Name amended to: 2010 Main Street, Suite 500 1663541 04/14/1997
Tennessee Gas Pipeline Irvine, CA 92714 Continuation
Company, Walker
Manufacturing
Company/Division
- ------------------------------------------------------------------------------------------------------------------------------------
Wisconsin S/S Tennessee Gas Pipeline Amplicon, Inc. 1380746 09/22/1993 Schedule 5 to Lease
Company, 5 Hutton Centre Drive, Suite #OL-6346 (WI); leased
Walker Manufacturing 500 1748494 04/03/1998 property located at Walker
Company Division Santa Ana, CA 92707 Continuation Exhaust
1201 Michigan Blvd. Assigned to: 500 Connestoga Blvd.
Racine, WI 53402 Concord Commercial Cambridge, Ontario, M1R 5T7
Corporation Canada
2010 Main Street, Suite 500
Irvine, CA 92714
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
41
<PAGE> 245
<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Wisconsin S/S Walker Manufacturing Pacific Atlantic Systems 1412879 03/02/1994 All Equipment pursuant to
Co., a Div. of Leasing Inc. (EXPIRED) Lease Agreement dated
Tennessee Gas Pipeline 11811 N. Tatum Blvd. Suite 04/27/1993, Schedule 15
Company 2000
1201 Michigan Blvd. Phoenix, AZ 85028
Racine, WI 53402
- ------------------------------------------------------------------------------------------------------------------------------------
Wisconsin S/S Walker Manufacturing Forum Financial Group, Inc. 1418657 03/28/1994 Equipment Lease Schedule
1201 Michigan Blvd. 2201 N. Central Expwy. #148 (EXPIRED) 2220-26
Racine, WI 53402 Richardson, TX 75080
Assigned to:
Texas Central Bank
8144 Walnut Hill LB94
Dallas, TX 7231-4316
- ------------------------------------------------------------------------------------------------------------------------------------
Wisconsin S/S Walker Manufacturing Co. LaSalle Systems Leasing, Inc. 1424180 04/21/1994 Master Lease #213 dated
Division of Tennessee 40 Skokie Blvd., Suite 310 (EXPIRED) 05/01/1986, Schedule #34A
Gas Pipeline Northbrook, IL 60062 dated 02/23/1994; Equipment
Company Assigned to: located at 3160 Abbott
1201 Michigan Blvd. LaSalle Equipment Limited Lane, Harrisonburg,
Racine, WI 53402 Partnership VA 22801
40 Skokie Blvd., Suite 310
Northbrook, IL 60062
- ------------------------------------------------------------------------------------------------------------------------------------
Wisconsin S/S Walker Manufacturing Capital Associates 1426397 05/02/1994 Lease #080901-R01 & R02
Company, a International, Inc. (EXPIRED) dated 09/16/1988
Division of Tennessee 7175 W. Jefferson Avenue,
Gas Pipeline Suite 3000
Company Lakewood, CO 80235
1201 Michigan Blvd.
Racine, WI 53402
- ------------------------------------------------------------------------------------------------------------------------------------
Wisconsin S/S Tennessee Gas Pipeline Amplicon, Inc. 1428941 05/12/1994 Schedule 1 to Lease
Company 5 Hutton Centre Drive #500 (EXPIRED) Agreement OL-8006
Walker Manufacturing Santa Ana, CA 92707
Company Division
1201 Michigan Blvd.
Racine, WI 53402
- ------------------------------------------------------------------------------------------------------------------------------------
Wisconsin S/S Walker Manufacturing LaSalle Systems Leasing, Inc. 1444719 07/25/1994 Master Lease #213 dated
Co., Division 40 Skokie Blvd., Suite 310 05/01/1986, Schedule #37
of Tennessee Gas Northbrook, IL 60062 dated 04/04/1994
Pipeline Company Assigned to: 1454728 09/12/1994
1201 Michigan Blvd. Manufacturers Bank Assignment (EXPIRED)
Racine, WI 53402 1200 N. Ashland Avenue
Chicago, IL 60622
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
42
<PAGE> 246
<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Wisconsin S/S Walker Manufacturing LaSalle Systems Leasing, Inc. 1444720 07/25/1994 Master Lease #213 dated
Co., Division 40 Skokie Blvd., Suite 310 05/01/1986, Schedule #35
of Tennessee Gas Northbrook, IL 60062 dated 04/12/1994
Pipeline Company Assigned to: 1454727 09/12/1994
1201 Michigan Blvd. Manufacturers Bank Assignment (EXPIRED)
Racine, WI 53402 1200 N. Ashland Avenue
Chicago, IL 60622
- ------------------------------------------------------------------------------------------------------------------------------------
Wisconsin S/S Walker Manufacturing Forum Financial Group, Inc. 1444423 07/25/1994 Equipment Lease Schedule
1201 Michigan Blvd. 2201 N. Central Expwy. #148 (EXPIRED) 2220-30
Racine, WI 53402 Richardson, TX 75080
Assigned to:
Texas Central Bank
8144 Walnut Hill LB94
Dallas, TX 7231-4316
- ------------------------------------------------------------------------------------------------------------------------------------
Wisconsin S/S Walker Manufacturing First Equipment Company 1450491 08/22/1994 Schedule "A" Sub-Schedule
Company 4851 Keller Springs Road, (EXPIRED) No. 1,6,7,10,11 to Master
1201 Michigan Blvd. #100 Lease Agreement Number
Racine, WI 53402 Dallas, Texas 75248 D01342 dated 02/02/1993
Assigned to:
Bank IV Oklahoma, N.A.
POB 2360
Tulsa, OK 74101
- ------------------------------------------------------------------------------------------------------------------------------------
Wisconsin S/S Walker Manufacturing LaSalle Systems Leasing, Inc. 1456253 09/19/1994 Master Lease #213 dated
Co., Division 40 Skokie Blvd., Suite 310 05/01/1986, Schedule
of Tennessee Gas Northbrook, IL 60062 #35A dated 08/04/1994;
Pipeline Company Assigned to: equipment located at 904
1201 Michigan Blvd. LaSalle Equipment Limited Industrial Road, Marshall,
Racine, WI 53402 Partnership MI 49068
40 Skokie Blvd., Suite 310
Northbrook, IL 60062
- ------------------------------------------------------------------------------------------------------------------------------------
Wisconsin S/S Tennessee Gas Pipeline Amplicon, Inc. 1459982 10/06/1994 Schedule 7 to Lease
Company 5 Hutton Centre Drive #500 Agreement OL-6346; leased
Walker Manufacturing Santa Ana, CA 92707 property located at 3160
Company Division Abbott Lane, Harrisonburg,
1201 Michigan Blvd. VA 22801
Racine, WI 53402
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
43
<PAGE> 247
<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Wisconsin S/S Tennessee Gas Pipeline Ameritech Credit Corporation 1460003 10/06/1994 Lease No. 001-0127159-008
Company 2550 W. Golf Road dated 12/10/1993
Walker Manufacturing Rolling Meadows, IL 60008
Company
1010 Milar
Houston, TX 77002
- ------------------------------------------------------------------------------------------------------------------------------------
Wisconsin S/S Walker Manufacturing LaSalle Systems Leasing, Inc. 1461193 10/12/1994 Master Lease #213 dated
Co., Division 40 Skokie Blvd., Suite 310 05/01/1986, Schedule #38
of Tennessee Gas Northbrook, IL 60062 dated 09/09/1994
Pipeline Company Assigned to: 1476895 12/27/1994
1201 Michigan Blvd. Manufacturers Bank Assignment
Racine, WI 53402 1200 N. Ashland Avenue
Chicago, IL 60622
- ------------------------------------------------------------------------------------------------------------------------------------
Wisconsin S/S Walker Manufacturing Advanta Leasing Corp. 1463653 10/24/1994 Schedule "A" to Lease
Company, Div. of TN Gas P. O. Box 1228-UCC Agreement dated 09/28/1994
Pipeline Co. Voorhees, NJ 08043
1201 Michigan Boulevard
Racine, WI 53402
- ------------------------------------------------------------------------------------------------------------------------------------
Wisconsin S/S Walker Manufacturing American Industrial 1457476 09/26/1994 Copiers
Division of Co. Leasing
Tennessee Gas Pipeline P. O. Box 683
1201 Michigan Blvd. Brookfield, WI 53008
Racine, WI 53402 Assigned to: 1470839 11/28/1994
M & I Marshall Ilsley Bank Assignment
770 N. Water St.
Milwaukee, WI 53202
- ------------------------------------------------------------------------------------------------------------------------------------
Wisconsin S/S Tennessee Gas Pipeline El Camino Resources, Ltd. 1483648 01/27/1995 Master Lease #2366,
Company acting through 21051 Warner Center Lane Schedule #001
its Walker Woodland Hills, CA 91367
Manufacturing Division,
Tenneco Bldg., 1010
Milan, Houston, TX 77002
- ------------------------------------------------------------------------------------------------------------------------------------
Wisconsin S/S Walker Manufacturing Forum Financial Group, Inc. 1483551 01/27/1995 Equipment Lease Schedule
1201 Michigan Blvd. 2201 N. Central Expwy. #148 2220-37
Racine, WI 53402 Richardson, TX 75080
Assigned to:
Texas Central Bank
8144 Walnut Hill LB94
Dallas, TX 7231-4316
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
44
<PAGE> 248
<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Wisconsin S/S Walker Manufacturing Forum Financial Group, Inc. 1491558 03/06/1995 Equipment Lease Schedule
1201 Michigan Blvd. 2201 N. Central Expwy. #148 2220-36
Racine, WI 53402 Richardson, TX 75080
Assigned to:
Colorado National Leasing,
Inc.
950 17th St. #1400
Denver, CO 80202
- ------------------------------------------------------------------------------------------------------------------------------------
Wisconsin S/S Tennessee Gas Pipeline Ameritech Credit Corporation 1542853 10/27/1995 Lease No.
Company Div- 2550 W. Golf Road 001-0127159-009,010 and 011
Walker Manufacturing Rolling Meadows, IL 60008 dated 12/10/1993
Company
1201 Michigan Blvd.
Racine, WI 53402
- ------------------------------------------------------------------------------------------------------------------------------------
Wisconsin S/S Walker Manufacturing Equis Financial Group 1620744 10/14/1996 Master Lease Agmt. No.
Company 98 North Washington Street 8906WIG377
1201 Michigan Blvd. Boston, MA 02114
Racine, WI 53402 Assigned to:
PaineWebber Preferred Yield
Fund II
PaineWebber Incorporated
1200 Harbor Boulevard
Weehawken, NJ 07087
- ------------------------------------------------------------------------------------------------------------------------------------
Wisconsin S/S Walker Manufacturing Co. Forum Financial Group, Inc. 1544841 11/06/1995 Equipment Lease Schedule
1201 Michigan Blvd. 2201 N. Central Expwy. #148 2220-41
Racine, WI 53402 Richardson, TX 75080
Assigned to:
Texas Central Bank
8144 Walnut Hill LB94
Dallas, TX 7231-4316
- ------------------------------------------------------------------------------------------------------------------------------------
Wisconsin S/S Tennessee Gas Pipeline Ameritech Credit Corporation 1556583 01/05/1996 Lease No. 001-0127159-012
Company Div- 2550 W. Golf Road dated 12/10/1993
Walker Manufacturing Rolling Meadows, IL 60008
Company
1201 Michigan Blvd.
Racine, WI 53402
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
45
<PAGE> 249
<TABLE>
<CAPTION>
JURISDICTION DEBTOR SECURED PARTY FILE NUMBER DATE FILED COLLATERAL
- ------------ ------ ------------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Wisconsin S/S Walker Manufacturing Data Sales Co., Inc. 1473650 12/12/1994 Lease 6-9600, Schedule 3A
Company, a 3450 West Burnsville Parkway
Division of Tennessee Burnsville, MN 55337
Gas Pipeline Assigned to: 1512522 06/02/1995
Company Manufacturers Bank Assignment
1201 Michigan Blvd. 1200 North Ashland Avenue
Racine, WI 53402 Chicago, IL 60622
Assigned to: 1592896 06/10/1996
Monroe Bank & Trust Assignment
102 E. Front Street
Monroe, MI 48161
- ------------------------------------------------------------------------------------------------------------------------------------
Wisconsin S/S Walker Manufacturing Forum Financial Group, Inc. 1627798 11/11/1996 Equipment Lease Schedule
1201 Michigan Blvd. 2201 N. Central Expwy. #148 2220-48
Racine, WI 53402 Richardson, TX 75080
Assigned to:
Colorado National Leasing,
Inc.
950 17th St. #1400
Denver, CO 80202
- ------------------------------------------------------------------------------------------------------------------------------------
Wisconsin S/S Walker Manufacturing Co. Forum Financial Group, Inc. 1705108 10/03/1997 Equipment Lease Schedule
1201 Michigan Blvd. 2201 N. Central Expwy. #148 5010-07
Racine, WI 53402 Richardson, TX 75080
Assigned to:
Texas Central Bank
8144 Walnut Hill LB94
Dallas, TX 7231-4316
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
46
<PAGE> 250
SCHEDULE 7.3(F) DRAFT 09/24/99
(FOREIGN LIENS)
<TABLE>
<CAPTION>
COUNTRY ENTITY BANK LIMIT(1) LIMIT(2) PURPOSE LIEN
- ---- ---------- ---------------- ------------- ------------ -------- ----------- ------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1 Argentina Fric Rot Galicia Bank ARS 500K 500 Overdraft Right of set-off, right to preferential
S.A.I.C. facility -- payment or other encumbrance on deposits
Working or other assets in bank's possession
Capital from time to time(3)
- ---- ---------- ---------------- ------------- ------------ -------- ----------- ------------------------------------------
2 Australia Monroe Westpac AUD 250K 160 Overdraft Right of set-off, right to preferential
Australia/Monroe Banking Corp facility payment or other encumbrance on deposits
Springs or other assets in bank's possession
Australia/Walker from time to time(3)
Australia
- ---- ---------- ---------------- ------------- ------------ -------- ----------- ------------------------------------------
3 Australia Monroe Westpac AUD 13.5M 8,659 Standby Right of set-off, right to preferential
Australia/Monroe Banking Corp overdraft payment or other encumbrance on deposits
Springs facility or other assets in bank's possession
Australia/Walker from time to time(3)
Australia
- ---- ---------- ---------------- ------------- ------------ -------- ----------- ------------------------------------------
4 Australia Monroe Westpac AUD 1.6M 1,026 Guarantee Right of set-off, right to preferential
Australia/Monroe Banking Corp facility payment or other encumbrance on deposits
Springs or other assets in bank's possession
Australia/Walker from time to time(3)
Australia
- ---- ---------- ---------------- ------------- ------------ -------- ----------- ------------------------------------------
5 Australia Monroe Westpac AUD 247K 158 Long term Right of set-off, right to preferential
Australia/Monroe Banking Corp lease payment or other encumbrance on deposits
Springs facility or other assets in bank's possession
Australia/Walker from time to time(3)
Australia
- ---- ---------- ---------------- ------------- ------------ -------- ----------- ------------------------------------------
6 Australia Monroe Westpac AUD 300K 192 Trade Right of set-off, right to preferential
Australia/Monroe Banking Corp finance payment or other encumbrance on deposits
Springs facility or other assets in bank's possession
Australia/Walker from time to time(3)
Australia
- ---- ---------- ---------------- ------------- ------------ -------- ----------- ------------------------------------------
7 Belgium Tenneco Artesia BEF 155M 3,983 Short term Right of set-off, right to preferential
Automotive credit payment or other encumbrance on deposits
Europe NV facility -- or other assets in bank's possession
Working from time to time(3)
Capital
- ---- ---------- ---------------- ------------- ------------ -------- ----------- ------------------------------------------
8 Belgium Tenneco Bank BEF 150M 3,855 Short term Right of set-off, right to preferential
Automotive Brussels credit payment or other encumbrance on deposits
Europe NV Lambert facility -- or other assets in bank's possession
Working from time to time(3)
Capital
</TABLE>
<PAGE> 251
<TABLE>
<CAPTION>
COUNTRY ENTITY BANK LIMIT(1) LIMIT(2) PURPOSE LIEN
- ---- ---------- --------------- ------------- ------------ -------- -------------- ------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
9 Belgium Tenneco A.S.L.K. BEF 25M 642 Short term Right of set-off, right to preferential
Automotive credit payment or other encumbrance on deposits
Europe NV facility - or other assets in bank's possession
Working from time to time(3)
Capital
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
10 Brazil Tenneco HSBC Drawn: BRL 700 Overdraft Right of set-off, right to preferential
Automotive Bamerindus 1.31M facility - payment or other encumbrance on deposits
Brazil Ltda Working or other assets in bank's possession
Capital from time to time(3)
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
11 Brazil Tenneco HSBC BRL 5M 2,671 Short term Right of set-off, right to preferential
Automotive Bamerindus credit payment or other encumbrance on deposits
Brazil Ltda facility - or other assets in bank's possession
Working from time to time(3)
Capital
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
12 Brazil Tenneco Banco ABC BRL 10M 5,342 Short term Right of set-off, right to preferential
Automotive Brasil credit payment or other encumbrance on deposits
Brazil Ltda facility or other assets in bank's possession
from time to time(3)
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
13 Brazil Tenneco Banco Real BRL 450K 240 Overdraft - Right of set-off, right to preferential
Automotive S/A Working payment or other encumbrance on deposits
Brazil Ltda Capital or other assets in bank's possession
from time to time(3)
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
14 Brazil Tenneco Banco Real BRL 3.6M 1,923 Short term Right of set-off, right to preferential
Automotive S/A credit payment or other encumbrance on deposits
Brazil Ltda facility - or other assets in bank's possession
Working from time to time(3)
Capital
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
15 Brazil Tenneco Banco Real BRL 7M 3,739 Short term Right of set-off, right to preferential
Automotive Investimentos credit payment or other encumbrance on deposits
Brazil Ltda facility or other assets in bank's possession
from time to time(3)
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
16 Brazil Tenneco Dresdner BRL 7M 3,739 Short term Right of set-off, right to preferential
Automotive Bank credit payment or other encumbrance on deposits
Brazil Ltda facility or other assets in bank's possession
from time to time(3)
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
17 Brazil Tenneco Unibanco BRL 5M 2,671 Short term Right of set-off, right to preferential
Automotive credit payment or other encumbrance on deposits
Brazil Ltda or other assets in bank's possession
from time to time(3)
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
18 Brazil Tenneco Banco BRL 1.3M 694 Export Line Right of set-off, right to preferential
Automotive Sudameris payment or other encumbrance on deposits
Brazil Ltda or other assets in bank's possession
from time to time(3)
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
19 Brazil Tenneco Citibank BRL 395K 211 BNDES Right of set-off, right to preferential
Automotive Financing payment or other encumbrance on deposits
Brazil Ltda or other assets in bank's possession
from time to time(3)
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
20 Canada TCI-Automotive Bank of USD 10M 10,000 Undocumented Right of set-off, right to preferential
Montreal line, payment or other encumbrance on deposits
advised or other assets in bank's possession
limit, from time to time(3)
includes
drawings in
CAD and USD
</TABLE>
2
<PAGE> 252
<TABLE>
<CAPTION>
COUNTRY ENTITY BANK LIMIT(1) LIMIT(2) PURPOSE LIEN
- ---- ---------- --------------- ------------- ------------ ------ ------------- ------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
21 China Beijing Finance RMB 750K 91 Short term Right of set-off, right to preferential
Monroe Shock Bureau, working payment or other encumbrance on deposits
Absorber China capital loan or other assets in bank's possession
Company from time to time(3)
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
22 China Beijing Industrial & Drawn: 1,099 Short term Pledge over assets
Monroe Shock Commercial RMB 9.1M working
Absorber Bank of capital loan
Company China
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
23 China Beijing Dai-ichi USD 1.5M 1,500 Short term Right of set-off, right to preferential
Monroe Shock Kangyo Bank working payment or other encumbrance on deposits
Absorber capital loan or other assets in bank's possession
Company supported by from time to time(3)
Tenneco Inc.
guarantee
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
24 China Beijing Localization RMB 5M 604 Long term Right of set-off, right to preferential
Monroe Shock loan/Planning capex loan payment or other encumbrance on deposits
Absorber committee or other assets in bank's possession
Company from time to time(3)
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
25 China Beijing Localization Drawn: 725 Long term Right of set-off, right to preferential
Monroe Shock loan/CBC RMB 6M capex loan payment or other encumbrance on deposits
Absorber or other assets in bank's possession
Company from time to time(3)
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
26 China Dalian Industrial & Drawn: 1,486 Short term Pledge over assets
Walker-Gillet Commercial RMB 12.3M working
Auto Muffler Bank, China capital loan
Company
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
27 Czech Monroe Czechia Komercni CZK 20M 570 Overdraft Right of set-off, right to preferential
Republic Banka facility - payment or other encumbrance on deposits
Liberec Working or other assets in bank's possession
Capital from time to time(3)
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
28 Denmark Walker Den Danske DKK 20M 2,794 Overdraft Right of set-off, right to preferential
Danmark A/S Bank facility/ payment or other encumbrance on deposits
Working or other assets in bank's possession
Capital from time to time(3)
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
29 Denmark Walker Den Danske DKK 3.8M 531 Multi-currency Right of set-off, right to preferential
Danmark A/S Bank overdraft payment or other encumbrance on deposits
facility or other assets in bank's possession
(EUR/DEM/NLG) from time to time(3)
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
30 France Gillet Tubes SODIEST Drawn: 472 Long term Right of set-off, right to preferential
Technologies (Development FRF 2.99M loan, payment or other encumbrance on deposits
Agency) matures May or other assets in bank's possession
2002 from time to time(3)
Capital
Expenditure
Finance
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
31 France Gillet Tubes SODIEST Drawn: 52 Long term Right of set-off, right to preferential
Technologies (Development FRF 330K loan, payment or other encumbrance on deposits
Agency) matures or other assets in bank's possession
January 2001 from time to time(3)
C apital
Expenditure
Finance
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
32 France Wimetal Banque FRF 150M 23,685 Bill Without recourse discounting facility
Nationale discounting -
de Paris Working
Capital
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
33 France Wimetal Sogenal FRF 40M 6,316 Overdraft Right of set-off, right to preferential
facility payment or other encumbrance on deposits
or other assets in bank's possession from
time to time(3)
</TABLE>
3
<PAGE> 253
<TABLE>
<CAPTION>
COUNTRY ENTITY BANK LIMIT(1) LIMIT(2) PURPOSE LIEN
- ---- ---------- --------------- ------------- ------------ -------- -------------- ------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
34 France Wimetal Sogenal FRF 150M 23,685 Bill Without recourse discounting facility
discounting
facility --
without
recourse
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
35 Germany Tenneco Commerzbank, DEM 16.3M 8,631 German Right of set-off, right to preferential
Deutschland Neustadt cashpool payment or other encumbrance on deposits
Holdings overdraft or other assets in bank's possession
Gesellschaft facility from time to time(3)
mbH (plus DEM
8.9 million
daylight
overdraft),
guaranteed by
Tenneco Inc.
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
36 Germany Heinrich Commerzbank See #36 Overdraft Right of set-off, right to preferential
Gillet GmbH & (ledger payment or other encumbrance on deposits
Co. KG balance) or other assets in bank's possession
Part of from time to time(3)
German
cashpool
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
37 Germany Tenneco Commerzbank See #36 Overdraft Right of set-off, right to preferential
Automotive (ledger payment or other encumbrance on deposits
Deutschland balance) or other assets in bank's possession
Part of from time to time(3)
German
cashpool
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
38 India Hydraulics Ltd Citibank INR 25M 575 Working Right of set-off, right to preferential
Capital payment or other encumbrance on deposits
facility, or other assets in bank's possession
guaranteed from time to time(3)
by Tenneco
Inc.
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
39 India Hydraulics Ltd Citibank Drawn: 805 Working Right of set-off, right to preferential
INR 35M Capital payment or other encumbrance on deposits
facility, or other assets in bank's possession
guaranteed from time to time(3)
by Tenneco
Inc.
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
40 India Hydraulics Ltd Bank of INR 150M 3,450 Long term Right of set-off, right to preferential
America loan payment or other encumbrance on deposits
supported by or other assets in bank's possession
Tenneco Inc. from time to time(3)
guarantee,
matures in
June 2000
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
41 India Hydraulics Ltd Bank of INR 225M 5,175 Short term Right of set-off, right to preferential
America working payment or other encumbrance on deposits
capital or other assets in bank's possession
loan, from time to time(3)
Tenneco Inc.
guarantee
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
42 India Renowned Auto Various INR 5.2M 120 Long term Right of set-off, right to preferential
Products loan -- payment or other encumbrance on deposits
Manufacturers Working or other assets in bank's possession
Capital from time to time(3)
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
43 India Renowned Auto SIPCOT INR 5,140 0 Term loan-- Right of set-off, right to preferential
Products matures June payment or other encumbrance on deposits
Manufacturers 2000 or other assets in bank's possession
Sales Tax from time to time(3)
Financing
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
44 India Renowned Auto SIPCOT INR 3.8M 87 Term loan, Right of set-off, right to preferential
Products matures June payment or other encumbrance on deposits
Manufacturers 2000 or other assets in bank's possession
Working from time to time(3)
Capital
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
45 India Walker Bank of INR 110M 2,530 Term loan Right of set-off, right to preferential
Exhaust India America supported by payment or other encumbrance on deposits
Pvt. Ltd. Tenneco Inc. or other assets in bank's possession
guarantee from time to time(3)
</TABLE>
4
<PAGE> 254
<TABLE>
<CAPTION>
COUNTRY ENTITY BANK LIMIT(1) LIMIT(2) PURPOSE LIEN
- ---- ---------- --------------- ------------- ------------ -------- -------------- ------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
46 India Walker Bank of INR 35M 805 Short term Right of set-off, right to preferential
Exhaust India America working payment or other encumbrance on deposits
Pvt. Ltd capital loan or other assets in bank's possession
supported by from time to time(3)
Tenneco Inc.
guarantee
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
47 Italy Tenneco Credito ITL 180M 4,140 Overdraft Right of set-off, right to preferential
Automotive Italiano SpA facility -- payment or other encumbrance on deposits
Italia Srl Working or other assets in bank's possession
Capital from time to time(3)
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
48 New Monroe Westpac NZD 250K 130 Overdraft Right of set-off, right to preferential
Zealand Springs New Banking Corp facility -- payment or other encumbrance on deposits
Zealand Working or other assets in bank's possession
Capital from time to time(3)
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
49 Poland Tenneco Citibank, PLN 35M 8,550 Short term Right of set-off, right to preferential
Automotive Poland credit payment or other encumbrance on deposits
Polska facility or other assets in bank's possession
supported by from time to time(3)
Tenneco Inc.
guarantee --
Working
Capital
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
50 Singapore Tenneco Asia Bank of SGD 500K 294 Overdraft Right of set-off, right to preferential
America, facility payment or other encumbrance on deposits
Singapore supported by or other assets in bank's possession
Tenneco Inc. from time to time(3)
letter of
comfort
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
51 Singapore Tenneco Citibank, USD 1M 1,000 Overdraft Right of set-off, right to preferential
Automotive Singapore facility payment or other encumbrance on deposits
Asia supported by or other assets in bank's possession
(T.A.T.C) Tenneco Inc. from time to time(3)
guarantee
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
52 South Armstrong First ZAR 10M 1,643 Short term Right of set-off, right to preferential
Africa Hydraulics National working payment or other encumbrance on deposits
Bank capital line or other assets in bank's possession
supported by from time to time(3)
Tenneco
Automotive
Holdings SA
guarantee
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
53 South Armstrong ABSA Bank ZAR 9M 1,479 Short term Right of set-off, right to preferential
Africa Hydraulics working payment or other encumbrance on deposits
capital or other assets in bank's possession
facility from time to time(3)
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
54 Spain Tenneco Banco ESP 3.3BN 20,543 Long term Secured by underlying assets
Automotive Santander capital
Iberica lease --
matures Sept
2009 (to be
signed
before
Spin-Off)
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
55 Spain Tenneco Banco ESP 150M 933 Guarantee Right of set-off, right to preferential
Automotive Santander facility payment or other encumbrance on deposits
Iberica or other assets in bank's possession
from time to time(3)
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
56 Spain Tenneco Banco ESP 178M 1,108 Finance Secured by underlying asset
Automotive Santander lease for
Iberica plant
machinery
- ---- ---------- --------------- ------------- ------------ ------ -------------- ------------------------------------------
57 Sweden Tenneco Sparbanken SEK 5M 604 Overdraft Right of set-off, right to preferential
Automotive facility -- payment or other encumbrance on deposits
Sweden Working or other assets in bank's possession
Capital from time to time(3)
</TABLE>
5
<PAGE> 255
<TABLE>
<CAPTION>
COUNTRY ENTITY BANK LIMIT(1) LIMIT(2) PURPOSE LIEN
- --- -------- ------------- ---------- ---------- -------- -------------- ----------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
58 Turkey Monroe Iktisat TRL 85BN 184 Overdraft-- Right of set-off, right to preferential
Amortisor Bankasi Working payment or other encumbrance on deposits
Capital or other assets in bank's possession
from time to time(3)
- --- -------- ------------- ---------- ---------- -------- -------------- ----------------------------------------
59 Turkey Monroe Is Bankasi TRL 100BN 217 Short term Right of set-off, right to preferential
Amortisor credit payment or other encumbrance on deposits
facility or other assets in bank's possession
(overdraft/ from time to time(3)
guarantees
supported by
TMEL letter
of comfort
- --- -------- ------------- ---------- ---------- -------- -------------- ----------------------------------------
60 UK Tenneco Barclays GBP 2.5M 4,051 Overdraft Right of set-off, right to preferential
Walker UK Bank facility-- payment or other encumbrance on deposits
cross or other assets in bank's possession
guarantee from time to time(3)
Part of UK
cashpool
- --- -------- ------------- ---------- ---------- -------- -------------- ----------------------------------------
61 UK Tenneco Barclays GBP 500K 810 Overdraft Right of set-off, right to preferential
Automotive UK Bank facility-- payment or other encumbrance on deposits
Ltd cross or other assets in bank's possession
guarantee from time to time(3)
Part of UK
cashpool
- --- -------- ------------- ---------- ---------- -------- -------------- ----------------------------------------
62 UK Tenneco Bank of GBP 100K 162 Overdraft Right of set-off, right to preferential
Europe Ltd America facility payment or other encumbrance on deposits
or other assets in bank's possession
from time to time(3)
- --- -------- ------------- ---------- ---------- -------- -------------- ----------------------------------------
63 UK Tenneco Bank of USD 25M 25,000 Credit Right of set-off, right to preferential
Management America, facility payment or other encumbrance on deposits
(Europe) London supported by or other assets in bank's possession
Limited Tenneco Inc. from time to time(3)
guarantee
- --- -------- ------------- ---------- ---------- -------- -------------- ----------------------------------------
64 UK Tenneco KBC Bank, USD 25M 25,000 Credit Right of set-off, right to preferential
Management London facility payment or other encumbrance on deposits
(Europe) supported by or other assets in bank's possession
Limited Tenneco Inc. from time to time(3)
comfort
letter
- --- -------- ------------- ---------- ---------- -------- -------------- ----------------------------------------
65 France Tenneco Banque FRF 100M 15,790 Credit Right of set-off, right to preferential
Management Nationale facility payment or other encumbrance on deposits
(Europe) de Paris, supported by or other assets in bank's possession
Limited Laval Tenneco Inc. from time to time(3)
comfort
letter
- --- -------- ------------- ---------- ---------- -------- -------------- ----------------------------------------
66 UK Tenneco Banque USD 25M 25,000 Credit Right of set-off, right to preferential
Management Nationale facility payment or other encumbrance on deposits
(Europe) de Paris, supported by or other assets in bank's possession
Limited London Tenneco Inc. from time to time(3)
comfort
letter
- --- -------- ------------- ---------- ---------- -------- -------------- ----------------------------------------
67 UK Tenneco Barclays GBP 2M 3,240 Overdraft-- Right of set-off, right to preferential
Management Bank Plc, Cross payment or other encumbrance on deposits
(Europe) London Guarantee or other assets in bank's possession
Limited Part of UK from time to time(3)
cashpool
- --- -------- ------------- ---------- ---------- -------- -------------- ----------------------------------------
TOTAL: 276,771
</TABLE>
(1) In local currency.
(2) In U.S. dollars (000), using the following exchange rates as of September
20, 1999:
6
<PAGE> 256
1 ARS = 1.0002 USD
1 AUD = .6414 USD
1 BEF = .0257 USD
1 BRL = .5342 USD
1 CAD = .6764 USD
1 RMD = .1208 USD
1 CZK = .02849 USD
1 DKK = .1397 USD
1 FRF = .1579 USD
1 DEM = .5295 USD
1 INR = .02300 USD
1 ITL = .0005349 USD
1 NZD = .5218 USD
1 PLN = .2443 USD
1 PTE = .005166 USD
1 SGD = .5872 USD
1 ZAR = .1643 USD
1 ESP = .006225 USD
1 SEK = .1207 USD
1 TRL = .00000217 USD
1 GBP = 1.6202 USD
3 Under applicable law the various rights may or may not constitute Liens.
7
<PAGE> 257
SCHEDULE 7.5
PLANNED DISPOSITIONS
None.
-3-
<PAGE> 258
SCHEDULE 7.8(I)
INVESTMENTS
<TABLE>
<CAPTION>
Owner Description Value
<S> <C>
Tenneco Canada Inc. Preferred Stock in Carquest $2,010,600
Tenneco Canada Inc. Notes Receivable from $10,440,607
BrakePro
Tenneco Automotive Inc. Notes Receivable from $11,683,832
BrakePro
</TABLE>
Existing Investments by the Borrower and its Subsidiaries in Subsidiaries
and Joint Ventures.
-4-
<PAGE> 259
EXHIBIT A
TO THE CREDIT AGREEMENT
================================================================================
GUARANTEE AND COLLATERAL AGREEMENT
made by
TENNECO AUTOMOTIVE INC.
[OTHER GRANTORS]
in favor of
THE CHASE MANHATTAN BANK,
as Administrative Agent
Dated as of ____________, 1999
================================================================================
<PAGE> 260
TABLE OF CONTENTS
Page
SECTION 1 DEFINED TERMS.......................................................2
1.1 Definitions..........................................................2
1.2 Other Definitional Provisions........................................6
SECTION 2. GUARANTEE..........................................................6
2.1 Guarantee............................................................7
2.2 Right of Contribution................................................7
2.3 No Subrogation.......................................................8
2.4 Amendments, etc. with respect to the Borrower Obligations............8
2.5 Guarantee Absolute and Unconditional.................................8
2.6 Reinstatement........................................................9
2.7 Payments.............................................................9
SECTION 3. GRANT OF SECURITY INTEREST.........................................9
SECTION 4. REPRESENTATIONS AND WARRANTIES....................................10
4.1 Title; No Other Liens...............................................10
4.2 Perfected First Priority Liens......................................10
4.3 Chief Executive Office..............................................11
4.4 Inventory and Equipment.............................................11
4.5 Farm Products.......................................................11
4.6 Investment Property.................................................11
4.7 Receivables.........................................................11
4.8 Intellectual Property...............................................12
SECTION 5. COVENANTS.........................................................12
5.1 Delivery of Instruments, Certificated Securities and Chattel Paper..12
5.2 Maintenance of Insurance............................................12
5.3 Payment of Obligations..............................................13
5.4 Maintenance of Perfected Security Interest; Further Documentation...13
5.5 Changes in Locations, Name, etc.....................................14
5.6 Notices.............................................................14
5.7 Investment Property.................................................14
5.8 Receivables.........................................................15
5.9 Intellectual Property...............................................16
SECTION 6. REMEDIAL PROVISIONS...............................................17
6.1 Certain Matters Relating to Receivables.............................17
6.2 Communications with Obligors; Grantors Remain Liable................18
6.3 Pledged Stock.......................................................18
6.4 Proceeds to be Turned Over To Administrative Agent..................19
i
<PAGE> 261
Page
6.5 Application of Proceeds....................................... 20
6.6 Code and Other Remedies....................................... 20
6.7 Registration Rights........................................... 21
6.8 Waiver; Deficiency............................................ 22
SECTION 7. THE ADMINISTRATIVE AGENT.................................... 22
7.1 Administrative Agent's Appointment as Attorney-in-Fact, etc... 22
7.2 Duty of Administrative Agent.................................. 24
7.3 Execution of Financing Statements............................. 24
7.4 Authority of Administrative Agent............................. 24
SECTION 8. MISCELLANEOUS............................................... 25
8.1 Amendments in Writing......................................... 25
8.2 Notices....................................................... 25
8.3 No Waiver by Course of Conduct; Cumulative Remedies........... 25
8.4 Enforcement Expenses; Indemnification......................... 25
8.5 Successors and Assigns........................................ 26
8.6 Set-Off....................................................... 26
8.7 Counterparts.................................................. 26
8.8 Severability.................................................. 26
8.9 Section Headings.............................................. 27
8.10 Integration................................................... 27
8.11 GOVERNING LAW................................................. 27
8.12 Submission To Jurisdiction; Waivers........................... 27
8.13 Acknowledgements.............................................. 28
8.14 Additional Grantors........................................... 28
8.15 Releases.......................................................28
8.16 WAIVER OF JURY TRIAL...........................................29
SCHEDULES
Schedule 1 Notice Addresses
Schedule 2 Investment Property
Schedule 3 Perfection Matters
Schedule 4 Jurisdictions of Organization and Chief Executive Offices
Schedule 5 Inventory and Equipment Locations
Schedule 6 Intellectual Property
ANNEX
Annex 1 Assumption Agreement
ii
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GUARANTEE AND COLLATERAL AGREEMENT
GUARANTEE AND COLLATERAL AGREEMENT, dated as of November 4, 1999, made by
each of the signatories hereto (together with any other entity that may become a
party hereto as provided herein, the "GRANTORS"), in favor of THE CHASE
MANHATTAN BANK, as Administrative Agent (in such capacity, the "ADMINISTRATIVE
AGENT") for the banks and other financial institutions (the "LENDERS") from time
to time parties to the Credit Agreement, dated as of September 30, 1999 (as
amended, supplemented or otherwise modified from time to time, the "CREDIT
AGREEMENT"), among Tenneco Inc., a Delaware corporation (the "BORROWER"), the
Lenders, Commerzbank, AG and Bank of America, N.A., as co-documentation agents,
Citicorp USA, Inc., as syndication agent, and the Administrative Agent.
W I T N E S S E T H:
WHEREAS, pursuant to the Credit Agreement, the Lenders have severally
agreed to make extensions of credit to the Borrower upon the terms and subject
to the conditions set forth therein;
WHEREAS, the Borrower is a member of an affiliated group of companies that
includes each other Grantor;
WHEREAS, the proceeds of the extensions of credit under the Credit
Agreement will be used in part to enable the Borrower to make valuable transfers
to one or more of the other Grantors in connection with the operation of their
respective businesses;
WHEREAS, the Borrower and the other Grantors are engaged in related
businesses, and each Grantor will derive substantial direct and indirect benefit
from the making of the extensions of credit under the Credit Agreement; and
WHEREAS, it is a condition precedent to the obligation of the Lenders to
make their respective extensions of credit to the Borrower under the Credit
Agreement that the Grantors shall have executed and delivered this Agreement to
the Administrative Agent for the ratable benefit of the Lenders;
NOW, THEREFORE, in consideration of the premises and to induce the
Administrative Agent and the Lenders to enter into the Credit Agreement and to
induce the Lenders to make their respective extensions of credit to the Borrower
thereunder, each Grantor hereby agrees with the Administrative Agent, for the
ratable benefit of the Lenders, as follows:
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2.
SECTION 1. DEFINED TERMS
1.1 DEFINITIONS. (a) Unless otherwise defined herein, terms defined in
the Credit Agreement and used herein shall have the meanings given to them in
the Credit Agreement, and the following terms are used herein as defined in the
New York UCC: Accounts, Certificated Security, Chattel Paper, Documents,
Equipment, Farm Products, Instruments and Inventory.
(b) The following terms shall have the following meanings:
"AGREEMENT": this Guarantee and Collateral Agreement, as the same may
be amended, supplemented or otherwise modified from time to time.
"BORROWER OBLIGATIONS": the collective reference to the unpaid
principal of and interest on the Loans and Reimbursement Obligations and
all other obligations and liabilities of the Borrower (including, without
limitation, interest accruing at the then applicable rate provided in the
Credit Agreement after the maturity of the Loans and Reimbursement
Obligations and interest accruing at the then applicable rate provided in
the Credit Agreement after the filing of any petition in bankruptcy, or the
commencement of any insolvency, reorganization or like proceeding, relating
to the Borrower, whether or not a claim for post-filing or post-petition
interest is allowed in such proceeding) to the Administrative Agent or any
Lender (or, in the case of any Lender Hedge Agreement, any Affiliate of any
Lender), whether direct or indirect, absolute or contingent, due or to
become due, or now existing or hereafter incurred, which may arise under,
out of, or in connection with, the Credit Agreement, this Agreement, the
other Loan Documents, any Letter of Credit, any Lender Hedge Agreement or
any other document made, delivered or given in connection with any of the
foregoing, in each case whether on account of principal, interest,
reimbursement obligations, fees, indemnities, costs, expenses or otherwise
(including, without limitation, all fees and disbursements of counsel to
the Administrative Agent or to the Lenders that are required to be paid by
the Borrower pursuant to the terms of any of the foregoing agreements).
"COLLATERAL": as defined in Section 3.
"COLLATERAL ACCOUNT": any collateral account established by the
Administrative Agent as provided in Section 6.1 or 6.4.
"COPYRIGHTS": (i) all copyrights arising under the laws of the United
States, any other country or any political subdivision thereof, whether
registered or unregistered and whether published or unpublished (including,
without limitation, those listed in SCHEDULE 6), all registrations and
recordings thereof, and all applications in connection therewith,
including, without limitation, all registrations, recordings and
applications in the United States Copyright Office, and (ii) the right to
obtain all renewals thereof.
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3.
"COPYRIGHT LICENSES": any written agreement naming any Grantor as
licensor or, any written agreement naming any Grantor as licensee to the
extent such agreement permits the Grantor to grant a security interest in
its rights thereunder, including, without limitation, those listed in
SCHEDULE 6, granting any right under any Copyright, including, without
limitation, the grant of rights to manufacture, distribute, exploit and
sell materials derived from any Copyright.
"DEPOSIT ACCOUNT": as defined in the Uniform Commercial Code of any
applicable jurisdiction and, in any event, including, without limitation,
any demand, time, savings, passbook or like account maintained with a
depositary institution.
"FOREIGN SUBSIDIARY": any Subsidiary organized under the laws of any
jurisdiction outside the United States of America.
"FOREIGN SUBSIDIARY VOTING STOCK": the voting Capital Stock of any
Foreign Subsidiary.
"GENERAL INTANGIBLES": all "general intangibles" as such term is
defined in Section 9-106 of the New York UCC and, in any event, including,
without limitation, with respect to any Grantor, all contracts, agreements,
instruments and indentures in any form, and portions thereof, to which such
Grantor is a party or under which such Grantor has any right, title or
interest or to which such Grantor or any property of such Grantor is
subject, as the same may from time to time be amended, supplemented or
otherwise modified, including, without limitation, (i) all rights of such
Grantor to receive moneys due and to become due to it thereunder or in
connection therewith, (ii) all rights of such Grantor to damages arising
thereunder and (iii) all rights of such Grantor to perform and to exercise
all remedies thereunder.
"GUARANTOR OBLIGATIONS": with respect to any Guarantor, all
obligations and liabilities of such Guarantor which may arise under or in
connection with this Agreement (including, without limitation, Section 2)
or any other Loan Document to which such Guarantor is a party, in each case
whether on account of guarantee obligations, reimbursement obligations,
fees, indemnities, costs, expenses or otherwise (including, without
limitation, all fees and disbursements of counsel to the Administrative
Agent or to the Lenders that are required to be paid by such Guarantor
pursuant to the terms of this Agreement or any other Loan Document).
"GUARANTORS": the collective reference to each Grantor other than the
Borrower.
"IMMATERIAL FOREIGN SUBSIDIARY": at any time, any Foreign Subsidiary
of the Borrower having total assets (as determined in accordance with GAAP)
in an amount of less than 1% of Consolidated Total Assets of the Borrower;
provided, however, that the total assets (as so determined) of all
Immaterial Foreign Subsidiaries shall not exceed 5% of Consolidated Total
Assets of the Borrower. In the event that the total assets of all
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4.
Immaterial Foreign Subsidiaries exceed 5% of Consolidated Total Assets
of the Borrower, the Borrower will designate Foreign Subsidiaries which
would otherwise constitute Immaterial Foreign Subsidiaries to be executed
as Immaterial Foreign Subsidiaries until such 5% threshold is met.
"INTELLECTUAL PROPERTY": the collective reference to all rights,
priorities and privileges relating to intellectual property, whether
arising under United States, multinational or foreign laws or otherwise,
including, without limitation, the Copyrights, the Copyright Licenses, the
Patents, the Patent Licenses, the Trademarks and the Trademark Licenses,
and all rights to sue at law or in equity for any infringement or other
impairment thereof, including the right to receive all proceeds and damages
therefrom.
"INTERCOMPANY NOTE": any promissory note evidencing loans made by any
Grantor to the Borrower or any of its Subsidiaries.
"INVESTMENT PROPERTY": the collective reference to (i) all "investment
property" as such term is defined in Section 9-115 of the New York UCC
(other than any Foreign Subsidiary Voting Stock excluded from the
definition of "Pledged Stock") and (ii) whether or not constituting
"investment property" as so defined, all Pledged Notes and all Pledged
Stock.
"ISSUERS": the collective reference to each issuer of any Investment
Property.
"LENDER HEDGE AGREEMENTS": all interest rate swaps, caps or collar
agreements or similar arrangements entered into by the Borrower with any
Lender (or any Affiliate of any Lender) providing for protection against
fluctuations in interest rates or currency exchange rates or the exchange
of nominal interest obligations, either generally or under specific
contingencies.
"NEW YORK UCC": the Uniform Commercial Code as from time to time in
effect in the State of New York.
"OBLIGATIONS": (i) in the case of the Borrower, the Borrower
Obligations, and (ii) in the case of each Guarantor, its Guarantor
Obligations.
"PATENTS": (i) all letters patent of the United States, any other
country or any political subdivision thereof, all reissues and extensions
thereof and all goodwill associated therewith, including, without
limitation, any of the foregoing referred to in SCHEDULE 6, (ii) all
applications for letters patent of the United States or any other country
and all divisions, continuations and continuations-in-part thereof,
including, without limitation, any of the foregoing referred to in SCHEDULE
6, and (iii) all rights to obtain any reissues or extensions of the
foregoing.
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5.
"PATENT LICENSE": all agreements, whether written or oral, providing
for (i) the grant by any Grantor of any right to manufacture, use or sell
any invention covered in whole or in part by a Patent and (ii) the grant to
any Grantor of any right to manufacture, use or sell any invention covered
in whole or in part by a Patent (to the extent such agreement permits the
Grantor to grant a security interest in its rights thereunder), including,
without limitation, any of the foregoing referred to in SCHEDULE 6.
"PLEDGED NOTES": all promissory notes listed on SCHEDULE 2, all
Intercompany Notes at any time issued to any Grantor and all other
promissory notes issued to or held by any Grantor (other than promissory
notes issued in connection with extensions of trade credit by any Grantor
in the ordinary course of business).
"PLEDGED STOCK": the shares of Capital Stock listed on SCHEDULE 2,
together with any other shares, stock certificates, options or rights of
any nature whatsoever in respect of the Capital Stock of any Person that
may be issued or granted to, or held by, any Grantor while this Agreement
is in effect other than the Capital Stock of any Immaterial Foreign
Subsidiary; PROVIDED that in no event shall more than 66% of the total
outstanding Foreign Subsidiary Voting Stock of any Foreign Subsidiary be
required to be pledged hereunder, provided, further, that the Borrower
shall not be obligated to pledge the Capital Stock of a Foreign Subsidiary
to the extent such pledge would violate the laws of the jurisdiction of
such Foreign Subsidiary's organization.
"PROCEEDS": all "proceeds" as such term is defined in Section 9-306(1)
of the New York UCC and, in any event, shall include, without limitation,
all dividends or other income from the Investment Property, collections
thereon or distributions or payments with respect thereto.
"RECEIVABLE": any right to payment for goods sold or leased or for
services rendered, whether or not such right is evidenced by an Instrument
or Chattel Paper and whether or not it has been earned by performance
(including, without limitation, any Account).
"SECURITIES ACT": the Securities Act of 1933, as amended.
"TRADEMARKS": (i) all trademarks, trade names, corporate names,
company names, business names, fictitious business names, trade styles,
service marks, logos and other source or business identifiers, and all
goodwill associated therewith, now existing or hereafter adopted or
acquired, all registrations and recordings thereof, and all applications in
connection therewith, whether in the United States Patent and Trademark
Office or in any similar office or agency of the United States, any State
thereof or any other country or any political subdivision thereof, or
otherwise, and all common-law rights related thereto, including, without
limitation, any of the foregoing referred to in SCHEDULE 6, and (ii) the
right to obtain all renewals thereof.
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6.
"TRADEMARK LICENSE": any agreement, whether written or oral, providing
for (i) the grant by any Grantor of any right to use any Trademark and (ii)
the grant to any Grantor of any right to use any Trademark (to the extent
such agreement permits the Grantor to grant a security interest in its
rights thereunder), including, without limitation, any of the foregoing
referred to in SCHEDULE 6.
1.2 OTHER DEFINITIONAL PROVISIONS. (a) The words "hereof," "herein",
"hereto" and "hereunder" and words of similar import when used in this Agreement
shall refer to this Agreement as a whole and not to any particular provision of
this Agreement, and Section and Schedule references are to this Agreement unless
otherwise specified.
(b) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
(c) Where the context requires, terms relating to the Collateral or
any part thereof, when used in relation to a Grantor, shall refer to such
Grantor's Collateral or the relevant part thereof.
SECTION 2. GUARANTEE
2.1 GUARANTEE. (a) Each of the Guarantors hereby, jointly and
severally, unconditionally and irrevocably, guarantees to the Administrative
Agent, for the ratable benefit of the Lenders and their respective successors,
indorsees, transferees and assigns, the prompt and complete payment and
performance by the Borrower when due (whether at the stated maturity, by
acceleration or otherwise) of the Borrower Obligations.
(b) Anything herein or in any other Loan Document to the contrary
notwithstanding, the maximum liability of each Guarantor hereunder and under the
other Loan Documents shall in no event exceed the amount which can be guaranteed
by such Guarantor under applicable federal and state laws relating to the
insolvency of debtors (after giving effect to the right of contribution
established in Section 2.2).
(c) Each Guarantor agrees that the Borrower Obligations may at any
time and from time to time exceed the amount of the liability of such Guarantor
hereunder without impairing the guarantee contained in this Section 2 or
affecting the rights and remedies of the Administrative Agent or any Lender
hereunder.
(d) The guarantee contained in this Section 2 shall remain in full
force and effect until all the Borrower Obligations and the obligations of each
Guarantor under the guarantee contained in this Section 2 shall have been
satisfied by payment in full, no Letter of Credit shall be outstanding and the
Commitments shall be terminated, notwithstanding that from time to time
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7.
during the term of the Credit Agreement the Borrower may be free from any
Borrower Obligations.
(e) No payment made by the Borrower, any of the Guarantors, any other
guarantor or any other Person or received or collected by the Administrative
Agent or any Lender from the Borrower, any of the Guarantors, any other
guarantor or any other Person by virtue of any action or proceeding or any
set-off or appropriation or application at any time or from time to time in
reduction of or in payment of the Borrower Obligations shall be deemed to
modify, reduce, release or otherwise affect the liability of any Guarantor
hereunder which shall, notwithstanding any such payment (other than any payment
made by such Guarantor in respect of the Borrower Obligations or any payment
received or collected from such Guarantor in respect of the Borrower
Obligations), remain liable for the Borrower Obligations up to the maximum
liability of such Guarantor hereunder until the Borrower Obligations are paid in
full, no Letter of Credit shall be outstanding and the Commitments are
terminated.
2.2 RIGHT OF CONTRIBUTION. Each Guarantor hereby agrees that to the
extent that a Guarantor shall have paid more than its proportionate share of any
payment made hereunder, such Guarantor shall be entitled to seek and receive
contribution from and against any other Guarantor hereunder which has not paid
its proportionate share of such payment. Each Guarantor's right of contribution
shall be subject to the terms and conditions of Section 2.3. The provisions of
this Section 2.2 shall in no respect limit the obligations and liabilities of
any Guarantor to the Administrative Agent and the Lenders, and each Guarantor
shall remain liable to the Administrative Agent and the Lenders for the full
amount guaranteed by such Guarantor hereunder.
2.3 NO SUBROGATION. Notwithstanding any payment made by any Guarantor
hereunder or any set-off or application of funds of any Guarantor by the
Administrative Agent or any Lender, no Guarantor shall be entitled to be
subrogated to any of the rights of the Administrative Agent or any Lender
against the Borrower or any other Guarantor or any collateral security or
guarantee or right of offset held by the Administrative Agent or any Lender for
the payment of the Borrower Obligations, nor shall any Guarantor seek or be
entitled to seek any contribution or reimbursement from the Borrower or any
other Guarantor in respect of payments made by such Guarantor hereunder, until
all amounts owing to the Administrative Agent and the Lenders by the Borrower on
account of the Borrower Obligations are paid in full, no Letter of Credit shall
be outstanding and the Commitments are terminated. If any amount shall be paid
to any Guarantor on account of such subrogation rights at any time when all of
the Borrower Obligations shall not have been paid in full, such amount shall be
held by such Guarantor in trust for the Administrative Agent and the Lenders,
segregated from other funds of such Guarantor, and shall, forthwith upon receipt
by such Guarantor, be turned over to the Administrative Agent in the exact form
received by such Guarantor (duly indorsed by such Guarantor to the
Administrative Agent, if required), to be applied against the Borrower
Obligations, whether matured or unmatured, in such order as the Administrative
Agent may determine.
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8.
2.4 AMENDMENTS, ETC. WITH RESPECT TO THE BORROWER OBLIGATIONS. Each
Guarantor shall remain obligated hereunder notwithstanding that, without any
reservation of rights against any Guarantor and without notice to or further
assent by any Guarantor, any demand for payment of any of the Borrower
Obligations made by the Administrative Agent or any Lender may be rescinded by
the Administrative Agent or such Lender and any of the Borrower Obligations
continued, and the Borrower Obligations, or the liability of any other Person
upon or for any part thereof, or any collateral security or guarantee therefor
or right of offset with respect thereto, may, from time to time, in whole or in
part, be renewed, extended, amended, modified, accelerated, compromised, waived,
surrendered or released by the Administrative Agent or any Lender, and the
Credit Agreement and the other Loan Documents and any other documents executed
and delivered in connection therewith may be amended, modified, supplemented or
terminated, in whole or in part, as the Administrative Agent (or the Required
Lenders or all Lenders, as the case may be) may deem advisable from time to
time, and any collateral security, guarantee or right of offset at any time held
by the Administrative Agent or any Lender for the payment of the Borrower
Obligations may be sold, exchanged, waived, surrendered or released. Neither the
Administrative Agent nor any Lender shall have any obligation to protect,
secure, perfect or insure any Lien at any time held by it as security for the
Borrower Obligations or for the guarantee contained in this Section 2 or any
property subject thereto.
2.5 GUARANTEE ABSOLUTE AND UNCONDITIONAL. Each Guarantor waives any
and all notice of the creation, renewal, extension or accrual of any of the
Borrower Obligations and notice of or proof of reliance by the Administrative
Agent or any Lender upon the guarantee contained in this Section 2 or acceptance
of the guarantee contained in this Section 2; the Borrower Obligations, and any
of them, shall conclusively be deemed to have been created, contracted or
incurred, or renewed, extended, amended or waived, in reliance upon the
guarantee contained in this Section 2; and all dealings between the Borrower and
any of the Guarantors, on the one hand, and the Administrative Agent and the
Lenders, on the other hand, likewise shall be conclusively presumed to have been
had or consummated in reliance upon the guarantee contained in this Section 2.
Each Guarantor waives diligence, presentment, protest, demand for payment and
notice of default or nonpayment to or upon the Borrower or any of the Guarantors
with respect to the Borrower Obligations. Each Guarantor understands and agrees
that the guarantee contained in this Section 2 shall be construed as a
continuing, absolute and unconditional guarantee of payment without regard to
(a) the validity or enforceability of the Credit Agreement or any other Loan
Document, any of the Borrower Obligations or any other collateral security
therefor or guarantee or right of offset with respect thereto at any time or
from time to time held by the Administrative Agent or any Lender, (b) any
defense, set-off or counterclaim (other than a defense of payment or
performance) which may at any time be available to or be asserted by the
Borrower or any other Person against the Administrative Agent or any Lender, or
(c) any other circumstance whatsoever (with or without notice to or knowledge of
the Borrower or such Guarantor) which constitutes, or might be construed to
constitute, an equitable or legal discharge of the Borrower for the Borrower
Obligations, or of such Guarantor under the guarantee contained in this
Section 2, in bankruptcy or in any other instance. When making any demand
hereunder or otherwise pursuing its rights and remedies hereunder against any
Guarantor, the Administrative Agent or any Lender may, but shall be under
no obligation to,
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9.
make a similar demand on or otherwise pursue such rights and remedies as it may
have against the Borrower, any other Guarantor or any other Person or against
any collateral security or guarantee for the Borrower Obligations or any right
of offset with respect thereto, and any failure by the Administrative Agent or
any Lender to make any such demand, to pursue such other rights or remedies or
to collect any payments from the Borrower, any other Guarantor or any other
Person or to realize upon any such collateral security or guarantee or to
exercise any such right of offset, or any release of the Borrower, any other
Guarantor or any other Person or any such collateral security, guarantee or
right of offset, shall not relieve any Guarantor of any obligation or liability
hereunder, and shall not impair or affect the rights and remedies, whether
express, implied or available as a matter of law, of the Administrative Agent or
any Lender against any Guarantor. For the purposes hereof "demand" shall include
the commencement and continuance of any legal proceedings.
2.6 REINSTATEMENT. The guarantee contained in this Section 2 shall
continue to be effective, or be reinstated, as the case may be, if at any time
payment, or any part thereof, of any of the Borrower Obligations is rescinded or
must otherwise be restored or returned by the Administrative Agent or any Lender
upon the insolvency, bankruptcy, dissolution, liquidation or reorganization of
the Borrower or any Guarantor, or upon or as a result of the appointment of a
receiver, intervenor or conservator of, or trustee or similar officer for, the
Borrower or any Guarantor or any substantial part of its property, or otherwise,
all as though such payments had not been made.
2.7 PAYMENTS. Each Guarantor hereby guarantees that payments hereunder
will be paid to the Administrative Agent without set-off or counterclaim in
Dollars at the office of the Administrative Agent located at 270 Park Avenue,
New York, New York 10017.
SECTION 3. GRANT OF SECURITY INTEREST
Each Grantor hereby assigns and transfers to the Administrative Agent,
and hereby grants to the Administrative Agent, for the ratable benefit of the
Lenders, a security interest in, all of the following property now owned or at
any time hereafter acquired by such Grantor or in which such Grantor now has or
at any time in the future may acquire any right, title or interest
(collectively, the "COLLATERAL"), as collateral security for the prompt and
complete payment and performance when due (whether at the stated maturity, by
acceleration or otherwise) of such Grantor's Obligations:
(a) all Accounts;
(b) all Chattel Paper;
(c) all Deposit Accounts;
(d) all Documents;
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10.
(e) all Equipment;
(f) all General Intangibles;
(g) all Instruments;
(h) all Intellectual Property;
(i) all Inventory;
(j) all Investment Property;
(k) all other property not otherwise described above;
(l) all books and records pertaining to the Collateral; and
(m) to the extent not otherwise included, all Proceeds and products of
any and all of the foregoing and all collateral security and guarantees given by
any Person with respect to any of the foregoing.
SECTION 4. REPRESENTATIONS AND WARRANTIES
To induce the Administrative Agent and the Lenders to enter into the
Credit Agreement and to induce the Lenders to make their respective extensions
of credit to the Borrower thereunder, each Grantor hereby represents and
warrants to the Administrative Agent and each Lender that:
4.1 TITLE; NO OTHER LIENS. Except for the security interest granted to
the Administrative Agent for the ratable benefit of the Lenders pursuant to this
Agreement and the other Liens permitted to exist on the Collateral by the Credit
Agreement, such Grantor owns each item of the Collateral free and clear of any
and all Liens or claims of others. No financing statement or other public notice
with respect to all or any part of the Collateral is on file or of record in any
public office, except such as have been filed in favor of the Administrative
Agent, for the ratable benefit of the Lenders, pursuant to this Agreement or as
are permitted by the Credit Agreement.
4.2 PERFECTED FIRST PRIORITY LIENS. The security interests granted
pursuant to this Agreement (a) upon completion of the filings and other actions
specified on SCHEDULE 3 (which, in the case of all filings and other documents
referred to on said Schedule, have been delivered to the Administrative Agent in
completed and duly executed form) will constitute valid perfected security
interests in all of the Collateral in favor of the Administrative Agent, for the
ratable benefit of the Lenders, as collateral security for such Grantor's
Obligations, enforceable in accordance with the terms hereof against all
creditors of such Grantor and any Persons purporting
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11.
to purchase any Collateral from such Grantor and (b) are prior to all other
Liens on the Collateral in existence on the date hereof except as are permitted
by the Credit Agreement and except for unrecorded Liens permitted by the Credit
Agreement which have priority over the Liens on the Collateral by operation of
law.
4.3 CHIEF EXECUTIVE OFFICE. On the date hereof, such Grantor's
jurisdiction of organization and the location of such Grantor's chief executive
office or sole place of business are specified on SCHEDULE 4.
4.4 INVENTORY AND EQUIPMENT. On the date hereof, the Inventory and the
Equipment (other than mobile goods) are kept at the locations listed on
SCHEDULE 5.
4.5 FARM PRODUCTS. None of the Collateral constitutes, or is the
Proceeds of, Farm Products.
4.6 INVESTMENT PROPERTY. (a) The shares of Pledged Stock pledged by
such Grantor hereunder constitute all the issued and outstanding shares of all
classes of the Capital Stock of each Issuer owned by such Grantor or, in the
case of Foreign Subsidiary Voting Stock, if less, 66% of the outstanding Foreign
Subsidiary Voting Stock of each relevant Issuer.
(b) All the shares of the Pledged Stock have been duly and validly
issued and are fully paid and nonassessable.
(c) Each of the Pledged Notes constitutes the legal, valid and binding
obligation of the obligor with respect thereto, enforceable in accordance with
its terms, subject to the effects of bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium and other similar laws relating to or
affecting creditors' rights generally, general equitable principles (whether
considered in a proceeding in equity or at law) and an implied covenant of good
faith and fair dealing.
(d) Such Grantor is the record and beneficial owner of, and has good
and marketable title to, the Investment Property pledged by it hereunder, free
of any and all Liens or options in favor of, or claims of, any other Person,
except the security interest created by this Agreement.
4.7 RECEIVABLES. (a) No amount payable to such Grantor under or in
connection with any Receivable is evidenced by any Instrument or Chattel Paper
which has not been delivered to the Administrative Agent.
(b) None of the obligors on any Receivables is a Governmental
Authority.
(c) The amounts represented by such Grantor to the Lenders from time
to time as owing to such Grantor in respect of the Receivables will at such
times be accurate.
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12.
4.8 INTELLECTUAL PROPERTY. (a) SCHEDULE 6 lists all Intellectual
Property owned by such Grantor in its own name on the date hereof.
(b) On the date hereof, all material Intellectual Property is valid,
subsisting, unexpired and enforceable, has not been abandoned and does not
infringe the intellectual property rights of any other Person.
(c) Except as set forth in SCHEDULE 6, on the date hereof, none of the
Intellectual Property is the subject of any licensing or franchise agreement
pursuant to which such Grantor is the licensor or franchisor.
(d) No holding, decision or judgment has been rendered by any
Governmental Authority which would limit, cancel or question the validity of, or
such Grantor's rights in, any Intellectual Property in any respect that would
reasonably be expected to have a Material Adverse Effect.
(e) No action or proceeding is pending, or, to the knowledge of such
Grantor, threatened, on the date hereof (i) seeking to limit, cancel or question
the validity of any Intellectual Property or such Grantor's ownership interest
therein, or (ii) which, if adversely determined, would have a material adverse
effect on the value of any Intellectual Property.
SECTION 5. COVENANTS
Each Grantor covenants and agrees with the Administrative Agent and the
Lenders that, from and after the date of this Agreement until the Obligations
shall have been paid in full, no Letter of Credit shall be outstanding and the
Commitments shall have terminated:
5.1 DELIVERY OF INSTRUMENTS, CERTIFICATED SECURITIES AND CHATTEL
PAPER. If any amount payable under or in connection with any of the Collateral
in excess of $[500,000] shall be or become evidenced by any Instrument,
Certificated Security or Chattel Paper, such Instrument, Certificated Security
or Chattel Paper shall be immediately delivered to the Administrative Agent,
duly indorsed in a manner satisfactory to the Administrative Agent, to be held
as Collateral pursuant to this Agreement.
5.2 MAINTENANCE OF INSURANCE. (a) Such Grantor will maintain, with
financially sound and reputable companies with A.M. Best ratings of A-III or
better, insurance policies (i) insuring the Inventory and Equipment against loss
by fire, explosion, theft and such other casualties and (ii) insuring such
Grantor, the Administrative Agent and the Lenders against liability for personal
injury and property damage relating to such Inventory and Equipment, in both
cases as is normal and customary for the automotive parts industry and mutually
agreeable to such Grantor and the Administrative Agent whose consent shall not
be unreasonably withheld.
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(b) All such insurance shall (i) provide that no cancellation,
material reduction in amount or material change in coverage thereof shall be
effective until at least 30 days after receipt by the Administrative Agent of
written notice thereof, (ii) name the Administrative Agent as additional loss
payee as its interests may appear and (iii) be reasonably satisfactory in all
other respects to the Administrative Agent.
(c) The Borrower shall deliver to the Administrative Agent and the
Lenders a report of a reputable insurance broker with respect to such insurance
substantially concurrently with each delivery of the Borrower's audited annual
financial statements and such supplemental reports with respect thereto as the
Administrative Agent may from time to time reasonably request.
5.3 PAYMENT OF OBLIGATIONS. Such Grantor will pay and discharge or
otherwise satisfy at or before maturity or before they become delinquent, as the
case may be, all taxes, assessments and governmental charges or levies imposed
upon the Collateral or in respect of income or profits therefrom, as well as all
claims of any kind (including, without limitation, claims for labor, materials
and supplies) against or with respect to the Collateral, except that no such
charge need be paid if the amount or validity thereof is currently being
contested in good faith by appropriate proceedings, reserves in conformity with
GAAP with respect thereto have been provided on the books of such Grantor and
such proceedings would not reasonably be expected to result in the sale,
forfeiture or loss of any material portion of the Collateral or any interest
therein.
5.4 MAINTENANCE OF PERFECTED SECURITY INTEREST; FURTHER DOCUMENTATION.
(a) Such Grantor shall maintain the security interest created by this Agreement
as a perfected security interest having at least the priority described in
Section 4.2 and shall defend such security interest against the claims and
demands of all Persons whomsoever.
(b) Such Grantor will furnish to the Administrative Agent and the
Lenders from time to time statements and schedules further identifying and
describing the assets and property of such Grantor and such other reports in
connection therewith as the Administrative Agent may reasonably request, all in
reasonable detail.
(c) At any time and from time to time, upon the written request of the
Administrative Agent, and at the sole expense of such Grantor, such Grantor will
promptly and duly execute and deliver, and have recorded, such further
instruments and documents and take such further actions as the Administrative
Agent may reasonably request for the purpose of obtaining or preserving the full
benefits of this Agreement and of the rights and powers herein granted,
including, without limitation, (i) filing any financing or continuation
statements under the Uniform Commercial Code (or other similar laws) in effect
in any jurisdiction with respect to the security interests created hereby and
(ii) in the case of Investment Property, Deposit Accounts and any other relevant
Collateral, taking any actions necessary to enable the Administrative Agent to
obtain "control" (within the meaning of the applicable Uniform Commercial Code)
with respect thereto.
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5.5 CHANGES IN LOCATIONS, NAME, ETC. Such Grantor will not, except
upon 15 days' prior written notice to the Administrative Agent and delivery to
the Administrative Agent of (a) all additional executed financing statements and
other documents reasonably requested by the Administrative Agent to maintain the
validity, perfection and priority of the security interests provided for herein
and (b) if applicable, a written supplement to SCHEDULE 5 showing any additional
location at which Inventory or Equipment shall be kept:
(i) permit any of the Inventory or Equipment to be kept at a location
other than those listed on SCHEDULE 5 with a value in excess of $[100,000];
(ii) change its jurisdiction of organization or the location of its
chief executive office or sole place of business from that referred to in
Section 4.3; or
(iii) change its name, identity or corporate structure to such an
extent that any financing statement filed by the Administrative Agent in
connection with this Agreement would become misleading.
5.6 NOTICES. Such Grantor will advise the Administrative Agent and the
Lenders promptly, in reasonable detail, of:
(a) any Lien (other than security interests created hereby or Liens
permitted under the Credit Agreement) on any of the Collateral which would
adversely affect the ability of the Administrative Agent to exercise any of its
remedies hereunder; and
(b) of the occurrence of any other event which would reasonably be
expected to have a material adverse effect on the aggregate value of the
Collateral or on the security interests created hereby.
5.7 INVESTMENT PROPERTY. (a) If such Grantor shall become entitled to
receive or shall receive any stock certificate (including, without limitation,
any certificate representing a stock dividend or a distribution in connection
with any reclassification, increase or reduction of capital or any certificate
issued in connection with any reorganization), option or rights in respect of
the Capital Stock of any Issuer, whether in addition to, in substitution of, as
a conversion of, or in exchange for, any shares of the Pledged Stock, or
otherwise in respect thereof, such Grantor shall accept the same as the agent of
the Administrative Agent and the Lenders, hold the same in trust for the
Administrative Agent and the Lenders and deliver the same forthwith to the
Administrative Agent in the exact form received, duly indorsed by such Grantor
to the Administrative Agent, if required, together with an undated stock power
covering such certificate duly executed in blank by such Grantor and with, if
the Administrative Agent so requests, signature guaranteed, to be held by the
Administrative Agent, subject to the terms hereof, as additional collateral
security for the Obligations. Except as otherwise provided in the Credit
Agreement, any sums paid upon or in respect of the Investment Property upon the
liquidation or dissolution of any Issuer shall be paid over to the
Administrative Agent to be held by it hereunder as additional collateral
security for the Obligations, and in case any distribution of capital shall be
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made on or in respect of the Investment Property or any property shall be
distributed upon or with respect to the Investment Property pursuant to the
recapitalization or reclassification of the capital of any Issuer or pursuant to
the reorganization thereof, the property so distributed shall, unless otherwise
subject to a perfected security interest in favor of the Administrative Agent,
be delivered to the Administrative Agent to be held by it hereunder as
additional collateral security for the Obligations. If any sums of money or
property so paid or distributed in respect of the Investment Property shall be
received by such Grantor, such Grantor shall, until such money or property is
paid or delivered to the Administrative Agent, hold such money or property in
trust for the Lenders, segregated from other funds of such Grantor, as
additional collateral security for the Obligations.
(b) Without the prior written consent of the Administrative Agent,
such Grantor will not (i) vote to enable, or take any other action to permit,
any Issuer to issue any stock or other equity securities of any nature or to
issue any other securities convertible into or granting the right to purchase or
exchange for any stock or other equity securities of any nature of any Issuer,
(ii) sell, assign, transfer, exchange, or otherwise dispose of, or grant any
option with respect to, the Investment Property or Proceeds thereof (except
pursuant to a transaction expressly permitted by the Credit Agreement), (iii)
create, incur or permit to exist any Lien or option in favor of, or any claim of
any Person with respect to, any of the Investment Property or Proceeds thereof,
or any interest therein, except for the security interests created by this
Agreement or (iv) enter into any agreement or undertaking restricting the right
or ability of such Grantor or the Administrative Agent to sell, assign or
transfer any of the Investment Property or Proceeds thereof.
(c) In the case of each Grantor which is an Issuer, such Issuer agrees
that (i) it will be bound by the terms of this Agreement relating to the
Investment Property issued by it and will comply with such terms insofar as such
terms are applicable to it, (ii) it will notify the Administrative Agent
promptly in writing of the occurrence of any of the events described in Section
5.7(a) with respect to the Investment Property issued by it and (iii) the terms
of Sections 6.3(c) and 6.7 shall apply to it, MUTATIS MUTANDIS, with respect to
all actions that may be required of it pursuant to Section 6.3(c) or 6.7 with
respect to the Investment Property issued by it.
5.8 RECEIVABLES. (a) Other than in the ordinary course of business
consistent with its past practice, such Grantor will not (i) grant any extension
of the time of payment of any Receivable, (ii) compromise or settle any
Receivable for less than the full amount thereof, (iii) release, wholly or
partially, any Person liable for the payment of any Receivable, (iv) allow any
credit or discount whatsoever on any Receivable or (v) amend, supplement or
modify any Receivable in any manner that could adversely affect the value
thereof.
(b) Such Grantor will deliver to the Administrative Agent a copy of
each material demand, notice or document received by it that questions or calls
into doubt the validity or enforceability of more than 5% of the aggregate
amount of the then outstanding Receivables.
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5.9 INTELLECTUAL PROPERTY. (a) Such Grantor (either itself or through
licensees) will (i) continue to use each material Trademark on each and every
trademark class of goods applicable to its current line as reflected in its
current catalogs, brochures and price lists in order to maintain such Trademark
in full force free from any claim of abandonment for non-use, (ii) maintain as
in the past the quality of products and services offered under such Trademark,
(iii) use such Trademark with the appropriate notice of registration and all
other notices and legends required by applicable Requirements of Law, (iv) not
adopt or use any mark which is confusingly similar or a colorable imitation of
such Trademark unless the Administrative Agent, for the ratable benefit of the
Lenders, shall obtain a perfected security interest in such mark pursuant to
this Agreement, and (v) not (and not permit any licensee or sublicensee thereof
to) do any act or knowingly omit to do any act whereby such Trademark may become
invalidated or impaired in any way.
(b) Such Grantor (either itself or through licensees) will not do any
act, or omit to do any act, whereby any material Patent may become forfeited,
abandoned or dedicated to the public.
(c) Such Grantor (either itself or through licensees) (i) will employ
each material Copyright and (ii) will not (and will not permit any licensee or
sublicensee thereof to) do any act or knowingly omit to do any act whereby any
material portion of the Copyrights may become invalidated or otherwise impaired.
Such Grantor will not (either itself or through licensees) do any act whereby
any material portion of the Copyrights may fall into the public domain.
(d) Such Grantor (either itself or through licensees) will not do any
act that knowingly uses any material Intellectual Property to infringe the
intellectual property rights of any other Person.
(e) Such Grantor will notify the Administrative Agent and the Lenders
immediately if it knows, or has reason to know, that any application or
registration relating to any material Intellectual Property may become
forfeited, abandoned or dedicated to the public, or of any adverse determination
or development (including, without limitation, the institution of, or any such
determination or development in, any proceeding in the United States Patent and
Trademark Office, the United States Copyright Office or any court or tribunal in
any country) regarding such Grantor's ownership of, or the validity of, any
material Intellectual Property or such Grantor's right to register the same or
to own and maintain the same.
(f) Whenever such Grantor, either by itself or through any agent,
employee, licensee or designee, shall file an application for the registration
of any Intellectual Property with the United States Patent and Trademark Office,
the United States Copyright Office or any similar office or agency in any other
country or any political subdivision thereof, such Grantor shall report such
filing to the Administrative Agent within five Business Days after the last day
of the fiscal quarter in which such filing occurs. Upon request of the
Administrative Agent, such Grantor shall execute and deliver, and have recorded,
any and all agreements, instruments, documents, and papers as the Administrative
Agent may request to evidence the Administrative
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Agent's and the Lenders' security interest in any Copyright, Patent or Trademark
and the goodwill and general intangibles of such Grantor relating thereto or
represented thereby.
(g) Such Grantor will take all reasonable and necessary steps,
including, without limitation, in any proceeding before the United States Patent
andTrademark Office, the United States Copyright Office or any similar office or
agency in any other country or any political subdivision thereof, to maintain
and pursue each application (and to obtain the relevant registration) and to
maintain each registration of the material Intellectual Property, including,
without limitation, filing of applications for renewal, affidavits of use and
affidavits of incontestability.
(h) In the event that any material Intellectual Property is infringed,
misappropriated or diluted by a third party, such Grantor shall (i) take such
actions as such Grantor shall reasonably deem appropriate under the
circumstances to protect such Intellectual Property and (ii) if such
Intellectual Property is of material economic value, promptly notify the
Administrative Agent after it learns thereof and sue for infringement,
misappropriation or dilution, to seek injunctive relief where appropriate and to
recover any and all damages for such infringement, misappropriation or dilution.
SECTION 6. REMEDIAL PROVISIONS
6.1 CERTAIN MATTERS RELATING TO RECEIVABLES. (a) The Administrative
Agent shall have the right to make test verifications of the Receivables in any
manner and through any medium that it reasonably considers advisable, and each
Grantor shall furnish all such assistance and information as the Administrative
Agent may require in connection with such test verifications after the
occurrence of a default or an Event of Default. At any time and from time to
time, upon the Administrative Agent's request and at the expense of the relevant
Grantor, such Grantor shall cause independent public accountants or others
satisfactory to the Administrative Agent to furnish to the Administrative Agent
reports showing reconciliations, aging and test verifications of, and trial
balances for, the Receivables.
(b) The Administrative Agent hereby authorizes each Grantor to collect
such Grantor's Receivables, subject to the Administrative Agent's direction and
control, and the Administrative Agent may curtail or terminate said authority at
any time after the occurrence and during the continuance of an Event of Default.
If required by the Administrative Agent at any time after the occurrence and
during the continuance of an Event of Default, any payments of Receivables, when
collected by any Grantor, (i) shall be forthwith (and, in any event, within two
Business Days) deposited by such Grantor in the exact form received, duly
indorsed by such Grantor to the Administrative Agent if required, in a
Collateral Account maintained under the sole dominion and control of the
Administrative Agent, subject to withdrawal by the Administrative Agent for the
account of the Lenders only as provided in Section 6.5, and (ii) until so turned
over, shall be held by such Grantor in trust for the Administrative Agent and
the Lenders, segregated from other funds of such Grantor. Each such deposit of
Proceeds of
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Receivables shall be accompanied by a report identifying in reasonable detail
the nature and source of the payments included in the deposit.
(c) At the Administrative Agent's request, each Grantor shall deliver
to the Administrative Agent all original and other documents evidencing, and
relating to, the agreements and transactions which gave rise to the Receivables,
including, without limitation, all original orders, invoices and shipping
receipts.
6.2 COMMUNICATIONS WITH OBLIGORS; GRANTORS REMAIN LIABLE. (a) The
Administrative Agent in its own name or in the name of others may at any time
after the occurrence and during the continuance of an Event of Default
communicate with obligors under the Receivables and parties to any material
contract of any Grantor to verify with them to the Administrative Agent's
satisfaction the existence, amount and terms of any Receivables or any material
contract of any Grantor.
(b) Upon the request of the Administrative Agent at any time after the
occurrence and during the continuance of an Event of Default, each Grantor shall
notify obligors on the Receivables and parties to any material contract of any
Grantor that the Receivables and such contracts have been assigned to the
Administrative Agent for the ratable benefit of the Lenders and that payments in
respect thereof shall be made directly to the Administrative Agent.
(c) Anything herein to the contrary notwithstanding, each Grantor
shall remain liable under each of the Receivables and material contracts of any
Grantor to observe and perform all the conditions and obligations to be observed
and performed by it thereunder, all in accordance with the terms of any
agreement giving rise thereto. Neither the Administrative Agent nor any Lender
shall have any obligation or liability under any Receivable (or any agreement
giving rise thereto) or any contract of any Grantor by reason of or arising out
of this Agreement or the receipt by the Administrative Agent or any Lender of
any payment relating thereto, nor shall the Administrative Agent or any Lender
be obligated in any manner to perform any of the obligations of any Grantor
under or pursuant to any Receivable (or any agreement giving rise thereto) or
any contract of any Grantor, to make any payment, to make any inquiry as to the
nature or the sufficiency of any payment received by it or as to the sufficiency
of any performance by any party thereunder, to present or file any claim, to
take any action to enforce any performance or to collect the payment of any
amounts which may have been assigned to it or to which it may be entitled at any
time or times.
6.3 PLEDGED STOCK. (a) Unless an Event of Default shall have occurred
and be continuing and the Administrative Agent shall have given notice to the
relevant Grantor of the Administrative Agent's intent to exercise its
corresponding rights pursuant to Section 6.3(b), each Grantor shall be permitted
to receive all cash dividends paid in respect of the Pledged Stock and all
payments made in respect of the Pledged Notes, in each case paid in the normal
course of business of the relevant Issuer and consistent with past practice, to
the extent permitted in the Credit Agreement, and to exercise all voting and
corporate rights with respect to the Investment Property; PROVIDED, HOWEVER,
that no vote shall be cast or corporate right exercised or other
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action taken which, in the Administrative Agent's reasonable judgment, would
impair the Collateral or which would be inconsistent with or result in any
violation of any provision of the Credit Agreement, this Agreement or any
other Loan Document.
(b) If an Event of Default shall occur and be continuing and the
Administrative Agent shall give notice of its intent to exercise such rights to
the relevant Grantor or Grantors, (i) the Administrative Agent shall have the
right to receive any and all cash dividends, payments or other Proceeds paid in
respect of the Investment Property and make application thereof to the
Obligations in such order as the Administrative Agent may determine, and (ii)
any or all of the Investment Property shall be registered in the name of the
Administrative Agent or its nominee, and the Administrative Agent or its nominee
may thereafter exercise (x) all voting, corporate and other rights pertaining to
such Investment Property at any meeting of shareholders of the relevant Issuer
or Issuers or otherwise and (y) any and all rights of conversion, exchange and
subscription and any other rights, privileges or options pertaining to such
Investment Property as if it were the absolute owner thereof (including, without
limitation, the right to exchange at its discretion any and all of the
Investment Property upon the merger, consolidation, reorganization,
recapitalization or other fundamental change in the corporate structure of any
Issuer, or upon the exercise by any Grantor or the Administrative Agent of any
right, privilege or option pertaining to such Investment Property, and in
connection therewith, the right to deposit and deliver any and all of the
Investment Property with any committee, depository, transfer agent, registrar or
other designated agency upon such terms and conditions as the Administrative
Agent may determine), all without liability except to account for property
actually received by it, but the Administrative Agent shall have no duty to any
Grantor to exercise any such right, privilege or option and shall not be
responsible for any failure to do so or delay in so doing.
(c) Each Grantor hereby authorizes and instructs each Issuer of any
Investment Property pledged by such Grantor hereunder to (i) comply with any
instruction received by it from the Administrative Agent in writing that
(x) states that an Event of Default has occurred and is continuing and (y) is
otherwise in accordance with the terms of this Agreement, without any other or
further instructions from such Grantor, and each Grantor agrees that each Issuer
shall be fully protected in so complying, and (ii) unless otherwise expressly
permitted hereby, pay any dividends or other payments with respect to the
Investment Property directly to the Administrative Agent.
6.4 PROCEEDS TO BE TURNED OVER TO ADMINISTRATIVE AGENT. In addition to
the rights of the Administrative Agent and the Lenders specified in Section 6.1
with respect to payments of Receivables, if an Event of Default shall occur and
be continuing, all Proceeds received by any Grantor consisting of cash, checks
and other near-cash items shall be held by such Grantor in trust for the
Administrative Agent and the Lenders, segregated from other funds of such
Grantor, and shall, forthwith upon receipt by such Grantor, be turned over to
the Administrative Agent in the exact form received by such Grantor (duly
indorsed by such Grantor to the Administrative Agent, if required). All Proceeds
received by the Administrative Agent hereunder shall be held by the
Administrative Agent in a Collateral Account maintained under its sole dominion
and control. All Proceeds while held by the Administrative Agent in a
Collateral
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Account (or by such Grantor in trust for the Administrative Agent and the
Lenders) shall continue to be held as collateral security for all the
Obligations and shall not constitute payment thereof until applied as provided
in Section 6.5.
6.5 APPLICATION OF PROCEEDS. At such intervals as may be agreed upon
by the Borrower and the Administrative Agent, or, if an Event of Default shall
have occurred and be continuing, at any time at the Administrative Agent's
election, the Administrative Agent may apply all or any part of Proceeds held in
any Collateral Account in payment of the Obligations in such order as the
Administrative Agent may elect, and any part of such funds which the
Administrative Agent elects not so to apply and deems not required as collateral
security for the Obligations shall be paid over from time to time by the
Administrative Agent to the Borrower or to whomsoever may be lawfully entitled
to receive the same. Any balance of such Proceeds remaining after the
Obligations shall have been paid in full, no Letters of Credit shall be
outstanding and the Commitments shall have terminated shall be paid over to the
Borrower or to whomsoever may be lawfully entitled to receive the same.
6.6 CODE AND OTHER REMEDIES. If an Event of Default shall occur and be
continuing, the Administrative Agent, on behalf of the Lenders, may exercise, in
addition to all other rights and remedies granted to them in this Agreement and
in any other instrument or agreement securing, evidencing or relating to the
Obligations, all rights and remedies of a secured party under the New York UCC
or any other applicable law. Without limiting the generality of the foregoing,
the Administrative Agent, without demand of performance or other demand,
presentment, protest, advertisement or notice of any kind (except any notice
required by law referred to below) to or upon any Grantor or any other Person
(all and each of which demands, defenses, advertisements and notices are hereby
waived), may in such circumstances forthwith collect, receive, appropriate and
realize upon the Collateral, or any part thereof, and/or may forthwith sell,
lease, assign, give option or options to purchase, or otherwise dispose of and
deliver the Collateral or any part thereof (or contract to do any of the
foregoing), in one or more parcels at public or private sale or sales, at any
exchange, broker's board or office of the Administrative Agent or any Lender or
elsewhere upon such terms and conditions as it may deem advisable and at such
prices as it may deem best, for cash or on credit or for future delivery without
assumption of any credit risk. The Administrative Agent or any Lender shall have
the right upon any such public sale or sales, and, to the extent permitted by
law, upon any such private sale or sales, to purchase the whole or any part of
the Collateral so sold, free of any right or equity of redemption in any
Grantor, which right or equity is hereby waived and released. Each Grantor
further agrees, at the Administrative Agent's request, to assemble the
Collateral and make it available to the Administrative Agent at places which the
Administrative Agent shall reasonably select, whether at such Grantor's premises
or elsewhere. The Administrative Agent shall apply the net proceeds of any
action taken by it pursuant to this Section 6.6, after deducting all reasonable
costs and expenses of every kind incurred in connection therewith or incidental
to the care or safekeeping of any of the Collateral or in any way relating to
the Collateral or the rights of the Administrative Agent and the Lenders
hereunder, including, without limitation, reasonable attorneys' fees and
disbursements, to the payment in whole or in part of the Obligations, in such
order as the Administrative Agent may elect, and only after such application
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and after the payment by the Administrative Agent of any other amount required
by any provision of law, including, without limitation, Section 9-504(1)(c) of
the New York UCC, need the Administrative Agent account for the surplus, if any,
to any Grantor. To the extent permitted by applicable law, each Grantor waives
all claims, damages and demands it may acquire against the Administrative Agent
or any Lender arising out of the exercise by them of any rights hereunder. If
any notice of a proposed sale or other disposition of Collateral shall be
required by law, such notice shall be deemed reasonable and proper if given
at least 10 days before such sale or other disposition.
6.7 REGISTRATION RIGHTS. (a) If the Administrative Agent shall
determine to exercise its right to sell any or all of the Pledged Stock pursuant
to Section 6.6, and if in the opinion of the Administrative Agent it is
necessary or advisable to have the Pledged Stock, or that portion thereof to be
sold, registered under the provisions of the Securities Act, the relevant
Grantor will cause the Issuer thereof to (i) execute and deliver, and cause the
directors and officers of such Issuer to execute and deliver, all such
instruments and documents, and do or cause to be done all such other acts as may
be, in the opinion of the Administrative Agent, necessary or advisable to
register the Pledged Stock, or that portion thereof to be sold, under the
provisions of the Securities Act, (ii) use its best efforts to cause the
registration statement relating thereto to become effective and to remain
effective for a period of one year from the date of the first public offering of
the Pledged Stock, or that portion thereof to be sold, and (iii) make all
amendments thereto and/or to the related prospectus which, in the opinion of the
Administrative Agent, are necessary or advisable, all in conformity with the
requirements of the Securities Act and the rules and regulations of the
Securities and Exchange Commission applicable thereto. Each Grantor agrees to
cause such Issuer to comply with the provisions of the securities or "Blue Sky"
laws of any and all jurisdictions which the Administrative Agent shall designate
and to make available to its security holders, as soon as practicable, an
earnings statement (which need not be audited) which will satisfy the provisions
of Section 11(a) of the Securities Act.
(b) Each Grantor recognizes that the Administrative Agent may be
unable to effect a public sale of any or all the Pledged Stock, by reason of
certain prohibitions contained in the Securities Act and applicable state
securities laws or otherwise, and may be compelled to resort to one or more
private sales thereof to a restricted group of purchasers which will be obliged
to agree, among other things, to acquire such securities for their own account
for investment and not with a view to the distribution or resale thereof. Each
Grantor acknowledges and agrees that any such private sale may result in prices
and other terms less favorable than if such sale were a public sale and,
notwithstanding such circumstances, agrees that any such private sale shall be
deemed to have been made in a commercially reasonable manner. The Administrative
Agent shall be under no obligation to delay a sale of any of the Pledged Stock
for the period of time necessary to permit the Issuer thereof to register such
securities for public sale under the Securities Act, or under applicable state
securities laws, even if such Issuer would agree to do so.
(c) Each Grantor agrees to use its best efforts to do or cause to be
done all such other acts as may be necessary to make such sale or sales of all
or any portion of the Pledged
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Stock pursuant to this Section 6.7 valid and binding and in compliance with any
and all other applicable Requirements of Law. Each Grantor further agrees that a
breach of any of the covenants contained in this Section 6.7 will cause
irreparable injury to the Administrative Agent and the Lenders, that the
Administrative Agent and the Lenders have no adequate remedy at law in respect
of such breach and, as a consequence, that each and every covenant contained in
this Section 6.7 shall be specifically enforceable against such Grantor, and
such Grantor hereby waives and agrees not to assert any defenses against an
action for specific performance of such covenants except for a defense that no
Event of Default has occurred under the Credit Agreement.
6.8 WAIVER; DEFICIENCY. Each Grantor waives and agrees not to assert
any rights or privileges which it may acquire under Section 9-112 of the New
York UCC. Each Grantor shall remain liable for any deficiency if the proceeds of
any sale or other disposition of the Collateral are insufficient to pay its
Obligations and the reasonable fees and disbursements of any attorneys employed
by the Administrative Agent or any Lender to collect such deficiency.
SECTION 7. THE ADMINISTRATIVE AGENT
7.1 ADMINISTRATIVE AGENT'S APPOINTMENT AS ATTORNEY-IN-FACT, ETC. (a)
Each Grantor hereby irrevocably constitutes and appoints the Administrative
Agent and any officer or agent thereof, with full power of substitution, as its
true and lawful attorney-in-fact with full irrevocable power and authority in
the place and stead of such Grantor and in the name of such Grantor or in its
own name, for the purpose of carrying out the terms of this Agreement, to take
any and all appropriate action and to execute any and all documents and
instruments which may be necessary or desirable to accomplish the purposes of
this Agreement, and, without limiting the generality of the foregoing, each
Grantor hereby gives the Administrative Agent the power and right, on behalf of
such Grantor, without notice to or assent by such Grantor, to do any or all of
the following:
(i) in the name of such Grantor or its own name, or otherwise, take
possession of and indorse and collect any checks, drafts, notes,
acceptances or other instruments for the payment of moneys due under any
Receivable or any material contract of any Grantor or with respect to any
other Collateral and file any claim or take any other action or proceeding
in any court of law or equity or otherwise deemed appropriate by the
Administrative Agent for the purpose of collecting any and all such moneys
due under any Receivable or any material contract of any Grantor or with
respect to any other Collateral whenever payable;
(ii) in the case of any Intellectual Property, execute and deliver,
and have recorded, any and all agreements, instruments, documents and
papers as the Administrative Agent may request to evidence the
Administrative Agent's and the Lenders' security interest in such
Intellectual Property and the goodwill and general intangibles of such
Grantor relating thereto or represented thereby;
<PAGE> 284
23.
(iii) pay or discharge taxes and Liens levied or placed on or
threatened against the Collateral, effect any repairs or any insurance
called for by the terms of this Agreement and pay all or any part of the
premiums therefor and the costs thereof;
(iv) execute, in connection with any sale provided for in Section 6.6
or 6.7, any indorsements, assignments or other instruments of conveyance or
transfer with respect to the Collateral; and
(v) (1) direct any party liable for any payment under any of the
Collateral to make payment of any and all moneys due or to become due
thereunder directly to the Administrative Agent or as the Administrative
Agent shall direct; (2) ask or demand for, collect, and receive payment of
and receipt for, any and all moneys, claims and other amounts due or to
become due at any time in respect of or arising out of any Collateral;
(3) sign and indorse any invoices, freight or express bills, bills of
lading, storage or warehouse receipts, drafts against debtors, assignments,
verifications, notices and other documents in connection with any of the
Collateral; (4) commence and prosecute any suits, actions or proceedings at
law or in equity in any court of competent jurisdiction to collect the
Collateral or any portion thereof and to enforce any other right in respect
of any Collateral; (5) defend any suit, action or proceeding brought
against such Grantor with respect to any Collateral; (6) settle, compromise
or adjust any such suit, action or proceeding and, in connection therewith,
give such discharges or releases as the Administrative Agent may deem
appropriate; (7) assign any Copyright, Patent or Trademark (along with the
goodwill of the business to which any such Copyright, Patent or Trademark
pertains), throughout the world for such term or terms, on such conditions,
and in such manner, as the Administrative Agent shall in its sole
discretion determine; and (8) generally, sell, transfer, pledge and make
any agreement with respect to or otherwise deal with any of the Collateral
as fully and completely as though the Administrative Agent were the
absolute owner thereof for all purposes, and do, at the Administrative
Agent's option and such Grantor's expense, at any time, or from time to
time, all acts and things which the Administrative Agent deems necessary to
protect, preserve or realize upon the Collateral and the Administrative
Agent's and the Lenders' security interests therein and to effect the
intent of this Agreement, all as fully and effectively as such Grantor
might do.
Anything in this Section 7.1(a) to the contrary notwithstanding, the
Administrative Agent agrees that it will not exercise any rights under the power
of attorney provided for in this Section 7.1(a) unless an Event of Default shall
have occurred and be continuing.
(b) If any Grantor fails to perform or comply with any of its
agreements contained herein, the Administrative Agent, at its option, but
without any obligation so to do, may perform or comply, or otherwise cause
performance or compliance, with such agreement.
(c) The expenses of the Administrative Agent incurred in connection
with actions undertaken as provided in this Section 7.1, together with interest
thereon at a rate per annum
<PAGE> 285
24.
equal to the highest rate per annum at which interest would then be payable on
any category of past due ABR Loans under the Credit Agreement, from the date of
payment by the Administrative Agent to the date reimbursed by the relevant
Grantor, shall be payable by such Grantor to the Administrative Agent on demand.
(d) Each Grantor hereby ratifies all that said attorneys shall
lawfully do or cause to be done by virtue hereof. All powers, authorizations and
agencies contained in this Agreement are coupled with an interest and are
irrevocable until this Agreement is terminated and the security interests
created hereby are released.
7.2 DUTY OF ADMINISTRATIVE AGENT. The Administrative Agent's sole duty
with respect to the custody, safekeeping and physical preservation of the
Collateral in its possession, under Section 9-207 of the New York UCC or
otherwise, shall be to deal with it in the same manner as the Administrative
Agent deals with similar property for its own account. Neither the
Administrative Agent, any Lender nor any of their respective officers,
directors, employees or agents shall be liable for failure to demand, collect or
realize upon any of the Collateral or for any delay in doing so or shall be
under any obligation to sell or otherwise dispose of any Collateral upon the
request of any Grantor or any other Person or to take any other action
whatsoever with regard to the Collateral or any part thereof. The powers
conferred on the Administrative Agent and the Lenders hereunder are solely to
protect the Administrative Agent's and the Lenders' interests in the Collateral
and shall not impose any duty upon the Administrative Agent or any Lender to
exercise any such powers. The Administrative Agent and the Lenders shall be
accountable only for amounts that they actually receive as a result of the
exercise of such powers, and neither they nor any of their officers, directors,
employees or agents shall be responsible to any Grantor for any act or failure
to act hereunder, except for their own gross negligence or willful misconduct.
7.3 EXECUTION OF FINANCING STATEMENTS. Pursuant to Section 9-402 of
the New York UCC and any other applicable law, each Grantor authorizes the
Administrative Agent to file or record financing statements and other filing or
recording documents or instruments with respect to the Collateral without the
signature of such Grantor in such form and in such offices as the Administrative
Agent determines appropriate to perfect the security interests of the
Administrative Agent under this Agreement. A photographic or other reproduction
of this Agreement shall be sufficient as a financing statement or other filing
or recording document or instrument for filing or recording in any jurisdiction.
7.4 AUTHORITY OF ADMINISTRATIVE AGENT. Each Grantor acknowledges that
the rights and responsibilities of the Administrative Agent under this Agreement
with respect to any action taken by the Administrative Agent or the exercise or
non-exercise by the Administrative Agent of any option, voting right, request,
judgment or other right or remedy provided for herein or resulting or arising
out of this Agreement shall, as between the Administrative Agent and the
Lenders, be governed by the Credit Agreement and by such other agreements with
respect thereto as may exist from time to time among them, but, as between the
Administrative Agent and the Grantors, the Administrative Agent shall be
conclusively presumed to be acting as agent for the
<PAGE> 286
25.
Lenders with full and valid authority so to act or refrain from acting, and no
Grantor shall be under any obligation, or entitlement, to make any inquiry
respecting such authority.
SECTION 8. MISCELLANEOUS
8.1 AMENDMENTS IN WRITING. None of the terms or provisions of this
Agreement may be waived, amended, supplemented or otherwise modified except in
accordance with subsection 10.1 of the Credit Agreement.
8.2 NOTICES. All notices, requests and demands to or upon the
Administrative Agent or any Grantor hereunder shall be effected in the manner
provided for in subsection 10.2 of the Credit Agreement; PROVIDED that any such
notice, request or demand to or upon any Guarantor shall be addressed to such
Guarantor at its notice address set forth on SCHEDULE 1.
8.3 NO WAIVER BY COURSE OF CONDUCT; CUMULATIVE REMEDIES. Neither the
Administrative Agent nor any Lender shall by any act (except by a written
instrument pursuant to Section 8.1), delay, indulgence, omission or otherwise be
deemed to have waived any right or remedy hereunder or to have acquiesced in any
Default or Event of Default. No failure to exercise, nor any delay in
exercising, on the part of the Administrative Agent or any Lender, any right,
power or privilege hereunder shall operate as a waiver thereof. No single or
partial exercise of any right, power or privilege hereunder shall preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege. A waiver by the Administrative Agent or any Lender of any right or
remedy hereunder on any one occasion shall not be construed as a bar to any
right or remedy which the Administrative Agent or such Lender would otherwise
have on any future occasion. The rights and remedies herein provided are
cumulative, may be exercised singly or concurrently and are not exclusive of any
other rights or remedies provided by law.
8.4 ENFORCEMENT EXPENSES; INDEMNIFICATION. (a) Each Guarantor agrees
to pay or reimburse each Lender and the Administrative Agent for all its costs
and expenses incurred in collecting against such Guarantor under the guarantee
contained in Section 2 or otherwise enforcing or preserving any rights under
this Agreement and the other Loan Documents to which such Guarantor is a party,
including, without limitation, the reasonable fees and disbursements of counsel
(including the allocated fees and expenses of in-house counsel) to each Lender
and of counsel to the Administrative Agent.
(b) Each Guarantor agrees to pay, and to save the Administrative Agent
and the Lenders harmless from, any and all liabilities with respect to, or
resulting from any delay in paying, any and all stamp, excise, sales or other
taxes which may be payable or determined to be payable with respect to any of
the Collateral or in connection with any of the transactions contemplated by
this Agreement.
<PAGE> 287
26.
(c) Each Guarantor agrees to pay, and to save the Administrative Agent
and the Lenders harmless from, any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind or nature whatsoever with respect to the execution, delivery,
enforcement, performance and administration of this Agreement to the extent the
Borrower would be required to do so pursuant to subsection 10.5 of the Credit
Agreement.
(d) The agreements in this Section 8.4 shall survive repayment of the
Obligations and all other amounts payable under the Credit Agreement and the
other Loan Documents.
8.5 SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon the
successors and assigns of each Grantor and shall inure to the benefit of the
Administrative Agent and the Lenders and their successors and assigns; PROVIDED
that no Grantor may assign, transfer or delegate any of its rights or
obligations under this Agreement without the prior written consent of the
Administrative Agent.
8.6 SET-OFF. Each Grantor hereby irrevocably authorizes the
Administrative Agent and each Lender at any time and from time to time while an
Event of Default pursuant to subsection 8(a) of the Credit Agreement shall have
occurred and be continuing, without notice to such Grantor or any other Grantor,
any such notice being expressly waived by each Grantor, to set-off and
appropriate and apply any and all deposits (general or special, time or demand,
provisional or final), in any currency, and any other credits, indebtedness or
claims, in any currency, in each case whether direct or indirect, absolute or
contingent, matured or unmatured, at any time held or owing by the
Administrative Agent or such Lender to or for the credit or the account of such
Grantor, or any part thereof in such amounts as the Administrative Agent or such
Lender may elect, against and on account of the obligations and liabilities of
such Grantor to the Administrative Agent or such Lender hereunder and claims of
every nature and description of the Administrative Agent or such Lender against
such Grantor, in any currency, whether arising hereunder, under the Credit
Agreement, any other Loan Document or otherwise, as the Administrative Agent or
such Lender may elect, whether or not the Administrative Agent or any Lender has
made any demand for payment and although such obligations, liabilities and
claims may be contingent or unmatured. The Administrative Agent and each Lender
shall notify such Grantor promptly of any such set-off and the application made
by the Administrative Agent or such Lender of the proceeds thereof, PROVIDED
that the failure to give such notice shall not affect the validity of such
set-off and application. The rights of the Administrative Agent and each Lender
under this Section 8.6 are in addition to other rights and remedies (including,
without limitation, other rights of set-off) which the Administrative Agent or
such Lender may have.
8.7 COUNTERPARTS. This Agreement may be executed by one or more of the
parties to this Agreement on any number of separate counterparts (including by
telecopy), and all of said counterparts taken together shall be deemed to
constitute one and the same instrument.
8.8 SEVERABILITY. Any provision of this Agreement which is prohibited
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such
<PAGE> 288
27.
prohibition or unenforceability without invalidating the remaining provisions
hereof, and any such prohibition or unenforceability in any jurisdiction shall
not invalidate or render unenforceable such provision in any other jurisdiction.
8.9 SECTION HEADINGS. The Section headings used in this Agreement are
for convenience of reference only and are not to affect the construction hereof
or be taken into consideration in the interpretation hereof.
8.10 INTEGRATION. This Agreement and the other Loan Documents
represent the agreement of the Grantors, the Administrative Agent and the
Lenders with respect to the subject matter hereof and thereof, and there are no
promises, undertakings, representations or warranties by the Administrative
Agent or any Lender relative to subject matter hereof and thereof not expressly
set forth or referred to herein or in the other Loan Documents.
8.11 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED
AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
8.12 SUBMISSION TO JURISDICTION; WAIVERS. Each Grantor hereby
irrevocably and unconditionally:
(a) submits for itself and its property in any legal action or
proceeding relating to this Agreement and the other Loan Documents to which it
is a party, or for recognition and enforcement of any judgment in respect
thereof, to the non-exclusive general jurisdiction of the Courts of the State of
New York, the courts of the United States of America for the Southern District
of New York, and appellate courts from any thereof;
(b) consents that any such action or proceeding may be brought in such
courts and waives any objection that it may now or hereafter have to the venue
of any such action or proceeding in any such court or that such action or
proceeding was brought in an inconvenient court and agrees not to plead or claim
the same;
(c) agrees that service of process in any such action or proceeding
may be effected by mailing a copy thereof by registered or certified mail (or
any substantially similar form of mail), postage prepaid, to such Grantor at its
address referred to in Section 8.2 or at such other address of which the
Administrative Agent shall have been notified pursuant thereto;
(d) agrees that nothing herein shall affect the right to effect
service of process in any other manner permitted by law or shall limit the right
to sue in any other jurisdiction; and
<PAGE> 289
28.
(e) waives, to the maximum extent not prohibited by law, any right it
may have to claim or recover in any legal action or proceeding referred to in
this Section any special, exemplary, punitive or consequential damages.
8.13 ACKNOWLEDGEMENTS. Each Grantor hereby acknowledges that:
(a) it has been advised by counsel in the negotiation, execution and
delivery of this Agreement and the other Loan Documents to which it is a party;
(b) neither the Administrative Agent nor any Lender has any fiduciary
relationship with or duty to any Grantor arising out of or in connection with
this Agreement or any of the other Loan Documents, and the relationship between
the Grantors, on the one hand, and the Administrative Agent and Lenders, on the
other hand, in connection herewith or therewith is solely that of debtor and
creditor; and
(c) no joint venture is created hereby or by the other Loan Documents
or otherwise exists by virtue of the transactions contemplated hereby among the
Lenders or among the Grantors and the Lenders.
8.14 ADDITIONAL GRANTORS. Each Subsidiary of the Borrower that is
required to become a party to this Agreement pursuant to subsection 6.10 of the
Credit Agreement shall become a Grantor for all purposes of this Agreement upon
execution and delivery by such Subsidiary of an Assumption Agreement in the form
of Annex 1 hereto.
8.15 RELEASES. (a) At such time as the Loans, the Reimbursement
Obligations and the other Obligations shall have been paid in full, the
Commitments have been terminated and no Letters of Credit shall be outstanding,
the Collateral shall be released from the Liens created hereby, and this
Agreement and all obligations (other than those expressly stated to survive such
termination) of the Administrative Agent and each Grantor hereunder shall
terminate, all without delivery of any instrument or performance of any act by
any party, and all rights to the Collateral shall revert to the Grantors. At the
request and sole expense of any Grantor following any such termination, the
Administrative Agent shall deliver to such Grantor any Collateral held by the
Administrative Agent hereunder, and execute and deliver to such Grantor such
documents as such Grantor shall reasonably request to evidence such termination.
(b) If any of the Collateral shall be sold, transferred or otherwise
disposed of by any Grantor in a transaction permitted by the Credit Agreement,
then the Administrative Agent, at the request and sole expense of such Grantor,
shall execute and deliver to such Grantor all releases or other documents
reasonably necessary or desirable for the release of the Liens created hereby on
such Collateral. At the request and sole expense of the Borrower, a Subsidiary
Guarantor shall be released from its obligations hereunder in the event that all
the Capital Stock of such Subsidiary Guarantor shall be sold, transferred or
otherwise disposed of in a transaction permitted by the Credit Agreement;
PROVIDED that the Borrower shall have delivered to the Administrative Agent, at
least ten Business Days prior to the date of the proposed release, a
<PAGE> 290
29.
written request for release identifying the relevant Subsidiary Guarantor and
the terms of the sale or other disposition in reasonable detail, including the
price thereof and any expenses in connection therewith, together with a
certification by the Borrower stating that such transaction is in compliance
with the Credit Agreement and the other Loan Documents.
8.16 WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING
TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.
<PAGE> 291
IN WITNESS WHEREOF, each of the undersigned has caused this Guarantee
and Collateral Agreement to be duly executed and delivered as of the date first
above written.
TENNECO INC.
By:_____________________________
Name:
Title:
TENNECO AUTOMOTIVE INC.
By:_____________________________
Name:
Title:
[OTHER GRANTORS]
<PAGE> 292
SCHEDULE 1
NOTICE ADDRESSES OF GUARANTORS
<PAGE> 293
SCHEDULE 2
DESCRIPTION OF INVESTMENT PROPERTY
PLEDGED STOCK:
<TABLE>
<CAPTION>
ISSUER CLASS OF STOCK STOCK CERTIFICATE NO. NO. OF SHARES
- ------ -------------- --------------------- -------------
<S> <C> <C> <C>
</TABLE>
PLEDGED NOTES:
<TABLE>
<CAPTION>
ISSUER PAYEE PRINCIPAL AMOUNT
- ------ ----- ----------------
<S> <C> <C>
</TABLE>
<PAGE> 294
SCHEDULE 3
FILINGS AND OTHER ACTIONS
REQUIRED TO PERFECT SECURITY INTERESTS
UNIFORM COMMERCIAL CODE FILINGS
[List each office where a financing statement is to be filed]*
PATENT AND TRADEMARK FILINGS
[List all filings]
ACTIONS WITH RESPECT TO PLEDGED STOCK**
OTHER ACTIONS
[Describe other actions to be taken]
- --------
* Note that perfection of security interests in patents and trademarks
requires filings under the UCC in the jurisdictions where filings would
be made for general intangibles, as well as filings in the U.S
Copyright Office and the U.S. Patent & Trademark Office.
** If the interest of a Grantor in Pledged Stock appears on the books of a
financial intermediary, a control agreement as described in Section
8-106 of the New York UCC will be required.
<PAGE> 295
SCHEDULE 4
LOCATION OF JURISDICTION OF ORGANIZATION AND CHIEF EXECUTIVE OFFICE
GRANTOR LOCATION
<PAGE> 296
SCHEDULE 5
LOCATION OF INVENTORY AND EQUIPMENT
GRANTOR LOCATION
<PAGE> 297
SCHEDULE 6
COPYRIGHTS AND COPYRIGHT LICENSES
PATENTS AND PATENT LICENSES
TRADEMARKS AND TRADEMARK LICENSES
<PAGE> 298
Annex 1 to
GUARANTEE AND COLLATERAL AGREEMENT
ASSUMPTION AGREEMENT, dated as of ______________, ____, made by
______________________________, a ______________ corporation (the "ADDITIONAL
GRANTOR"), in favor of THE CHASE MANHATTAN BANK, as administrative agent (in
such capacity, the "ADMINISTRATIVE AGENT") for the banks and other financial
institutions (the "LENDERS") parties to the Credit Agreement referred to below.
All capitalized terms not defined herein shall have the meaning ascribed to them
in such Credit Agreement.
W I T N E S S E T H :
WHEREAS, Tenneco Inc. (the "BORROWER"), the Lenders, Commerzbank and
Bank of America, as Co-Documentation Agents, Citibank, as Syndication Agent, and
the Administrative Agent have entered into the Credit Agreement, dated as of
September __, 1999 (as amended, supplemented or otherwise modified from time to
time, the "CREDIT AGREEMENT");
WHEREAS, in connection with the Credit Agreement, the Borrower and
certain of its Affiliates (other than the Additional Grantor) have entered into
the Guarantee and Collateral Agreement, dated as of _______________, 1999 (as
amended, supplemented or otherwise modified from time to time, the "GUARANTEE
AND COLLATERAL AGREEMENT") in favor of the Administrative Agent for the benefit
of the Lenders;
WHEREAS, the Credit Agreement requires the Additional Grantor to
become a party to the Guarantee and Collateral Agreement; and
WHEREAS, the Additional Grantor has agreed to execute and deliver this
Assumption Agreement in order to become a party to the Guarantee and Collateral
Agreement;
NOW, THEREFORE, IT IS AGREED:
1. GUARANTEE AND COLLATERAL AGREEMENT. By executing and delivering
this Assumption Agreement, the Additional Grantor, as provided in Section 8.14
of the Guarantee and Collateral Agreement, hereby becomes a party to the
Guarantee and Collateral Agreement as a Grantor thereunder with the same force
and effect as if originally named therein as a Grantor and, without limiting the
generality of the foregoing, hereby expressly assumes all obligations and
liabilities of a Grantor thereunder. The information set forth in Annex 1-A
hereto is hereby added to the information set forth in the Schedules to the
Guarantee and Collateral Agreement. The Additional Grantor hereby represents and
warrants that each of the representations and warranties contained in Section 4
of the Guarantee and Collateral Agreement is true and correct on and as the date
hereof (after giving effect to this Assumption Agreement) as if made on and as
of such date.
<PAGE> 299
2.
2. GOVERNING LAW. THIS ASSUMPTION AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
IN WITNESS WHEREOF, the undersigned has caused this Assumption
Agreement to be duly executed and delivered as of the date first above written.
[ADDITIONAL GRANTOR]
By: _______________________________________
Name:
Title:
<PAGE> 300
Annex 1-A to
ASSUMPTION AGREEMENT
SUPPLEMENT TO SCHEDULE 1
SUPPLEMENT TO SCHEDULE 2
SUPPLEMENT TO SCHEDULE 3
SUPPLEMENT TO SCHEDULE 4
SUPPLEMENT TO SCHEDULE 5
SUPPLEMENT TO SCHEDULE 6
<PAGE> 301
EXHIBIT B
TO THE CREDIT AGREEMENT
FORM OF
COMPLIANCE CERTIFICATE
[For the Fiscal Quarter ending____________]
[For the Fiscal Year ending____________]
Pursuant to Section 6.2(b) of the Credit Agreement, dated as of
September 30, 1999 (as amended, supplemented or otherwise modified from time to
time, the "CREDIT AGREEMENT"; terms defined therein being used herein as therein
defined unless otherwise defined), among TENNECO INC., the lenders parties
thereto (the "LENDERS"), the Syndication Agent and the Co-Documentation Agents
parties thereto and THE CHASE MANHATTAN BANK, as Administrative Agent, the
undersigned, duly elected, qualified and acting Responsible Officer of the
Borrower hereby certifies that, to the best of such Responsible Officer's
knowledge:
(a) The Borrower and each other Loan Party has, during the period or
periods referred to above, observed or performed all of its covenants and other
agreements, and satisfied every condition, contained in the Credit Agreement and
the other Loan Documents to which it is a party to be observed, performed or
satisfied by it on or before the date hereof, and as of the date hereof such
Responsible Officer has obtained no knowledge of any Default or Event of Default
except as follows: _______________________________
(b) The financial statements referred to in Section 6.1 of the Credit
Agreement which have been delivered prior to or which are delivered concurrently
with the delivery of this Compliance Certificate fairly present in all material
respects the consolidated financial position of the Borrower and its
consolidated Subsidiaries as at the date of such financial statements, and the
consolidated results of their operations and their consolidated cash flows for
the fiscal quarter then ended (subject to normal year-end audit adjustments in
the case of quarterly financial statements). Such financial statements have been
prepared in accordance with GAAP applied consistently throughout the period
involved and with prior periods (except as approved by a Responsible Officer and
disclosed therein).
(c) The covenants as listed and calculated below are based on the
financial statements referred to in Section 6.1 of the Credit Agreement which
are delivered concurrently with the delivery of this Compliance Certificate.
<PAGE> 302
2.
1. CONSOLIDATED LEVERAGE RATIO* (SECTION 7.1(A))
The ratio of
(i) Consolidated Total Debt* as of such day $__________
to
(ii) Consolidated EBITDA for the period of four
consecutive fiscal quarters* $__________
Ratio: __________
(must not be greater than [see appropriate period
in Section 7.1(a)]) __________
2. CONSOLIDATED INTEREST COVERAGE RATIO* (SECTION 7.1(b))
The ratio of
(i) Consolidated EBITDA* for the period of four
consecutive fiscal quarters $__________
to
(ii) Consolidated Interest Expense* for such period $__________
Ratio: __________
(must not be less than [see appropriate period
in Section 7.1(b)]) __________
3. CONSOLIDATED FIXED CHARGE COVERAGE RATIO* (SECTION 7.1(c))
The ratio of
(i) Consolidated EBITDA* for the period of four
consecutive fiscal quarters $__________
less
(ii) Aggregate actual payment on account of Capital
Expenditures during such period $__________
to
___________________
* See Schedule 1 for calculations.
<PAGE> 303
3.
(iii) Consolidated Interest Expense* for such period $__________
Ratio: __________
(must not be less than [see appropriate period in
Section 7.1(c)]) __________
4. LIMITATION ON INDEBTEDNESS (SECTION 7.2)
(a) Aggregate amount of Guarantee Obligations incurred
in the ordinary course of business by the Borrower
and its Subsidiaries of obligations of any
Subsidiary not otherwise permitted under the
Credit Agreement in an aggregate amount not to
exceed $50,000,000 $__________
(b) Aggregate amount of Indebtedness of the Borrower
and its Subsidiaries outstanding as of such date
as permitted by Section 7.2(d) of the Credit
Agreement $__________
(c) Aggregate amount of Indebtedness of the Borrower
and its Subsidiaries, including Capital Lease
Obligations, permitted by Section 7.2(e) of the
Credit Agreement, in an amount not to exceed
$75,000,000 $__________
(d) Aggregate amount of Indebtedness of the Borrower
in respect of the Senior Subordinated Notes
permitted by Section 7.2(f) of the Credit
Agreement, in an amount not to exceed $750,000,000 $__________
(e) Aggregate amount of Indebtedness of Foreign
Subsidiaries under lines of credit in an amount
not to exceed the local currency equivalent of
$100,000,000 $__________
(f) Aggregate amount of additional Indebtedness of the
Borrower or any of its Subsidiaries in an
aggregate principal amount not to exceed
$50,000,000 $__________
5. DISPOSITIONS OF PROPERTY (SECTION 7.5)
(a) Dispositions pursuant to Section 7.5(g) of the
Credit Agreement so long as the fair market value
of such disposed property does not exceed
$________ (i.e., 10% of Consolidated Total Assets
of the Borrower on the Funding Date ($________)
plus the proceeds of any Reinvestment Deferred
Amount reinvested in the business of the Borrower
and its Subsidiaries after the Funding Date
($________)) $__________
<PAGE> 304
4.
6. RESTRICTED PAYMENTS (SECTION 7.6)
(a) Restricted Payments made pursuant to Section 7.6(b)
of the Credit Agreement so long as the aggregate
amount of payments made after the Funding Date does
not exceed $10,000,000 $__________
(b) Other Restricted Payments made pursuant to Section
7.6[(e)][(f)] of the Credit Agreement (not to exceed
[$2,500,000 in the fourth quarter or fiscal 1999]
[$15,000,000 per fiscal year]) $__________
7. CAPITAL EXPENDITURES (SECTION 7.7)
(a) Aggregate Capital Expenditures of the Borrower and its
Subsidiaries in the ordinary course of business in
accordance with Section 7.7 of the Credit Agreement
(not to exceed [$75,000,000 from the Funding Date
through December 31, 1999] [$275,000,000 per fiscal
year] plus permitted carryovers) $__________
8. INVESTMENTS (SECTION 7.8)
(a) Aggregate amount of loans and advances to employees
of the Borrower or any of its Subsidiaries as
described in Section 7.8(d) of the Credit Agreement
(not to exceed $10,000,000 at any one time
outstanding) $__________
(b) Aggregate amount of investments in Joint Ventures $__________
(c) Aggregate amount of other Investments not otherwise
permitted by Section 7.8 of the Credit Agreement so
long as the aggregate amount expended in connection
therewith does not exceed $25,000,000 (valued at
cost) $__________
IN WITNESS WHEREOF, I have hereto set my name in my capacity as an
officer of the Borrower.
Dated:
By: _____________________________
Name:
Title: [Responsible Officer
of the Borrower]
<PAGE> 305
Schedule 1 to
Compliance Certificate
CALCULATIONS
1. CONSOLIDATED TOTAL DEBT: for the Borrower and its
Subsidiaries as of any date, without duplication,
shall be:
THE SUM OF
(a) all indebtedness for borrowed money, $__________
(b) all obligations for the deferred purchase price of
property or services (other than any such obligations
incurred in the ordinary course of business maturing
less than one year from the creation thereof),
$__________
(c) all obligations evidenced by notes, bonds, debentures
or other similar instruments (other than an operating
lease, synthetic lease or similar arrangement),
$__________
(d) all unpaid reimbursement obligations in respect of
drawings under letters of credit, $__________
(e) all obligations of the kind referred to in clauses
(a) through (i) above secured by (or for which the
holder of such obligation has an existing right,
contingent or otherwise, to be secured by) any Lien
on property (including accounts and contract rights)
owned by any such Person, whether or not such Person
has assumed or become liable for the payment of such
obligation. $__________
CONSOLIDATED TOTAL DEBT $__________
2. CONSOLIDATED EBITDA: for any period with respect to the
Borrower and its Subsidiaries:
Consolidated Net Income for such period $__________
PLUS THE SUM OF (without duplication and to the extent
reflected as a charge in the statement of Consolidated
Net Income for such period)
(a) total income tax expense, $__________
(b) interest expense, amortization or writeoff of debt
discount and debt issuance costs and commissions,
discounts and other fees and charges associated with
Indebtedness, $__________
(c) depreciation and amortization expense, $__________
(d) amortization of intangibles and organization costs, $__________
(e) any extraordinary, unusual or non-recurring non-cash
expenses or losses, and $__________
(f) other noncash charges $__________
THE SUM OF (A) THROUGH (F) $__________
<PAGE> 306
2.
minus the sum of (without duplication and to the extent
included in the statement of Consolidated Net Income for
such period)
(a) interest income $__________
(b) any non-cash extraordinary, unusual or non-recurring
income or gains, and $__________
(c) other non-cash income, all as determined on a
consolidated basis in accordance with GAAP. $__________
THE SUM OF (a) THROUGH (c) $__________
CONSOLIDATED EBITDA $__________
3. CONSOLIDATED INTEREST EXPENSE: for any period, the sum of:
(a) total cash interest expense (including that
attributable to Capital Lease Obligations but net of
interest income) of the Borrower and its Subsidiaries
during such period (including all commissions,
discounts and other fees and charges owed with
respect to letters of credit and bankers' acceptance
financing and net costs under Hedge Agreements to the
extent such net costs are allocable to such period in
accordance with GAAP). $__________
CONSOLIDATED INTEREST EXPENSE $__________
<PAGE> 307
EXHIBIT C
TO THE CREDIT AGREEMENT
FORM OF
CLOSING CERTIFICATE
I, the undersigned, [President/Vice President/Chief Financial Officer] of
[NAME OF LOAN PARTY], a corporation organized and existing under the laws of
the State of_____________ (the "Company"), do hereby certify on behalf of the
Company that:
1. This Certificate is furnished pursuant to the Credit Agreement, dated
as of September 30, 1999, among Tenneco Inc., the Lenders parties thereto, the
Co-Documentation Agents and Syndication Agent party thereto and The Chase
Manhattan Bank, as Administrative Agent (such Credit Agreement, as in effect on
the date of this Certificate, being herein called the "Credit Agreement").
Unless otherwise defined herein, capitalized terms used in this Certificate
shall have the meanings set forth in the Credit Agreement.
2. The following named individuals are elected or appointed officers of
the Company, and each holds the office of the Company set forth opposite his or
her name and has held such office since _____________________, 19___(1). The
signature written opposite the name and title of each such officer is his or her
genuine signature.
NAME(2) OFFICE SIGNATURE
______________________ ___________________________ ________________________
______________________ ___________________________ ________________________
______________________ ___________________________ ________________________
3. Attached hereto as Exhibit A is a certified copy of the Certificate
of Incorporation of the Company, as filed in the Office of the Secretary of
State of the State of _____________________ on ________________________, 19___,
together with all amendments thereto adopted through the date hereof.
4. Attached hereto as Exhibit B is a true and correct copy of the By-Laws
of the Company which were duly adopted, are in full force and effect on the date
hereof, and have been in effect since ____________________, 19___.
____________
1 Insert a date prior to the time of any corporate action relating to
the Loan Documents or related documentation.
2 Include name, office and signature of each officer who will sign the
Credit Agreement and any Note, including the officer who will sign
the certification at the end of this Certificate or related
documentation.
<PAGE> 308
5. Attached hereto as Exhibit C is a true and correct copy of resolutions
which were duly adopted on ___________, 19___ [by unanimous written consent of
the Board of Directors of the Company] [by a meeting of the Board of Directors
of the Company at which a quorum was present and acting throughout], and said
resolutions have not been rescinded, amended or modified. Except as attached
hereto as Exhibit C, no resolutions have been adopted by the Board of Directors
of the Company which deal with the execution, delivery or performance of the
Loan Documents.
6. On the date hereof, all of the conditions set forth in Section 5.3 of
the Credit Agreement have been satisfied or waived in accordance with the
Credit Agreement.
7. On the date hereof, the representations and warranties of the Company
set forth in the Credit Agreement are true and correct with the same effect as
though such representations and warranties had been made on and as of the date
hereof.
8. On the date hereof, no Default or Event of Default has occurred and is
continuing or would result from any Borrowing to occur on the date hereof or
the application of the proceeds thereof, as applicable.
9. There is no proceeding for the dissolution or liquidation of the
Company or threatening its existence.
IN WITNESS WHEREOF, I have hereunto set my hand this _____________ day of
________________, 1999.
[NAME OF LOAN PARTY]
By:_______________________________________
Name:
Title:
<PAGE> 309
I, the undersigned, [Secretary/Assistant Secretary] of the [LOAN PARTY], do
hereby certify that:
1. [Name of Person making above certifications] is the duly elected and
qualified [President/Vice President/Chief Financial Officer] of the [LOAN
PARTY] and the signature above is his genuine signature.
2. The certifications made by [name of Person making above
certifications] in Items 2,3,4,5,6,7,8 and 9 above are true and correct.
IN WITNESS WHEREOF, I have hereunto set my hand this ______________ day of
______________, 1999.
[NAME OF LOAN PARTY]
By:___________________________________
Name:
Title:
<PAGE> 310
EXHIBIT D -- Form of Mortgage
[Michigan]
THIS MORTGAGE CONSTITUTES A FIXTURE FILING
UNDER THE MICHIGAN UNIFORM COMMERCIAL CODE
MORTGAGE, SECURITY AGREEMENT
AND ASSIGNMENT OF LEASES AND RENTS
from
_________________, Mortgagor, a _____________________
corporation whose address
is __________________________
to
THE CHASE MANHATTAN BANK,
as Administrative Agent, Mortgagee,
a New York banking
corporation whose address
is 270 Park Avenue
New York, New York 10017
DATED AS OF ____________________, 1999
Prepared by, and after recording, please return to:
Simpson Thacher & Bartlett
a partnership which includes
professional corporations
425 Lexington Avenue
New York, New York 10017
ATTN: Nicola Ramsay-Palmer, Esq.
<PAGE> 311
MICHIGAN
MORTGAGE, SECURITY AGREEMENT
AND ASSIGNMENT OF LEASES AND RENTS
THIS MORTGAGE, SECURITY AGREEMENT AND ASSIGNMENT OF LEASES AND RENTS
dated as of , 1999 is made by ("MORTGAGOR"),
whose address is , to THE
CHASE MANHATTAN BANK, a New York banking corporation ("CHASE"), as
Administrative Agent for the Lenders referred to and as defined below (in such
capacity, "MORTGAGEE", which term shall be deemed to include successors and
assigns of the Administrative Agent), whose address is 270 Park Avenue, New
York, New York 10017. References to this "MORTGAGE" shall mean this instrument
and any and all renewals, modifications, amendments, supplements, extensions,
consolidations, substitutions, spreaders and replacements of this instrument.
Background
A. Tenneco Inc., a Delaware corporation (the "BORROWER"), has entered
into the Credit Agreement dated as of September 30, 1999 (as the same may be
amended, supplemented, restated or otherwise modified from time to time, the
"CREDIT AGREEMENT") with the several banks and other financial institutions or
entities from time to time parties thereto (the "LENDERS"), Commerzbank and Bank
of America, as Co-Documentation Agents, Citicorp USA, Inc., as Syndication
Agent, and Mortgagee. The terms of the Credit Agreement are incorporated by
reference in this Mortgage as if the terms thereof were fully set forth herein.
In the event of any conflict between the provisions of this Mortgage and the
provisions of the Credit Agreement, the applicable provisions of the Credit
Agreement shall govern and control, provided, that in the case of a provision in
this Mortgage which is more specific and detailed than the related provision in
the Credit Agreement (including by way of illustration, the section of this
Mortgage entitled "Leases"), such Mortgage provision shall not be deemed to be
in conflict with the related provision in the Credit Agreement.
Capitalized terms not otherwise defined herein shall have the meanings
ascribed thereto in the Credit Agreement. References in this Mortgage to the
"Default Rate" shall mean the interest rate applicable to ABR Loans plus 2%.
B. Mortgagor is the owner of the parcel(s) of real property described
on Schedule A attached (such real property, together with all of the buildings,
improvements, structures and fixtures now or subsequently located thereon (the
"IMPROVEMENTS"), being collectively referred to as the "REAL ESTATE").
<PAGE> 312
2
C. Pursuant to the terms of the Credit Agreement, (1) the Lenders have
agreed (a) to make certain Revolving Loans to, and issue Letters of Credit for
the account of, Borrower in an aggregate principal amount at any one time
outstanding not to exceed $500,000,000.00 and (b) to make certain Term Loans to
Borrower in an aggregate principal amount not to exceed $1,050,000,000.00, (2)
the Swing Line Lender has agreed to make certain Swing Line Loans to Borrower in
an aggregate principal amount at any one time outstanding not to exceed
$50,000,000.00, and (3) the Issuing Lender, has agreed to issue, and the other
Lenders which are L/C Participants have agreed to acquire participating
interests in, Letters of Credit for the account of Borrower. The maximum
aggregate principal amount of the Loans and the L/C Obligations outstanding at
any one time shall not exceed $1,550,000,000.00.
D. It is a condition precedent to the effectiveness of the Credit
Agreement and the obligations of the Lenders to make their respective extensions
of credit to the Borrower thereunder inter alia, that [(1) Mortgagor guaranty
the obligations of Borrower under the Credit Agreement and the other Loan
Documents in respect of the Loans and the Reimbursement Obligations by executing
and delivering that certain Guarantee and Collateral Agreement dated as of
November 4, 1999 in favor of Mortgagee (as the same may be amended, supplemented
or otherwise modified from time to time, the "GUARANTEE AND COLLATERAL
AGREEMENT") and (2)] Mortgagor secure its obligations under the Guarantee and
Collateral Agreement by executing and delivering this Mortgage. Mortgagor, a
subsidiary of the Borrower, will receive substantial direct and indirect benefit
from the extensions of credit made to the Borrower pursuant to the Credit
Agreement. [THIS MORTGAGE WILL BE APPROPRIATELY MODIFIED FOR MORTGAGEES BY
BORROWER]
Granting Clauses
For good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, Mortgagor agrees that to secure the following
(collectively, the "OBLIGATIONS"):
(a) the due and punctual payment and performance by Mortgagor of
any and all of its obligations and liabilities, whether direct or
indirect, absolute or contingent, due or to become due, or now
existing or hereafter incurred, which may arise under, out of, or in
connection with the Guarantee and Collateral Agreement;
(b) the payment of all other obligations and liabilities of
Mortgagor, whether direct or indirect, absolute or contingent, due or
to become due, or now existing or hereafter incurred, which may arise
under, out of or in connection with the Guarantee and Collateral
Agreement, this Mortgage, any other document securing
<PAGE> 313
3
payment of the Obligations (the "SECURITY DOCUMENTS") and any
amendments, supplements, extensions, renewals, restatements,
replacements or modifications of any of the foregoing (the Credit
Agreement, the Letters of Credit, the Interest Rate Protection
Agreements (as defined in the Guarantee and Collateral Agreement), the
Guarantee and Collateral Agreement, this Mortgage and the other
Security Documents and all other documents and instruments from time
to time evidencing, securing or guaranteeing the payment and
performance of the Obligations, as any of the same may be amended,
supplemented, extended, renewed, restated, replaced or modified from
time to time, are collectively referred to as the "LOAN DOCUMENTS"),
in each case whether on account of principal, interest, reimbursement
obligations, fees, indemnities, costs, expenses or otherwise
(including, without limitation, all fees, charges and disbursements of
counsel to Mortgagee or to the Lenders that are required to be paid by
Mortgagor pursuant to the terms of the Credit Agreement, this Mortgage
or any other Loan Document); and
(c) the performance of all covenants, agreements, obligations and
liabilities of Mortgagor under or pursuant to the provisions of the
Loan Documents;
MORTGAGOR HEREBY GRANTS TO MORTGAGEE A LIEN UPON AND A SECURITY INTEREST IN,
AND HEREBY MORTGAGES AND WARRANTS, GRANTS, ASSIGNS, TRANSFERS AND SETS OVER TO
MORTGAGEE:
(A) the Real Estate;
(B) all the estate, right, title, claim or demand whatsoever of
Mortgagor, in possession or expectancy, in and to the Real Estate or any
part thereof;
(C) all right, title and interest of Mortgagor in, to and under all
easements, rights of way, gores of land, streets, ways, alleys, passages,
sewer rights, waters, water courses, water and riparian rights, development
rights, air rights, mineral rights, oil and gas rights and all estates,
rights, titles, interests, privileges, licenses, tenements, hereditaments
and appurtenances belonging, relating or appertaining to the Real Estate,
and any reversions, remainders, rents, issues, profits and revenue thereof
and all land lying in the bed of any street, road or avenue, in front of or
adjoining the Real Estate to the center line thereof;
(D) all of the fixtures, chattels, business machines, machinery,
apparatus, equipment, furnishings, fittings and articles of personal
property of every kind and nature whatsoever, and all appurtenances and
additions thereto and substitutions or replacements thereof (together with,
in each case, attachments, components, parts and accessories)
<PAGE> 314
4
currently owned or subsequently acquired by Mortgagor and now or
subsequently attached to, or contained in or used or usable in any way in
connection with any operation or letting of the Real Estate, including but
without limiting the generality of the foregoing, all screens, awnings,
shades, blinds, curtains, draperies, artwork, carpets, rugs, storm doors
and windows, furniture and furnishings, heating, electrical, and mechanical
equipment, lighting, switchboards, plumbing, ventilating, air conditioning
and air-cooling apparatus, refrigerating, and incinerating equipment,
escalators, elevators, loading and unloading equipment and systems, stoves,
ranges, laundry equipment, cleaning systems (including window cleaning
apparatus), telephones, communication systems (including satellite dishes
and antennae), televisions, computers, sprinkler systems and other fire
prevention and extinguishing apparatus and materials, security systems,
motors, engines, machinery, pipes, pumps, tanks, conduits, appliances,
fittings and fixtures of every kind and description (all of the foregoing
in this paragraph (D) being referred to as the "EQUIPMENT");
(E) all right, title and interest of Mortgagor in and to all
substitutes and replacements of, and all additions and improvements to, the
Real Estate and the Equipment, subsequently acquired by or released to
Mortgagor or constructed, assembled or placed by Mortgagor on the Real
Estate, immediately upon such acquisition, release, construction,
assembling or placement, including, without limitation, any and all
building materials whether stored at the Real Estate or offsite, and, in
each such case, without any further mortgage, conveyance, assignment or
other act by Mortgagor;
(F) all right, title and interest of Mortgagor in, to and under all
leases, subleases, underlettings, concession agreements, management
agreements, licenses and other agreements relating to the use or occupancy
of the Real Estate or the Equipment or any part thereof, now existing or
subsequently entered into by Mortgagor and whether written or oral and all
guarantees of any of the foregoing (collectively, as any of the foregoing
may be amended, restated, extended, renewed or modified from time to time,
the "LEASES"), and all rights of Mortgagor in respect of cash and
securities deposited thereunder and the right to receive and collect the
revenues, income, rents, issues and profits thereof, together with all
other rents, royalties, issues, profits, revenue, income and other benefits
arising from the use and enjoyment of the Mortgaged Property (as defined
below) (collectively, the "RENTS") including, but not limited to, all
rights conferred by Act No. 210 of the Michigan Public Acts of 1953 as
amended by Act No. 151 of the Michigan Public Acts of 1966 (MCLA 554.231 et
seq.), and Act No. 228 of the Michigan Public
<PAGE> 315
5
Acts of 1925 as amended by Act No. 55 of the Michigan Public Acts of 1933
(MCLA 554.211 et seq.);
(G) all trade names, trade marks, logos, copyrights, good will and
books and records relating to or used in connection with the operation of
the Real Estate or the Equipment or any part thereof; all general
intangibles related to the operation of the Improvements now existing or
hereafter arising;
(H) all unearned premiums under insurance policies now or subsequently
obtained by Mortgagor relating to the Real Estate or Equipment and
Mortgagor's interest in and to any such insurance policies and all proceeds
of any such insurance policies (including title insurance policies)
including the right to collect and receive such proceeds, subject to the
provisions relating to insurance generally set forth below; and all awards
and other compensation, including the interest payable thereon and the
right to collect and receive the same, made to the present or any
subsequent owner of the Real Estate or Equipment for the taking by eminent
domain, condemnation or otherwise, of all or any part of the Real Estate or
any easement or other right therein;
(I) all right, title and interest of Mortgagor in and to (i) all
contracts from time to time executed by Mortgagor or any manager or agent
on its behalf relating to the ownership, construction, maintenance, repair,
operation, occupancy, sale or financing of the Real Estate or Equipment or
any part thereof and all agreements relating to the purchase or lease of
any portion of the Real Estate or any property which is adjacent or
peripheral to the Real Estate, together with the right to exercise such
options and all leases of Equipment (collectively, the "CONTRACTS"), (ii)
all consents, licenses, building permits, certificates of occupancy and
other governmental approvals relating to construction, completion,
occupancy, use or operation of the Real Estate or any part thereof
(collectively, the "PERMITS") and (iii) all drawings, plans, specifications
and similar or related items relating to the Real Estate (collectively, the
"PLANS");
(J) any and all monies now or subsequently on deposit for the payment
of real estate taxes or special assessments against the Real Estate or for
the payment of premiums on insurance policies covering the foregoing
property or otherwise on deposit with or held by Mortgagee as provided in
this Mortgage; and
(K) all proceeds, both cash and noncash, of the foregoing;
(All of the foregoing property and rights and interests now owned or
held or subsequently acquired by Mortgagor and
<PAGE> 316
6
described in the foregoing clauses (A) through (E) are collectively referred to
as the "PREMISES", and those described in the foregoing clauses (A) through (K)
are collectively referred to as the "MORTGAGED PROPERTY").
TO HAVE AND TO HOLD the Mortgaged Property and the rights and
privileges hereby mortgaged unto Mortgagee, its successors and assigns for the
uses and purposes set forth, until the Obligations are fully paid and performed.
PROVIDED ALWAYS, that if Mortgagor shall promptly and fully pay and perform all
of the Obligations and shall perform all of the other provisions contained
herein and in the Loan Documents, then the estate hereby granted shall cease,
terminate and become void but shall otherwise remain in full force and effect.
Terms and Conditions
Mortgagor further represents, warrants, covenants and agrees with
Mortgagee as follows:
1. Warranty of Title. Mortgagor warrants the title to the Premises,
subject only to the matters that are set forth in Schedule B of the title
insurance policy or policies being issued to Mortgagee to insure the lien of
this Mortgage and to the Liens expressly permitted under Section 7.3 of the
Credit Agreement (the "PERMITTED EXCEPTIONS")and Mortgagor shall warrant, defend
and preserve such title and the lien of the Mortgage thereon against all claims
of all persons and entities. Mortgagor further warrants that it has the right to
mortgage the Mortgaged Property.
2. Payment of Obligations. Mortgagor shall pay and perform all the
Obligations at the times and places and in the manner specified in the Guarantee
and Collateral Agreement and in this Mortgage.
3. Requirements.
(a) Mortgagor shall promptly comply with, or cause to be complied
with, and conform to all present and future laws, statutes, codes, ordinances,
orders, judgments, decrees, rules, regulations and requirements, and
irrespective of the nature of the work to be done, of each of the United States
of America, any State and any municipality, local government or other political
subdivision thereof and any agency, department, bureau, board, commission or
other instrumentality of any of them, now existing or subsequently created
(collectively, "GOVERNMENTAL AUTHORITY") which has jurisdiction over the
Mortgaged Property and all covenants, restrictions and conditions now or later
of record which may be applicable to any of the Mortgaged Property, or to the
use, manner of use, occupancy, possession, operation, maintenance, alteration,
repair or reconstruction of any of the Mortgaged Property, except to the extent
that failure to comply therewith could not, in the
<PAGE> 317
7
aggregate, reasonably be expected to have a Material Adverse Effect. All present
and future laws, statutes, codes, ordinances, orders, judgments, decrees, rules,
regulations and requirements of every Governmental Authority applicable to
Mortgagor or to any of the Mortgaged Property and all covenants, restrictions,
and conditions which now or later may be applicable to any of the Mortgaged
Property are collectively referred to as the "LEGAL REQUIREMENTS".
(b) From and after the date of this Mortgage, Mortgagor shall not by
act or omission permit any building or other improvement on any premises not
subject to the lien of this Mortgage to rely on the Premises or any part thereof
or any interest therein to fulfill any Legal Requirement, and Mortgagor hereby
assigns to Mortgagee any and all rights to give consent for all or any portion
of the Premises or any interest therein to be so used. Mortgagor shall not by
act or omission impair the integrity of any of the Real Estate as a single
zoning lot separate and apart from all other premises. Mortgagor represents that
each parcel of the Real Estate constitutes a legally subdivided lot, in
compliance with all subdivision laws and similar Legal Requirements except to
the extent that failure to comply therewith, in the aggregate, would not
reasonably be expected to have a Material Adverse Effect.. Any act or omission
by Mortgagor which would result in a violation of any of the provisions of this
subsection shall be void.
4. Payment of Taxes and Other Impositions. (a) Promptly when due,
Mortgagor shall pay and discharge all taxes of every kind and nature (including,
without limitation, all real and personal property, income, franchise,
withholding, transfer, gains, profits and gross receipts taxes), all charges for
any easement or agreement maintained for the benefit of any of the Mortgaged
Property, all general and special assessments, levies, permits, inspection and
license fees, all water and sewer rents and charges, vault taxes, and all other
public charges even if unforeseen or extraordinary, imposed upon or assessed
against or which may become a lien on any of the Mortgaged Property, or arising
in respect of the occupancy, use or possession thereof, together with any
penalties or interest on any of the foregoing (all of the foregoing are
collectively referred to as the "IMPOSITIONS"). Mortgagor shall within 30 days
after written request by Mortgagee deliver to Mortgagee (i) original or copies
of receipted bills and canceled checks evidencing payment of such Imposition if
it is a real estate tax or other public charge and (ii) evidence acceptable to
Mortgagee showing the payment of any other such Imposition. If by law any
Imposition, at Mortgagor's option, may be paid in installments (whether or not
interest shall accrue on the unpaid balance of such Imposition), Mortgagor may
elect to pay such Imposition in such installments and shall be responsible for
the payment of such installments with interest, if any.
<PAGE> 318
8
(b) Nothing herein shall affect any right or remedy of Mortgagee under
this Mortgage or otherwise, with notice to Mortgagor, to pay any Imposition
after the date such Imposition shall have become delinquent (unless being
contested by Mortgagor as provided in (c) below), and to add to the Obligations
the amount so paid, together with interest from the time of payment at the
Default Rate. Any sums paid by Mortgagee in discharge of any Impositions shall
be (i) a lien on the Premises secured hereby prior to any right or title to,
interest in, or claim upon the Premises subordinate to the lien of this
Mortgage, and (ii) payable on written demand by Mortgagor to Mortgagee together
with interest at the Default Rate as set forth above.
(c) Mortgagor shall have the right before any delinquency occurs to
contest or object in good faith to the amount or validity of any Imposition by
appropriate legal proceedings, but such right shall not be deemed or construed
in any way as relieving, modifying, or extending Mortgagor's covenant to pay any
such Imposition at the time and in the manner provided in this Section unless
(i) Mortgagor has given prior written notice to Mortgagee of Mortgagor's intent
so to contest or object to an Imposition, (ii) Mortgagor shall demonstrate to
Mortgagee's reasonable satisfaction that the legal proceedings shall operate
conclusively to prevent the sale of the Mortgaged Property, or any part thereof,
to satisfy such Imposition prior to final determination of such proceedings and
(iii) Mortgagor shall either (x) furnish a good and sufficient bond or surety as
requested by and reasonably satisfactory to Mortgagee or (y) maintain adequate
reserves in accordance with GAAP on Mortgagor's books, in each case in the
amount of the Impositions which are being contested plus any interest and
penalty which may be imposed thereon and which could become a lien against the
Real Estate or any part of the Mortgaged Property.
5. Insurance. (a) Mortgagor shall maintain or cause to be maintained
on all of the Premises
(i) property insurance against loss or damage by fire, lightning,
windstorm, tornado, water damage, flood, earthquake and by such other
further risks and hazards as now are or subsequently may be covered by an
"all risk" policy or a fire policy covering "special" causes of
loss(provided, however, that the maintenance of insurance against
earthquake and flood risks shall be subject to availability of such
insurance coverage on commercially reasonable terms) and the policy limits
shall be automatically reinstated after each loss (other than with respect
to flood and earthquake coverage which shall be reinstated on a
commercially reasonable basis);
(ii) commercial general liability insurance under a policy including
the "broad form CGL endorsement" (or which incorporates the language or
similar language of such endorsement), covering all claims for personal
injury, bodily
<PAGE> 319
9
injury or death, or property damage, subject to standard policy terms,
conditions and exclusions, occurring on, in or about the Premises in an
amount not less than $10,000,000 combined single limit with respect to
personal injury, bodily injury or death, or property damage, relating to
any one occurrence plus such excess limits as Mortgagee shall reasonably
request from time to time;
(iii) insurance against rent loss, extra expense or business
interruption, in amounts reasonably satisfactory to Mortgagee, but not less
than one year's gross rent or gross income (except as may be otherwise
reasonably agreed to by Mortgagee);
(iv) if any portion of the Premises are located in an area identified
as a special flood hazard area by the Federal Emergency Management Agency
or other applicable agency, flood insurance in an amount satisfactory to
Mortgagee, but in no event less than the maximum limit of coverage
available under the National Flood Insurance Act of 1968, as amended; and
(v) such other insurance in such amounts as is mutually agreeable to
Mortgagor and Mortgagee against loss or damage by any other risk commonly
insured against by persons occupying or using like properties for like
purposes in the locality or localities in which the Real Estate is
situated.
(b) Each insurance policy (other than flood insurance written under
the National Flood Insurance Act of 1968, as amended, in which case to the
extent available) shall (i) provide that it shall not be canceled, non-renewed
or materially amended without 30-days' prior written notice to Mortgagee, and
(ii) with respect to all property insurance, contain a "Replacement Cost
Endorsement" without any deduction made for depreciation and with no
co-insurance penalty (or attaching an agreed amount endorsement satisfactory to
Mortgagee), with loss payable to Mortgagee as its interest may appear, without
contribution, under a "standard" or "New York" mortgagee clause acceptable to
Mortgagee. Liability insurance policies shall name Mortgagee as an additional
insured and contain a waiver of subrogation against Mortgagee; all such policies
shall indemnify and hold Mortgagee harmless from all liability claims occurring
on, in or about the Premises and the adjoining streets, sidewalks and
passageways, subject to standard policy terms, conditions and exclusions. The
amounts of each insurance policy and the form of each such policy shall at all
times be mutually agreeable to Mortgagor and Mortgagee.
(c) Mortgagor shall deliver to Mortgagee a certificate of such
insurance acceptable to Mortgagee, together with a copy of the declaration page
for each such policy. Mortgagor shall (i) pay as they become due all premiums
for such insurance, (ii) not later than 15 days prior to the expiration of each
policy to be furnished pursuant to the provisions of this Section, deliver a
certificate
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of insurance acceptable to Mortgagee, accompanied by evidence of payment
satisfactory to Mortgagee and (iii) upon the written request of Mortgagee
deliver a renewed policy or policies, or duplicate original or originals
thereof, marked "premium paid," or accompanied by such other evidence of payment
satisfactory to Mortgagee.
(d) If Mortgagor is in default of its obligations to insure or deliver
any such prepaid policy or policies, then Mortgagee, at its option and with
prior notice (written or otherwise), may effect such insurance from year to
year, and pay the premium or premiums therefor, and Mortgagor shall pay to
Mortgagee on demand such premium or premiums so paid by Mortgagee with interest
from the time of payment at the Default Rate and the same shall be deemed to be
secured by this Mortgage and shall be collectible in the same manner as the
Obligations secured by this Mortgage.
(e) Mortgagor promptly shall comply with and conform to (i) all
provisions of each such insurance policy, and (ii) all requirements of the
insurers applicable to Mortgagor or to any of the Mortgaged Property or to the
use, manner of use, occupancy, possession, operation, maintenance or repair of
any of the Mortgaged Property. Mortgagor shall not use or permit the use of the
Mortgaged Property in any manner which would permit any insurer to cancel any
insurance policy or void coverage required to be maintained by this Mortgage.
(f) If the Mortgaged Property, or any part thereof, shall be destroyed
or damaged, Mortgagor shall give immediate notice thereof to Mortgagee. All
insurance proceeds shall be paid to Mortgagee to be held by Mortgagee as
collateral to secure the payment and performance of the Obligations.
Notwithstanding the preceding sentence, provided that no Event of Default shall
have occurred and be continuing, Mortgagor shall have the right to adjust such
loss, and subject to the provisions of Section 2.11 of the Credit Agreement, the
insurance proceeds relating to such loss shall be paid over to Mortgagor;
provided that Mortgagor shall, promptly after any such damage, repair all such
damage regardless of whether any insurance proceeds have been received or
whether such proceeds, if received, are sufficient to pay for the costs of
repair.
(g) Mortgagor may maintain insurance required under this Mortgage by
means of one or more blanket insurance policies maintained by Mortgagor;
provided, however, that (A) any such policy shall specify, or Mortgagor shall
furnish to Mortgagee a written statement from the insurer so specifying, the
maximum amount of the total insurance afforded by such blanket policy that is
allocated to the Premises and the other Mortgaged Property and any sublimits in
such blanket policy applicable to the Premises and the other Mortgaged Property,
(B) each such blanket policy shall include an endorsement providing that, in the
event of a loss
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resulting from an insured peril, insurance proceeds shall be allocated to the
Mortgaged Property in an amount equal to the coverages required to be maintained
by Mortgagor as provided above and (C) the protection afforded under any such
blanket policy shall be no less than that which would have been afforded under a
separate policy or policies relating only to the Mortgaged Property.
6. Restrictions on Liens and Encumbrances. Except for the lien of this
Mortgage and the Permitted Exceptions, and except as expressly permitted under
the Credit Agreement, Mortgagor shall not further mortgage, nor otherwise
encumber the Mortgaged Property nor create or suffer to exist any lien, charge
or encumbrance on the Mortgaged Property, or any part thereof, whether superior
or subordinate to the lien of this Mortgage and whether recourse or
non-recourse.
7. Due on Sale and Other Transfer Restrictions. Except as expressly
permitted under the Credit Agreement, Mortgagor shall not sell, convey or assign
all or any portion of, or any interest in, the Mortgaged Property.
8. Maintenance; No Alteration; Inspection; Utilities. (a) Mortgagor
shall maintain or cause to be maintained all the Improvements in good condition
and repair and shall not commit or suffer any waste of the Improvements.
Mortgagor shall repair, restore, replace or rebuild promptly any part of the
Premises which may be damaged or destroyed by any casualty whatsoever. The
Improvements shall not be demolished or materially altered, nor any material
additions built, without the prior written consent of Mortgagee, which consent
shall not be unreasonably withheld or delayed. Mortgagor's failure to pay (i)
any Imposition assessed against the Premises (not being contested in the manner
provided therein), or any installment thereof, or (ii) any insurance premium
upon policies required to be carried by the terms of this Mortgage, shall
constitute waste (although the meaning of the term "waste" shall not be limited
to such nonpayment) as provided by Act No. 236 of the Michigan Public Acts of
1961 (Revised Judicature Act), Section 600.2927, as and if amended and shall
entitle Mortgagee to all remedies provided for therein; and Mortgagor agrees to
and hereby does consent to the appointment of a receiver under said statute,
should Mortgagee elect to seek such relief thereunder.
(b) Mortgagee and any persons authorized by Mortgagee shall have the
right at all reasonable times upon reasonable prior written notice to enter and
inspect the Premises and all work done, labor performed and materials furnished
in and about the Improvements and to inspect and make copies of all books,
contracts and records of Mortgagor relating to the Mortgaged Property.
(c) Mortgagor shall pay or cause to be paid when due all utility
charges which are incurred for gas, electricity, water or
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sewer services furnished to the Premises and all other assessments or charges of
a similar nature, whether public or private, affecting the Premises or any
portion thereof, whether or not such assessments or charges are liens thereon.
9. Condemnation/Eminent Domain. Immediately upon obtaining knowledge
of the institution of any proceedings for the condemnation of the Mortgaged
Property, or any portion thereof, Mortgagor will notify Mortgagee of the
pendency of such proceedings. Mortgagor authorizes Mortgagee, at Mortgagee's
option and in Mortgagee's reasonable discretion, as attorney-in-fact for
Mortgagor, to commence, appear in and prosecute, in Mortgagee's or Mortgagor's
name, any action or proceeding relating to any condemnation of the Mortgaged
Property, or any portion thereof, and to settle or compromise any claim in
connection with such condemnation upon the occurrence and during the continuance
of an Event of Default. If Mortgagee elects not to participate in such
condemnation proceeding, then Mortgagor shall, at its expense, diligently
prosecute any such proceeding and shall consult with Mortgagee, its attorneys
and experts and cooperate with them in any defense of any such proceedings. All
awards and proceeds of condemnation shall be assigned to Mortgagee to be applied
in the same manner as insurance proceeds, as provided above, and Mortgagor
agrees to execute any such assignments of all such awards as Mortgagee may
request.
10. Restoration. Subject to Section 2.11 of the Credit Agreement,
Mortgagor shall use all insurance proceeds and all condemnation proceeds and
awards to promptly restore the Mortgaged Property to its condition prior to such
casualty or condemnation, (giving effect to the remaining configuration of the
Premises after such condemnation) and in compliance with all Legal Requirements.
11. Leases. (a) Mortgagor shall not (i) execute an assignment or
pledge of any Lease relating to all or any portion of the Mortgaged Property
other than in favor of Mortgagee, or (ii) except as expressly permitted under
the Credit Agreement, without the prior written consent of Mortgagee (which
consent shall not be unreasonably withheld or delayed), execute any Lease of the
Mortgaged Property or permit to exist any Lease of any of the Mortgaged Property
not already in existence prior to the date of this Mortgage.
(b) As to any Lease consented to by Mortgagee, Mortgagor shall:
(i) promptly perform all of the provisions of the Lease on the part of
the lessor thereunder to be performed;
(ii) promptly enforce all of the provisions of the Lease on the part
of the lessee thereunder to be performed;
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13
(iii) appear in and defend any action or proceeding arising under or
in any manner connected with the Lease or the obligations of Mortgagor as
lessor or of the lessee thereunder;
(iv) exercise, within 5 days after a request by Mortgagee, any right
to request from the lessee a certificate with respect to the status
thereof;
(v) simultaneously deliver to Mortgagee copies of any notices of any
material default (as reasonably determined in good faith by Mortgagor)
which Mortgagor may at any time forward to or receive from the lessee;
(vi) promptly deliver to Mortgagee a fully executed counterpart of the
Lease; and
(vii) promptly deliver to Mortgagee, upon Mortgagee's request, an
assignment of the Mortgagor's interest under such Lease.
(c) Mortgagor shall deliver to Mortgagee, within 10 days after a
request by Mortgagee, a written statement, certified by Mortgagor as being true,
correct and complete, containing the names of all lessees and other occupants of
the Mortgaged Property, the terms of all Leases and the spaces occupied and
rentals payable thereunder, and a list of all Leases which are then in default,
including the nature and magnitude of the default.
(d) All Leases entered into by Mortgagor after the date hereof, if
any, and all rights of any lessees thereunder shall be subject and subordinate
in all respects to the lien and provisions of this Mortgage unless Mortgagee
shall otherwise elect in writing.
(e) As to any Lease now in existence or subsequently consented to by
Mortgagee, except as expressly permitted under the Credit Agreement, Mortgagor
shall not accept a surrender or terminate, cancel, rescind, supplement, alter,
revise, modify or amend such Lease or permit any such action to be taken nor
shall Mortgagor accept the payment of rent more than thirty (30) days in advance
of its due date.
(f) In the event of the enforcement by Mortgagee of any remedy under
this Mortgage, the lessee under each Lease shall, if requested by Mortgagee or
any other person succeeding to the interest of Mortgagee as a result of such
enforcement, attorn to Mortgagee or to such person and shall recognize Mortgagee
or such successor in interest as lessor under the Lease without change in the
provisions thereof; provided however, that Mortgagee or such successor in
interest shall not be: (i) bound by any payment of an installment of rent or
additional rent which may have been made more than 30 days before the due date
of such installment; (ii) bound by any amendment or modification to the Lease
made without
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the consent of Mortgagee or such successor in interest; (iii) liable for any
previous act or omission of Mortgagor (or its predecessors in interest); (iv)
responsible for any monies owing by Mortgagor to the credit of such lessee or
subject to any credits, offsets, claims, counterclaims, demands or defenses
which the lessee may have against Mortgagor (or its predecessors in interest);
(v) bound by any covenant to undertake or complete any construction of the
Premises or any portion thereof; or (vi) obligated to make any payment to such
lessee other than any security deposit actually delivered to Mortgagee or such
successor in interest. Each lessee or other occupant, upon request by Mortgagee
or such successor in interest, shall execute and deliver an instrument or
instruments confirming such attornment. In addition, Mortgagor agrees that each
Lease entered into after the date of this Mortgage shall include language to the
effect of subsections (d)-(g) of this Section; provided that the provisions of
such subsections shall be self-operative and any failure of any Lease to include
such language shall not impair the binding effect of such provisions on any
lessee under such Lease.
12. Further Assurances. To further assure Mortgagee's rights under
this Mortgage, Mortgagor agrees upon demand of Mortgagee to do any act or
execute any additional documents (including, but not limited to, security
agreements on any personalty included or to be included in the Mortgaged
Property and a separate assignment of each Lease in recordable form) as may be
required by Mortgagee to confirm the lien of this Mortgage and all other rights
or benefits conferred on Mortgagee.
13. Mortgagee's Right to Perform. If Mortgagor fails to perform any of
the covenants or agreements of Mortgagor, Mortgagee, without waiving or
releasing Mortgagor from any obligation or default under this Mortgage, may, at
any time (but shall be under no obligation to) pay or perform the same, and the
amount or cost thereof, with interest at the Default Rate, shall immediately be
due from Mortgagor to Mortgagee and the same shall be secured by this Mortgage
and shall be a lien on the Mortgaged Property prior to any right, title to,
interest in or claim upon the Mortgaged Property attaching subsequent to the
lien of this Mortgage. No payment or advance of money by Mortgagee under this
Section shall be deemed or construed to cure Mortgagor's default or waive any
right or remedy of Mortgagee.
14. Events of Default. The occurrence of any one or more of the
following events shall constitute an "EVENT OF DEFAULT" hereunder:
(a) an Event of Default (as defined in the Credit Agreement) shall
occur under the Credit Agreement; or
(b) a failure (i) to keep in force the insurance required by this
Mortgage, or (ii) to comply with and conform
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to all provisions and requirements of the insurance policies and the
insurers thereunder which would affect Mortgagor's ability to keep in force
the insurance required by this Mortgage or to collect any proceeds
therefrom, or (iii) which is not cured within ten (10) days of written
notice by Mortgagee to Mortgagor, to comply with any other material
provisions of this Mortgage regarding insurance; or
(c) a failure of Mortgagor to duly perform and observe, or a violation
or breach of, any other terms, covenants, provisions or conditions of
Sections 6 or 7 of this Mortgage.
15. Remedies.
(a) Upon the occurrence of any Event of Default, in addition to any
other rights and remedies Mortgagee may have pursuant to the Loan Documents, or
as provided by law, and without limitation, (x) if such event is an Event of
Default specified in clause (i) or (ii) of paragraph (f) of Section 8 of the
Credit Agreement with respect to Borrower, automatically the Commitments shall
immediately terminate and the Loans (with accrued interest thereon) and all
other amounts owing under the Credit Agreement and the other Loan Documents
(including, without limitation, all amounts of L/C Obligations, whether or not
the beneficiaries of the then outstanding Letters of Credit shall have presented
the documents required thereunder) shall immediately become due and payable, and
(y) if such event is any other Event of Default, either or both of the following
actions may be taken: (i) with the consent of the Required Lenders, Mortgagee
may, or upon the request of the Required Lenders Mortgagee shall, by notice to
Mortgagor declare the Revolving Commitments to be terminated forthwith,
whereupon the Revolving Commitments shall immediately terminate; and (ii) with
the consent of the Required Lenders, Mortgagee may, or upon the request of the
Required Lenders, Mortgagee shall, by notice to Mortgagor, declare the Loans
(with accrued interest thereon) and all other amounts owing under the Credit
Agreement and the other Loan Documents (including, without limitation, all
amounts of L/C Obligations, whether or not the beneficiaries of the then
outstanding Letters of Credit shall have presented the documents required
thereunder) to be due and payable forthwith, whereupon the same shall
immediately become due and payable. Except as expressly provided above in this
Section, presentment, demand, protest and all other notices of any kind are
hereby expressly waived. In addition, upon the occurrence of any Event of
Default, Mortgagee may immediately take such action, without notice or demand,
as it deems advisable to protect and enforce its rights against Mortgagor and in
and to the Mortgaged Property, including, but not limited to, the following
actions, each of which may be pursued concurrently or otherwise, at such time
and in such manner as Mortgagee may determine, in its sole discretion, without
impairing or otherwise affecting the other rights and remedies of Mortgagee:
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16
(i) Mortgagee may, to the extent permitted by applicable law, (A)
institute and maintain an action of mortgage foreclosure against all or any
part of the Mortgaged Property, (B) institute and maintain an action on the
Guarantee and Collateral Agreement or any other Loan Document, (C) sell all
or part of the Mortgaged Property (Mortgagor expressly granting to
Mortgagee the power of sale), or (D) take such other action at law or in
equity for the enforcement of this Mortgage or any of the Loan Documents as
the law may allow. Mortgagee may proceed in any such action to final
judgment and execution thereon for all sums due hereunder, together with
interest thereon at the Default Rate and all costs of suit, including,
without limitation, reasonable attorneys' fees and disbursements. Interest
at the Default Rate shall be due on any judgment obtained by Mortgagee from
the date of judgment until actual payment is made of the full amount of the
judgment.
(ii) Mortgagee may immediately commence foreclosure proceedings
against the Mortgaged Property pursuant to applicable law. The commencement
by Mortgagee of foreclosure proceedings by advertisement or in equity shall
be deemed an exercise by Mortgagee of its option set forth above to
accelerate the due date of all sums secured hereby. Mortgagor hereby grants
power to Mortgagee, in the event of the occurrence of an Event of Default
hereunder, to grant, bargain, sell, release and convey the Mortgaged
Property at public auction or vendue, and upon such sale to execute and
deliver to the purchaser(s) instruments of conveyance pursuant to the terms
hereof and to the applicable laws. Mortgagor acknowledges that the
foregoing sentence confers a power of sale upon Mortgagee, and that upon
the occurrence of an Event of Default this Mortgage may be foreclosed by
advertisement as described below and in the applicable Michigan statutes.
MORTGAGOR UNDERSTANDS THAT UPON DEFAULT, MORTGAGEE IS HEREBY AUTHORIZED AND
EMPOWERED TO SELL THE MORTGAGED PROPERTY, OR CAUSE THE SAME TO BE SOLD AND
TO CONVEY THE SAME TO THE PURCHASER IN ANY LAWFUL MANNER, INCLUDING BUT NOT
LIMITED TO THAT PROVIDED BY CHAPTER 32 OF THE REVISED JUDICATURE ACT OF
MICHIGAN, ENTITLED "FORECLOSURE OF MORTGAGE BY ADVERTISEMENT", WHICH
PERMITS MORTGAGEE TO SELL THE MORTGAGED PROPERTY WITHOUT AFFORDING
MORTGAGOR A HEARING, OR GIVING IT ACTUAL PERSONAL NOTICE. THE ONLY NOTICE
REQUIRED UNDER SUCH CHAPTER 32 IS TO PUBLISH NOTICE IN A LOCAL NEWSPAPER
AND TO POST A COPY OF THE NOTICE ON THE MORTGAGED PROPERTY.
WAIVER: BY CONFERRING THIS POWER OF SALE UPON MORTGAGEE, MORTGAGOR,
FOR ITSELF, ITS SUCCESSORS AND ASSIGNS, AFTER AN OPPORTUNITY FOR
CONSULTATION WITH ITS LEGAL COUNSEL, HEREBY
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VOLUNTARILY, KNOWINGLY AND INTELLIGENTLY WAIVES ALL RIGHTS UNDER THE
CONSTITUTION AND LAWS OF THE UNITED STATES AND UNDER THE CONSTITUTION AND
LAWS OF THE STATE OF MICHIGAN, BOTH TO A HEARING ON THE RIGHT TO EXERCISE
AND THE EXERCISE OF THE POWER OF SALE, AND TO NOTICE EXCEPT AS REQUIRED BY
THE MICHIGAN STATUTE WHICH PROVIDES FOR FORECLOSURE OF MORTGAGES BY
ADVERTISEMENT.
(iii) Mortgagee may personally, or by its agents, attorneys and
employees and without regard to the adequacy or inadequacy of the Mortgaged
Property or any other collateral as security for the Obligations enter into
and upon the Mortgaged Property and each and every part thereof and exclude
Mortgagor and its agents and employees therefrom without liability for
trespass, damage or otherwise (Mortgagor hereby agreeing to surrender
possession of the Mortgaged Property to Mortgagee upon demand at any such
time) and use, operate, manage, maintain and control the Mortgaged Property
and every part thereof. Following such entry and taking of possession,
Mortgagee shall be entitled, without limitation, (x) to lease all or any
part or parts of the Mortgaged Property for such periods of time and upon
such conditions as Mortgagee may, in its discretion, deem proper, (y) to
enforce, cancel or modify any Lease and (z) generally to execute, do and
perform any other act, deed, matter or thing concerning the Mortgaged
Property as Mortgagee shall deem appropriate as fully as Mortgagor might
do.
In connection with Mortgagee's right to possession of the Mortgaged
Property as specified in this paragraph, Mortgagor acknowledges that it has
been advised that there is a significant body of case law in Michigan which
purportedly provides that in the absence of a showing of waste of a
character sufficient to endanger the value of the Mortgaged Property, or
other special factors, a mortgagor is entitled to remain in possession of
Mortgaged Property, and to enjoy the income, rents and profits therefrom,
during the pendency of foreclosure proceedings and until the expiration of
the redemption period, even if the mortgage documents expressly provide to
the contrary. Mortgagor further acknowledges that it has been advised that
Mortgagee recognizes the value of the security covered hereby is
inextricably intertwined with the effectiveness of the management,
maintenance and general operation of the Mortgaged Property, and that
Mortgagee would not extend the Loans and the other Obligations secured
hereby unless it could be assured that it would have the right to take
possession of the Mortgaged Property in order to manage or to control
management thereof, and to enjoy the income, rents and profits therefrom,
immediately upon default by Mortgagor hereunder, notwithstanding that
foreclosure proceedings may not have been instituted, or are pending, or
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18
the redemption period may not have expired. Accordingly, Mortgagor hereby
knowingly, intelligently and voluntarily waives all right to possession of
the Mortgaged Property from and after the occurrence of an Event of Default
hereunder, upon demand for possession by Mortgagee, and Mortgagor agrees
not to assert any objection or defense to Mortgagee's request or petition
to a court for possession. The rights hereby conferred upon Mortgagee have
been agreed upon prior to any default by Mortgagor hereunder and the
exercise by Mortgagee of any such rights shall not be deemed to put
Mortgagee in the status of a "mortgagee in possession". Mortgagor
acknowledges that this provision is material to this transaction and that
Mortgagee would not extend the Indebtedness secured hereby but for this
paragraph.
(b) The holder of this Mortgage, in any action to foreclose it, shall
be entitled to the appointment of a receiver. In case of a foreclosure sale, the
Real Estate may be sold, at Mortgagee's election, in one parcel or in more than
one parcel and Mortgagee is specifically empowered, (without being required to
do so, and in its sole and absolute discretion) to cause successive sales of
portions of the Mortgaged Property to be held.
(c) In the event of any breach of any of the covenants, agreements,
terms or conditions contained in this Mortgage, and notwithstanding to the
contrary any exculpatory or non-recourse language which may be contained herein,
Mortgagee shall be entitled to enjoin such breach and obtain specific
performance of any covenant, agreement, term or condition and Mortgagee shall
have the right to invoke any equitable right or remedy as though other remedies
were not provided for in this Mortgage.
16. Right of Mortgagee to Credit Sale. Upon the occurrence of any sale
made under this Mortgage, whether made under the power of sale or by virtue of
judicial proceedings or of a judgment or decree of foreclosure and sale,
Mortgagee may bid for and acquire the Mortgaged Property or any part thereof. In
lieu of paying cash therefor, Mortgagee may make settlement for the purchase
price by crediting upon the Obligations or other sums secured by this Mortgage
the net sales price after deducting therefrom the expenses of sale and the cost
of the action and any other sums which Mortgagee is authorized to deduct under
this Mortgage. In such event, this Mortgage, the Credit Agreement, the Guarantee
and Collateral Agreement and documents evidencing expenditures secured hereby
may be presented to the person or persons conducting the sale in order that the
amount so used or applied may be credited upon the Obligations as having been
paid.
17. Appointment of Receiver. If an Event of Default shall have
occurred and be continuing, Mortgagee as a matter of right and without notice to
Mortgagor, unless otherwise required by
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19
applicable law, and without regard to the adequacy or inadequacy of the
Mortgaged Property or any other collateral as security for the Obligations or
the interest of Mortgagor therein, shall have the right to apply to any court
having jurisdiction to appoint a receiver or receivers or other manager of the
Mortgaged Property, and Mortgagor hereby irrevocably consents to such
appointment and waives notice of any application therefor (except as may be
required by law). Any such receiver or receivers shall have all the usual powers
and duties of receivers in like or similar cases and all the powers and duties
of Mortgagee in case of entry as provided in this Mortgage, including, without
limitation and to the extent permitted by law, the right to enter into leases of
all or any part of the Mortgaged Property, and shall continue as such and
exercise all such powers until the date of confirmation of sale of the Mortgaged
Property unless such receivership is sooner terminated.
18. Extension, Release, etc. (a) Without affecting the lien or charge
of this Mortgage upon any portion of the Mortgaged Property not then or
theretofore released as security for the full amount of the Obligations,
Mortgagee may, from time to time and without notice, agree to (i) release any
person liable for the indebtedness guaranteed under the Guarantee and Collateral
Agreement, (ii) extend the maturity or alter any of the terms of the
indebtedness guaranteed under the Guarantee and Collateral Agreement or any
other guaranty thereof, (iii) grant other indulgences, (iv) release or reconvey,
or cause to be released or reconveyed at any time at Mortgagee's option any
parcel, portion or all of the Mortgaged Property, (v) take or release any other
or additional security for any obligation herein mentioned, or (vi) make
compositions or other arrangements with debtors in relation thereto. If at any
time this Mortgage shall secure less than all of the principal amount of the
Obligations, it is expressly agreed that any repayments of the principal amount
of the Obligations shall not reduce the amount of the lien of this Mortgage
until the lien amount shall equal the principal amount of the Obligations
outstanding.
(b) No recovery of any judgment by Mortgagee and no levy of an
execution under any judgment upon the Mortgaged Property or upon any other
property of Mortgagor shall affect the lien of this Mortgage or any liens,
rights, powers or remedies of Mortgagee hereunder, and such liens, rights,
powers and remedies shall continue unimpaired.
(c) If Mortgagee shall have the right to foreclose this Mortgage,
Mortgagor authorizes Mortgagee at its option to foreclose the lien of this
Mortgage subject to the rights of any tenants of the Mortgaged Property. The
failure to make any such tenants parties defendant to any such foreclosure
proceeding and to foreclose their rights will not be asserted by Mortgagor as a
defense to any proceeding instituted by Mortgagee to collect the Obligations or
to foreclose the lien of this Mortgage.
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(d) Unless expressly provided otherwise, in the event that ownership
of this Mortgage and title to the Mortgaged Property or any estate therein shall
become vested in the same person or entity, this Mortgage shall not merge in
such title but shall continue as a valid lien on the Mortgaged Property for the
amount secured hereby.
19. Security Agreement under Uniform Commercial Code. (a) It is the
intention of the parties hereto that this Mortgage shall constitute a Security
Agreement within the meaning of the Uniform Commercial Code (the "CODE") of the
State of Michigan. If an Event of Default shall occur under this Mortgage, then
in addition to having any other right or remedy available at law or in equity,
Mortgagee shall have the option of either (i) proceeding under the Code and
exercising such rights and remedies as may be provided to a secured party by the
Code with respect to all or any portion of the Mortgaged Property which is
personal property (including, without limitation, taking possession of and
selling such property) or (ii) treating such property as real property and
proceeding with respect to both the real and personal property constituting the
Mortgaged Property in accordance with Mortgagee's rights, powers and remedies
with respect to the real property (in which event the default provisions of the
Code shall not apply). If Mortgagee shall elect to proceed under the Code, then
ten days' notice of sale of the personal property shall be deemed reasonable
notice and the reasonable expenses of retaking, holding, preparing for sale,
selling and the like incurred by Mortgagee shall include, but not be limited to,
attorneys' fees and legal expenses. At Mortgagee's request, Mortgagor shall
assemble the personal property and make it available to Mortgagee at a place
designated by Mortgagee which is reasonably convenient to both parties.
(b) Mortgagor and Mortgagee agree, to the extent permitted by law,
that: (i) all of the goods described within the definition of the word
"Equipment" are or are to become fixtures on the Real Estate; (ii) this Mortgage
upon recording or registration in the real estate records of the proper office
shall constitute a financing statement filed as a "fixture filing" within the
meaning of Sections 9-313 and 9-402 of the Code; (iii) Mortgagor is the record
owner of the Real Estate; (v) the mailing addresses of Mortgagor and Mortgagee
are as set forth on the first page of this Mortgage; and (vi) Mortgagor's
federal tax identification number is _______________. In addition, for purposes
of Article 9 of the Michigan Uniform Commercial Code, (i) Mortgagor is the
"debtor", (ii) Mortgagee is the "secured party" and (iii) information concerning
the security interest created hereby may be obtained from Mortgagee at its
address on the first page of this Mortgage.
(c) Mortgagor, upon request by Mortgagee from time to time, shall
execute, acknowledge and deliver to Mortgagee one or more separate security
agreements, in form satisfactory to Mortgagee, covering all or any part of the
Mortgaged Property and will further execute, acknowledge and deliver, or cause
to be
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executed, acknowledged and delivered, any financing statement, affidavit,
continuation statement or certificate or other document as Mortgagee may request
in order to perfect, preserve, maintain, continue or extend the security
interest under and the priority of this Mortgage and such security instrument.
Mortgagor further agrees to pay to Mortgagee on demand all costs and expenses
incurred by Mortgagee in connection with the preparation, execution, recording,
filing and refiling of any such document and all reasonable costs and expenses
of any record searches for financing statements Mortgagee shall reasonably
require. If Mortgagor shall fail to furnish any financing or continuation
statement within 10 days after request by Mortgagee, then pursuant to the
provisions of the Code, Mortgagor hereby authorizes Mortgagee, without the
signature of Mortgagor, to execute and file any such financing and continuation
statements. The filing of any financing or continuation statements in the
records relating to personal property or chattels shall not be construed as in
any way impairing the right of Mortgagee to proceed against any personal
property encumbered by this Mortgage as real property, as set forth above.
20. Assignment of Rents. Mortgagor hereby assigns to Mortgagee the
Rents as further security for the payment and performance of the Obligations,
and Mortgagor grants to Mortgagee the right to enter the Mortgaged Property for
the purpose of collecting the same and to let the Mortgaged Property or any part
thereof, and to apply the Rents on account of the Obligations. The foregoing
assignment and grant is present and absolute and shall continue in effect until
the Obligations are paid and performed in full, but Mortgagee hereby waives the
right to enter the Mortgaged Property for the purpose of collecting the Rents
and Mortgagor shall be entitled to collect, receive, use and retain the Rents
until the occurrence of an Event of Default under this Mortgage; such right of
Mortgagor to collect, receive, use and retain the Rents may be revoked by
Mortgagee upon the occurrence of any Event of Default under this Mortgage by
giving not less than five days' written notice of such revocation to Mortgagor;
in the event such notice is given, Mortgagor shall pay over to Mortgagee, or to
any receiver appointed to collect the Rents, any lease security deposits, and
shall pay monthly in advance to Mortgagee, or to any such receiver, the fair and
reasonable rental value as determined by Mortgagee for the use and occupancy of
the Mortgaged Property or of such part thereof as may be in the possession of
Mortgagor or any affiliate of Mortgagor, and upon default in any such payment
Mortgagor and any such affiliate will vacate and surrender the possession of the
Mortgaged Property to Mortgagee or to such receiver, and in default thereof may
be evicted by summary proceedings or otherwise. Mortgagor shall not accept
prepayments of installments of Rent to become due for a period of more than one
month in advance (except for security deposits and estimated payments of
percentage rent, if any). Mortgagee shall be entitled to all of the rights and
benefits conferred by Act No. 210 of the Michigan Public Acts of 1953 as it may
be amended, including by Act
<PAGE> 332
22
No. 151 of the Michigan Public Acts of 1966 (MCLA 554.231 et seq.), and Act No.
228 of the Michigan Public Acts of 1925 as it may be amended, including by Act
No. 55 of the Michigan Public Acts of 1933 (MCLA 554.211 et seq.). The
collection of rents by Mortgagee shall in no way waive the right of Mortgagee to
foreclose this Mortgage in the event of any Event of Default.
21. Trust Funds. To the extent required under applicable law, all
lease security deposits of the Real Estate shall be treated as trust funds not
to be commingled with any other funds of Mortgagor. Within 10 days after request
by Mortgagee, Mortgagor shall furnish Mortgagee satisfactory evidence of
compliance with this subsection, together with a statement of all lease security
deposits by lessees and copies of all Leases not previously delivered to
Mortgagee, which statement shall be certified by Mortgagor.
22. Additional Rights. The holder of any subordinate lien on the
Mortgaged Property shall have no right to terminate any Lease whether or not
such Lease is subordinate to this Mortgage nor shall any holder of any
subordinate lien join any tenant under any Lease in any action to foreclose the
lien or modify, interfere with, disturb or terminate the rights of any tenant
under any Lease. By recordation of this Mortgage all subordinate lienholders are
subject to and notified of this provision, and any action taken by any such
lienholder contrary to this provision shall be null and void. Upon the
occurrence of any Event of Default, Mortgagee may, in its sole discretion and
without regard to the adequacy of its security under this Mortgage, apply all or
any part of any amounts on deposit with Mortgagee under this Mortgage against
all or any part of the Obligations. Any such application shall not be construed
to cure or waive any Event of Default or invalidate any act taken by Mortgagee
on account of such Event of Default.
23. Notices. Except as otherwise set forth herein, all notices,
requests, demands and other communications hereunder shall be given in
accordance with the provisions of Section 10.2 of the Credit Agreement to
Mortgagor and to Mortgagee as specified therein.
24. No Oral Modification. This Mortgage may not be amended,
supplemented or otherwise modified except in accordance with the provisions of
Section 10.1 of the Credit Agreement. Any agreement made by Mortgagor and
Mortgagee after the date of this Mortgage relating to this Mortgage shall be
superior to the rights of the holder of any intervening or subordinate lien or
encumbrance.
25. Partial Invalidity. In the event any one or more of the provisions
contained in this Mortgage shall for any reason be held to be invalid, illegal
or unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provision hereof, but each shall be construed as if
such
<PAGE> 333
23
invalid, illegal or unenforceable provision had never been included.
Notwithstanding to the contrary anything contained in this Mortgage or in any
provisions of any Loan Document, the obligations of Mortgagor and of any other
obligor under any of the Loan Documents shall be subject to the limitation that
Mortgagee shall not charge, take or receive, nor shall Mortgagor or any other
obligor be obligated to pay to Mortgagee, any amounts constituting interest in
excess of the maximum rate permitted by law to be charged by Mortgagee.
26. Mortgagor's Waiver of Rights. To the fullest extent permitted by
law, Mortgagor waives the benefit of all laws now existing or that may
subsequently be enacted providing for (i) any appraisement before sale of any
portion of the Mortgaged Property, (ii) any extension of the time for the
enforcement of the collection of the Obligations or the creation or extension of
a period of redemption from any sale made in collecting such debt and (iii)
exemption of the Mortgaged Property from attachment, levy or sale under
execution or exemption from civil process. To the full extent Mortgagor may do
so, Mortgagor agrees that Mortgagor will not at any time insist upon, plead,
claim or take the benefit or advantage of any law now or hereafter in force
providing for any appraisement, valuation, stay, exemption, extension or
redemption, or requiring foreclosure of this Mortgage before exercising any
other remedy granted hereunder and Mortgagor, for Mortgagor and its successors
and assigns, and for any and all persons ever claiming any interest in the
Mortgaged Property, to the extent permitted by law, hereby waives and releases
all rights of redemption, valuation, appraisement, stay of execution, notice of
election to mature or declare due the whole of the secured indebtedness and
marshalling in the event of foreclosure of the liens hereby created.
27. Remedies Not Exclusive. Mortgagee shall be entitled to enforce
payment and performance of the Obligations and to exercise all rights and powers
under this Mortgage or under any of the other Loan Documents or other agreement
or any laws now or hereafter in force, notwithstanding some or all of the
Obligations may now or hereafter be otherwise secured, whether by mortgage,
security agreement, pledge, lien, assignment or otherwise. Neither the
acceptance of this Mortgage nor its enforcement, shall prejudice or in any
manner affect Mortgagee's right to realize upon or enforce any other security
now or hereafter held by Mortgagee, it being agreed that Mortgagee shall be
entitled to enforce this Mortgage and any other security now or hereafter held
by Mortgagee in such order and manner as Mortgagee may determine in its absolute
discretion. No remedy herein conferred upon or reserved to Mortgagee is intended
to be exclusive of any other remedy herein or by law provided or permitted, but
each shall be cumulative and shall be in addition to every other remedy given
hereunder or now or hereafter existing at law or in equity or by statute. Every
power or remedy given by any of the Loan Documents to Mortgagee or to which it
may otherwise be entitled, may be exercised,
<PAGE> 334
24
concurrently or independently, from time to time and as often as may be deemed
expedient by Mortgagee. In no event shall Mortgagee, in the exercise of the
remedies provided in this Mortgage (including, without limitation, in connection
with the assignment of Rents to Mortgagee, or the appointment of a receiver and
the entry of such receiver on to all or any part of the Mortgaged Property), be
deemed a "mortgagee in possession," and Mortgagee shall not in any way be made
liable for any act, either of commission or omission, in connection with the
exercise of such remedies.
28. Multiple Security. If (a) the Premises shall consist of one or
more parcels, whether or not contiguous and whether or not located in the same
county, or (b) in addition to this Mortgage, Mortgagee shall now or hereafter
hold one or more additional mortgages, liens, deeds of trust or other security
(directly or indirectly) for the Obligations upon other property in the State in
which the Premises are located (whether or not such property is owned by
Mortgagor or by others) or (c) both the circumstances described in clauses (a)
and (b) shall be true, then to the fullest extent permitted by law, Mortgagee
may, at its election, commence or consolidate in a single foreclosure action all
foreclosure proceedings against all such collateral securing the Obligations
(including the Mortgaged Property), which action may be brought or consolidated
in the courts of any county in which any of such collateral is located.
Mortgagor acknowledges that the right to maintain a consolidated foreclosure
action is a specific inducement to Mortgagee to enter into the Credit Agreement
and to extend the indebtedness guaranteed by the Guarantee and Collateral
Agreement, and Mortgagor expressly and irrevocably waives any objections to the
commencement or consolidation of the foreclosure proceedings in a single action
and any objections to the laying of venue or based on the grounds of forum non
conveniens which it may now or hereafter have. Mortgagor further agrees that if
Mortgagee shall be prosecuting one or more foreclosure or other proceedings
against a portion of the Mortgaged Property or against any collateral other than
the Mortgaged Property, which collateral directly or indirectly secures the
Obligations, or if Mortgagee shall have obtained a judgment of foreclosure and
sale or similar judgment against such collateral, then, whether or not such
proceedings are being maintained or judgments were obtained in or outside the
State in which the Premises are located, Mortgagee may commence or continue
foreclosure proceedings and exercise its other remedies granted in this Mortgage
against all or any part of the Mortgaged Property and Mortgagor waives any
objections to the commencement or continuation of a foreclosure of this Mortgage
or exercise of any other remedies hereunder based on such other proceedings or
judgments, and waives any right to seek to dismiss, stay, remove, transfer or
consolidate either any action under this Mortgage or such other proceedings on
such basis. Neither the commencement nor continuation of proceedings to
foreclose this Mortgage nor the exercise of any other rights hereunder nor the
recovery of any judgment by Mortgagee in any such proceedings shall
<PAGE> 335
25
prejudice, limit or preclude Mortgagee's right to commence or continue one or
more foreclosure or other proceedings or obtain a judgment against any other
collateral (either in or outside the State in which the Premises are located)
which directly or indirectly secures the Obligations, and Mortgagor expressly
waives any objections to the commencement of, continuation of, or entry of a
judgment in such other proceedings or exercise of any remedies in such
proceedings based upon any action or judgment connected to this Mortgage, and
Mortgagor also waives any right to seek to dismiss, stay, remove, transfer or
consolidate either such other proceedings or any action under this Mortgage on
such basis. It is expressly understood and agreed that to the fullest extent
permitted by law, Mortgagee may, at its election, cause the sale of all
collateral which is the subject of a single foreclosure action at either a
single sale or at multiple sales conducted simultaneously and take such other
measures as are appropriate in order to effect the agreement of the parties to
dispose of and administer all collateral securing the Obligations (directly or
indirectly) in the most economical and least time-consuming manner.
29. Successors and Assigns. All covenants of Mortgagor contained in
this Mortgage are imposed solely and exclusively for the benefit of Mortgagee
and its successors and assigns, and no other person or entity shall have
standing to require compliance with such covenants or be deemed, under any
circumstances, to be a beneficiary of such covenants, any or all of which may be
freely waived in whole or in part by Mortgagee at any time if in its sole
discretion it deems such waiver advisable. All such covenants of Mortgagor shall
run with the land and bind Mortgagor, the successors and assigns of Mortgagor
(and each of them) and all subsequent owners, encumbrancers and tenants of the
Mortgaged Property, and shall inure to the benefit of Mortgagee, its successors
and assigns. The word "Mortgagor" shall be construed as if it read "Mortgagors"
whenever the sense of this Mortgage so requires and if there shall be more than
one Mortgagor, the obligations of the Mortgagors shall be joint and several.
30. No Waivers, etc. Any failure by Mortgagee to insist upon the
strict performance by Mortgagor of any of the terms and provisions of this
Mortgage shall not be deemed to be a waiver of any of the terms and provisions
hereof, and Mortgagee, notwithstanding any such failure, shall have the right
thereafter to insist upon the strict performance by Mortgagor of any and all of
the terms and provisions of this Mortgage to be performed by Mortgagor.
Mortgagee may release, regardless of consideration and without the necessity for
any notice to or consent by the holder of any subordinate lien on the Mortgaged
Property, any part of the security held for the obligations secured by this
Mortgage without, as to the remainder of the security, in any way impairing or
affecting the lien of this Mortgage or the priority of such lien over any
subordinate lien.
<PAGE> 336
26
31. GOVERNING LAW, ETC. THIS MORTGAGE SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF MICHIGAN, EXCEPT THAT
MORTGAGOR EXPRESSLY ACKNOWLEDGES THAT BY THEIR RESPECTIVE TERMS THE CREDIT
AGREEMENT, THE NOTES AND THE GUARANTEE AND COLLATERAL AGREEMENT SHALL BE
GOVERNED AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK,
WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAW, AND FOR PURPOSES OF
CONSISTENCY, MORTGAGOR AGREES THAT IN ANY IN PERSONAM PROCEEDING RELATED TO THIS
MORTGAGE THE RIGHTS OF THE PARTIES TO THIS MORTGAGE SHALL ALSO BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK GOVERNING
CONTRACTS MADE AND TO BE PERFORMED IN THAT STATE, WITHOUT REGARD TO PRINCIPLES
OF CONFLICT OF LAW.
32. Certain Definitions. Unless the context clearly indicates a
contrary intent or unless otherwise specifically provided herein, words used in
this Mortgage shall be used interchangeably in singular or plural form and the
word "Mortgagor" shall mean "each Mortgagor or any subsequent owner or owners of
the Mortgaged Property or any part thereof or interest therein," the word
"Mortgagee" shall mean "Mortgagee or any successor agent for the Lenders," the
words "Guarantee and Collateral Agreement" shall mean "the Guarantee and
Collateral Agreement, the Credit Agreement or any other evidence of indebtedness
secured by this Mortgage," the word "person" shall include any individual,
corporation, partnership, trust, unincorporated association, government,
governmental authority, or other entity, and the words "Mortgaged Property"
shall include any portion of the Mortgaged Property or interest therein.
Whenever the context may require, any pronouns used herein shall include the
corresponding masculine, feminine or neuter forms, and the singular form of
nouns and pronouns shall include the plural and vice versa. The captions in this
Mortgage are for convenience or reference only and in no way limit or amplify
the provisions hereof.
33. Future Advances. This Mortgage is executed and delivered to
secure, among other things, future advances and re-advances. It is understood
and agreed that this Mortgage secures present and future advances and
re-advances made for the benefit of Mortgagor and that the lien of such future
advances and re-advances shall relate back to the date of this Mortgage.
34. Receipt of Copy. Mortgagor acknowledges that it has received a
true copy of this Mortgage.
35. Release. If Mortgagor shall and does pay to Mortgagee the full
principal amount of the indebtedness secured hereby, together with all interest
accrued thereon, and keeps all the other covenants and agreements contained
herein and in the Guarantee and Collateral Agreement and in the other Loan
Documents, all in the manner and at the times set forth herein or in the
Guarantee and Collateral Agreement and in the other Loan Documents, and if
Mortgagor shall also pay all satisfaction costs, including,
<PAGE> 337
27
but not limited to, reasonable attorneys' fees and the cost of recording a
satisfaction piece and, if appropriate, a power-of-attorney to satisfy this
Mortgage, then and from thenceforth this Mortgage and the estate hereby created,
granted, transferred and assigned shall cease and become void.
This Mortgage has been duly executed by Mortgagor on ________________,
1999 and is intended to be effective as of __________________, 1999.
---------------------------------------
In the Presence of:
- ------------------------------
Print name: By:
---------------------------------------
Print name:
---------------------------
Title:
Print name:
<PAGE> 338
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
The foregoing instrument was acknowledged before me this ________ day
of _______________, 1999, by ______________, the [ ] President of
_______________________, a _________________ corporation, on behalf of the
corporation.
------------------------------------
Notary Public
[Notarial Stamp]
[Notary Seal]
<PAGE> 339
Schedule A
Description of the Premises
[Attach Legal Description of all parcels; include
municipal tax assessment identification numbers] ]
<PAGE> 340
EXHIBIT E
TO THE CREDIT AGREEMENT
FORM OF
ASSIGNMENT AND ACCEPTANCE
Reference is made to the Credit Agreement, dated as of
September 30, 1999 (as amended, supplemented or otherwise modified from time to
time, the "Credit Agreement"), among Tenneco Inc. (the "Borrower"), the Lenders
parties thereto, the Co-Documentation Agents and the Syndication Agent parties
thereto and The Chase Manhattan Bank, as administrative agent for the Lenders
(in such capacity, the "Administrative Agent"). Unless otherwise defined herein,
terms defined in the Credit Agreement and used herein shall have the meanings
given to them in the Credit Agreement.
The Assignor identified on Schedule l hereto (the "Assignor")
and the Assignee identified on Schedule l hereto (the "Assignee") agree as
follows:
1. The Assignor hereby irrevocably sells and assigns to the Assignee without
recourse to the Assignor, and the Assignee hereby irrevocably purchases and
assumes from the Assignor without recourse to the Assignor, as of the Effective
Date (as defined below), the interest described in Schedule 1 hereto (the
"Assigned Interest") in and to the Assignor's rights and obligations under the
Credit Agreement with respect to those credit facilities contained in the Credit
Agreement as are set forth on Schedule 1 hereto (individually, an "Assigned
Facility"; collectively, the "Assigned Facilities"), in a principal amount for
each Assigned Facility as set forth on Schedule 1 hereto.
2. The Assignor (a) makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with the Credit Agreement or with respect to the
execution, legality, validity, enforceability, genuineness, sufficiency or value
of the Credit Agreement, any other Loan Document or any other instrument or
document furnished pursuant thereto, other than that the Assignor has not
created any adverse claim upon the interest being assigned by it hereunder and
that such interest is free and clear of any such adverse claim; (b) makes no
representation or warranty and assumes no responsibility with respect to the
financial condition of the Borrower, any of its Subsidiaries or any other
obligor or the performance or observance by the Borrower, any of its
Subsidiaries or any other obligor of any of their respective obligations under
the Credit Agreement or any other Loan Document or any other instrument or
document furnished pursuant hereto or thereto; and (c) attaches any Notes held
by it evidencing the Assigned Facilities and (i) requests that the Agent, upon
request by the Assignee, exchange the attached Notes for a new Note or Notes
payable to the Assignee and (ii) if the Assignor has retained any interest in
the Assigned Facility, requests that the Agent exchange the attached Notes for a
new Note or Notes payable to the Assignor, in each case in amounts which reflect
the assignment being made hereby (and after giving effect to any other
assignments which have become effective on the Effective Date).
3. The Assignee (a) represents and warrants that it is legally authorized to
enter into this Assignment and Acceptance; (b) confirms that it has received a
copy of the Credit Agreement, together with copies of the financial statements
most recently delivered pursuant to Section 6.1 thereof and such other financial
information, documents and information as it has deemed appropriate to make its
own credit analysis and decision to enter into this Assignment and Acceptance;
(c) agrees that it will, independently and without reliance upon the Assignor,
any Agent or any other Lender and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit
<PAGE> 341
2
decisions in taking or not taking action under the Credit Agreement, the
other Loan Documents or any other instrument or document furnished pursuant
hereto or thereto; (d) appoints and authorizes the Administrative Agent to take
such action as agent on its behalf and to exercise such powers and discretion
under the Credit Agreement, the other Loan Documents or any other instrument or
document furnished pursuant hereto or thereto as are delegated to the Agent by
the terms thereof, together with such powers as are incidental thereto; and (e)
agrees that it will be bound by the provisions of the Credit Agreement and will
perform in accordance with its terms all the obligations which by the terms of
the Credit Agreement are required to be performed by it as a Lender including,
if it is organized under the laws of a jurisdiction outside the United States,
its obligation pursuant to subsection 2.19(d) of the Credit Agreement.
4. The effective date of this Assignment and Acceptance shall
be the Effective Date of Assignment described in Schedule 1 hereto (the
"Effective Date"). Following the execution of this Assignment and Acceptance, it
will be delivered to the Administrative Agent for acceptance by it and recording
by the Administrative Agent pursuant to the Credit Agreement, effective as of
the Effective Date (which shall not, unless otherwise agreed to by the
Administrative Agent, be earlier than five Business Days after the date of such
acceptance and recording by the Agent).
5. Upon such acceptance and recording, from and after the
Effective Date, the Administrative Agent shall make all payments in respect of
the Assigned Interest (including payments of principal, interest, fees and other
amounts) to the Assignor for amounts which have accrued to the Effective Date
and to the Assignee for amounts which have accrued subsequent to the Effective
Date. The Assignor and the Assignee shall make all appropriate adjustments in
payments by the Agent for periods prior to the Effective Date or with respect to
the making of this assignment directly between themselves.
6. From and after the Effective Date (a) the Assignee shall be
a party to the Credit Agreement and, to the extent provided in this Assignment
and Acceptance, have the rights and obligations of a Lender thereunder and under
the other Loan Documents and shall be bound by the provisions thereof and (b)
the Assignor shall, to the extent provided in this Assignment and Acceptance,
relinquish its rights and be released from its obligations under the Credit
Agreement.
7. This Assignment and Acceptance shall be governed by and
construed in accordance with the laws of the State of New York.
IN WITNESS WHEREOF, the parties hereto have caused this
Assignment and Acceptance to be executed as of the date first above written by
their respective duly authorized officers on Schedule 1 hereto.
<PAGE> 342
Schedule 1
to Assignment and Acceptance
Name of Assignor: ___________________________________
Name of Assignee: ___________________________________
Effective Date of Assignment: _______________________
<TABLE>
<S> <C> <C>
Credit Facility Assigned Principal Amount Assigned Percentage Assigned1/
- ------------------------------------ ---------------------------------------------- --------------------------------
$_________ __________%
[Name of Assignee] [Name of Assignor]
By: ______________________________________________ By: ______________________________________________
Title: Title:
Consented To and Accepted By: [Consented To:
THE CHASE MANHATTAN BANK, as Administrative Agent TENNECO INC.2/
By: ______________________________________________ By: ______________________________________________
Title: Title:
</TABLE>
1/ Calculate the percentage of the applicable Facility that is assigned to
at least 15 decimal places and show as a percentage of the aggregate Commitments
or Loans, as applicable, of all Lenders under the applicable Facility.
2/ The Borrower's consent should be obtained only if required by Section
10.6(c) of the Credit Agreement.
<PAGE> 343
EXHIBIT F
TO THE CREDIT AGREEMENT
WASHINGTON OFFICE LAKE FOREST OFFICE
601 THIRTEENTH STREET, N.W. ONE WESTMINSTER PLACE
SUITE 1200 SOUTH LAKE FOREST, IL 60048
WASHINGTON, D.C. 20008 (647) 296-8200
(202) 630-80000 (247) 295-7210 FAX
(202) 630-6066 FAX
LAW OFFICES
JENNER & BLOCK
A PARTNERSHIP INCLUDING PROFESSIONAL CORPORATIONS
ONE IBM PLAZA
CHICAGO, ILLINOIS 60611-7602
(312) 222-9350
(312) 527-0484 FAX
September 30, 1999
The Chase Manhattan Bank, a national banking association,
as Administrative Agent under the Credit Agreement as hereinafter defined,
CITICORP USA, INC., as Syndication Agent under the Credit Agreement,
Commerzbank and Bank of America, as
Co-Documentation Agents
and
The Lenders which are parties to the Credit Agreement
on the date hereof (the "Initial Lenders")
Re: Tenneco Inc.
Ladies and Gentlemen:
We have acted as special counsel to Tenneco Inc., a Delaware corporation
(the "Borrower") in connection with the transactions contemplated in that
certain Credit Agreement dated as of September 30, 1999, among Administrative
Agent, CITICORP USA, INC., as Syndication Agent, Commerzbank and Bank of
America, as Co-Documentation Agents and each of the Lenders from time to time a
party thereto (the "Credit Agreement"). The opinions expressed below are being
provided pursuant to Section 5.1(e) of the Credit Agreement. Capitalized terms
used but not otherwise defined herein shall have the respective meanings given
such terms in the Credit Agreement (with references herein to the Credit
Agreement and each document defined therein meaning the Credit Agreement and
each such document as executed and delivered this date (or if executed and
delivered on an earlier date, as the same is in effect on the date hereof)). The
Initial Lenders and the Administrative Agent, the Co-Documentation Agents and
Syndication Agent are herein sometimes called "you". References herein to the
"Offering Memorandum" mean the Preliminary Offering Memorandum of the Borrower,
dated September 22, 1999, covering the offering and sale of the Senior
Subordinated Notes.
<PAGE> 344
September 30, 1999
Page 2
We have reviewed executed counterparts of the Credit Agreement and each of
the other documents and instruments identified on the Schedule of Documents
attached hereto (the "Other Documents"), each in the form executed and delivered
on this date (or if executed and delivered on an earlier date, as the same is in
effect on the date hereof).
Subject to the assumptions, qualifications, exclusions and other
limitations which are identified in this opinion letter and in the schedules
attached to this opinion letter, it is our opinion that:
1. The Borrower was duly incorporated and is existing and in good standing
under the Delaware General Corporation Law ("DGCL"). The Borrower has the
corporate power and authority to own and lease its properties and assets of
which we are aware and to carry on the business in which it is presently
engaged as described in the Offering Memorandum.
2. The Borrower is qualified to do business as a foreign corporation and is in
good standing in the jurisdictions noted on the Schedule of Foreign
Qualifications attached hereto.
3. The Borrower has the corporate power to execute and deliver the Credit
Agreement, to borrow money under the Credit Agreement, and to perform its
obligations under the Credit Agreement.
4. The Board of Directors of Borrower has duly authorized Borrower's
execution, delivery and performance of the Credit Agreement, and no other
corporate action of Borrower is required in connection with such
authorizations.
5. The Credit Agreement has been duly executed and delivered by authorized
officers of the Borrower.
6. The Credit Agreement is a valid and binding obligation of Borrower and is
enforceable against Borrower in accordance with its terms.
7. The Borrower is not presently required to obtain any consent, approval,
authorization or order of any court or governmental or regulatory agency in
order to obtain the right to execute and deliver the Credit Agreement, to
borrow money under the Credit Agreement, and to perform its obligations
under the Credit Agreement except for those obtained prior to the date
hereof, which remain in full force and effect, or as may be required to be
obtained and be in full force and effect on the Funding Date.
<PAGE> 345
September 30, 1999
Page 3
Each opinion in this letter is subject to the General Qualifications that
are recited in Schedule A to this letter to the extent relevant to that opinion.
In preparing this opinion letter, we have relied without any independent
verification upon the assumptions recited in Schedule B to this opinion letter
and upon: (i) factual information contained in certificates obtained from
governmental authorities, (ii) factual information represented to be true in the
Credit Agreement and the other Loan Documents; (iii) factual information
provided to us in a support certificate signed by each of the Loan Parties; and
(iv) factual information we have obtained from such other sources as we have
deemed reasonable. We have examined the originals or copies certified to our
satisfaction, of such other corporate records of the Loan parties as we deem
necessary for or relevant to this opinion, certificates of public officials and
other officers of the Loan Parties and we have assumed without investigation
that there has been no relevant change or development between the dates as of
which the information cited in the preceding sentence was given and the date of
this opinion letter and that the information upon which we have relied is
accurate and does not omit disclosures necessary to prevent such information
from being misleading.
While we have not conducted any independent investigation to determine
facts upon which our opinions are based or to obtain information about which
this opinion letter advises you, we confirm that we do not have any actual
knowledge which has caused us to conclude that our reliance and assumptions
cited in the preceding paragraph are unwarranted or that any information
supplied in this opinion letter is wrong. The terms "knowledge" and "actual
knowledge and references to "awareness" whenever used in this opinion letter
with respect to our firm means actual knowledge at the time this opinion letter
is delivered on the date it bears by Jenner & Block lawyers who have given
substantive attention to matters concerning the Loan Parties during the course
of our representation of the Loan Parties which knowledge has been obtained by
such attorneys in their capacity as such.
We are licensed to practice only in the State of Illinois and, insofar as
the opinions expressed herein involve matters of New York law, we have assumed
with your permission and without investigation, that the laws of New York are
substantially the same in all material respects as the laws of Illinois. Our
advise on every legal issue addressed in this opinion letter is based
exclusively on such internal laws of the State of Illinois (and, subject to the
provisions of the preceding sentence, the laws of the State of New York) and
such federal law of the United States which is in our experience normally
applicable to general business corporations not engaged in regulated business
activities and to transactions of the type contemplated in the Loan Documents
between the Loan Parties, on the one hand, and you on the other hand (but
without our having made any special investigation as to any other laws), except
that (i) we express no opinion or advice as to any law or legal issue (a) which
might be violated by any misrepresentation or omission or a fraudulent act, (b)
to which any Loan Party may be subject as a result of your legal or regulatory
status, your sale or
<PAGE> 346
September 30, 1999
Page 4
transfer of the Loans or interests therein or your (as opposed to any other
lender's) involvement in the transactions contemplated by the Loan Documents, or
(c) identified on Schedule C, and (ii) the opinions in paragraphs 1 and 3
through 5 are based on the DGCL. For purposes of each opinion in the first
sentence of paragraph 1 and each opinion in paragraph 2, we have relied
exclusively upon certificates issued by a governmental authority in each
relevant jurisdiction and such opinion is not intended to provide any conclusion
or assurance beyond that conveyed by such certificates. We advise you that some
issues addressed by this opinion letter may be governed in whole or in part by
other laws, but we express no opinion as to whether any relevant difference
exists between the laws upon which our opinions are based and any other laws
which may actually govern. Our opinions do not cover or otherwise address any
provision of the Credit Agreement of any type identified in Schedule D.
Provisions in the Credit Agreement which are not excluded by Schedule D or any
other part of this opinion letter or its attachments are called the "Relevant
Agreement Terms."
Our advice on each legal issue addressed in this letter represents our
opinion as to how that issue would be resolved were it to be considered by the
highest court of the jurisdiction upon whose law our opinion on that issue is
based. The manner in which any particular issue would be treated in any actual
court case would depend in part on facts and circumstances particular to the
case, and this letter is not intended to guarantee the outcome of any legal
dispute which may arise in the future. It is possible that some Relevant
Agreement Terms of a remedial nature contained in the Credit Agreement may not
prove enforceable for reasons other than those cited in this letter should an
actual enforcement action be brought, but (subject to all the exceptions,
qualifications, exclusions and other limitations contained in this letter) such
unenforceability would not in our opinion prevent you from realizing the
principal benefits purported to be provided by the Relevant Agreement Terms of a
remedial nature contained in the Credit Agreement.
This opinion letter speaks as of the time of its delivery on the date it
bears. We do not assume any obligation to provide you with any subsequent
opinion or advice by reason of any fact about which we did not have actual
knowledge at that time, by reason of any change subsequent to that time in any
law covered by any of our opinions, or for any other reason. The attached
schedules are an integral part of this opinion letter, and any term defined in
this opinion letter or any schedule has that defined meaning wherever it is used
in this opinion letter or in any schedule to this opinion letter.
You may rely upon this letter only for the purpose served by the provision
in the Agreement cited in the initial paragraph of this opinion letter in
response to which it has been delivered. Without our written consent: (i) no
person other than you may rely on this opinion letter for any purpose; (ii) this
opinion letter may not be cited or quoted in any financial statement,
prospectus, private placement memorandum or other similar document; (iii) this
opinion letter may not be cited
<PAGE> 347
September 30, 1999
Page 5
or quoted in any other document or communication which might encourage reliance
upon this opinion letter by any person or for any purpose excluded by the
restrictions in this paragraph, and (iv) copies of this opinion letter may not
be furnished to anyone for purposes of encouraging such reliance (except to the
extent such reliance is permitted (or would be permitted) pursuant to the
following sentence if such person became a Lender or participant).
Notwithstanding the foregoing persons who subsequently become Lenders in
accordance with the terms of 10.6 of the Credit Agreement (or participants in
accordance with the terms of Section 10.6 of the Credit Agreement) may rely on
this opinion letter as of the time of its delivery on the date hereof as if this
letter were addressed to them.
Sincerely,
Jenner & Block
<PAGE> 348
Schedule A
General Qualifications
Our opinions in the opinion letter to which this Schedule A is attached
("our letter") are subject as follows to the following qualifications:
1. Bankruptcy and Insolvency Exception. Each of the opinions ("our
opinions") in our letter regarding the validity, binding effect and
enforceability of any Loan Document (the "Specified Opinions") is subject to the
effect of bankruptcy, insolvency, reorganization, receivership, moratorium and
other similar laws. This exception includes:
a. the Federal Bankruptcy Code and thus comprehends, among others, matters
of turnover, automatic stay, avoiding powers, fraudulent transfer, preference,
discharge, conversion of a non-recourse obligation into a recourse claim,
limitations on ipso facto and anti-assignment clauses and the coverage of
pre-petition security agreements applicable to property acquired after a
petition is filed;
b. all other Federal and state bankruptcy, insolvency, reorganization,
receivership, moratorium, arrangement and assignment for the benefit of
creditors laws that affect the rights of creditors generally or that have
reference to or affect only creditors of specific types of debtors;
c. state fraudulent transfer and conveyance laws; and
d. judicially developed doctrines in this area, such as substantive
consolidation of entities and equitable subordination.
2. Equitable Principles Limitation. Each of the Specified Opinions is
subject to the effect of general principles of equity, whether applied by a
court of law or equity. This limitation includes principles:
a. governing the availability of specific performance, injunctive relief
or other equitable remedies, which generally place the award of such remedies,
subject to certain guidelines, in the discretion of the court to which
application for such relief is made;
b. affording equitable defenses (e.g., waiver, laches and estoppel)
against a party seeking enforcement;
c. requiring good faith and fair dealing in the performance and
enforcement of a contract by the party seeking its enforcement;
A-1
<PAGE> 349
d. requiring reasonableness in the performance and enforcement of an
agreement by the party seeking enforcement of the contract;
e. requiring consideration of the materiality of (i) a breach and (ii) the
consequences of the breach to the party seeking enforcement;
f. requiring consideration of the impracticability or impossibility of
performance at the time of attempted enforcement; and
g. affording defenses based upon the unconscionability of the enforcing
party's conduct after the parties have entered into the contract.
3. Other Common Qualifications. Each of the Specified Opinions is subject
to the effect of rules of law that;
a. limit or affect the enforcement of provisions of a contract that
purport to waive, or to require waiver of, the obligations of good faith, fair
dealing, diligence and reasonableness;
b. provide that forum selection clauses in contracts are not necessarily
binding on the court(s) in the forum selected;
c. limit the availability of a remedy under certain circumstances where
another remedy has been elected;
d. provide a time limitation after which a remedy may not be enforced,
e. limit the right of a creditor to use force or cause a breach of the
peace in enforcing rights;
f. relate to the sale or disposition of collateral or the requirements of
a commercially reasonable sale,
g. limit the enforceability of provisions releasing, exculpating or
exempting a party from, or requiring indemnification of a party for, liability
for its own action or inaction, to the extent the action or inaction involves
negligence, recklessness, willful misconduct, unlawful conduct, violation of
public policy or litigation against another party determined adversely to such
party;
h. may, where less than all of a contract may be unenforceable, limit the
enforceability of the balance of the contract to circumstances in which the
unenforceable portion is not an essential part of the agreed exchange;
A-2
<PAGE> 350
i. govern and afford judicial discretion regarding the determination of
damages and entitlement to attorneys' fees and other costs;
j. may permit a party that has materially failed to render or offer
performance required by the contract to cure that failure unless (i) permitting
a cure would unreasonably hinder the aggrieved party from making substitute
arrangements for performance, or (ii) it was important in the circumstances to
the aggrieved party that performance occur by the date stated in the contract;
k. may render guarantees unenforceable under circumstances where the
beneficiary's actions, failures to act or waivers, amendments or replacement of
the documents evidencing or relating to the guaranteed obligations so radically
change the essential nature of the terms and conditions of the guaranteed
obligations and the related transactions that, in effect, a new relationship has
arisen between the beneficiary and any the principal obligor or any guarantor
which is substantially and materially different from that presently contemplated
by the original documents evidencing or relating to the guaranteed obligations;
and
l. limit the enforceablility of requirements in the Loan Documents that
provisions therein may only be waived or amended in writing, to the extent that
an oral agreement or an implied agreement by trade practice or course of conduct
has been created modifying any such provision.
4. Referenced Provision Qualification. Each opinion regarding the
validity, binding effect or enforceability of a provision (the "First
Provision") in the Loan Documents requiring any Loan Party to perform its
obligations under, or to cause any other person to perform its obligations
under, any other provision (the "Second Provision") of any Loan Document, or
stating that any action will be taken as provided in or in accordance with any
such Second Provision, are subject to the same qualifications as the
corresponding opinion in this letter relating to the validity, binding effect
and enforceability of such Second Provision.
5. Lender's Regulatory Qualification. We express no opinion with
respect to, and all our opinions are subject to, the effect of the compliance or
noncompliance of each of you with any state or federal laws or regulations
applicable to you because of your legal or regulatory status or the nature of
your business or requiring you to qualify to conduct business in any
jurisdiction.
6. Usury Qualification. We express no opinion with regard to usury or other
laws limiting or regulating the maximum amount of interest that may be changed,
collected, received or contracted for, other than the internal laws of the State
of Illinois and the federal laws of the United States, and, without limiting the
foregoing, we expressly disclaim any opinions as to the usury or other such laws
of any other jurisdiction (including laws of other states made applicable
through principles of federal preemption or otherwise) which may be applicable
to the transactions contemplated by the Loan Documents.
A-3
<PAGE> 351
SCHEDULE B
ASSUMPTIONS
For the purposes of our letter, we have relied, without investigation, upon
each of the following assumptions:
1. Each document submitted to us for review is accurate and complete,
each such document that is an original is authentic, each such document that is
a copy conforms to an authentic original and all signatures (other than those of
or on behalf of any Loan Party) on each such document are genuine.
2. Each certificate obtained from a governmental authority relied on by
us is accurate, complete and authentic and all relevant official public records
to which each such certificate relates are accurate and complete.
3. There has not been any mutual mistake of fact or misunderstanding,
fraud, duress or undue influence.
4. The Loan Documents constitute valid and binding obligations of yours
and are enforceable against you in accordance with their terms (subject to
qualifications, exclusions and other limitations similar to those applicable to
our letter).
5. You have satisfied those legal requirements that are applicable to you
to the extent necessary to make the Loan Documents to which you are a party
enforceable against you.
6. The conduct of the parties to the Loan Documents has complied with any
requirement of good faith, fair dealing and conscionability.
7. All parties to the transactions contemplated by the Loan Documents (the
"Transactions") will act in accordance with, and will refrain from taking any
action that is forbidden by, the terms and conditions of the Loan Documents.
8. With respect to the opinions set forth in opinion paragraph 7, we
assume no Loan Party will in the future take any discretionary action (including
a decision not to act) permitted under the Loan Documents that would result in a
violation of law or constitute a breach or default under any other agreements or
court orders to which the Loan Party may be subject.
B-1
<PAGE> 352
SCHEDULE C
EXCLUDED LAW AND LEGAL ISSUES
None of the opinions or advice contained in the letter to which this
Schedule C is attached (herein called "our letter") covers or otherwise
addresses any of the following legal issues:
1. except with respect to the extent of our opinion in paragraph 7,
federal securities laws and regulations administered by the Securities and
Exchange Commission, state "Blue Sky" laws and regulations, and laws and
regulations relating to commodity (and other) futures and indices and other
similar instruments;
2. pension and employee benefit laws and regulations (e.g., ERISA);
3. federal and state antitrust and unfair competition laws and
regulations;
4. federal laws, regulations, directives and executive orders that
prohibit or limit the enforceability of obligations based on attributes of the
party seeking enforcement (e.g., the Trading with the Enemy Act and the
International Emergency Economic Powers Act);
5. compliance with fiduciary duty requirements;
6. the statutes and ordinances, the administrative decisions and the
rules and regulations of counties, towns, municipalities and special political
subdivisions and judicial decisions to the extent that they deal with any of the
foregoing;
7. fraudulent transfer and fraudulent conveyance laws;
8. Federal and state environmental, tax, land use and subdivision,
racketeering (e.g., RICO), health and safety (e.g., OSHA), and labor laws and
regulations;
9. Federal patent, copyright and trademark, state trademark, and other
Federal and state intellectual property laws and regulations;
10. other Federal and state statutes of general application to the extent
they provide for criminal prosecution (e.g., mail fraud and wire fraud
statutes); and
11. the effect of any law, regulation or order which hereafter becomes
effective.
C-1
<PAGE> 353
SCHEDULE D
EXCLUDED PROVISIONS
None of the opinions in the letter to which this Schedule D is attached
covers or otherwise addresses any of the following types of provisions which may
be contained in the Loan Documents:
1. Choice-of-law provisions.
2. Indemnification for gross negligence, willful misconduct or other
wrongdoing or strict product liability or any indemnification for liabilities
arising under securities laws.
3. Provisions mandating contribution towards judgments or settlements
among various parties.
4. Waivers of (i) legal or equitable defenses, (ii) rights to damages,
(iii) rights to counter claim or set off, (iv) statutes of limitations, (v)
rights to notice, (vi) the benefits of statutory, regulatory, or constitutional
rights, unless and to the extent the statute, regulation, or constitution
explicitly allows waiver, and (vii) other benefits to the extent they cannot be
waived under applicable law.
5. Provisions providing for forfeitures or the recovery of amounts deemed
to constitute penalties, or for liquidated damages (to the extent deemed to be
penalties), acceleration of future amounts due (other than principal) without
appropriate discount to present value, late charges (to the extent deemed to be
penalties) and prepayment charges.
6. Agreements to submit to the jurisdiction of any particular court or
other governmental authority (either as to personal jurisdiction and subject
matter jurisdiction); waiver of service of process requirements which would
otherwise be applicable; and provisions otherwise purporting to affect the
jurisdiction and venue of courts.
7. Provisions appointing one party as an attorney-in-fact for an adverse
party or providing that the decision of any particular person will be
conclusive or binding on others.
8. Provisions purporting to limit rights of third parties who have not
consented thereto or purporting to grant rights to third parties.
9. Provisions which purport to award attorneys' fees solely to one party.
10. Provisions purporting to create a trust or constructive trust without
compliance with applicable trust law.
D-1
<PAGE> 354
11. Provisions or agreements regarding proxies, shareholder voting rights
and the like.
12. Confidentiality agreements.
13. Provisions in any of the Loan Documents requiring a Loan Party to
perform its obligations under, or to cause any other person to perform its
obligations under, or stating that any action will be taken as provided in or in
accordance with, any agreement or other document that is not a Loan Document.
14. Provisions, if any, which are contrary to the public policy of any
jurisdiction.
D-2
<PAGE> 355
SCHEDULE OF DOCUMENTS
1. The Certificate of Incorporation of Borrower
2. The By-Laws of Borrower
3. The resolutions adopted by the Board of Directors of Borrower on September
14, 1999;
4. Certificate of good standing issued by the State of Delaware with respect
to the Borrower; and
5. Certificate as to the qualification of Borrower as a foreign corporation in
the State of California.
E-1
<PAGE> 356
SCHEDULE OF FOREIGN QUALIFICATIONS
1. California
F-1
<PAGE> 357
EXHIBIT G
TO THE CREDIT AGREEMENT
FORM OF
PREPAYMENT OPTION NOTICE
[Tranche [B][C] Term Lender]
Attention of [ ]
Telecopy No. [ ]
[Date]
Ladies and Gentlemen:
The undersigned, The Chase Manhattan Bank, as Administrative
Agent, refers to the Credit Agreement, dated as of September 30, 1999 (as
amended, supplemented or otherwise modified from time to time, the "Credit
Agreement"), among TENNECO INC., the lenders parties thereto (the "Lenders"),
the Co-Documentation Agent and the Syndication Agent parties thereto and THE
CHASE MANHATTAN BANK, as Administrative Agent. Capitalized terms used herein and
not otherwise defined herein shall have the meanings assigned to such terms in
the Credit Agreement. The Administrative Agent hereby gives notice of an offer
of prepayment made by the Borrower pursuant to Section 2.11(e) of the Credit
Agreement of the [Tranche B] [Tranche C] Prepayment Amount. Amounts applied to
prepay the [Tranche B] [Tranche C] Term Loans shall be applied pro rata to the
[Tranche B] [Tranche C] Term Loans held by you. The portion of the prepayment
amount to be allocated to the [Tranche B] [Tranche C] Term Loans held by you and
the date on which such prepayment will be made to you (should you elect to
receive such prepayment) are set forth below:
(A) Total [Tranche B] [Tranche C] Prepayment Amount -----------------
(B) Portion of [Tranche B] [Tranche C] Prepayment
Amount to be received by you -----------------
(C) Prepayment Date (Five Business Days after the date
of this Prepayment Option Notice) -----------------
<PAGE> 358
Please indicate below whether or not you wish to accept the
Borrower's prepayment offer by marking the appropriate box below, executing this
Prepayment Option Notice and returning it via telecopy to the Administrative
Agent (attention: [___________________]) no later than 10:00 a.m., New York City
time, _____________, _____, at Telecopy No. [________________]. Failure to
properly complete, execute and submit this Prepayment Option Notice in
accordance with the above terms shall be deemed to be notice that you accept the
Borrower's prepayment offer.
THE CHASE MANHATTAN BANK,
as Administrative Agent
By: _________________
Name:
Title:
- - LENDER ACCEPTS BORROWER'S PREPAYMENT OFFER
- - LENDER DOES NOT ACCEPT BORROWER'S PREPAYMENT OFFER
By: ______________________________
Name:
Title:
__________________________________
[Name of Lender]
<PAGE> 1
EXHIBIT 10.8
TENNECO AUTOMOTIVE INC.
EXECUTIVE INCENTIVE COMPENSATION PLAN
PLAN DOCUMENT
<PAGE> 2
TENNECO AUTOMOTIVE INC.
EXECUTIVE INCENTIVE COMPENSATION PLAN
Section 1. Establishment and Purpose
1.1 Establishment of the Plan. Tenneco Automotive Inc.
hereby establishes the "TENNECO AUTOMOTIVE INC. EXECUTIVE INCENTIVE COMPENSATION
PLAN" (The "Plan"), set forth herein, effective November 4, 1999.
1.2 Purpose. The objectives of the Plan are to:
(a) Reinforce a results-oriented management culture with
executive pay that varies according to corporate, division, and individual
performance against aggressive goals.
(b) Provide incentives, in the form of substantial reward
potential, for executives to remain employees of the Company.
(c) Focus on business results that include financial
measures such as net income, cash flow, working capital, and economic value
added (EVA) with improvement in quality, safety, environmental, risk management,
effective leadership and equal employment opportunities performance.
(d) De-emphasize fixed compensation in the form of base
salary and place greater emphasis on variable performance-based compensation.
(e) Provide key executives with competitive levels of total
current compensation and incentive earning opportunities commensurate with the
results achieved and individual performance.
(f) Provide plans that are simple and easy to describe and
understand.
Section 2. Plan Definitions
(a) Company means Tenneco Automotive Inc. and any successor
employer which adopts the Plan and any subsidiary corporation designated by the
Board as eligible to participate in the Plan; except that when used with
reference to authority under this Plan, Company shall mean Tenneco Automotive
Inc. exclusively.
(b) Board means the Board of Directors of the Company.
(c) Compensation/Nominating/Governance Committee means
those members of the Compensation/Nominating/Governance Committee of the Board
who are not employees of the Company. This Committee is charged with the overall
responsibility for this Plan.
-1-
<PAGE> 3
(d) Corporate means the entity which is responsible for the overall
management and staff support functions of the Company.
(e) Division means each operating organizational entity which,
through the conduct of its business, produces revenues for the Company.
(f) Executive means a regular, full-time salaried employee of the
Company who is in a position meeting the defined eligibility criteria for
participation in the Plan.
(g) Participant means an executive who has been approved for
participation in the Plan.
(h) Effective Date means November 4, 1999.
(i) Plan Year means the calendar year.
(j) Salary grade means the position classification assigned to the
Participant in accordance with the position evaluation system adopted by Tenneco
Automotive Inc. for Plan purposes.
(k) EICP Objectives means the "Target" (Budget) level of financial
objectives (e.g., net income, cash flow, and economic value added (EVA) or other
operating measurements for the Plan Year, assigned annually by the Company to
each Strategic Business Unit (SBU). This represents the expected level of
achievement for the Plan Year. The target goal (budget) for Corporate will be
the Company's consolidated operating measurements.
(l) Individual Incentive Target Award means the anticipated
individual incentive award to be allocated to a Participant in the event EICP
objectives are met and his/her individual performance is fully satisfactory. The
schedule of individual incentive target awards applicable to the various salary
grades shall be determined by the Company.
Section 3. Eligibility and Participation
3.1 Eligibility and Participation. Eligibility for participation
in the Plan will be limited to those key executives who, by the nature and scope
of their positions, regularly and directly make or influence policy decisions
which significantly impact the overall results or success of the Company. The
Company will receive recommendations for participation from SBU Senior
Leadership and appropriate Corporate Staff Officers. Each such nominated
executive shall become a Participant upon being approved by the Company. All
such executives approved for participation shall be notified of their selection
as soon as practical following approval.
3.2 Cessation of Participation. The Company may withdraw its
approval of an existing position at any time during the Plan Year. Participants
whose employment is terminated during the Plan Year for reasons other than
disability, death, or retirement under a Company retirement plan shall forfeit
participation in the Plan unless otherwise authorized by the Company.
-2-
<PAGE> 4
At the sole discretion of the Company, participation may be prorated for
participants who become disabled, die, retire or are assigned to a non-eligible
position during the Plan Year.
Section 4. Fund Generation
4.1 SBU/Corporate Incentive Amounts. Annually, the Company shall
establish SBU and Corporate EICP Objectives (Target/Budget) applicable to each
participating Division. In addition, the Company shall determine for each
participating SBU a target incentive amount equal to the sum of individual
incentive targets. The Company may adjust the target incentive amount during the
Plan Year to accommodate the admission or elimination of Participants to the
Plan and to incorporate adjustments to individual incentive targets of
Participants whose salary grade changes during the Plan Year. SBU and corporate
incentive funds will be determined based on the budgeted financial objectives
(e.g., net income, cash flow, and EVA) with each weighted to reflect appropriate
emphasis.
The size of the incentive fund applicable to each division will be determined as
follows:
FINANCIAL OBJECTIVES
A preliminary fund will be established based on performance against
financial objectives from the Annual Operating Plan (AOP).
- Performance on AOP will generate a fund equal to the sum of
individual target awards.
- Performance below AOP will result in a pro-rated incentive fund
as determined by Tenneco Automotive Inc. taking into
consideration the reasons that AOP was not attained.
- Performance above AOP may result in a higher than target level
fund as determined by Tenneco Automotive Inc. taking into
consideration the reasons that AOP was exceeded.
NON -FINANCIAL OBJECTIVES
Quantitative Adjustments
Once the preliminary fund is established, the following
quantitative adjustment factors will be applied to determine a
final incentive fund:
- Working Capital Performance
- Environmental Performance
- Safety & Health Performance
- Quality Performance
- EEO Performance
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<PAGE> 5
Each of these quantitative adjustment factors will be applied
a maximum of 5% for a total increase/decrease to the fund of
as much as 25%.
Qualitative Adjustments
The following qualitative adjustment factors for overall
leadership will also be applied:
- Global Market Development
- Customer Satisfaction
- Employee Satisfaction
- Leadership Development (Recruiting/Staffing/Training)
- Operational Considerations (Quality of Earnings)
These qualitative factors will be applied a maximum of 2% for
a total increase/decrease to the fund as much as 10%.
4.2 Committee Authority. The Committee shall have the right
at any time in its sole discretion to modify, eliminate or withdraw for such
period or periods as it may determine, the incentive amounts, in part or in
whole, to be made available under this Section 4 for payment of awards to any or
all participating Corporate or SBU entities or any Participant or Participants
hereunder.
Section 5. Determination of Individual Awards
5.1 Determination of Individual Awards. Annually, the
Compensation and Benefits Committee shall determine the Salary Grade applicable
to the Chairman and CEO of the Company and the Company shall determine the
salary grade applicable to all other Participants. Each Participant's individual
incentive target award will be determined by the Company.
5.2 Determination of Individual Incentive Awards. Actual
individual awards to be paid to Participants will vary above or below the
assigned individual incentive target awards dependent upon each individual's
performance in accordance with guidelines prescribed by the Company. The actual
award to a Participant must be approved by both the Company and the Compensation
and Benefits Committee (or only the Committee for awards applicable to the
Chairman and President of the Company) and shall not exceed 100% of the
Participant's annual base salary without approval of the Committee.
Section 6. Form of Timing of Awards
Payment of Individual Awards. The actual awards to be paid to
participants in accordance with Section 5.2 shall be paid in cash as soon as
practical once final operating performance is available.
-4-
<PAGE> 6
Section 7. Administration
This Plan shall be administered by the Company in accordance with
rules that may be established from time to time by the
Compensation/Nominating/Governance Committee. The determination of the Company
as to any disputed question arising under this Plan, including any question of
construction or interpretation, shall be final, binding, and conclusive upon all
persons.
Section 8. Amendment and Termination
The Committee, in its absolute discretion and without notice, may
at any time and from time to time modify or amend, in whole or in part, any or
all of the provisions of this Plan, or suspend or terminate it entirely.
Section 9. Applicable Laws
This Plan shall be construed, administered and governed in all
respects under and by the laws of the State of Illinois.
IN WITNESS WHEREOF, the Company has caused the Plan to be
executed on its behalf by its respective officers thereunder duly authorized, on
this day and year set forth below.
TENNECO AUTOMOTIVE INC.
Date:
-------------------------------- -----------------------------------
By:
--------------------------------
Its:
-------------------------------
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<PAGE> 1
Exhibit 10.1
TENNECO AUTOMOTIVE INC. CHANGE IN CONTROL
SEVERANCE BENEFIT PLAN FOR KEY EXECUTIVES
(the "Plan")
This Plan is established by Tenneco Inc., a Delaware corporation to be
renamed Tenneco Automotive Inc., effective on the date and time at which the
Company completes the spin-off of its packaging business to the shareholders of
the Company (the "Effective Time"). The purpose of the Plan is to induce key
employees to enter into, or continue their services or employment with, and to
steadfastly serve the Company if and when a Change in Control (as defined below)
is threatened, despite attendant career uncertainties, by committing the Company
to provide severance benefits in the event their employment terminates as a
result of a Change in Control.
1. Definitions
A. "Change in Control" shall mean any of the following events (but no
event other than one of the following events):
(1) any person, alone or together with any of its affiliates or
associates, becomes the beneficial owner, directly or
indirectly, of securities of the Company representing (a)
fifteen percent (15%) or more of either the Company's then
outstanding shares of common stock or the combined voting power
of the Company's then outstanding securities having general
voting rights, and a majority of the Incumbent Board does not
approve the acquisition before the acquisition occurs, or (b)
forty percent (40%) or more of either the Company's then
outstanding shares of common stock or the combined voting power
of the Company's then outstanding securities having general
voting rights; provided, however, that, notwithstanding the
foregoing, a Change in Control shall not be deemed to occur
pursuant to this paragraph (1) solely because the requisite
percentage of either the Company's then outstanding shares of
common stock or the combined voting power of the Company's then
outstanding securities having general voting rights is acquired
by one or more employee benefit plans maintained by one or more
Tenneco Companies; or
(2) members of the Incumbent Board cease to constitute a majority of
the Company Board; or
(3) the consummation of any plan of merger, consolidation, share
exchange or combination between the Company and any person,
including without limitation becoming a subsidiary of any other
person, without members of the Incumbent Board, as constituted
immediately prior to the merger, consolidation, share exchange
or combination, constituting a majority of the board of
directors of (a) the surviving or successor corporation of such
transaction, or (b) if the surviving or successor corporation of
such transaction is a majority-owned subsidiary of another
corporation or corporations, the ultimate parent company of the
surviving or successor corporation; or
<PAGE> 2
(4) the consummation of any sale, exchange or other disposition of
all or substantially all of the Company's assets without members
of the Incumbent Board immediately prior to any sale, exchange
or disposition of all or substantially all of the Company's
assets constituting a majority of the board of directors of (a)
the corporation which holds such assets after such disposition,
or, (b) if such corporation is a majority-owned subsidiary of
another corporation or corporations, the ultimate parent company
of the corporation which holds such assets after such
disposition; provided, however, that the Company Board may
determine conclusively that any transaction does not constitute
a sale, exchange or other disposition of substantially all of
the Company's assets; or
(5) if any person, alone or together with any of its affiliates or
associates, shall elect or have elected, during any period not
exceeding 24 months, at least 25% of the members of the Company
Board, without the approval of the Incumbent Board, and such
members are comprised of persons not serving as members of the
Company Board immediately prior to the formation of such group
or the first solicitation of proxies by such persons; or
(6) the Company's stockholders approve a plan of complete
liquidation or dissolution of the Company.
B. "Company" means Tenneco Inc., a Delaware corporation to be renamed
Tenneco Automotive Inc., and any successors thereto as provided in
Section 7.
C. "Company Board" means the Board of Directors of the Company.
D. "Constructive Termination" will be deemed to have occurred if, upon or
following the Change in Control, a Key Executive separates from
service with all Tenneco Companies after the Tenneco Companies, by
action or inaction, and without the Key Executive's express prior
written consent:
(1) diminish in any manner the Key Executive's status, position,
duties or responsibilities with Tenneco Companies from those in
effect immediately prior to the Change in Control (without
limiting the generality of foregoing, for purposes of this
clause (1) a diminution will be deemed to have occurred if the
Key Executive does not maintain the same or greater status,
position, duties and responsibilities with the ultimate parent
corporation of a controlled group of corporations of which the
Company is a member upon consummation of the transaction or
transactions constituting the Change in Control);
(2) reduce the Key Executive's then current annual cash compensation
from Tenneco Companies below the sum of (a) the Key Executive's
annual base salary or annual base compensation from the Tenneco
Companies in effect immediately prior to the Change in Control
and (b) the Key Executive's average annual award under the
Company's Executive Incentive
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<PAGE> 3
Compensation Plan (or any successor plan) for the three calendar
year periods (or for such shorter period as the Key Executive
has been employed by the Company) completed immediately prior to
the Change in Control;
(3) cause a material reduction in (a) the level of aggregate Tenneco
Companies-paid medical benefit, life insurance and disability
plan coverages; or (b) the aggregate rate of Tenneco
Companies-paid thrift/savings plan contributions and of Tenneco
Companies-paid defined benefit retirement plan benefit accrual,
from those coverages and rates in effect immediately prior to
the Change in Control; or
(4) effectively require the Key Executive to relocate because of
transfer of the Key Executive's place of employment with Tenneco
Companies from the place where the Key Executive was employed
immediately prior to the Change in Control ( for purposes of the
foregoing, a transfer of place of employment shall be deemed to
require a Key Executive to relocate if such transfer (i) is
greater than 25 miles from the place where the Key Executive was
employed immediately prior to the Change in Control and (ii)
increases the normal commuting time of such Key Executive by
more than 50%).
A Constructive Termination will be deemed to have occurred for
all Key Executives if any successor to the Company in a merger,
consolidation, purchase or other combination constituting a
Change in Control fails to assume, in writing, all of the
Company's obligations under the Plan promptly upon consummation
of such Change in Control.
In addition, a determination that a Key Executive has been
Constructively Terminated for purposes of eligibility for
benefits under this Plan shall be based solely on the criteria
set forth in this paragraph D and the Key Executive's
eligibility or application for, or receipt of, any retirement
benefits from any Tenneco Company following separation from
service shall have no bearing on such determination.
E. "Discharge for Cause" shall be deemed to have occurred only if,
following the Change in Control, a Key Executive is discharged by any
of the Tenneco Companies from employment because:
(1) the Key Executive has engaged in dishonesty or other serious
misconduct in his or her capacity as an employee of any of the
Tenneco Companies having the effect of materially injuring the
reputation or business of any of the Tenneco Companies,
monetarily or otherwise; or
(2) the Key Executive has willfully and continually failed (unless
due to incapacity resulting from physical or mental illness) to
substantially perform the duties of his or her employment by any
of the Tenneco
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<PAGE> 4
Companies after written demand for substantial performance is
delivered to the Key Executive by any of the Tenneco Companies
specifically identifying the manner in which the Key Executive
has not substantially performed such duties.
Notwithstanding the foregoing, a Key Executive who, immediately prior
to the Change in Control, is a member of Executive Group I shall not
be deemed to have been Discharged for Cause under paragraph 1 or 2
above unless a written notice has been delivered to the Key Executive
stating that the Tenneco Companies have terminated the Key Executive's
employment, which notice shall include a resolution, adopted by at
least a three-quarter's vote of the Incumbent Board (after the Key
Executive has been provided with reasonable notice and an opportunity,
together with counsel, for a hearing before the entire Incumbent
Board), finding that the Key Executive has engaged in the conduct
set forth in paragraphs (1) or (2) of the preceding sentence.
F. "Executive Group I" shall consist of each individual who, immediately
prior to a Change in Control,
(1) is the Chief Executive Officer of Tenneco; or
(2) is designated by the Chief Executive Officer of Tenneco, in
writing on or before the Change in Control, as a member of
Executive Group I.
G. "Executive Group II" shall consist of each individual
(1) who is not a member of Executive Group I; and
(2) (a) who, immediately prior to the Change in Control, is an
active participant in the Company's Executive Incentive
Compensation Plan, or (b) who, immediately prior to the Change
in Control, is an employee of a Tenneco Company who has been
designated by the Chief Executive Officer of the Company, in
writing before the Change in Control, as a member of Executive
Group II.
H. "Incumbent Board" means
(1) the members of the Company Board on the Effective Time, to the
extent that they continue to serve as members of the Company
Board; and
(2) any individual who becomes a member of the Company Board after
the Effective Time, if his or her election or nomination for
election as a director is approved by a vote of at least
three-quarters of then Incumbent Board, other than a director
whose initial assumption of office is in connection with an
actual or threatened election contest, including but not limited
to a consent solicitation, relating to the election of directors
of the Company.
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<PAGE> 5
I. "Internal Revenue Code" means the Internal Revenue Code of 1986, as
amended.
J. "Key Executive" means an individual who, immediately prior to the
Change in Control, is a member of Executive Group I or Executive Group
II.
K. "Tenneco Company" or "Tenneco Companies" mean the Company and any
stock corporation of which a majority of the voting common or capital
stock is owned directly or indirectly by the Company.
L. "Threatened Change in Control" shall mean (i) any publicly disclosed
proposal, offer, actual or proposed purchase of stock or other action
which, if consummated, would, in the opinion of the Incumbent Board,
constitute a Change in Control, including the Company entering into an
agreement, the consummation of which would result in a Change in
Control or (ii) the adoption of a resolution by the Incumbent Board
that a Threatened Change in Control has occurred.
M. "Threatened Change in Control Period" shall mean the period beginning
on the date a Threatened Change in Control occurs and ending on the
earlier of (1) the date the proposal, offer, actual or proposed
purchase of stock or other action is formally withdrawn or the
Incumbent Board has determined that the circumstances which
constituted the Threatened Change in Control no longer exist or (2)
the date a Change in Control occurs.
For purposes of the foregoing definitions, the terms "associate",
"affiliate", "person", and "beneficial owner" shall have the
respective meanings set forth in Sections 3(a) and 13(d) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and
the regulations promulgated thereunder, and the regulations
promulgated under Section 12 of the Exchange Act.
2. Eligibility for Benefits. Any Key Executive who meets the criteria set
forth in paragraphs (A) or (B) below shall be entitled to receive the
benefits described in Sections 3 and 6 below.
A. If (i) within two years after a Change in Control, a Key Executive is
separated from service as an employee with the Tenneco Companies
because (a) the Key Executive is discharged by the Tenneco Companies,
provided, such discharge is not Discharge for Cause, or (b) because of
Constructive Termination, and (ii) throughout the period beginning
with the Change in Control and ending with such separation from
service with Tenneco Companies, the Key Executive remains an employee
of Tenneco Companies; or
B. If, during the first thirty days following the first anniversary of a
Change in Control, a member of Executive Group I on the date of the
Change in Control, voluntarily elects to separate from service.
3. Severance Benefits.
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<PAGE> 6
A. If the Key Executive is a member of Executive Group I immediately
prior to the Change in Control -- a cash amount equal to three times
the sum of (a) the Key Executive's annual base salary or other annual
base compensation in effect immediately prior to the Change in
Control, plus (b) the greater of (i) the average of the Key
Executive's annual awards under the Company's Executive Incentive
Compensation Plan (or any successor plan), together with any special
awards from Tenneco Companies, for the last three years of the Key
Executive's employment with Tenneco Companies (or such shorter period
as the Key Executive has been employed by the Tenneco Companies) or
(ii) the Key Executive's targeted annual award under such plans in
effect immediately prior to the Change in Control.
B. If the Key Executive is a member of Executive Group II immediately
prior to the Change in Control -- a cash amount equal to two times the
sum of (a) the Key Executive's annual base salary in effect
immediately prior to the Change in Control, plus (b) the greater of
(i) the average of the Key Executive's annual awards under the
Company's Executive Incentive Compensation Plan (or any successor
plan), together with any special awards from the Tenneco Companies,
for the last three years of the Key Executive's employment with the
Tenneco Companies (or such shorter period as the Key Executive has
been employed by the Tenneco Companies) or (ii) the Key Executive's
targeted annual award under such plans in effect immediately prior to
the Change in Control.
C. All deferred compensation (and earnings accrued thereon) credited to
the account of a Key Executive under any deferred compensation plan,
program or arrangement of the Tenneco Companies shall be paid to such
Key Executive immediately following termination of employment,
notwithstanding any provisions of such plan, program or arrangement to
the contrary.
D. An amount, paid in a single lump sum of cash, equal to the sum of (i)
any incentive compensation which has been allocated or awarded to such
Key Executive for a completed calendar year or other measuring period
preceding the Change in Control but has not yet been paid and (ii) a
pro rata portion to the date of the Change in Control of the aggregate
value of all contingent incentive compensation awards to such Key
Executive for the current calendar year or other measuring period
under any compensation or incentive plans of the Company, calculated
as if 100% of any performance target or goal was achieved or otherwise
on a basis on which such Key Executive will receive a pro rata portion
(based on elapsed time) of the amounts he or she would have been
entitled to receive if he or she had continued to be employed by the
Company throughout the period contemplated with respect to such award
and if all other conditions for receiving the maximum amount with
respect to all such awards had been met, notwithstanding any provision
of any such plan to the contrary.
E. The Key Executive shall be entitled to be paid in cash the total of
the fair market value, determined as of the date of his or her
separation from service, of any Restricted Stock, Stock Appreciation
Rights, Performance Units, Stock
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<PAGE> 7
Equivalent Units and Dividend Equivalents which he or she held
immediately prior to such separation from service to the extent that
he or she would not otherwise receive the value thereof. The terms
"Restricted Stock", "Stock Appreciation Rights", "Performance Units",
"Stock Equivalent Units" and "Dividend Equivalents" shall have the
meaning ascribed to those terms in the Company's Stock Ownership Plan.
F. The Key Executive and his or her eligible dependents, if any, shall
continue to be covered by the health, life and disability plans
applicable to comparably situated active employees as in effect from
time to time and subject to the rules thereof for the period described
below. For persons entitled to Executive Group I benefits, and their
eligible dependents, the period is three (3) years from his or her
separation form service. For persons entitled to Executive Group II
benefits, and their eligible dependents, the period is two (2) years
from his or her separation from service. This period of coverage will
not count against the minimum period of health coverage required by
the Consolidated Omnibus Budget Reconciliation Act of 1985 ("COBRA"),
and persons covered by this provision will be afforded their
applicable COBRA rights at the end of the health coverage provided
herein.
G. The Company shall provide each Key Executive with reasonable out
placement services consistent with past practices of the Company with
respect to officers at such level prior to the Change in Control.
H. If a Key Executive receives other cash severance benefits from Tenneco
Companies, the amount of severance benefit to which the Key Executive
is entitled under Section 3(A) or (B) above shall be considered to be
satisfied to the extent of such other cash severance payment.
4. Other Benefits. Upon a Change in Control, and without regard to the Key
Executive's employment status following such Change in Control, all Stock
Options granted under the Company's Stock Ownership Plan or any other
similar plan maintained by the Company shall become immediately vested and
exercisable for the lesser of 36 months or the remaining life of the
option. The term "Stock Options" shall have the meaning ascribed thereto
in the Company's Stock Ownership Plan.
5. Method of Payment. The Company shall pay, or cause to be paid, the cash
severance benefits under the Plan to the Key Executive in a single cash
sum within 30 days following the later of the Key Executive's separation
from service as an employee with Tenneco Companies and submission of a
claim as required by Section 12 of the Plan. Except for withholdings
required by law to satisfy local, state, and federal tax withholding
requirements, no offset nor any other reduction shall be taken in paying
such benefit.
6. Gross-Up Payment. If any portion of the payments described herein, and/or
any other payments no matter the source of such payments, shall be subject
to the tax imposed by Section 4999 of the Internal Revenue Code (the
portion of such payments which are
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<PAGE> 8
subject to the Excise Tax being referred to herein as the "Payments") the
Company shall pay to the affected Key Executive, not later than the 30th
day following the date the Key Executive becomes subject to the Excise Tax
an additional amount (the "Gross-Up Payment"), such that the net amount
retained by the Key Executive after deduction of the Excise Tax on such
Payments, and all federal, state and local income and employment tax
(assuming the Key Executive is in the highest marginal tax bracket),
interest and penalties and Excise Tax on the Gross-Up Payment, shall be
equal to the amount which would have been retained by the Key Executive
had the payments not been subject to the Excise Tax.
7. Assignment. No Key Executive may assign, transfer, convey, mortgage,
hypothecate, or in any way encumber any severance benefit payable under
the Plan, nor shall the Key Executive have any right to receive any
severance benefit under the Plan except at the time, in the amount and in
the manner provided in the Plan, provided that the rights of a Key
Executive under the Plan may be enforced by the Key Executive's heirs and
legal representatives.
This Plan may and shall be assigned or transferred to, and shall be
binding upon and shall inure to the benefit of, any successor of the
Company, and any such successor shall be deemed substituted for all
purposes of "the Company" under the provisions of the Plan. As used in the
preceding sentence, the term "successor" shall mean any person, firm,
corporation, or business entity which at any time, whether by merger,
purchase or otherwise, acquires all, or substantially all, of the assets
or business of the Company. Notwithstanding such assignments, the Company
shall remain, with such successor, jointly and severally liable for all
obligations under the Plan, which, except as herein provided, may not be
assigned by the Company.
8. Plan Amendment and Termination. The Plan may be terminated or amended at
any time by the Board of Directors provided that during a Threatened
Change in Control Period, the Plan may not be terminated or amended in any
manner that reduces the benefits to a Key Executive or adversely affects
the rights of a Key Executive under the Plan. In the event of a Change in
Control, no amendment, or termination, made on or after the date of the
Change in Control shall apply to any Key Executive until the expiration of
two years and thirty-one days from the date of the Change in Control.
9. Funding. The Company shall pay, or cause to be paid, any severance benefit
under the Plan out of general assets of the Tenneco Companies. Nothing
contained herein shall preclude the Company from establishing a grantor
trust through which assets to satisfy obligations under the Plan may be
set aside to provide for benefit payments to participants in the Plan. Any
assets or property held by such trust shall be subject to the claims of
general creditors of the Company, but only upon the insolvency or
bankruptcy of the Company and only to the extent that the assets or
property held by such trust are attributable to contributions made by the
Company. No person other than the Company shall, by virtue of the
provisions of the Plan, have any interest in such funds.
10. Controlling Law. The Plan shall be interpreted under the laws of the State
of Illinois, except to the extent that federal law preempts such laws.
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<PAGE> 9
11. Plan Administrator. The Company is the Plan Administrator, and it shall
have the authority to control and manage the operation of this Plan with
the authority to interpret the Plan.
12. Making a Claim
A. Submission of a Claim. In order to claim a severance benefit under
this Plan, a Key Executive need only advise the Plan Administrator in
writing that the Key Executive's employment with Tenneco Companies has
terminated, that the Key Executive claims a severance benefit under
the Plan and of the mailing address to which the severance benefit or
related correspondence is to be sent.
B. Denial of a Claim. If a Key Executive has made a claim for benefits
under this Plan and any portion of the claim is denied, the Plan
Administrator will furnish the Key Executive with a written notice
stating the specific reasons for the denial, specific reference to
pertinent Plan provisions upon which the denial was based, a
description of any additional information or material necessary to
perfect the claim and an explanation of why such information or
material is necessary, and appropriate information concerning steps to
take if the Key Executive wishes to submit the claim for review.
The claim will be deemed accepted if the Plan Administrator does not
approve the claim and fails to notify the Key Executive within 90 days
after receipt of the claim, plus any extension of time for processing
the claim, not to exceed 90 additional days, as special circumstances
require. To obtain an extension, the Plan Administrator must advise
the Key Executive in writing during the initial 90 days if an
extension is necessary, stating the special circumstances requiring
the extension and the date by which the Key Executive can expect the
Plan Administrator's decision regarding the claim.
C. Review Procedure. Within 60 days after the date of written notice
denying any benefits, the Key Executive or the Key Executive's
authorized representative may write to the Plan Administrator
requesting a review of that decision by the Company Board or the
Compensation / Nominating / Governance Committee thereof (the
"Committee").
The request for review may contain such issues and comments as the Key
Executive wishes to have considered in the review. The Key Executive
may also review pertinent documents in the Plan Administrator's
possession. The Company Board or the Committee will make a final
determination with respect to the claim as soon as practicable. The
Plan Administrator will advise the Key Executive of the determination
in writing and will set forth the specific reasons for the
determination and the specific references to any pertinent Plan
provisions upon which the determination is based.
The claim will be deemed accepted on review if the Plan Administrator
fails to give the Key Executive written notice of final determination
within 60 days after
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<PAGE> 10
receipt of the request for review, plus any extension of time for
completing the review, not to exceed 60 additional days, as special
circumstances require. To obtain an extension, the Plan Administrator
must advise the Key Executive in writing during the initial 60 days if
any extension is necessary, stating the special circumstances
requiring the extension and the date by which the Key Executive can
expect the Company's decision regarding the review of the claim.
13. Legal Fees and Costs. In the event a Key Executive initiates legal action
to enforce his or her right to any benefit under this Plan, the Company
shall pay all reasonable legal fees and costs incurred by the Key
Executive in connection with such legal action, provided that the Key
Executive prevails on any material issue that is a subject of the legal
action.
14. Severability. If for any reason any provision or provisions of the Plan
are determined invalid or unenforceable, the validity and effect of the
other provisions of the Plan shall not be affected thereby.
IN WITNESS WHEREOF, the Company has caused the Plan to be executed on its behalf
by its officer duly authorized, on the day and year set forth below.
TENNECO INC. (to be renamed
TENNECO AUTOMOTIVE INC.)
By__________________
Its_________________
Date:____________________
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<PAGE> 1
Exhibit 10.2
TENNECO AUTOMOTIVE INC.
STOCK OWNERSHIP PLAN
1. Purpose
The purpose of the Tenneco Automotive Stock Ownership Plan (the "Plan") is
to promote the long-term success of Tenneco Automotive Inc. (the "Company") for
the benefit of shareholders by encouraging its directors, officers and key
employees to have meaningful investments in the Company so that, as stockholders
themselves, those individuals will be more likely to represent the views and
interest of other stockholders and by providing incentives to such directors,
officers and key employees for continued service. The Company believes that the
possibility of participation under the Plan will provide this group of
directors, officers and employees an incentive to perform more effectively and
will assist the Company in attracting and retaining people of outstanding
training, experience and ability. This document amends and restates the 1996
Tenneco Inc. Stock Ownership Plan.
2. Definitions
"Automotive Company" means the Company and any stock corporation of which a
majority of the voting common or capital stock is owned directly or indirectly
by the Company and any other company designated as such by the Committee, but
only during the period of such ownership or designation.
"Award" means an award or grant made to a Participant under Section 8.
"Award Agreement" means the agreement provided in connection with an Award
under Section 12.
"Award Date" means the date that an Award is made, as specified in an Award
Agreement.
"Code" means the Internal Revenue Code of 1986, as amended, or any
successor legislation.
"Committee" means the Compensation / Nominating / Governance Committee of
the Board of Directors of the Company, or any successor committee thereto.
"Common Stock" means the Company's common stock.
"Covered Employees" shall have the meaning specified in Section 162(m)(3)
of the Code.
"Dividend Equivalent" means an amount equal to the amount of the cash
dividends that are declared and become payable after the Award Date for the
Award to which it relates and on or before the Settlement Date for such Award.
"Fair Market Value" on any date means the average of the highest and the
lowest sales prices of a share of Common Stock on the Composite Tape for such
date, as reported by the National Quotation Bureau Incorporated, provided that
if (i) no sales of Common Stock are included on the Composite Tape for such
date, or (ii) in the opinion of the Committee, the sales of Common Stock on such
date are insufficient to constitute a representative market, then the
<PAGE> 2
Fair Market Value of a share of Common Stock on such date shall be deemed to be
the average of the highest and lowest prices of a share of Common Stock as
reported on said Composite Tape for the next preceding day on which (x) sales of
Common Stock are included and (y) the circumstances described in this clause
(ii) do not exist.
"ISO" means any Stock Option designated in an Award Agreement as an
"Incentive Stock Option" within the meaning of Section 422 of the Code.
"Non-Qualified Stock Option" means any Stock Option that is not an ISO.
"Option Price" means the purchase price of one share of Common Stock under
a Stock Option.
"Participant" means a director, employee or officer of an Automotive
Company who has been selected by the Committee to receive an Award under the
Plan.
"Performance Unit" means an Award denominated in cash, the amount of which
may be based on the performance of the Participant, of an Automotive Company or
of any subsidiary or division thereof.
"Reload Stock Option" means a Stock Option (i) that is awarded, either
automatically in accordance with the terms of an Award Agreement in which one or
more other Awards are made or by separate Award, upon the exercise of a Stock
Option granted under this Plan or otherwise where the Option Price is paid by
the option holder by delivery of shares of Common Stock on the Settlement Date
for such exercise and (ii) that entitles such holder to purchase the number of
shares so delivered for an Option Price equal to the Fair Market Value of a
share of Common Stock on such Settlement Date.
"Restricted Stock" means shares of Common Stock subject to restrictions and
conditions pursuant to Section 8(c).
"Settlement Date" means, (i) with respect to any Stock Option that has been
exercised in whole or in part, the date or dates upon which shares of Common
Stock are to be delivered to the Participant and the Option Price therefor paid,
(ii) with respect to any SARs that have been exercised, the date or dates upon
which a cash payment is to be made to the Participant, or in the case of SARs
that are to be settled in shares of Common Stock, the date or dates upon which
such shares are to be delivered to the Participant, (iii) with respect to
Performance Units, the date or dates upon which cash or shares of Common Stock
are to be delivered to the Participant, (iv) with respect to Dividend
Equivalents, the date upon which payment thereof is to be made, and (v) with
respect to Stock Equivalent Units, the date upon which payment thereof is to be
made, in each case, determined in accordance with the terms of the Award
Agreement under which any Award was made.
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<PAGE> 3
"Stock Appreciation Right" or "SAR" means an Award that entitles the
Participant to receive on the Settlement Date an amount equal to the excess of
(i) the Fair Market Value of one share of Common Stock on the date of
exercise of the SAR over
(ii) the Fair Market Value of one share of Common Stock on the Award Date
or any other higher amount specified in the Award Agreement.
"Stock Equivalent Unit" means an Award that entitles the Participant to
receive on the Settlement Date an amount equal to the Fair Market Value of one
share of Common Stock on such date.
"Stock Option" or "Option" means any right to purchase shares of Common
Stock (including a Reload Stock Option) awarded pursuant to Section 8(a).
3. Term
The Plan shall be effective as of October 8, 1996 and shall remain in
effect through December 31, 2001. After termination of the Plan, no further
Awards may be granted other than Reload Stock Options granted in accordance with
Award Agreements existing as of the termination of the Plan, but outstanding
Awards shall remain effective in accordance with their terms and the terms of
the Plan.
4. Plan Administration
(a) The Committee shall be responsible for administering the Plan.
(i) Composition of the Committee. The Committee shall be comprised of
two or more members of the Board of Directors, all of whom shall be
"non-employee directors" as defined in Rule 16b-3 and "outside directors"
as that term is used in Section 162 of the Code and the regulations
promulgated thereunder.
(ii) Powers. The Committee shall have full and exclusive discretionary
power to interpret the Plan and to determine eligibility for benefits and
to adopt such rules, regulations and guidelines for administering the Plan
as the Committee may deem necessary or proper. Such power shall include,
but not be limited to, selecting Award recipients, establishing all Award
terms and conditions and, subject to Section 13, adopting modifications and
amendments to the Plan or any Award Agreement, including without
limitation, any that are necessary to comply with the laws of the countries
in which the Company or its affiliates operate.
(iii) Delegation. The Committee may delegate to one more of its
members or to one or more agents or advisors such non-discretionary
administrative duties as it may deem advisable, and the Committee or any
person to whom it has delegated duties as aforesaid may employ one or more
persons to render advice with respect to any responsibility the Committee
or such persons may have under the Plan.
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<PAGE> 4
(b) The Committee may employee attorneys, consultants, accountants and
other persons, and the Committee, the Company and its officers and directors
shall be entitled to rely upon the advice, opinions or valuations of any such
persons. All actions taken and all interpretations and determinations made by
the Committee in good faith shall be final and binding upon the Participants,
the Company and all other interested persons. No member of the Committee shall
be personally liable for any action, determination, or interpretation made in
good faith with respect to the Plan or Awards, and all members of the Committee
shall be fully protected by the Company, to the fullest extent permitted by
applicable law, in respect to any such action, determination and interpretation.
5. Eligibility
Awards will be limited to persons who are directors, officers, or key
employees of the Automotive Companies. In determining the persons to whom Awards
shall be made, the Committee shall, in its discretion, take into account the
nature of the person's duties, past and potential contributions to the success
of the Automotive Companies and such other factors as the Committee shall deem
relevant in connection with accomplishing the purposes of the Plan. A person who
has received an Award or Awards may receive an additional Award or Awards. For
purposes of this Section 5, the terms "director," "key employee" and "officer"
shall also include any former director, former key employee or former officer of
an Automotive Company or Tenneco Inc. eligible to receive a replacement Award as
contemplated in the third sentence of Section 8.
6. Authorized Awards; Limitations
(a) Except for adjustments pursuant to Section 7, the maximum number of
shares of Common Stock that shall be available for issuance under the Plan (the
"Authorized Plan Shares") shall be 3,400,000 after giving effect to the
one-for-five reverse stock split on November 5, 1999.
(b) If an Award expires unexercised or is forfeited, surrendered, canceled,
terminated or settled in cash in lieu of Common Stock, the shares of Common
Stock that were theretofore subject (or potentially subject) to such Award may
again be made subject to an Award Agreement.
(c) Common Stock that may be issued under the Plan may be either authorized
and unissued shares, or issued shares that have been reacquired by the Company
and that are being held as treasury shares. No fractional shares of Common Stock
shall be issued under the Plan; provided, however, that cash, in an amount equal
to the Fair Market Value of a fractional share of Common Stock as of the
Settlement Date of the Award, shall be paid in lieu of any fractional shares in
the settlement of Awards payable in shares of Common Stock.
(d) In no event shall the number of shares of Common Stock subject to Stock
Options plus the number of shares underlying SARs awarded to any one Participant
during the term set forth in Section 3 hereof, exceed 50% of the Authorized Plan
Shares. In all events, determinations under the preceding sentence shall be made
in a manner that is consistent with Code Section 162 and the regulations
promulgated thereunder.
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7. Adjustments and Reorganizations
The Committee may make such adjustments to Awards granted under the Plan
(including the terms, exercise price and otherwise) as it deems appropriate in
the event of changes that impact the Company, the Company's share price, or
share status, provided, that, notwithstanding any other provision hereof,
insofar as any Award is subject to performance goals established to qualify
payments thereunder as "performance-based compensation" as described in Section
162(m) of the Code, the Committee shall have no power to adjust such Awards
other than (i) negative discretion and (ii) the power to adjust Awards for
corporate transactions, in either case to the extent permissible under
regulations interpreting Code Section 162(m).
In the event of any merger, reorganization, consolidation,
recapitalization, separation, liquidation, stock dividend, extraordinary
dividend, spin-off, split-off, rights offering, share combination, or other
change in the corporate structure of the Company affecting the Common Stock, the
number and kind of shares that may be delivered under the Plan shall be subject
to such adjustment as the Committee, in its sole discretion, may deem
appropriate, and the number and kind and price of shares subject to outstanding
Awards and any other terms of outstanding Awards shall be subject to such
adjustment as the Committee, in its sole discretion, may deem appropriate.
8. Awards
The Committee shall determine the type and amount of any Award to be made
to any Participant; provided however, that, except as provided in paragraph (g),
no Awards granted pursuant to this Plan shall vest in less than six months after
the date the Award is granted. Awards may be granted singly, in combination, or
in tandem. Awards may also be made in combination or in tandem with, in
replacement of, as alternatives to, or as the payment form for, grants or rights
under any other employee benefit or compensation plan of the Automotive
Companies or Tenneco Inc., including any such employee benefit or compensation
plan of any acquired entity.
(a) Stock Options
(i) Awards. Stock Options (including Reload Stock Options) granted
under this Plan may be either of the following:
(1) an ISO or
(2) a Non-Qualified Stock Option.
The Committee may grant any Participant one or more ISOs, Non-Qualified
Stock Options, or both types of Stock Options, in each case with or without
SARs or Reload Stock Options or any other form of Award. Stock Options
granted pursuant to this Plan shall be subject to such additional terms,
conditions, or restrictions as may be provided in the Award Agreement
relating to such Stock Option.
(ii) Option Price. The Option Price of a Stock Option shall not be
less than 100% of the Fair Market Value of a share of Common Stock on the
Award Date.
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(iii) ISOs. Anything in this Plan to the contrary notwithstanding, no
term of this Plan relating to ISOs shall be interpreted, amended or
altered, nor shall any discretion or authority awarded under the Plan be
exercised, so as to disqualify this Plan under Section 422 of the Code, or,
without the consent of the Participants affected, to disqualify any ISO
under Section 422 of the Code.
An ISO shall not be granted to an individual who, on the date of grant,
owns stock possessing more than 10% of the total combined voting power of
all classes of stock of the employing Company or of its parent or any
subsidiary corporation.
The aggregate Fair Market Value, determined on the Award Date, of the
shares of Common Stock with respect to which one or more ISOs that are
exercisable for the first time by the Participant during any calendar year
shall not exceed the $100,000 limitation imposed by Section 422(d) of the
Code.
(iv) Manner of Payment of Option Price. The Option Price shall be paid
in full at the time of the exercise of the Stock Option and may be paid in
any of the following methods or combinations thereof;
(A) In United States dollars in cash, check, bank draft or money
order payable to the order of the Company;
(B) By the delivery of shares of Common Stock having an
aggregate Fair Market Value on the date of such exercise to the Option
Price;
(C) Participants may simultaneously exercise the Stock Option
and sell their shares of Common Stock acquired thereby and apply the
proceeds to the payment of the Option Price pursuant to the procedures
established by the Committee; and
(D) In any other manner that the Committee shall approve.
Any shares of Common Stock required or permitted to be sold by an
executive officer of the Company in connection with the payment of the
Option Price shall be transferred to the Company.
(v) Reload Stock Options. The Committee may award Reload Stock Options
to any Participant either in combination with other Awards or in separate
Award Agreements that grant Reload Stock Options upon exercise of
outstanding stock options granted under this Plan or otherwise.
(b) Stock Appreciation Rights.
(i) Awards. The Committee may award any Participant SARs, which shall
be subject to such additional terms, conditions, or restrictions as may be
provided in the Award Agreement relating to such SAR Award, including any
limits on aggregate appreciation. SARs may be settled in Common Stock or
cash or both.
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(ii) Award Price. The award price per share of Common Stock of an SAR
shall be fixed in the Award Agreement and shall be not less than 100% of
the Fair Market Value of a share of Common Stock on the date of the Award.
(iii) Distribution of SARs. SARs shall be exercisable in accordance
with the conditions and procedures set out in the Award Agreement relating
to such SAR Award.
(c) Restricted Stock. The Committee may award Restricted Stock to any
Participant. Awards of Restricted Stock shall be subject to such conditions and
restrictions as are established by the Committee and set forth in the Award
Agreement, which may include, but are not limited to, continued service with the
Company, achievement of specific business objectives, and other measurements of
individual or business unit or Company performance.
(d) Stock Equivalent Units. The Committee may award Stock Equivalent Units
to any Participant. All or part of any Stock Equivalent Units Award may be
subject to conditions and restrictions established by the Committee, and set
forth in the Award Agreement, which may include some or all of the following:
continued service with the Company, achievement of specific business objectives,
and other measurements of individual or business unit or Company performance
that may include but shall not be limited to, earnings per share, net profits,
total shareholder return, cash flow, return on shareholders' equity, EVA, and
cumulative return on net assets employed. Without limiting the generality of the
foregoing, it is intended that the Committee shall establish performance goals
applicable to Stock Equivalent Units granted to Participants who, in the
judgment of the Committee, may be Covered Employees, in such manner as shall
permit payments with respect thereto to qualify as "performance-based
compensation" as described in Section 162(m)(4)(C) of the Code. The maximum
number of Stock Equivalent Units that may be awarded to any Participant in any
one calendar year shall not exceed 100,000.
(e) Dividend Equivalents. The Committee may provide in any Award Agreement
in which Stock Equivalent Units are awarded that such Stock Equivalent Units may
accrue Dividend Equivalents. In lieu of awarding Dividend Equivalents, the
Committee may provide for automatic Awards of additional Stock Equivalent Units
on each date that cash dividends are paid on the Common Stock in an amount equal
to (i) the product of the dividend per share on the Common Stock times the total
number of Stock Equivalent Units then held by the Participant, divided by (ii)
the Fair Market Value of the Common Stock on the dividend payment date.
(f) Performance Units. Performance Units shall be based on the attainment,
over a specified period, of individual performance targets or, on other
parameters that may include but shall not be limited to, earnings per share, net
profits, total shareholder return, cash flow, return on shareholders' equity,
EVA, and cumulative return on net assets employed. Performance Units may be
settled in Common Stock or cash or both. Without limiting the generality of the
foregoing, it is intended that the Committee shall establish performance goals
applicable to Performance Units granted to Participants who, in the judgment of
the Committee, may be Covered Employees, in such a manner as shall permit
payments with respect thereto to qualify as "performance-based compensation" as
described in Section 162(m)(4)(C) of the Code. The maximum amount of
compensation that may be paid to any one Participant by means of Performance
Units with respect to any one year shall be $2,000,000.
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(g) The Committee may also, in its sole discretion, shorten or terminate
the restricted period or waive any other conditions for the lapse of
restrictions with respect to all or any portion of any Award. Notwithstanding
the foregoing, all restricted periods shall terminate and the Awards shall be
fully vested with respect to any Participant upon the Participant's Retirement,
death or Total Disability, coincident with termination of employment with
Automotive Companies. For purposes of this Section 8:
"Retirement" means the Participant's termination of employment with all
Automotive Companies at a time that is determined by the Committee to be
retirement; and
"Total Disability" means the permanent inability of the Participant, which
is a result of accident or sickness, to perform such Participant's occupation or
employment for which the Participant is suited by reason of the Participant's
previous training, education and experience and which results in the termination
of the Participant's employment with all Automotive Companies.
9. Dividends
The Committee may provide in the appropriate Award Agreement that dividends
on Restricted Stock may be paid currently in cash or credited to a Participant's
account for subsequent distribution as determined by the Committee. The Award
Agreement may provide for the reinvestment of dividends paid on Restricted Stock
in shares of Common Stock.
10. Deferrals and Settlements
Settlement of Awards may be in the form of cash, Common Stock, other
Awards, or in combinations thereof as the Committee shall determine, and which
such other restrictions as it may impose. The Committee may also require or
permit Participants to defer the issuance or vesting of shares or the settlement
of Awards under such rules and procedures as it may establish under the Plan.
The Committee may also provide that deferred settlements include the payment or
crediting of interest on, the deferral amounts or the payment or crediting of
Dividend Equivalents on deferred settlements denominated in shares.
11. Transferability and Beneficiaries
No Awards under the Plan shall be assignable, alienable, saleable or
otherwise transferable other than by will or the laws of descent and
distribution, or pursuant to a qualified domestic relations order (as defined by
the Code) or Title I of the Employee Retirement Income Security Act, or the
rules thereunder unless otherwise determined by the Committee under the
following paragraph.
12. Award Agreements
Awards under the Plan shall be evidenced by Award Agreements that set forth
the details, conditions and limitations for each Award, which may include the
term of an Award (except that (i) except as provided in Section 8(g), no Award
shall vest in less than six months after the date the Award is granted and (ii)
in no event shall the term of any ISO exceed a period of ten years
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from the date of its grant), the provisions applicable in the event the
Participant's employment terminates, and the Company's authority to unilaterally
or bilaterally amend, modify, suspend, cancel or rescind any Award.
13. Amendments; Compliance with Applicable Laws
The Committee may suspend, terminate, or amend the Plan as it deems
necessary or appropriate to better achieve the purposes of the Plan, except
that, if shareholder approval is necessary in order for any such amendment to
comply with any applicable tax or regulatory requirements, including for these
purposes, any approval requirement which is a prerequisite for exemptive relief
under Section 16b of the Securities Exchange Act of 1934 (the "Exchange Act"),
no such amendment shall be made without the approval of the Company's
shareholders.
14. Tax Withholding
The Company shall have the right to (i) make deductions from any settlement
of an Award made under the Plan, including the delivery of vesting of shares, or
require shares or cash or both be withheld from any Award, in each case in an
amount sufficient to satisfy withholding of any federal, state or local taxes
required by law, or (ii) take such other action as may be necessary or
appropriate to satisfy any such withholding obligations. The Committee may
determine the manner in which such tax withholding may be satisfied, and may
permit shares of Common Stock (rounded up to the next whole number) to be used
to satisfy required tax withholding based on the Fair Market Value of any such
shares of Common Stock, as of the Settlement Date of the applicable Award.
15. Other Company Benefit and Compensation Programs
Unless otherwise specifically determined by the Committee, settlements of
Awards received by a Participant under the Plan shall not be deemed a part of
the Participant's regular, recurring compensation for purposes of calculating
payments or benefits from any Company benefit plan, severance program or
severance pay law of any country. Further, the Company may adopt other
compensation programs, plans or arrangements as it deems appropriate or
necessary.
16. Unfunded Plan
Unless otherwise determined by the Committee, the Plan shall be unfunded
and shall not create (or be construed to create) a trust or separate fund or
funds. The Plan shall not establish any fiduciary relationship between the
Company and any Participant or other person. To the extent any person holds any
rights by virtue of an Award granted under the Plan, such right (unless
otherwise determined by the Committee) shall be no greater than the right of an
unsecured general creditor of the Company.
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17. Future Rights
No person shall have any claim or right to be granted an Award under the
Plan, and no Participant shall have any right under the Plan to be retained in
the employment of the Company or its affiliates.
18. Governing Law
The validity, construction and effect of the Plan, and any actions taken or
relating to the Plan, shall be determined in accordance with the laws of the
State of Illinois and applicable federal law.
19. Successors and Assigns
The Plan shall be binding on all successors and assigns of a Participant,
including, without limitation, the estate of such Participant and the executor,
administrator or trustee of such estate, or any receiver or trustee in
bankruptcy or representative of the Participant's creditors.
20. Rights as a Shareholder
Except as otherwise provided in any Award Agreement, a Participant shall
have no rights as a shareholder of the Company until he or she becomes the
holder of record of Common Stock.
21. Section 16b
No Award or other transaction shall be permitted under this Plan which
would have the effect of imposing liability on a Participant under Section 16 of
the Exchange Act. Irrespective of any other provision of this Plan or an Award
Agreement, any such Award or other transaction purportedly made under or
pursuant to this Plan shall be void, ab initio.
IN WITNESS WHEREOF, the Company has caused the Plan to be executed on its
behalf by its respective officers thereunder duly authorized, on this day and
year set forth below.
TENNECO AUTOMOTIVE INC.
Date: ________________________ ________________________________
By: ____________________________
Its: ___________________________
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Exhibit 10.3
TENNECO AUTOMOTIVE INC.
KEY EXECUTIVE PENSION PLAN
PURPOSE
The Tenneco Automotive Inc. Key Executive Pension Plan (the "Plan") is
maintained by Tenneco Automotive Inc. (formerly known as Tenneco Inc.) (the
"Company") as an unfunded plan for the purpose of providing retirement benefits
with respect to certain employees. The benefits provided under the Plan are only
available to a "select group of management or highly compensated employees" as
determined by the Compensation/Nominating/Governance Committee of the Board of
Directors of the Company (the "Committee"), and the Plan is intended to satisfy
the exemption requirements of the Employee Retirement Income Security Act of
1974, as amended, for a plan limited to such a group.
THE PLAN
1. Effective Date
The Plan as set forth herein is effective as of November 4, 1999 (the
"Effective Date").
2. Eligibility
The employees indicated in Appendix A, attached hereto, shall be eligible
to participate in the Plan as of the Effective Date. After the Effective Date,
the Committee, in its discretion, shall determine which other employees are
eligible to participate in the Plan, provided that such employees also satisfy
the eligibility and participation requirements of the Company's qualified
defined benefit plan for salaried employees. All employees that are listed in
Appendix A or that are selected by the Committee under this Section 2 shall be
deemed "Participants" under the Plan.
3. Commencement & Amount of Benefit
The retirement benefit payable under this Plan, commencing at age 55 in the
form of a single life annuity, shall be an annual benefit in an amount equal to
the excess, if any, of (a) over (b), where
(a) is an amount equal to 4% of Compensation per year of participation in
the Company's qualified defined benefit plan for salaried employees,
including participation credited under the Tenneco Retirement Plan. In no
event shall the amount determined under this paragraph (a) exceed 50% of
the Participant's Compensation. "Compensation" shall mean the Participant's
final three-year average base salary and bonus.
(b) is the total amount (if any) that is payable under the Tenneco
Retirement Plan (or any successor thereto), the Company's qualified defined
benefit plan for salaried employees and the Tenneco Automotive Inc.
Supplemental Executive Retirement Plan, including any special supplemental
benefit for the individual in question.
<PAGE> 2
4. Form of Benefit
Any benefit under this Plan shall be paid in the same form and manner as
the benefit payments made to, or with respect to, the Participant under the
Company's qualified defined benefit plan for salaried employees. Notwithstanding
the preceding sentence, no benefit is payable hereunder prior to 60 days after
the Participant has separated from service, unless the Committee so determines.
Prior to the commencement of benefits, but in no event later than 24 months
after the Participant has separated from service, the Participant or beneficiary
may elect, but only with the approval of the Committee, to receive payment of
such benefit in the form of a lump sum or annuity, provided that in cases where
a Participant has chosen a lump sum and the exact amount of a Participant's
benefit cannot be determined by the date elected for payment, a preliminary lump
sum shall be paid with respect to amounts that can be clearly ascertained then,
with the remainder to be issued in a subsequent lump sum when that amount is
exactly determined by the Committee or its delegatee. In addition, with respect
to all Plan Participants, if the benefit payable from this Plan (expressed as an
age 65 life annuity) would be less than $50 per month, the benefit payable from
this Plan automatically shall be paid as a lump sum.
The actuarial factors set forth in the Company's qualified defined benefit
plan for salaried employees shall be used to compute benefits hereunder,
provided that, for purposes of any lump sum payment that may be payable under
the Plan, the interest rate used shall be the annual rate of interest on 30-year
Treasury securities as specified by the Internal Revenue Service (the "IRS") for
the second calendar month preceding the first day of the Plan Year during which
the annuity starting date occurs, and the applicable mortality table described
in Rev. Rul. 95-6, 1995-1 C.B. 80, or in such other formal guidance as may be
issued from time to time by the IRS.
5. Unfunded Plan
This Plan shall be maintained as an unfunded non-qualified deferred
compensation plan. All benefits under this Plan shall be payable from the
general assets of the Company. No benefit hereunder shall be paid from the funds
of any qualified plan maintained by the Company.
6. No Assignment
No benefit under this Plan shall be assignable or alienable or subjected,
by attachment or otherwise, to the claims of creditors of any person.
7. No Guarantee of Employment
This Plan shall not be construed to give any Participant the right to be
retained in the employment of the Company or any of its affiliates.
8. Operation and Administration
This Plan shall be operated under the direction of and administered by the
Committee.
The Committee's decision in all matters involving the interpretation and
application of this Plan shall be final and binding. The Committee shall
establish a claims procedure which is
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consistent with the claims procedure employed under the Company's qualified
defined benefit plan for salaried employees.
9. Governing Law
To the extent not preempted by federal law, this Plan shall be construed,
administered and enforced in accordance with the laws of the State of Illinois.
10. Amendment and Discontinuance
The Company reserves the right, by action of its chief executive officer,
to amend or discontinue the Plan. However, no such amendment or discontinuance
shall impair or adversely affect any benefits accrued under this Plan as of the
date of such action.
IN WITNESS WHEREOF, the Tenneco Automotive Inc. Key Executive Pension Plan
is adopted as of this ____ day of November, 1999.
TENNECO AUTOMOTIVE INC.
By: __________________________
Its: __________________________
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Appendix A
Participants
Mark P. Frissora
Richard P. Schneider
Mark A. McCollum
Timothy R. Donovan
Timothy E. Jackson
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Exhibit 10.4
TENNECO AUTOMOTIVE INC. DEFERRED COMPENSATION PLAN
1. PURPOSE
The purpose of the Plan is to provide to directors and a select group of
management or highly compensated employees of Tenneco Automotive Inc. (formerly
known as Tenneco Inc.) and its subsidiaries and affiliates (hereinafter
collectively referred to as the "Company") an opportunity to defer compensation
received by them from the Company in accordance with the terms and conditions
set forth herein.
2. ADOPTION AND ADMINISTRATION
The Plan shall be administered by the Compensation / Nominating / Governance
Committee of the Board of Directors of the Company (the "Committee"). The
Committee shall have sole and complete authority and discretion to interpret the
terms and provisions of the Plan and to adopt, alter and repeal such
administrative rules, regulations and practices governing the operation of the
Plan, and to determine facts under the Plan as it shall from time to time deem
advisable.
3. ELIGIBILITY
Directors and U.S. paid participants in the Company's Executive Incentive
Compensation Plan shall be eligible to participate in the Plan.
Any person who had an account balance in the Tenneco Inc. Deferred Compensation
Plan (or the Deferred Compensation Plan for Directors of Tenneco Inc.) as of the
date (the "Distribution Date") on which the stock of Tenneco Packaging Inc. was
distributed to the shareholders of the Company and whose account balance was
allocated to the Company under the Human Resources Agreement between the Company
and Tenneco Packaging, Inc. (the "Agreement") shall participate in this Plan.
Persons eligible to participate in the Plan shall be referred to as
"Participant" or "Participants" as the case may be.
4. ELECTION TO DEFER
(a) A Participant may elect in writing to defer receipt of all or a
specified portion of his or her bonuses or incentive compensation to
be received during a calendar year ("Deferral Election"); provided,
however, that any election by a Participant who is subject to the
reporting and short swing profits liability provisions of Section 16
of the Securities and Exchange Act of 1934, as amended, including an
election relating to the form of distribution or to defer income into
an "Automotive stock index account" pursuant to Section 6 of the Plan,
shall not be effective until such election and the transactions
contemplated thereby shall have been specifically approved by the
Committee to the extent such approval is required to avoid liability
under Section 16 of the Securities and Exchange Act of 1934 and the
regulations thereunder. Amounts deferred under the Plan shall be
referred to as the "Deferred Amounts." Once received by the Committee,
a Deferral Election cannot be revoked.
(b) Directors who are not employees of Automotive or its subsidiaries
(hereinafter referred to as "Outside Directors") will receive as part
of their compensation for service on the Company's Board of Directors
sixty (60) percent of their annual
<PAGE> 2
retainer fee in the form of credits deferred subject to the terms of
this Plan in the Automotive stock index account with stock settlement.
(c) Except as provided in this Section 4(c), a Deferral Election must be
made prior to September 30 of the calendar year in which the bonus,
incentive compensation or retainer fee will be awarded. A Participant
must make a separate Deferral Election with respect to each calendar
year of participation in the Plan. A new Participant in the Plan shall
have 30 days following his or her notification by the Committee of his
or her eligibility to participate in the Plan to make a Deferral
Election with respect to bonus or incentive compensation to be awarded
within that calendar year.
(d) As specified by the Participant in a Deferral Election, the period of
deferral shall be until the Participant dies, terminates employment
with Automotive, or until a specific date selected by the Participant
in the Deferral Election.
5. ESTABLISHMENT OF DEFERRED COMPENSATION ACCOUNT
At the time of a Participant's initial Deferral Election, the Company shall
establish a memorandum account (a "Deferred Compensation Account") for such
Participant on its books. The Deferred Amount shall be credited to the
Participant's Deferred Compensation Account as of the day on which the
Participant would otherwise be entitled to receive the bonus or incentive
compensation. Any required withholding for taxes (e.g. Social Security taxes) on
the Deferred Amount shall be made from other compensation of the Participant.
Adjustments as provided below, shall be made to the Participant's Deferred
Compensation Account.
6. ADJUSTMENTS TO DEFERRED AMOUNTS
The Committee shall credit the balance of the Participant's Deferred
Compensation Account with an earnings factor. The earnings factor will equal the
amount the Participant's Deferred Compensation Account would have earned if it
had been invested in the investment options listed below. The Participant is
permitted to select the investment option used to determine the earnings factor
and may change the selection at any time. The Participant may choose more than
one investment option in increments of at least one (1) percent. The Company
reserves the right to change or amend any of the investment options at any time.
The investment options used to determine the earnings factor are:
(a) The prime rate of interest as reported by The Chase Manhattan Bank at
the first day of each calendar month.
(b) Automotive stock index account -- amount of deferral will be invested
in Tenneco Automotive stock equivalent unit account. Any investment in
this account will be measured solely by the performance of the
Company's common stock (including dividends that will be reinvested).
Cash settlement or stock settlement.
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(c) The return for selected Mutual Funds currently offered in the
Company's qualified thrift plan for salaried employees:
(1) Fidelity Growth Company Fund
(2) Barclays U.S. Debt Index Fund (Bond)
(3) Barclays Daily Equity Index Fund
The Company is under no obligation to acquire or provide any of the investments
designated by a Participant, and any investments actually made by the Company
will be made solely in its name and will remain its property.
The crediting of an earnings factor shall occur so long as there is a balance in
the Participant's Deferred Compensation Account regardless of whether the
Participant has terminated employment.
7. PAYMENT OF DEFERRED AMOUNTS
(a) Except as otherwise provided in subsection (b) or (c) below, a
Participant's Deferred Amount shall be paid, or commence to be paid,
to the Participant, or the Participant's beneficiary, as soon as
practicable after:
(i) the Participant's death,
(ii) the termination of the Participant's employment or service as a
director, or
(iii) the date specified in the applicable Deferral Election made by
the Participant.
In the event of the Participant's death, payment of the balance
in the Participant's Deferred Compensation Account shall be
made, either (i) in a lump sum or (ii) in a number of annual
installments, not to exceed five, as soon as administratively
feasible to the Participant's designated beneficiary, or if
none, to the Participant's estate.
(b) The Participant may elect to receive payment of the balance of his or
her Deferred Compensation Account either (i) in a lump sum upon
termination or (ii) in a single payment at a specified date prior to
termination or (iii) in a number of post termination annual
installments, not to exceed five, as the Participant shall elect. The
distribution election must be made at least one year before the
Deferred Amount is payable and must be approved by the Committee. If
no election is made, a lump sum payment will be made upon the
Participant's termination.
(c) Anything contained in this Section 7 to the contrary notwithstanding,
in the event a Participant incurs a severe financial hardship, the
Committee, in its sole discretion and upon written application of such
Participant, may direct immediate payment of all or a portion of the
then current value of such Participant's Deferred Compensation
Account; provided that such payment shall in no event exceed the
amount necessary to alleviate such financial hardship; and provided
further that in the case of such payment, the Participant's Deferred
Compensation Account shall be reduced by 110% of the amount of such
payment.
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8. PARTICIPANT REPORTS
The Committee shall provide a statement to the Participant quarterly concerning
the status of his or her Deferred Compensation Account.
9. TRANSFERABILITY OF INTERESTS
During the period of deferral, all Deferred Amounts shall be considered as
general assets of the Company for use as it deems necessary and shall be subject
to the claims of its creditors.
The rights and interests of a Participant during the period of deferral shall be
those of a general unsecured creditor except that such Participant's rights and
interests may not be reached by the creditors of the Participant or the
Participant's beneficiary, or anticipated, assigned, pledged, transferred or
otherwise encumbered except in the event of the death of the Participant, and
then only by will or the laws of descent and distribution.
10. AMENDMENT, SUSPENSION AND TERMINATION
The Company at any time may amend, suspend or terminate the Plan or any portion
thereof in such manner and to such extent as it may deem advisable and in its
best interests. No amendment, suspension and termination shall reduce the amount
then credited to a Participant's Deferred Compensation Account.
11. UNFUNDED OBLIGATION
The Plan shall not be funded; no trust, escrow or other provisions shall be
established to secure payments due under the Plan; and the Plan shall be
regarded as unfunded for purposes of the Employee Retirement Income Security Act
of 1974, as amended, and the Internal Revenue Code. A Participant shall be
treated as a general, unsecured creditor at all times under the Plan, and shall
have no rights to any specific assets of the Company. All amounts credited to
the memorandum accounts of the Participants will remain general assets of the
Company and shall be payable solely from the general assets of the Company.
12. NO RIGHT TO EMPLOYMENT OR OTHER BENEFITS
Nothing contained herein shall be construed as conferring upon any Participant
the right to continue in the employ of the Company. Any compensation deferred
and any payments made under this Plan shall not be included in creditable
compensation in computing benefits under any employee benefit plan of the
Company except to the extent expressly provided therein.
-4-
<PAGE> 5
13. DISPUTE RESOLUTION
By participating in the Plan, the Participant agrees that any dispute arising
under the Plan shall be resolved by binding arbitration in Lake Forest, Illinois
under the rules of the American Arbitration Association and that there will be
no remedy besides the disputed deferred compensation amount in issue.
14. EFFECTIVE DATE
The effective date of this Plan is the date on which the stock of the Tenneco
Packaging Inc. is distributed to the shareholders of Tenneco Inc.
IN WITNESS WHEREOF, the Company has caused the Plan to be executed on its
behalf by its respective officers thereunder duly authorized, on this day and
year set forth below.
TENNECO INC.
Date: ________________________ ________________________________
By: ____________________________
Its: ___________________________
-5-
<PAGE> 1
Exhibit 10.5
TENNECO AUTOMOTIVE INC.
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
PURPOSE
The Plan is maintained by Tenneco Automotive Inc. (formerly known as
Tenneco Inc.) (the "Company") as an unfunded plan for the purpose of providing
retirement benefits with respect to certain employees that are equal to
retirement benefits lost under its qualified defined benefit pension plan for
salaried employees (the "Retirement Plan") as a result of the imposition of the
limitations contained in the Internal Revenue Code of 1986, as amended (the
"Code"). The portion of the Plan that provides for benefits limited by Code
Section 415 is maintained as an "excess benefit plan" as described in Section
3(36) of the Employee Retirement Income Security Act of 1974 as amended
("ERISA"). The other benefits provided for under the Plan are only available to
a "select group of management or highly compensated employees" as determined by
the Compensation / Nominating / Governance Committee of the Board of Directors
of the Company (the "Committee"), and the portion of the Plan providing such
benefits is intended to satisfy the ERISA exemption requirements for a plan
limited to such a group. Capitalized terms not defined herein shall have the
meaning ascribed to such terms in the Retirement Plan.
THE PLAN
1. Effective Date
The Plan as set forth herein is effective as of the date on which the stock
of Tenneco Packaging Inc. is distributed to the shareholders of the Company (the
"Distribution Date"). The benefit entitlement, if any, under the Tenneco Inc.
Supplemental Employee Retirement Plan (the "Former Plan") of any person who
separated from service prior to that date shall be governed by the provisions of
the Former Plan as it was in effect from time to time prior to that date, and
liability for such benefit has been allocated under the HR Agreement.
2. Eligibility
An employee shall be a "Participant" in this Plan if the employee is a
participant in the Retirement Plan or is provided a benefit under Section 11
hereof.
3. Amount of Benefit
The benefit payable under this Plan to a Participant, or to the
Participant's Eligible Spouse, Eligible Child(ren), joint annuitant or other
beneficiary(ies), all as determined under the provisions of the Retirement Plan,
shall equal the excess, if any, of (a) over (b) where:
(a) is the benefit that would be paid under the Retirement Plan if the
provisions of the Retirement Plan were administered without regard to the
limitations imposed by the Code and, only with respect to Participants who,
at any time, were participants in the Company's Executive Incentive
Compensation Plan (the "EICP"), if Final Average Compensation, as computed
under the Retirement Plan, were determined on the basis of compensation
paid during the three calendar years (of the five calendar year period
ending no later than the calendar year immediately preceding his or her
termination or retirement) for which such compensation is the highest, and
increased by the quotient of (i) the total of the cash bonuses, as defined
below, paid to the Participant in the three calendar years (during the same
five calendar year period ending no later than the calendar year
immediately preceding his or her
<PAGE> 2
termination or retirement) for which such total is the highest, divided by
(ii) three or such lesser number of calendar years (included in such
period) in which such bonuses were paid to the Participant; provided, that
the calendar year including his or her termination or retirement shall be
included if such event follows the payment of regular bonuses for that
year; and provided, that bonuses and salary, respectively, deferred at the
election of the Participant shall be counted only in the year that they
would have been paid absent such election, and provided further, that the
foregoing language shall be applied to count bonuses which relate to a
calendar year as paid in that year, for example, 2000 bonuses will be
counted in 2000 notwithstanding the fact that they are actually paid in
2001; and
(b) is the benefit that is payable under the Retirement Plan.
Notwithstanding the foregoing, if, except as otherwise provided in writing,
an employee is granted credit for purposes of benefit accrual under the
Retirement Plan for service rendered prior to the time that the employee became
a participant in the Retirement Plan, such employee shall be credited with such
service under this Plan only if and to the extent determined by the Committee.
Unless otherwise provided in writing, no benefit shall be payable under the Plan
unless a benefit also is payable under the Retirement Plan, except that benefits
accrued hereunder as of the effective date are treated as fully vested and
nonforfeitable to the extent provided in the HR Agreement.
Cash bonus means only cash bonuses paid under the EICP and other cash
bonuses as the Committee determines.
4. Form of Benefit
Any benefit under this Plan shall be paid in the same form and manner as
the benefit payments made to, or with respect to, the Participant under the
Retirement Plan. Notwithstanding the preceding sentence, no benefit is payable
hereunder prior to 60 days after the Participant has separated from service,
unless the Committee so determines. Prior to the commencement of benefits but,
in no event later than 24 months after the Participant has separated from
service, and only with respect to a Participant who at any time was a
participant in the EICP (or a beneficiary of such a Participant), such
Participant or beneficiary may elect, but only with the approval of the
Committee, to receive payment of such benefit in the form of a lump sum or
annuity, provided that in cases where a Participant has chosen a lump sum and
the exact amount of a Participant's benefit cannot be determined by the date
elected for payment, a preliminary lump sum shall be paid with respect to
amounts that can be clearly ascertained then, with the remainder to be issued in
a subsequent lump sum when that amount is exactly determined by the Committee or
its delegee. In addition, with respect to all Plan Participants, if the benefit
payable from this Plan (expressed as an age 65 life annuity) would be less than
$50 per month, the benefit payable from this Plan automatically shall be paid as
a lump sum.
-2-
<PAGE> 3
The actuarial factors set forth in the Retirement Plan shall be used to
compute benefits hereunder, provided that, for purposes of any lump sum payment
that may be payable under the Plan, the interest rate used shall be the annual
rate of interest on 30-year Treasury securities as specified by the IRS for the
second calendar month preceding the first day of the Plan Year during which the
annuity starting date occurs, and the applicable mortality table described in
Rev. Rul. 95-6, 1995-1 C.B. (page 80), or in such other formal guidance as may
be issued from time to time by the IRS.
5. Unfunded Plan
This Plan shall be maintained as an unfunded non-qualified deferred
compensation plan. All benefits under this Plan shall be payable from the
general assets of the Company. No person shall be entitled to receive any
benefits under this Plan from the funds of the Retirement Plan.
6. No Assignment
No benefit under this Plan shall be assignable or alienable or subjected,
by attachment or otherwise, to the claims of creditors of any person.
7. No Guarantee of Employment
This Plan shall not be construed to give any Participant the right to be
retained in the employment of the Company or any of its affiliates.
8. Operation and Administration
This Plan shall be operated under the direction of and administered by the
Committee.
The Committee's decision in all matters involving the interpretation and
application of this Plan shall be final and binding. The Committee shall
establish a claims procedure which is consistent with the claims procedure
employed under the Retirement Plan.
9. Governing Law
To the extent not preempted by federal law, this Plan shall be construed,
administered and enforced in accordance with the laws of the State of Illinois.
10. Amendment and Discontinuance
The Company reserves the right, by action of the Committee, to amend or
discontinue the Plan. However, no such amendment or discontinuance shall impair
or adversely affect any benefits accrued under this Plan as of the date of such
action.
-3-
<PAGE> 4
11. Special Appendix
The Company may from time to time determine to provide certain persons
additional supplemental pension benefits, which may be reflected in a Special
Appendix hereto or in such other document as the Company shall determine.
References in a Special Appendix or such other document to the "Plan" are to
this Plan.
IN WITNESS WHEREOF, the Company has caused the Plan to be executed on its
behalf by its respective officers thereunder duly authorized, on this day and
year set forth below.
TENNECO AUTOMOTIVE INC.
Date: ________________________ __________________________________
By: ______________________________
Its: _____________________________
-4-
<PAGE> 1
[TENNECO LETTERHEAD]
EXHIBIT 10.18
October 12, 1999
Dana G. Mead
c/o Tenneco Inc.
1275 King Street
Greenwich, CT 06831
Re: Release Agreement
-----------------
Dear Dana:
This Release Agreement ("Agreement") entered into as of the date at the end
hereof is by and between Dana G. Mead ("Employee") and the employer, Tenneco
Management Company ("Employer" or "Company"), (collectively, "the Parties").
The Parties named above agree as follows:
1. Your employment with Employer will terminate contemporaneously with
the distribution of Tenneco Packaging Inc. stock to the shareholders of
Tenneco Inc. (the "Termination Date").
Effective as of the Termination Date, you will resign all positions
which you hold with Tenneco Inc. and its subsidiaries and affiliates
except your position as a member of the Pension Investment Committee
from which you will resign in March of 2000. Notwithstanding the
foregoing, you will continue as the non-employee Chairman of the Board
of Directors of each of Tenneco Inc. and Tenneco Packaging Inc. and as
a trustee of the Tenneco Rabbi Trust. You will be entitled to receive
director's fees from both companies.
On your resignation and for five years thereafter, you will be provided
with an office in Greenwich, Connecticut or such other location in the
continental U.S. as you shall choose, together with secretarial and
administrative services and support.
2. You will be entitled to the following consideration upon the later of
the Termination Date or the end of the seven-day revocation period
defined in Paragraph 28, assuming you execute this Agreement, fail
to revoke it during the seven-day period
<PAGE> 2
Dana G. Mead
Page 2
referred to in Paragraph 28 and remain in compliance with all of the terms
and conditions of this Agreement, and further assuming that your spouse
executes a separate spousal waiver agreement to be tendered to your
spouse ("Effective Date"):
- PAYMENT - You will receive a lump sum payment equal to three times the
total of your annual salary and target bonus, less applicable tax
withholdings and any amounts due the Employer, as soon as
administratively feasible after the Effective Date but no later than
April 1, 2000. This payment shall be in lieu of any other payments,
wages and benefits including without limitation any severance-type
payment, except as expressly provided in this Agreement. If you fail to
execute this Agreement by December 3, 1999, or revoke or cancel this
Agreement during the seven-day period referred to in Paragraph 28,
Employer shall not be obligated to make lump sum payment to you. If you
revoke or cancel the Agreement after Employer has made the lump sum
payment, you shall be obligated to return to Employer all benefits and
payments provided to you under this Agreement, including but not limited
to the lump sum payment.
- RELOCATION LOAN MODIFICATION - The Employer and you and your spouse are
parties to a note (the "Note"), which Note has a current outstanding
principal balance. The Employer hereby forgives the full principal
balance of Note, and all accrued interest under the Note. Accordingly,
the Note is hereby canceled. The Employer shall deliver to you a release
of the mortgage, given by you to the Employer securing the Note.
- EXECUTIVE INCENTIVE COMPENSATION PLAN - Should the Company achieve the
performance goals for Executive Incentive Compensation Plan ("EICP")
payouts for the calendar year 1999, you will receive an adjusted target
EICP Award prorated through the Termination Date. No future payments
will be made under this Plan.
- DEFERRED COMPENSATION - The balance of your Deferred Compensation
Account will be distributed, as soon as administratively feasible after
the Effective Date, in accordance with your election under the terms of
the Plan.
- SERP - You are eligible for retirement and survivor benefits under your
Special Appendix to the Tenneco Inc. Supplemental Executive Retirement
<PAGE> 3
Dana G. Mead
Page 3
Plan provided, that you will be treated as though you had remained an
employee and been a participant in the Tenneco Retirement Plan until you
had attained age 65. Your special SERP will be revised to count
compensation earned in 1999 if that would increase your benefit and it
will be further revised to compute compensation as provided in the
general SERP document if that would increase your benefit.
- TENNECO INC. STOCK OPTION PLAN - You can exercise all currently
exercisable options during the remainder of your employment in
accordance with provisions of the Plan. Remaining options will become
exercisable as of the Effective Date. Since you are eligible for
retirement, your options will remain active for a period of ten (10)
years following the termination of your employment (or the remaining
term of the option, if less.) You will not be awarded any reload stock
options upon the exercise of any such options. Except as modified
herein, your stock options will continue to be subject to the rules of
the 1996 Tenneco Inc. Stock Ownership Plan as amended from time to time,
including without limitation, the provisions regarding adjustment and
amendment of outstanding options. This will result in the replacement of
one-half of these options with options on the stock of Tenneco Packaging
Inc. Both the Tenneco Packaging Inc. options and the remaining Tenneco
Inc. options shall be adjusted to reflect the economic status of the
options which existed prior to the spin-off of Tenneco Packaging in
accordance with the procedures applied generally.
- NEW OPTIONS - In addition to the options described above, you will be
granted 50,000 options on the common stock of Tenneco Packaging Inc. and
50,000 options on the common stock of Tenneco Inc. Such options shall be
granted at the fair market value of the stock of the company to which
they relate and shall have a term of not less than 10 years.
- TENNECO INC. PERFORMANCE SHARES - Subject to any generally applicable
earlier earn-out, at the Effective Date, all outstanding performance
shares awarded under the Stock Ownership Plan shall be deemed to have
been earned at target and shall be paid out in Tenneco Inc. common
stock.
- TENNECO INC. RESTRICTED STOCK - Subject to any generally applicable
earlier vesting, your restricted shares awarded under the Stock
Ownership Plan will vest on the Effective Date and all applicable
restrictions will lapse. A stock
<PAGE> 4
Dana G. Mead
Page 4
certificate for the appropriate number of shares will be delivered to
you as soon as administratively feasible.
- THRIFT PLAN - You are a participant in the Tenneco Inc. Thrift Plan and
contributions to the Tenneco Thrift Plan cease upon the termination of
your employment. You may then elect to receive a final settlement of
your account balance, usually within four to six weeks following the
receipt of your properly completed election forms. You are 100% vested
in the account. You should contact the Benefits Center for information
about your Thrift Plan account, including any outstanding Thrift Plan
loans, and the tax consequences of the distribution.
- MEDICAL AND DENTAL COVERAGE - You and your surviving spouse are
entitled to retiree medical and dental coverage. For information
regarding your Medical Benefits, call the Benefits Center at
1-800-444-5578. You will also be eligible for the Medical Select
Provider Program, as long as that program continues to exist.
- LIFE INSURANCE - You are entitled to retiree life insurance coverage in
accordance with generally applicable rules.
- DISABILITY AND ACCIDENT INSURANCE - Your participation in the Tenneco
Inc. Long Term Disability and Travel Accident Insurance Plans ceases
upon your termination of employment.
- BENEFIT PLANS - Except as set out in this Agreement, the provisions of
the policies or plan documents will control.
3. You acknowledge that the aggregate of all benefits set forth in Paragraph
2 of this Agreement is greater than the aggregate to which you are already
entitled. IN ADDITION TO THE OTHER RESTRICTIONS AND CONDITIONS SET FORTH
IN THIS AGREEMENT AND IN NO WAY IN LIMIT OF THOSE OTHER RESTRICTIONS AND
CONDITIONS, YOU SHALL NOT BE ENTITLED TO ANY RETENTION, SEVERANCE, OR
OTHER NON-VESTED BENEFITS SET FORTH IN THIS AGREEMENT IN THE EVENT YOU
RESIGN YOUR EMPLOYMENT PRIOR TO THE TERMINATION DATE. FURTHERMORE, IN THE
EVENT THAT YOU TRANSFER TO ANOTHER TENNECO COMPANY OR ONE OF ITS
AFFILIATES OR SUCCESSORS AS
<PAGE> 5
Dana G. Mead
Page 5
DEFINED IN PARAGRAPH 4, YOU SHALL FORFEIT ALL RIGHTS TO ANY RETENTION,
SEVERANCE OR OTHER NON-VESTED BENEFITS SET FORTH IN THIS AGREEMENT.
4. Except as specifically provided herein, you acknowledge that your
employment shall terminate with Employer, its direct or indirect
subsidiaries, affiliates, parents, and related companies or entities,
regardless of its or their form of business organization, including
without limitation the plans described in Paragraph 7 (all
collectively the "Employer Entities"), on the Termination Date.
5. In exchange for the compensation and benefits described in Paragraph
2, you release and discharge any and all Employer Entities as defined
in Paragraph 4 and any and all of their past and present subsidiaries,
affiliates, parents, related companies, persons and entities,
directors, employees, officers, agents, partners, insurers, attorneys,
trustees, administrators and fiduciaries (all collectively the
"Released Parties") from any and all claims, demands, and causes of
action, whether arising in contract, tort or any other theory of
action, whether arising in law or equity, whether known or unknown,
accrued or unaccrued, asserted or unasserted, from the beginning of
time up to the effective date of this Agreement, except for those
obligations created by or arising out of this Agreement. You expressly
waive the benefit of any statute or rule of law which, if applied to
this Agreement, would otherwise exclude from its binding effect any
claim against any Released Party not now known by you to exist. Except
as necessary for you to enforce this Agreement, this Agreement is
intended to be a general release that extinguishes all claims by you
against any Employer Entity. Without limiting the generality of this
Paragraph, if you commence or continue any claim in violation of this
Agreement, the Released Party shall be entitled to assert this
Agreement as a bar to such action or proceeding.
6. Without in any way limiting the generality of the foregoing, this
Agreement constitutes a full release and disclaimer of any and all
claims arising or accruing up to the effective date of this Agreement,
including but not limited to any claims arising out of or in any way
connected with or relating to the termination of your employment and
any claims arising out of or in any way connected with or related to
your employment with Employer or any other Employer Entity up to the
effective date of this Agreement. The scope of this waiver includes
but is not limited to claims arising under 29 U.S.C. Section 1981, the
Age Discrimination in Employment Act of 1967 as amended (29 U.S.C.
Section 621), Title VII of the Civil Rights Act of 1964 as amended,
(42 U.S.C. Section 2000e), the Americans With
<PAGE> 6
Dana G. Mead
Page 6
Disabilities Act (42 U.S.C. Section 12101), the Worker Adjustment
Retraining and Notification Act (29 U.S.C. Section 2101), the Family
and Medical Leave Act of 1993 (29 U.S.C. Section 2601), the
Connecticut Human Rights and Opportunities Act, the Connecticut Family
and Medical Leave laws (Conn. Gen. Stat. 31-51cc to 31-51gg and Ct.
Legis. 96-140, effective January 1, 1997), the Texas Human Rights Act,
(Tex. Rev. Civ. Stat. Art. 5221k), the Illinois Human Rights Act, the
Wisconsin Fair Employment Act, the New York Human Rights Law, the New
York Equal Pay Law, the New York Rights of Persons with a Disability
Law, the New York Equal Rights Law, the National Labor Relations Act,
any claims for breach of contract, wrongful or retaliatory discharge,
tortious action, inaction or interference of any sort, and any claim
under any other state, local or federal statute, regulation or
ordinance, or common law cause of action.
7. It is expressly agreed that the payments described in Paragraph 2 of
this Agreement are in full and complete satisfaction of any and all
liabilities or obligations which any Employer Entity, including any
plan, fund or program sponsored, maintained or contributed to by any
Employer Entity, has or may have to you under or with respect to any
employee benefit plan described in Section 3(3) of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA"), any
payment or other item excluded from the definition of "employee
welfare benefit plan", "employee pension benefit plan" or "employee
benefit plan" under the rules of 29 C.F.R. Section 2510.3-1, 2510.3-2
or 2510.3-3, as the case may be, and any employee benefit plan
described in Section 4 of ERISA. It is further agreed that the
payments described in this Agreement exceed in value anything to which
you may be already entitled.
8. You represent that you have not assigned or transferred, or purported
to assign or transfer, to any person or entity, any claim or any
portion thereof or interest therein against a Released Party.
9. You represent that as of the Termination Date, you will have turned
over to Employer all originals and copies of expense reports, notes,
memoranda, records, documents, Employer manuals, credit cards, pass
keys, computer diskettes, office equipment, sales records and data,
and all other information or property, no matter how produced,
reproduced or maintained, which you have in your possession and
pertain to the business of any Employer Entity, including but not
limited to lists of customers, prices, marketing plans, strategies,
documents relating to the legal rights and obligations of any Employer
Entity, the work product
<PAGE> 7
Dana G. Mead
Page 7
of any attorney employed or retained by any Employer Entity, and
other confidential materials or information obtained by you in the
course of your employment; except for those such memoranda and other
documents referred to herein, as are necessary and appropriate for
your conduct of your duties as non-executive Chairman of Tenneco Inc.
and Tenneco Packaging Inc.
10. You acknowledge that the business and services of all Employer
Entities are highly specialized and that the following information is
not generally known, is highly confidential and constitutes trade
secrets: proprietary technical and business information relating to
any Employer Entity's plans, analysis or strategies concerning
international or domestic acquisitions, possible acquisitions or new
ventures; development plans or introduction plans for products or
services; unannounced products or services; operation costs; pricing of
products or services; research and development; personnel information;
manufacturing processes; installation, service and distribution
procedures and processes; customer lists; any know-how relating to the
design, manufacture, and marketing of any Employer Entity's services
and products, including components and parts thereof; non-public
information acquired by you concerning the requirements and
specifications of any Employer Entity's agents, vendors, contractors,
customers and potential customers; non-public financial information,
business and marketing plans, pricing and price lists; non-public
matters relating to employee benefit plans; quotations or proposals
given to agents or customers or received from suppliers; documents
relating to any Employer Entity's legal rights and obligations; the
work product of any attorney employed by or retained by any Employer
Entity; and any other information which is sufficiently secret to
derive economic value from not being generally known.
11. You shall maintain in the strictest confidence and will not, directly
or indirectly, use, intentionally or inadvertently, publish
or otherwise disclose to any person or entity whatever, any trade
secrets, or any confidential, proprietary or other non-public
information of or belonging to any Employer Entity or any agent, joint
venturer, contractor, customer, vendor or supplier of any Employer
Entity (collectively, the "Confidential Information"), regardless of
its form without the prior written explicit consent of Employer. You
shall take reasonable precautions to protect the inadvertent
disclosure of Confidential Information. Your obligations under this
Agreement with respect to Confidential Information shall extend for
the period that such information is not generally known outside of the
relevant Employer Entity for reasons other than disclosure or
disclosures made by you or on your behalf. All duties and obligations
set forth in this Agreement shall be in
<PAGE> 8
Dana G. Mead
Page 8
addition to those which exist under statute and at common law and
shall not negate but shall be in addition to or coextensive with those
obligations arising under any agreements or documents executed by you
during your employment with Employer. Should you be served with legal
process seeking to compel disclosure of any such information, you
shall notify the General Counsel of Employer immediately.
12. Paragraphs 10 - 11 hereof shall be deemed to consist of a series of
separate covenants. Should a determination be made by a court of
competent jurisdiction that the character, duration, or geographical
scope of those provisions are unreasonable in light of the
circumstances as they then exist, then it is the intention and the
agreement of the Parties that these shall be construed by the court in
such a manner as to impose only those restrictions on your conduct
which are reasonable in light of the circumstances as they then exist
and as are necessary to assure the relevant Employer Entity of their
intended benefit. If, in any judicial proceeding, a court shall refuse
to enforce all of the separate covenants because, taken together, they
are more extensive than necessary to assure the relevant Employer
Entity of the intended benefit, then it is expressly understood and
agreed that those of such covenants which, if modified or eliminated,
would permit the remaining separate covenants to be enforced in such
proceeding, shall, for the purpose of such proceeding, be deemed
modified or eliminated in order to enforce the remaining provisions.
13. In expansion and not in limitation of Paragraphs 9, 10, and 11,
hereof, it is specifically provided that among the communications,
publications and disclosures forbidden or restricted by such
Paragraphs, are any such communications, publications or disclosures
by means of electronic, computer, print or other media, including
without limitation, any use of the Internet, chat rooms, bulletin
boards, web sites, etc.
You hereby agree that Employer would suffer significant damages, which
would be difficult to completely quantify in the event you or any
Affiliate breached the provisions of Paragraphs 9, 10, or 11 of this
Agreement. You acknowledge that any violation of any such Paragraphs
by you or by any Affiliate shall be treated as a material breach and
that you shall pay to Employer either $50,000 in total liquidated
damages, or, alternatively, the actual damages suffered by Employer as
a result of the breach if Employer is able to adequately establish
that its actual total damages exceeded $50,000. You hereby acknowledge
and agree that as of the date
<PAGE> 9
Dana G. Mead
Page 9
of this Agreement $50,000 represents a reasonable estimate of the
minimum damages that Employer can be expected to incur as a result of
any such breach.
14. Nothing in this Agreement shall be construed as an admission of any
wrongdoing by any person or entity.
15. The Parties agree to cooperate fully and to execute any and all
supplementary documents and to take all additional actions that may be
necessary or appropriate to give full force to the terms and intent of
this Agreement that are not inconsistent with its terms.
16. You shall provide thorough and accurate information and testimony
voluntarily to or on behalf of any Employer Entity, regarding any
investigation or court case initiated by or against any Employer
Entity or by any government agency, but you agree not to disclose or
to discuss with anyone who is not directing or assisting in any
Employer Entity investigation or case, other than your attorney, the
fact of or the subject matter of any investigation, except as required
by law. You will cooperate with the Employer Entity and promptly
provide such information. If the Employer Entity requests information,
it will attempt to work with you to arrange times that reasonably
accommodate you, and will reimburse you for commuting, parking or
other similar expenses and, to the extent permitted by law, will
reasonably compensate you for any significant imposition on your time
by the request.
17. You acknowledge that any employment or contractual relationship
between you and any and all Employer Entities, including but not
limited to the Employer, will terminate by virtue of this Agreement on
the Termination Date. In consideration of this Agreement, you waive
any and all employment rights that you now have with any Employer
Entity, except as otherwise expressly provided in this Agreement. You
agree not to seek reinstatement, reemployment, or future employment as
a new employee, and no Employer Entity has an obligation, contractual
or otherwise, to employ or reemploy, hire or rehire, or recall or
reinstate you in the future.
18. You agree to keep confidential the terms, conditions, and amounts set
forth in this Agreement and not to disclose any information relating
to this Agreement to any employee or former employee of any Employer
Entity except as required by law or a court of competent jurisdiction.
<PAGE> 10
Dana G. Mead
Page 10
19. It is further agreed that if any provision of this Agreement
contravenes the law of any state or jurisdiction where this Agreement
is to be performed or enforced, such provision shall be deemed not to
be a part of this Agreement, and the other provisions of this
Agreement, shall remain in full force and effect.
20. The failure of the Employer to exercise any rights under this
Agreement upon any breach or threatened breach by you shall not
constitute a waiver of any rights arising by reason of other or similar
breaches.
21. You shall have not right of assignment or transfer of any rights
herein or any sums that may accrue to you hereunder, nor shall any
creditor or other claimant have any right to assert any interest in or
right to receive such sums either by voluntary or involuntary act on
their part, by any writ or garnishment or attachment or otherwise.
22. The rights and obligations of the Parties shall be construed and
enforced in accordance with, and governed by, the laws of the State
of Connecticut without regard to that or any other state's rules
regarding conflict of laws. The language of all parts of this
Agreement shall in all cases be construed as a whole, according to its
fair meaning and not strictly for or against any of the Parties.
23. This Agreement shall be binding upon and inure to the benefit of the
respective successors, heirs, assigns, administrators, executors and
legal representatives of the Parties and other entities described in
this Agreement.
24. You warrant that no promise or inducement to enter into this Agreement
has been offered or made except as set forth in this Agreement, that
you are entering into this Agreement without any threat or coercion
and without reliance on any statement or representation made on behalf
of any Employer Entity or by any person employed by or representing any
Employer Entity, except for the written provisions and promises
contained in this Agreement.
25. This Agreement constitutes the entire agreement and understanding
between the Parties with regard to all matters, including but not
limited to your employment, the cessation of your employment from
Employer, payments owed to you, and the other subject matters
addressed in this Agreement. This Agreement supersedes and replaces
all prior commitments, negotiations and all agreements proposed
or otherwise, whether written or oral, concerning the subject matters
contained in this
<PAGE> 11
Dana G. Mead
Page 11
Agreement. This Agreement is an integrated document and the
consideration stated herein is the sole consideration for this
Agreement.
26. This Agreement is being delivered to you on October 15, 1999. You
shall have forty-seven days, or until December 3, 1999, to decide
whether to sign the Agreement and be bound by its terms.
27. Employer informs you of the following:
a) In order to be eligible for the benefits contained in this
Release Agreement, you must; (i) have worked in the
Administrative Department on January 1, 1999 and, (ii)
terminate your employment on your Termination Date, and (iii)
agree on or before December 3, 1999 to terminate your
employment under the terms of a valid separation agreement, by
executing this Agreement.
b) The decision that you would no longer be the CEO of Tenneco
Inc. was a mutual decision made by and between you and the
Board of Directors. No other employees were considered.
Accordingly, this was not made as part of any group
termination decision.
c) Nevertheless, the Company has decided to provide you with
information that you may consider relevant in assessing the
waiver of age discrimination claims. Certain other employees
are separating from service in connection with Tenneco's
corporate restructuring and as a result, are eligible for
Tenneco's severance program.
28. In addition, the Parties agree that even after signing the Agreement,
you shall have the right to revoke or cancel it only within seven days
after signing it. This cancellation or revocation can be accomplished
by delivery of a written notification if you wish to revoke the
Agreement to the Vice President of Human Resources. In the event that
this Agreement is canceled or revoked by you, Employer shall have no
obligation to meet any of the commitments described in this Agreement.
29. You acknowledge that you have been advised and encouraged by Employer
to consult your own attorney prior to signing this Agreement, and that
you execute this Agreement voluntarily.
<PAGE> 12
Dana G. Mead
Page 12
30. You acknowledge that you have read this Agreement and that you
understand that the Agreement will have the effect of waiving any
action or recovery you might pursue, including breach of contract,
personal injury, discrimination on the basis of race, age, sex,
national origin, citizenship, religion, veteran status, handicap, or
disability and any other claims arising prior to the date of the
Agreement.
Please return the executed original of this letter to Stephen J. Smith,
Vice President Human Resources, 1275 King Street, Greenwich, Connecticut
06831.
Sincerely,
/s/ Larry D. Brady
------------------------
Director and Chairman of the Compensation and Benefits Committee
Tenneco Inc. Board of Directors
AGREED AND ACCEPTED:
/s/ Dana G. Mead Dated as of: October 18, 1999
------------------------ ----------------
Dana G. Mead
<PAGE> 13
[TENNECO LOGO]
MODIFICATION OF RELEASE AGREEMENT
The parties hereto have entered into the Release Agreement, dated October
12, 1999 (the "Release Agreement").
This Modification supersedes and amends the Release Agreement as and to
the extent set forth herein.
Notwithstanding any provision of the Release agreement to the contrary,
Dana G. Mead ("Officer") shall not be deemed to have waived any rights to
indemnification, contribution or reimbursement to which Officer is or would
otherwise be entitled by contract, operation of law or otherwise, including
without limitation, under and pursuant to the Delaware General Corporation Law,
the certificate of incorporation of Tenneco Inc., the By-Laws of Tenneco Inc.,
any contract, the Tenneco Rabbi Trust or any insurance policy or other similar
arrangement at any time maintained by Tenneco Inc. or any of its subsidiaries or
any right in respect or resulting from any legal, accounting, financial or other
advice provided to Tenneco Inc. or any of its subsidiaries or Officer by any
legal counsel, accountant, financial advisor, engineer, consultant or other
similar person, firm or corporation in the discharge of such Officer's
employment as an officer, director or employee of Tenneco Inc. or any of it
subsidiaries or as a representative of Tenneco Inc. or any of its subsidiaries.
Neither Tenneco Inc. nor any of its subsidiaries will, for a period of ten years
from the date of the spin-off described below, amend or modify or terminate any
such certificate of incorporation, by-law, contract, insurance policy or other
arrangement if the effect thereof could be to eliminate or diminish the
protection afforded the Officer thereby in any material respect.
Officer shall also retain, without cost to Officer, the benefit of all the
liability insurance coverage maintained by Tenneco Inc., Tenneco Packaging Inc.,
Tenneco Automotive Inc. or otherwise, including, without limitation, the Tenneco
Inc. Director and Officer and Fiduciary "run-off" insurance policies to be
purchased in connection with the Tenneco Packaging Inc. spin-off. Tenneco Inc.
and Tenneco Management Company each further agrees jointly and severally to
purchase and keep in force, at their sole expense, such coverage for its full
term and to deliver proof of such coverage to Officer.
<PAGE> 14
Nothing contained herein or in the Release Agreement shall be deemed to be
a waiver or discharge of any right which the Officer has or may have if the
effect of any such waiver or discharge would be to abrogate or diminish any
right the Officer or Tenneco Inc. or any of its subsidiaries has or may have
under any insurance policy or other similar arrangement.
Dated: October 18, 1999
----------------
/s/ Dana G. Mead
- -----------------------
Dana G. Mead
TENNECO INC.
By: /s/ Karl A. Stewart
------------------------------------------
Karl A. Stewart
Vice President and Corporate Secretary
TENNECO MANAGEMENT COMPANY
By: /s/ Stephen J. Smith
------------------------------------------
Stephen J. Smith
Vice President, Human Resources
-2-
<PAGE> 1
Exhibit 10.21
AMENDED AND RESTATED
TRANSITION SERVICES AGREEMENT
THIS AMENDED AND RESTATED TRANSITION SERVICES AGREEMENT (this
"Agreement") is made and entered into as of November 4, 1999, between Tenneco
Packaging Inc., a Delaware corporation ("Packaging"), and Tenneco Inc., a
Delaware corporation to be renamed Tenneco Automotive Inc. ("Tenneco"), and
amends and restates the Transition Services Agreement entered into as of the
same date and by the same Parties.
RECITALS
WHEREAS, pursuant to the terms of that certain Distribution
Agreement dated November 3, 1999 by and between Tenneco and Packaging (the
"Distribution Agreement"), the parties have entered into this Agreement
regarding certain services to be provided by Packaging to Tenneco in connection
with the Automotive Business and certain services to be provided by Tenneco to
Packaging in connection with the Packaging Business.
NOW, THEREFORE, in consideration of the foregoing and of the
mutual covenants and undertakings contained herein, and subject to and on the
terms and conditions herein set forth, the parties hereto agree as follows:
1. DEFINITIONS AND TERMS
1.1 CERTAIN DEFINITIONS. The following terms, when capitalized
herein, shall have the meanings set forth below. All other capitalized terms
used but not otherwise defined herein shall have the meanings ascribed to them
in the Distribution Agreement.
"Affiliate" shall have the meaning ascribed to such term in
the Distribution Agreement, provided, however, that the Affiliates of each Party
for purposes of this Agreement shall be determined after giving effect to the
consummation of the Distribution.
"ITOC" shall mean the Information Technology Operations Center
of TBS located in Lincolnshire, Illinois.
"Party" shall mean either Packaging or Tenneco; "Parties"
shall mean Packaging and Tenneco.
"Services" shall mean, as applicable, the (a) Tenneco
Services, (b) Outsource Services, (c) Phase-out Services, (d) ITOC Services or
(e) Other Services.
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"Set-up Costs" shall mean any costs incurred to separate data
and establish a new database for a Party in order to provide a Service.
"TBS" shall mean Tenneco Business Services Inc.
1.2 OTHER TERMS. Other terms may be defined elsewhere in the
text of this Agreement or the Schedules and, unless otherwise indicated, shall
have such meaning throughout this Agreement and Schedules.
1.3 OTHER DEFINITIONAL PROVISIONS.
(a) The words "hereof", "herein", and "hereunder", and words
of similar import, when used in this Agreement, shall refer to this Agreement as
a whole and not to any particular provision of this Agreement.
(b) The terms defined in the singular shall have a comparable
meaning when used in the plural, and vice versa.
(c) The terms "dollars" and "$" shall mean United States
dollars.
(d) The term "including" shall be deemed to mean "including
without limitation."
2. PROVISION OF SERVICES
2.1 PROVISION OF OUTSOURCE SERVICES.
(a) SERVICES. Subject to the provisions of Section 2.1(b)
below, for the period commencing on the date hereof and ending March 31, 2001,
Packaging shall provide or cause to be provided (through one or more of its
Affiliates and/or outside service providers to the extent utilized by the
Automotive Business as of the date hereof or engaged hereafter with the prior
written consent of Tenneco in accordance with the terms of Section 2.1(b)) to
Tenneco and its Affiliates the Payroll Processing and Related Services and
Accounts Payable and Related Services described on SCHEDULE A-1 hereto
(collectively, the "Outsource Services").
(b) POSSIBLE SALE OF OUTSOURCE SERVICES BUSINESS.
(i) The parties acknowledge that Packaging and its Affiliates
are presently engaged in negotiations with respect to the possible sale to a
third party of certain of the assets of Packaging and its Affiliates related to
the provision of the Outsource Services (the "Outsourcing Sale"). Packaging
shall not cause or permit an Outsourcing Sale to be consummated without the
prior written consent of Tenneco. Subject to the conditions described in Section
2.1(b)(ii), Tenneco agrees to consent to any Outsourcing Sale which is to a
purchaser (1) that is engaged in the business of providing
2
<PAGE> 3
services of the nature of the Outsource Services, or that is identified
specifically in paragraph 1 of the FAS Letter (as defined below), (2) that will
be providing Outsource Services to Packaging and its Affiliates, and (3) that is
not engaged in competition with the Automotive Business.
(ii) It shall be a condition to Tenneco's approval of an
Outsourcing Sale that, on or prior to the date such Outsourcing Sale is
consummated, the purchaser in the Outsourcing Sale enters into a separate
agreement with Tenneco for the provision of Outsource Services on terms which
will afford Tenneco and its Affiliates the pricing, volume and term of services
and other terms and conditions no less favorable to Tenneco and its Affiliates
than that required to be provided hereunder (assuming this Agreement continued
for the term of such separate agreement with such purchaser). If requested by
the purchaser in an Outsourcing Sale, Tenneco agrees that the term of the
services to be provided by such party, whether pursuant to a separate agreement
or an assumption of Packaging's obligations hereunder, may be extended for a
period which ends no later than November 4, 2004.
(iii) If Packaging consummates an Outsourcing Sale in
accordance with the provisions of this Section 2.1(b), Tenneco will agree to
reimburse the purchaser in such Outsourcing Sale for postage, communications,
and other reasonable and customary "pass through" charges incurred by that
purchaser in connection with its provision of the Outsource Services to Tenneco
and its Affiliates.
2.2 PROVISION OF PHASE-OUT SERVICES. Packaging shall
provide or cause to be provided (through one or more of its Affiliates and/or
outside service providers to the extent utilized by the Automotive Business as
of the date hereof or engaged hereafter with the prior written consent of
Tenneco) to Tenneco and its Affiliates the Financial Reporting, Accounting and
Consolidations, Cash Management and Tax services described on SCHEDULE A-2
hereto (collectively, the "Phase-out Services"), in each case for the applicable
periods for such services identified on SCHEDULE A-2.
2.3 PROVISION OF ITOC SERVICES. For the period commencing
on the date hereof and ending December 31, 2001, Packaging shall provide or
cause to be provided (through one or more of its Affiliates and/or outside
service providers to the extent utilized by the Automotive Business as of the
date hereof or engaged hereafter with the prior written consent of Tenneco) to
Tenneco and its Affiliates the telecommunication and information services
described on SCHEDULE A-3 hereto (collectively, the "ITOC Services").
2.4 PROVISION OF TENNECO SERVICES. Tenneco shall provide or
cause to be provided (through one or more of its Affiliates and/or outside
service providers to the extent utilized by the Packaging Business as of the
date hereof or engaged hereafter with the prior written consent of Packaging) to
Packaging and its Affiliates the Treasury and Cash Management Administration and
Accounting Services described on SCHEDULE A-4 hereto (collectively, the "Tenneco
Services"). Except as identified on SCHEDULE A-4, Tenneco will provide Tenneco
Services to Packaging for an initial term of six months
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<PAGE> 4
following the date hereof (the "Tenneco Services Term"). Packaging may elect to
extend the Tenneco Services Term on a monthly basis for up to six additional
months (the "Tenneco Extension Term") by giving Tenneco written notice thirty
(30) days prior to the end of the Tenneco Services Term or each additional month
extension.
2.5 OTHER SERVICES. Specified human resources services will be
provided by Packaging to Tenneco and its Affiliates pursuant to the Human
Resources Agreement entered as of the date hereof between the Parties (the "HR
Agreement"). Until December 31, 2001, at the request of one Party, the other
Party will perform reasonable special administrative services for that Party, if
the other Party has the personnel and equipment reasonably necessary to provide
such additional services, for terms and at fees to be mutually agreed upon (the
"Other Services").
3. CONSIDERATION FOR SERVICES
3.1 CONSIDERATION FOR OUTSOURCE SERVICES. In consideration of
the Outsource Services provided hereunder, Tenneco shall pay Packaging the
services fees established in paragraph 2 of the fees, assets and staffing letter
agreement entered into by the Parties and effective as of November 4, 1999 (the
"FAS Letter").
3.2 CONSIDERATION FOR PHASE-OUT SERVICES. In consideration of
the Phase-out Services provided hereunder, Tenneco shall pay Packaging (1) the
services fees established in paragraph 3(a) of the FAS Letter for the period
during which the related services are provided and (2) a monthly general
administration fee (which includes the charge for LAN/WAN Support) established
in paragraph 3(b) of the FAS Letter through March 31, 2001.
3.3 CONSIDERATION FOR ITOC SERVICES. In consideration of the
ITOC Services provided hereunder, Tenneco shall pay Packaging a fee equal to (1)
an amount equal to the actual direct costs to Packaging to provide such ITOC
Services on a fully loaded basis without allocation of corporate overhead (the
"ITOC Direct Fee"), plus (2) an amount (the "ITOC Overhead Fee") equal to 50% of
the unreimbursed costs for general and administrative expenses directly related
to operating the ITOC in respect of the provision of such ITOC Services (the
"ITOC Overhead Expenses"), which costs shall specifically exclude (a) amounts
related to the severance of or retention payments for any employee and (b)
allocations of general and administrative expenses that were not directly
related to the operation of the ITOC, provided that any reduction of the costs
in clause (1) or (2) above from the cost to provide such Services as of the date
hereof (other than reductions due to a reduction in volume, pursuant to Section
3.6 or pursuant to the transactions contemplated by Section 5) shall be governed
by Section 3.5(d).
3.4 CONSIDERATION FOR TENNECO SERVICES. In consideration of
the Tenneco Services, Packaging shall pay Tenneco the services fees established
in paragraph 4 of the FAS Letter.
3.5 OTHER CONSIDERATION.
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<PAGE> 5
(a) SET-UP COSTS. Each Party will reimburse the other Party
for one-half of the initial Set-up Costs actually and reasonably incurred by the
other Party or its Affiliates (directly or through the engagement of outside
service providers engaged hereafter with the prior written consent of the Party
obligated to reimburse the other) relating to the provision by the other Party
or its Affiliates of Services to the first Party or its Affiliates on the terms
and conditions and at the standards of performance set forth herein, including
the Set-up Costs in connection with an Outsourcing Sale. The Parties
specifically agree that Set-up Costs shall exclude the costs of any licenses or
third-party consents or any costs with respect to a Party providing for itself
Services which are provided to such Party by the other Party hereunder, which
costs are separately addressed herein.
(b) INCREASED VOLUME. If the volume of transactions for a
specific Service provided to a Party and its Affiliates exceeds the level which
historically has been utilized by that Party's Group during the 12 months prior
to the date hereof and, as a result, requires human or equipment resources in
excess of the level of resources allocated to such Service by the Party required
to provide such Service as of the date hereof, the additional cost associated
with the increased volume will be passed through directly to the Party whose
Group is receiving the Service.
(c) INTEGRATION OF ACQUIRED BUSINESSES. Each Party will
reimburse the other Party on a cost (time and materials) basis plus 10% to
integrate acquired businesses of the first Party and its Affiliates into the
Services provided or caused to be provided by the other Party hereunder.
(d) COST SAVINGS REBATE. Notwithstanding Section 3.3, if
Packaging or one of its Affiliates (or a purchaser in an Outsourcing Sale) is
able to reduce or cause the reduction of the direct costs incurred by it in
providing any Services provided to Tenneco or its Affiliates hereunder from the
direct costs to provide such Services as of the date hereof, including any
savings arising from an outsourcing arrangement, Packaging will pay Tenneco a
cost savings rebate equal to 50% of such savings, provided that Tenneco shall
receive the full benefit of all cost reductions which are attributable to its
volume reductions. Notwithstanding Section 3.3, if Packaging or one of its
Affiliates (or a purchaser in an Outsourcing Sale) is able to reduce the shared
costs incurred by it with respect to the Services provided to Tenneco or its
Affiliates hereunder from the costs to provide such Services as of the date
hereof, including any savings arising from an outsourcing arrangement, Packaging
will pay Tenneco a cost savings rebate equal to 25% of such savings. The amounts
payable by Packaging under this Section 3.5(d) are referred to herein as the
"Cost Savings Rebates." Packaging shall pay the Cost Savings Rebates to Tenneco
at the end of each six-month period of this Agreement, as a credit against fees
hereunder as contemplated by Section 10.2, provided that if the Cost Savings
Rebate exceeds the amount due hereunder, Packaging shall pay the balance in cash
to Tenneco. The Cost Ravings Rebate shall terminate in the event Tenneco is
acquired (whether by stock purchase, asset purchase, merger, or otherwise) by a
third party.
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<PAGE> 6
3.6 THIRD-PARTY CHARGES. Packaging agrees to use its
reasonable best efforts to cause all third-party (i.e. other than from Packaging
or its Affiliates) charges related directly to the ITOC Services provided to
Tenneco and its Affiliates hereunder (the "Third-Party Direct Charges") to be
billed directly to Tenneco by such third-party, and such Third-Party Direct
Charges shall not be included in any ITOC Direct Fee.
3.7 NO DOUBLE CONSIDERATION. In no event shall any Party be
entitled to compensation or consideration under any provision of this Agreement
in respect of a matter for which such Party (or one of its Affiliates) has been
compensated pursuant to another provision hereof, the terms of the Distribution
Agreement or the terms of any Ancillary Agreement.
4. TERM AND TERMINATION
4.1 COMMENCEMENT OF TERM. The term of this Agreement shall
commence on the date hereof.
4.2 TERM OF OUTSOURCE SERVICES. Packaging shall provide or
cause to be provided the Outsource Services for the term set forth in Section
2.1(a), and otherwise in accordance with the provisions of this Agreement.
4.3 TERM OF PHASE-OUT SERVICES. Except as otherwise set forth
in this Section 4.3, Packaging shall provide or cause to be provided the
Phase-out Services for the term set forth in Section 2.2, and otherwise in
accordance with the provisions of this Agreement. Except for the Tax services
described on SCHEDULE A-2, Tenneco may discontinue all or any portion of the
Phase-out Services prior to the expiration of the term therefor at any time on
thirty (30) days prior written notice to Packaging. In the event Tenneco so
elects to discontinue all or any portion of the Phase-out Services, Tenneco
shall cease paying the service fees established pursuant to clause (1) of
Section 3.2 with respect to the discontinued Phase-out Services. In any event,
Tenneco shall continue to pay the general administration fee established
pursuant to clause (2) of Section 3.2 through March 31, 2001.
4.4 TERM OF ITOC SERVICES. Except as otherwise set forth in
this Section 4.4 or as contemplated by Section 5 hereof, Packaging shall provide
or cause to be provided the ITOC Services for the term set forth in Section 2.3,
and otherwise in accordance with the provisions of this Agreement. Tenneco may
discontinue all or any portion of the ITOC Services prior to the expiration of
the term therefor at any time on sixty (60) days prior written notice to
Packaging. In the event Tenneco so elects to discontinue all or any portion of
the ITOC Services, Tenneco shall (1) no longer be required to pay the portion of
the ITOC Direct Fee with respect to the ITOC Services which have been
discontinued (other than third party costs related to the provision of such
portion of the ITOC Services, to the extent such costs will continue to be
incurred by Packaging even though such services have been discontinued), and (2)
continue to pay the ITOC Overhead Fee through December 31, 2001.
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<PAGE> 7
4.5 TERM OF TENNECO SERVICES. Tenneco shall provide or cause
to be provided the Tenneco Services for the term (including any extension of
such term) set forth in Section 2.4, and otherwise in accordance with the
provisions of this Agreement.
4.6 SURVIVAL. Sections 5, 6, 7, 8, 9, 10, 11.2, 11.3, 11.4,
13 and 14 shall survive termination of this Agreement or the provision of
any Services hereunder.
5. TRANSITION OF ITOC SERVICES
5.1 GENERAL. Tenneco and Packaging agree to cooperate and work
together in good faith so that, on or before the end of the term contemplated by
Section 2.3, Packaging will have completely conveyed and transferred to Tenneco
and/or its Affiliates licenses, leases, equipment and other assets and
operations, free and clear of any liens and encumbrances, that will enable
Tenneco to provide for itself and its Affiliates the ITOC Services at the same
level of quality and quantity as has been utilized by the Automotive Business
during the 12 months prior to the date hereof, subject to increase to reflect
increased volume for which Packaging is compensated pursuant to Section 3.5, all
at Tenneco's cost (subject to Section 5.6 hereof). Neither Tenneco nor any of
its Affiliates will be required to pay any additional consideration to Packaging
or its Affiliates in respect of such conveyance and transfer.
5.2 TRANSFERS OF OWNED AND LEASED EQUIPMENT. Without limiting
the generality of Section 5.1, as soon as practical after the date hereof
Packaging agrees to:
(a) Use commercially reasonable efforts to cause any lease of
equipment which is dedicated to providing ITOC Services to the Automotive
Business to be assigned to and assumed by Tenneco.
(b) Cause any owned equipment which is dedicated to providing
ITOC Services to the Automotive Business to be assigned to Tenneco.
The costs of any assignments shall be borne by Tenneco.
5.3 MAINFRAME. Without limiting the generality of Section 5.1,
with respect to the mainframe computer system located at the ITOC , Packaging
and Tenneco agree to negotiate in good faith a mutually satisfactory arrangement
whereby Tenneco shall be granted access to and the right to use the mainframe.
5.4 TRANSFERS OF EMPLOYEES. Without limiting the generality of
Section 5.1, Packaging agrees to cooperate and work with Tenneco to encourage
and cause any employee of Packaging or its Affiliates whose primary
responsibility is to provide an ITOC Service to the Automotive Business to
accept employment with Tenneco or one of its Affiliates when such ITOC Service
is transitioned to Tenneco pursuant hereto.
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5.5 FACILITY LEASE. Without limiting the generality of Section
5.1, upon completion of the transition of the ITOC Services to Tenneco at the
end of the term contemplated by Section 5.1 hereof, Tenneco shall sublease 50%
of the ITOC until April 30, 2013, such sublease to include raised floor,
control, lab and office space substantially equivalent to that retained by
Packaging or its Affiliates, provided that Packaging shall not be required to
incur any expenses in connection therewith. The rent under such sublease shall
include 50% of all costs to occupy, maintain and operate the ITOC facility.
5.6 COSTS AND EXPENSES. Each party will pay its own internal
costs incurred by it or its Affiliates in connection with the transition of the
ITOC Services to Tenneco as contemplated by this Section. Notwithstanding
anything to the contrary contained herein, to the extent Tenneco or its
Affiliates assume any expenses from Packaging or its Affiliates in connection
with the transition of ITOC Services pursuant to this Section 5, (1) such
assumed expenses shall not be included in the ITOC Direct Fee or ITOC Overhead
Expenses for purposes of Section 3.3 and (2) the ITOC Overhead Fee shall be
reduced by 50% of the amount of such assumed expenses (not duties and
responsibilities) that were ITOC Overhead Expenses.
6. TRANSFER OF ASSETS TO TENNECO
6.1 TRANSFER OF ASSETS TO TENNECO. Effective as of the date
hereof, Packaging shall, and shall cause its applicable Affiliates to, sell,
assign, transfer and convey to Tenneco (or one of Tenneco's Affiliates as
directed by Tenneco) all of the right, title and interest of Packaging and its
Affiliates in and to the assets identified in paragraph 5 of the FAS Letter,
free and clear of any and all liens and encumbrances.
7. CERTAIN EMPLOYEES
7.1 OFFER OF EMPLOYMENT. Effective as of the date hereof,
Tenneco shall offer employment to the individuals identified in paragraph 6 of
the FAS Letter (the "Employees") at Tenneco's facility in Lake Forest, Illinois
on terms and conditions that otherwise are equivalent to the terms and
conditions of their employment by TBS as described in materials provided to
Tenneco by TBS prior to the date hereof. Those Employees who accept such offer
of employment are referred to herein as the "Transferred Employees" and those
Employees who do not accept such offer of employment are referred to herein as
the "Non-Transferred Employees."
7.2 RESPONSIBILITY FOR TRANSFERRED EMPLOYEES. From and after
the date hereof, the Transferred Employees shall be considered employees of the
Automotive Group for purposes of the Human Resources Agreement, dated as of the
date hereof, by and between the Parties (the "Human Resources Agreement").
7.3 RESPONSIBILITY FOR NON-TRANSFERRED EMPLOYEES. Packaging
shall use reasonable efforts to cause TBS to continue the employment of the
Non-Transferred Employees with TBS on terms and conditions equivalent to the
terms and conditions of their employment by TBS immediately prior to the date
hereof, until such
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time as Tenneco directs Packaging to terminate such employment. At such time,
Packaging agrees to cause the Non-Transferred Employees to be terminated by TBS
(or transferred to a function that is not the responsibility of Tenneco) at such
time as may be specified in Tenneco's direction. Notwithstanding anything to the
contrary contained in the Human Resources Agreement, Tenneco shall reimburse
Packaging for all compensation, retention payments and severance payments paid
by TBS to such Non-Transferred Employees, so long as such compensation and
payments are made pursuant to terms and conditions of employment applicable to
the Non-Transferred Employees as provided to Tenneco by TBS pursuant to Section
7.1.
7.4 SEVERANCE AND RETENTIONS. Notwithstanding anything herein
or in the Human Resources Agreement to the contrary, (1) severance and retention
payments reasonably incurred by either Party in respect of employees then
providing Services to each Party's Group hereunder shall be borne and paid 50%
by Tenneco and 50% by Packaging and (2) severance and retention payments
reasonably incurred by either Party in respect of employees then providing
Services exclusively to the other Party's Group hereunder shall be borne and
paid 100% by the Party whose group has received such Services.
8. THIRD PARTY CONSENTS AND LICENSES
8.1 SEPARATION. With respect to any hardware or software
licenses that are utilized as of the date hereof by both the Automotive Business
and the Packaging Business related to the Services to be provided hereunder, the
Parties agree to cooperate and use their reasonable best efforts to cause, on or
before the expiration of the relevant terms hereunder, such licenses to be
separated and allocated between the Parties so that Tenneco receives a number of
such licenses that is consistent with the historical usage of the licensed
hardware or software by Tenneco and its Affiliates.
8.2 FEES. The Parties will cooperate and use their reasonable
best efforts to obtain the consents or licenses of any relevant third party
required to (1) provide or have provided any of the Services contemplated by
this Agreement, (2) effect the transition of the ITOC Services to Tenneco as
contemplated by Section 5 hereof or (3) effect the separation of the licenses as
contemplated by Section 8.1 hereof. If any consent or license to provide or have
provided any of the Services contemplated by this Agreement cannot be obtained,
the Party required to provide the related services will arrange for alternative
methods of delivering the necessary Services in the manner provided in this
Agreement. Costs relating to obtaining such consents or licenses or for
providing any alternative method of delivering the necessary service shall be
shared 50% by Packaging and 50% by Tenneco. Subject to Section 5.6, Tenneco will
pay the costs, if any, to effect the transition of the ITOC Services to Tenneco
as contemplated by Section 5 hereof.
9. SAP/HR PAYROLL PROJECT
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9.1 PROJECT CONSTRUCTION IN PROGRESS. With respect to the
SAP/HR payroll project which Tenneco and Packaging are jointly pursuing as of
the date hereof (the "Project"), effective as of the date hereof Packaging shall
allocate to Tenneco 50% of the construction in progress balance (cash payments
to date) for the Project which appears on the books and records of Packaging.
9.2 RESPONSIBILITY FOR AND COMPLETION OF PROJECT. Packaging
and Tenneco shall each use its commercially reasonable efforts to cause the
Project to be completed according to the plan for the Project in effect as of
the date hereof. Ownership over the Project and any construction in progress
with respect to the Project shall be shared 50% by Tenneco and 50% by Packaging.
Packaging shall retain project management responsibility.
9.3 COSTS TO COMPLETE.. All costs to complete the Project
shall be incurred directly Packaging. Tenneco shall reimburse Packaging for 50%
of the costs reasonably incurred by Packaging in connection with the completion
of the Project.
10. BILLING, PAYMENT AND AUDIT
10.1 OUTSOURCE, PHASE-OUT AND TENNECO SERVICES; PROJECT. The
consideration set forth in Section 3 for the Outsource and Phase-out Services
shall be billed on a calendar monthly basis by the Party providing the service,
in advance on the first day of each month. In addition, Packaging shall bill
Tenneco monthly for 50% of the costs reasonably incurred to complete the Project
described in Section 9 hereof. Each Party shall remit the amount due for the
applicable Services to the other Party within fifteen (15) days after receipt of
any such bill.
10.2 ITOC SERVICES.
(a) ESTIMATED MONTHLY PAYMENTS. For the term of the ITOC
Services, Tenneco shall pay to Packaging a monthly fee in the amount established
in paragraph 7 of the FAS Letter, less the amount of any Third Party Direct
Charges for the immediately preceding month (the "Estimated Monthly Payment").
(b) WORKSHEET. Within 60 days following the end of each
six-month period during which Packaging is obligated to provide or cause to be
provided Services to Tenneco and its Affiliates pursuant hereto and within 60
days following the termination of Packaging's obligations to provide Services
hereunder, Packaging shall prepare, or cause to be prepared, and deliver to
Tenneco a written worksheet setting forth Packaging's determination (a
"Worksheet") of the amount of any ITOC Overhead Expenses, any ITOC Direct Fees
and ITOC Overhead Fees payable by Tenneco, and any Cost Savings Rebates payable
to Tenneco, pursuant to this Agreement, in respect of such period.
(c) REVIEW OF WORKSHEET. Tenneco shall complete its review
of each Worksheet within 30 days after the date on which the Worksheet is
delivered to Tenneco.
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In the event that Tenneco determines that any item reflected on the Worksheet
has not been determined on the basis set forth in this Agreement, Tenneco shall
so notify Packaging in writing (the "Objection"), on or before the last day of
such 30-day period, setting forth a specific description of the basis or bases
of the Objection and the adjustments to the Worksheet which Tenneco believes
should be made. Packaging shall have 30 days after the delivery of the Objection
to review and respond to the Objection and the Parties shall attempt in good
faith to reach an agreement with respect to any matters in dispute. If Tenneco
and Packaging are unable to resolve all of their differences within 45 days
after delivery of the Objection, they shall refer their remaining differences to
an internationally recognized firm of independent public accountants as to which
Tenneco and Packaging shall mutually agree (the "CPA Firm").
(d) DISPUTES REGARDING WORKSHEET. The CPA Firm shall
determine, acting as experts and not arbitrators, on the basis of the standards
set forth in this Agreement, and only with respect to the remaining differences
so submitted, whether and to what extent, if any, the items reflected on the
Worksheet require adjustment. The CPA Firm's determination shall be conclusive
and binding upon Tenneco and Packaging and shall be set forth in a written
determination of the CPA Firm. The fees and disbursements of the CPA Firm shall
be shared equally by Tenneco and Packaging. Tenneco and Packaging shall each
make readily available to the CPA Firm all relevant books and records and any
work papers (including those of their respective accountants) relating to the
Worksheet, and all other items reasonably requested by the CPA Firm. As used
herein, the term "Final Worksheet" shall mean (i) any Worksheet as delivered by
Packaging in the event no Objection is delivered to Packaging during the 30-day
period specified above, or Tenneco and Packaging so agree, (ii) the Worksheet,
adjusted in accordance with the Objection in the event that Packaging does not
respond to such Objection within the 30-day period following receipt by
Packaging of such Objection, (iii) the Worksheet, as adjusted by the mutual
agreement of the Tenneco and Packaging or (iv) the Worksheet, as determined by
the CPA Firm pursuant hereto if the Tenneco and Packaging are unable to reach a
mutual agreement and refer their remaining differences to the CPA Firm.
(e) ACCESS. Packaging shall provide Tenneco and its
accountants full access to the books and records, any other information,
including work papers of its accountants, and to any employees to the extent
necessary for Tenneco or its accountants to review any Worksheet. Tenneco and
its accountants shall have full access to all information used by Packaging in
preparing any Worksheet, including the work papers of its accountants.
(f) ADJUSTMENT PAYMENT BASED ON FINAL WORKSHEET. If the ITOC
Direct Fees plus ITOC Overhead Fees (less any Cost Savings Rebates) for any
period as reflected on the Final Worksheet for that period exceed the Estimated
Monthly Payments made by Tenneco to Packaging in respect of that period, Tenneco
shall pay such excess, together with accrued interest thereon from the date when
such excess was originally due to the date of payment calculated at the rate of
8.5% per annum, to Packaging. If the Estimated Monthly Payments made by Tenneco
to Packaging in respect of any six-month
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period exceed the ITOC Direct Fees plus ITOC Overhead Fees (less any Cost
Savings Rebates) for any that period as reflected on the Final Worksheet for
that period , Packaging shall refund such excess, together with accrued interest
thereon from the date such excess was originally paid to Packaging to the date
of refund calculated at the rate of 8.5% per annum, to Tenneco. Any payment to
be made pursuant to this Section 10.2(e) shall be payable 10 business days after
determination of the applicable Final Worksheet. Any such payment shall be paid
by wire transfer of immediately available funds to an account designated by
Tenneco or Packaging, as applicable.
(g) FEES AND COSTS. To the extent a Party is obligated to
reimburse the other Party in respect of any fees, costs or expenses not subject
to Section 10.1 or 10.2, above, such reimbursement shall be made promptly upon
receipt by the reimbursing Party of a written request for reimbursement from the
other Party.
11. WARRANTIES AND LIABILITIES
11.1 LEVEL OF PERFORMANCE. EACH PARTY WARRANTS THAT THE
SERVICES PROVIDED HEREUNDER BY IT (OR THROUGH ITS AFFILIATES OR OUTSIDE SERVICE
PROVIDERS) UNDER SCHEDULES A-1 TO A-4 WILL BE PERFORMED IN A MANNER AND AT A
LEVEL OF VOLUME AND QUALITY AT LEAST EQUIVALENT TO THE MANNER, VOLUME AND
QUALITY STANDARDS AT WHICH SUCH SERVICES HAVE HERETOFORE BEEN PROVIDED BY THAT
PARTY OR ITS AFFILIATES TO THE OTHER PARTY AND ITS AFFILIATES DURING THE TWELVE
(12) MONTH PERIOD PRIOR TO THE DISTRIBUTION DATE AND AT A DEGREE OF CARE AND
SKILL NO LESS THAN IT PROVIDES WITH RESPECT TO SIMILAR SERVICES IT PROVIDES OR
HAS PROVIDED FOR ITS OWN PURPOSES.
11.2 DISCLAIMER OF YEAR 2000 COMPLIANCE WARRANTY. EACH PARTY
AND ITS AFFILIATES EXPRESSLY DISCLAIM ANY WARRANTIES THAT THE SERVICES PROVIDED
UNDER THIS TRANSITION SERVICES AGREEMENT ARE YEAR 2000 COMPLIANT, THAT IS, THAT
SOFTWARE, HARDWARE AND OTHER EQUIPMENT USED IN THE PROVISION OF THE SERVICES
HEREUNDER WILL ACCURATELY PROCESS DATE DATA SUCH THAT: (a) NO VALUE FOR A DATE
WILL CAUSE ANY INTERRUPTION IN PROCESSING, (b) DATE-BASED FUNCTIONALITY OPERATES
CONSISTENTLY FOR DATES PRIOR TO, DURING AND AFTER THE YEAR 2000, AND (c) LEAP
YEARS WILL BE ACCURATELY RECOGNIZED AND PROCESSED.
11.3 DISCLAIMER OF ALL OTHER WARRANTIES. EXCEPT AS
EXPRESSLY PROVIDED HEREIN, EACH PARTY AND ITS AFFILIATES DISCLAIM ALL OTHER
WARRANTIES INCLUDING THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A
PARTICULAR PURPOSE, WITH RESPECT TO ANY SERVICES PROVIDED HEREUNDER.
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11.4 LIMITATION ON LIABILITY. EACH PARTY ACKNOWLEDGES THAT
THE OTHER PARTY IS NOT IN THE BUSINESS OF PROVIDING SERVICES OF THE TYPE
CONTEMPLATED BY THIS AGREEMENT, AND THAT SUCH SERVICES ARE PROVIDED ON A
TEMPORARY BASIS, SOLELY AS AN ACCOMMODATION. ACCORDINGLY, EACH PARTY
ACKNOWLEDGES THAT A PARTY'S MAXIMUM LIABILITY TO, AND THE SOLE REMEDY OF, THE
OTHER PARTY FOR BREACH OF THIS TRANSITION SERVICES AGREEMENT (EXCLUDING GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT) SHALL BE FOR THE FIRST PARTY UPON RECEIPT OF
WRITTEN NOTICE FROM THE OTHER PARTY OF SUCH BREACH, TO USE COMMERCIALLY
REASONABLE EFFORTS TO CURE THE BREACH AT ITS EXPENSE, INCLUDING RETAINING A
THIRD PARTY TO PROVIDE THE PARTICULAR SERVICE. HOWEVER, A PARTY SHALL NOT BE
LIABLE TO THE OTHER PARTY FOR ANY BREACH OF THIS TRANSITION SERVICES AGREEMENT
IF EITHER (A) THE FIRST PARTY IS UNABLE TO PERFORM THE PARTICULAR SERVICE DUE TO
THE OTHER PARTY'S FAILURE TO PROVIDE PROPER GUIDANCE, REQUISITE ASSISTANCE OR
REQUISITE COOPERATION AS IDENTIFIED IN SCHEDULES A-1, A-2, A-3 or A-4 AND (B) TO
THE EXTENT THE OTHER PARTY CONTRIBUTED TO SUCH BREACH.
11.5 NO CONSEQUENTIAL, INCIDENTAL OR SPECIAL DAMAGES. IN NO
EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER PARTY FOR ANY CONSEQUENTIAL,
INCIDENTAL OR SPECIAL DAMAGES SUFFERED BY THE OTHER PARTY ARISING OUT OF THIS
AGREEMENT, WHETHER RESULTING FROM NEGLIGENCE OF A PARTY OR OTHERWISE.
12. FORCE MAJEURE
No Party shall be responsible for, or be considered to be in
breach hereunder because of, failure or delay in delivery of any Service
hereunder, nor shall any Party be responsible for failure or delay in receiving
such Service, if caused by an act of God or public enemy, war, government acts
or regulations, fire, flood, embargo, quarantine, epidemic, labor stoppages
beyond its reasonable control, accident, unusually severe weather or other cause
similar or dissimilar to the foregoing beyond its control, except to the extent
such failure or delay is due to such Party's failure to maintain disaster
recovery provisions that are customary in nature and scope (based on historical
practices) to minimize the impact of any such event.
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13. PROPRIETARY INFORMATION AND RIGHTS
Each Party acknowledges that the other Party possesses and
will continue to possess information that has been created, discovered or
developed by the other Party and/or in which property rights have been assigned
or otherwise conveyed to the other Party, which information has commercial value
and is not in the public domain. The proprietary information of each Party will
be and remain the sole property of such Party and its assigns. The disclosure
and use of any such proprietary information shall be subject to and governed by
the terms of the Distribution Agreement.
14. MISCELLANEOUS
14.1 NOTICES. All notices and other communications hereunder
shall be in writing and shall be deemed to have been given if (i) delivered in
person (to the individual whose attention is specified below) or via facsimile
(followed immediately with a copy in the manner specified in clause (ii)
hereof), (ii) sent by prepaid first-class registered or certified mail, return
receipt requested, or (iii) sent by recognized overnight courier service, as
follows:
to Packaging:
Tenneco Packaging Inc.
1900 West Field Court
Lake Forest, IL 60045
Attention: Chief Executive Officer
Facsimile: (847) 482-4589
with a copy to:
Tenneco Packaging Inc.
1900 West Field Court
Lake Forest, IL 60045
Attention: General Counsel
Facsimile: (847) 482-4589
to Tenneco:
Tenneco Automotive Inc.
500 North Field Drive
Lake Forest, IL 60045
Attention: Chief Executive Officer
Facsimile: (847) 482-5040
with a copy to:
Tenneco Automotive Inc.
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500 North Field Drive
Lake Forest, IL 60045
Attention: General Counsel
Facsimile: (847) 482-5040
or to such other address as either Party hereto may, from time to time,
designate in a written notice given in like manner. All notices and other
communications hereunder shall be effective: (i) the day of delivery when
delivered by hand, facsimile or overnight courier; and (ii) three business days
from the date deposited in the mail in the manner specified above.
14.2 MODIFICATION; WAIVER; SEVERABILITY. Subject to the
provisions of Section 9.08 of the Distribution Agreement, this Agreement and the
FAS Letter may not be amended or modified except in a writing executed by each
of the parties hereto. The failure by any party to exercise or a delay in
exercising any right provided for herein shall not be deemed a waiver of any
right hereunder. Whenever possible, each provision of this Agreement and the FAS
Letter will be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement or the FAS Letter is held
to be prohibited by or invalid under applicable law, such provision will be
ineffective only to the extent of such prohibition or invalidity, without
invalidating the remainder of this Agreement or the FAS letter.
14.3 ASSIGNMENT. The provisions of this Agreement and the
FAS Letter shall be binding upon, inure to the benefit of and be enforceable by
the parties and their respective permitted successors and permitted assigns.
This Agreement and the FAS Letter shall be assignable in whole in connection
with a merger or consolidation or the sale of all or substantially all the
assets of a party hereto so long as the resulting, surviving or transferee
entity assumes all the obligations of the relevant party hereto by operation of
law or pursuant to an agreement in form and substance reasonably satisfactory to
the parties to this Agreement. Otherwise this Agreement and the FAS Letter shall
not be assignable, in whole or in part, directly or indirectly, by any party
hereto without the prior written consent of the other, and any attempt to assign
any rights or obligations arising under this Agreement and the FAS Letter
without such consent shall be void.
14.4 GOVERNING LAW; SUBMISSION TO JURISDICTION; SELECTION OF
FORUM. THIS AGREEMENT AND THE FAS LETTER SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF ILLINOIS, WITHOUT REGARD TO ITS
PRINCIPLES OF CONFLICTS OF LAWS. JURISDICTION AND SELECTION OF FORUM SHALL BE
SUBJECT TO SECTION 9.17 OF THE DISTRIBUTION AGREEMENT.
14.5 COUNTERPARTS. This Agreement and the FAS Letter may be
executed in one or more counterparts, each of which shall be deemed an original,
and all of which shall constitute one and the same agreement.
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14.6 TERMINATION. This Agreement and the FAS Letter may be
terminated at any time prior to the Distribution by and in the sole discretion
of Tenneco without the approval of Packaging. In the event of such termination,
no party shall have any liability of any kind to any other party or any other
person. After the Distribution, this Agreement and the FAS Letter may not be
terminated except by an agreement in writing signed by all of the parties hereto
or as expressly contemplated herein with respect to the termination and
discontinuation of Services provided hereunder.
14.7 PACKAGINGCORPORATION OF AMERICA. Notwithstanding
anything set forth to the contrary, the Agreement does
not cover and shall not be construed to provide any
services to Packaging Corporation of America.
14.8 ENTIRE AGREEMENT. This Agreement, together with the
schedules hereto, the FAS Letter and the portions of
the HR Agreement regarding the provision of human
resources services, constitute the entire agreement
between the Parties with respect to the subject
matter hereof and thereof and shall supersede all
previous negotiations, commitments and writings with
respect thereto.
IN WITNESS WHEREOF, the parties have executed or caused this
Transition Services Agreement to be executed as of the date first written above.
TENNECO PACKAGING INC. TENNECO INC.
By: By:
----------------------------- ---------------------------
Name: Name:
--------------------------- -------------------------
Title: Title:
-------------------------- ------------------------
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SCHEDULE A-1
OUTSOURCE SERVICES
Packaging shall provide or have provided (as set forth in the
Agreement) to Tenneco (and its Affiliates) the following Outsource Services:
1. Payroll Processing and Related Services.
a. Interfacing benefits elections to the Integral (or its
replacement) payroll system to maintain appropriate payroll
deductions, update benefits data, and support existing
financial and third party interfaces;
b. Time and attendance data processing, including ensuring that
time data is received from all Tenneco locations assigned to
a particular payroll run (note: time and attendance files
received from Tenneco after the Packaging published deadline
may be defaulted to the standard hours (40 hours weekly/80
hours bi-weekly) for the affected payroll run); provided,
however, Packaging will use all reasonable efforts to
accommodate Tenneco in special circumstances in which time
and attendance files are not received prior to the Packaging
published deadline before defaulting to the standard hours;
in any event, Tenneco will advise Packaging in advance that
deadlines will not be met. Tenneco will reimburse Packaging
for any costs associated with processing late time and
attendance files, except where Packaging is responsible, in
whole or part, for the delay;
c. Gross to net processing, i.e., entering and verifying payroll
transactions (W4 changes, special pay, etc.); resolving out of
balance batches and time data errors sent in from Tenneco
locations; verifying and balancing the payroll run;
transmitting the direct deposit (ACH); and printing, sealing,
and boxing paychecks and advices;
d. Tax filings, withholdings, deductions and reporting;
e. Assist Tenneco locations with processing mass transactions for
merit increases, gainsharing, data changes, etc. (requests
must be received per the Packaging published lead time in
order to ensure on time processing);
f. Payroll processing related to domestic and international
relocation transactions and coordination of expatriate and
domestic outside service providers and compliance tax
reporting;
g. Garnishments and wage attachments and third party remittances;
Packaging will collect and retain any court ordered
garnishment fees relating to Tenneco employees;
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h. Check preparation (including off-cycle and on demand checks)
and direct deposit administration (only demand requests
received by 1:00 p.m. CST may be processed and distributed the
same day);
i. Distribute payroll checks and advices based on a mutually
agreed upon schedule to be published by Packaging;
j. Process year-end adjustments (true-ups, etc.), as well as
incentive bonuses, gainsharing, merit increases, benefits
enrollment, relocation adjustments, etc., and support federal,
state and local tax reporting, including preparation of W2
forms;
k. Help desk support for answering payroll questions from Tenneco
employees or operations personnel from 7:00 a.m. CST to 6:00
p.m. CST, Monday through Friday (except for mutually agreed
upon corporate holidays), and voice response unit employee
assistance to handle employee inquiries through an 800 number;
l. Security administration for the payroll system, subject to
mutually agreed upon standards for system access;
m. Payroll system enhancement requests submitted by Tenneco that
require more than three (3) days of programming effort by
Packaging may be charged to Tenneco;
n. Interface payroll documents will be posted from the Integral
payroll system. Package will review the SAP job error log
daily and work with Tenneco personnel to resolve
discrepancies;
o. Replace the Integral payroll system with the SAP HR/payroll
system within the scope of the defined project;
p. Provide Tenneco with data necessary to compile the annual
proxy statement pursuant to a mutually agreed upon time
schedule; and
q. Payroll Accounting Related Services.
(i) Payroll withholding and tax liability
reconciliations. Journal entry reconciliation
(reclassification and/or corrections), interface
error management and the reconciliation of amounts,
other than for benefit related items, that Tenneco
employees have deducted from their paychecks to
verify that the amounts withheld are paid. The
reconciliation process also includes the
identification and correction of
mapping/classification issues.
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(ii) Payroll Disbursement Accounts. Reconciling the
Tenneco Payroll Disbursement Account at Bank of
America (or other Tenneco-designated bank) utilizing
the data from the payroll (currently Integral)
system, as well as transactions that are filtered
through one or more other systems before they reach
SAP's general ledger.
2. Accounts Payable and Related Services.
a. Document Management/Imaging. Appropriate invoice documents
will be scanned by optical reading equipment, tested for
readability, committed to invoice processing queues and
assigned batch numbers. Hard copies of batched invoices with
assigned batch numbers filed on site for approximately 90 days
will be moved to off-site storage. Imaged invoices will be
linked to SAP documents and will be available for review by
all Tenneco plants/facilities with users established on
Filenet software;
b. Invoice Processing of Imaged Documents. Imaged invoices will
be manually inputted (commonly referred to as "posted") into
the SAP system and matched to the proper purchase order number
or cost element/cost center number. If an imaged invoice does
not contain required information, the invoice will be:
(i) Parked" because of inadequate purchase order or cost
element/cost center information and further action is
required by Packaging's accounts payable staff or
(ii) Entered in the SAP system as "non-compliant." A
letter will be sent to the vendor identifying the
reason the invoice cannot be processed. Purchase
order invoices that do not match (within a tolerance
level) the receiving document or the purchase order
price will be "blocked" by the SAP system and
require corrective action by the Tenneco purchase
requisitioner or buyer. Tenneco will provide
Packaging with documentation outlining the
appropriate buyer assignments by vendor. This
documentation will include authorization for
Packaging to release payments to the appropriate
vendor based on the buyer's approval. At the
direction of the Tenneco purchase requisitioner or
buyer, Packaging will clear the blocked document
by applying the document to a different purchase
order or line number on the purchase order or by
processing a sub-debit to the same purchase order
line;
c. Check Request Processing. Requests for check payments received
via the Lotus Notes database will be processed for payment
with the proper authorization and cost element/cost center
number. Tenneco will be responsible for identifying in writing
each Tenneco employee who may
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utilize the check request process and the level of approval
authority for such Tenneco employee;
d. Evaluated Receipt Settlement (ERS) Processing. On a mutually
agreed upon time schedule, Packaging will execute the SAP job
that will match purchase order and goods receipt documents to
create ERS invoices for payment. Tenneco will be responsible
for providing Packaging with accurate receiving and remit data
on the goods documentation and the correct purchase order
pricing. After executing the SAP job, Packaging will review
the SAP ERS error log daily and work with the appropriate
Tenneco personnel to resolve discrepancies;
e. Recurring Payment Processing. Tenneco will identify in writing
goods and services that can be purchased utilizing a recurring
payment process. Tenneco will provide Packaging with the start
and end dates on payments and the amounts to be paid.
Packaging will then create payment documents and schedule
settlement dates for each payment. Packaging will review the
SAP job error log daily and work with the appropriate Tenneco
personnel to resolve discrepancies;
f. Tenneco Interface Processing. Invoice documents will be posted
in the SAP system. Packaging will review the SAP job error log
daily and work with Tenneco personnel to resolve
discrepancies;
g. Payment of Posted Documents. Invoices, check requests and
other documents will be scheduled for payment based on terms
outlined in the purchase order or in the accounts payable
vendor master file. Tenneco personnel will be responsible for
managing the payment terms placed on the purchase orders and
the payment terms provided for in the accounts payable vendor
master file.
(i) Payments will be scheduled according to payment type:
check, special handling check, netting or electronic
transmission (same day settlement called "wire" and
next day settlement is called "ACH").
(ii) Checks will be printed, sealed and distributed to a
third party mail sorting facility for grouping and
application of bulk mailing rates.
(iii) Special handling checks will be distributed pursuant
to written instructions from authorized Tenneco
personnel. Tenneco will reimburse Packaging directly
for the cost of all checks distributed via special
carrier services (e.g., UPS, Federal Express and wire
transfer).
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(iv) Netting and wire transfer payment information will be
settled through the former Tenneco Management Europe
Limited office in London.
(v) ACH payment information will be electronically
submitted through the SAP system to Harris Bank (or
other Tenneco- designated bank) for execution;
h. Vendor Maintenance. Packaging will maintain the accounts
payable vendor master file within the SAP system pursuant to
written instructions from authorized Tenneco personnel.
Services include establishing new vendors and updating
existing vendor records (i.e., remittance address changes and
payment methods). In compliance with the Internal Revenue
Service, Packaging will require all non-exempt accounts
payable vendors to have a Taxpayer Identification Number prior
to making payment to the vendor. Tenneco will assist Packaging
with securing the required W-9 forms for all exempt vendors
including government entities and employees;
i. 1099 Processing. Packaging will coordinate the annual
processing of IRS Form 1099 to identified vendors including
consolidation and reporting to the IRS. Tenneco will provide
Packaging with all appropriate 1099 data that might be
associated with petty cash or related remote payables
functions administered in the various field locations;
j. Matching Gift Processing. Applications for matching gift
requests received from Tenneco employees will be checked for
eligibility (employee status and institution) and processed in
the SAP accounts payable system. Disbursements to charitable
institutions are considered special handling because of return
remittances required for such institutions.
k. Accounts Payable Related Accounting Services.
(i) Payable related reconciliations. Journal entry
reconciliation (reclassification and/or corrections),
interface error management and reconciliation of
related accounts (e.g., T&E), as well as providing
information required to reconcile or manage goods
received, invoices received and intercompany related
accounts (T&E reconciliations involve the vendor
accounts and corresponding general ledger accounts,
as well as reclassifying amounts appropriately
between groups where payroll and expenses are
cross-charged).
(ii) Payable disbursement accounts. Reconciliation of
accounts payable for Tenneco bank accounts including
identifying and reconciling outstanding transactions
on Harris Bank's (or other
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Tenneco-designated bank's) records, SAP's general
ledger and the accounts payable system.
l. Travel and Entertainment Administration.
(i) Travel and Entertainment Expense Reimbursement.
Packaging will post and schedule Tenneco employee
travel and entertainment expense reimbursements (T&E)
in one of three forms:
(a) Electronic SAP Filing. Semi-monthly
settlement processing for T&E submitted
directly by Tenneco employees into the SAP
system.
(b) Non-Electronic SAP Filing. Tenneco employees
without access to the SAP system will submit
T&E on the Visual Basic tool that is
currently in use. The expense report then
will be up-loaded into the SAP system and
made ready for settlement;
(c) Manual Filing. Paper expense reports will
be processed by Packaging directly into the
SAP system and settled;
(ii) Employee Record Maintenance. Packaging will maintain
Tenneco employee personnel records in the SAP system
pursuant to written instructions from authorized
Tenneco personnel or initiated by the payroll
process.
(iii) T&E Verification. Packaging will verify the receipt
of all required T&E support documentation and update
the SAP system accordingly. Also, Packaging will
contact Tenneco personnel who do not comply with
established policies. Packaging may suspend T&E
filing privileges for any Tenneco employee whose
outstanding T&E support documentation is more than 3
months old; and
(iv) Post Payment Audit. Packaging will conduct
post-payment auditing of expense reports and
associated receipt packages pursuant to mutually
agreed upon performance documentation standards.
Packaging will notify Tenneco employees and the
designated Tenneco management representative of
violations to the performance documentation standards
and follow-up with the Tenneco employees to assure
compliance.
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m. Travel Card Administration.
(i) Manage the relationship with the bank including
recovering rebates earned and assist with: securing
credit for marginal Tenneco employees, managing the
delinquent account portfolio, removing the travel
card program from divested businesses and
establishing organizational hierarchies for
management reporting;
(ii) Administer credit card program policies and
procedures including obtaining the necessary
authorization to increase traveler credit limits,
notifying appropriate company personnel of violations
to company policy, and reviewing credit card
applications and credit limits to assure they are
appropriate for a Tenneco employee's position and
travel needs;
(iii) Issue and cancel credit cards related to the
termination or reassignment of a Tenneco employee or
for the purpose of reporting a lost or stolen travel
card;
(iv) Assist Tenneco employees with resolution of disputed
charges that appear on the credit card statement, but
require further investigation by non-bank personnel
prior to removal from the statement; and
(v) Notify designated Tenneco management monthly, in
writing, of all delinquent credit card accounts that
have resulted in the suspension of a Tenneco
employee's travel card privileges and assist Tenneco,
as directed, in the collection of these delinquent
account balances.
Any periodic volume or delinquency management rebates paid by
the travel card supplier and earned by Tenneco will be
reported to Tenneco on a timely basis and netted against the
billing of services.
n. Procurement Card Administration (Procard).
(i) Manage the relationship with the bank including the
recovery of rebates earned and assist with: removal
of the Procard program from divested businesses,
establishing organizational hierarchies for
management reporting, and coordinating the
establishment of standard cardholder profiles
controlled by daily and week spending limits and
uniform merchandise codes;
(ii) Provide training materials, such as cardholder and
administrator handbooks and bank issued training
tapes to the designated Procard site coordinators
(Tenneco will reimburse Packaging for any on-site
training that Packaging provides);
23
<PAGE> 24
(iii) Issue and cancel credit cards related to the
termination or reassignment of a Tenneco employee or
for the purpose of reporting a lost or stolen card;
(iv) Assist Tenneco employees with the resolution of
disputed charges that appear on their credit card
statement and require further non-bank related
investigation prior to removal from the credit card
statement;
(v) Process monthly payments to Citibank (or other
Tenneco- designated bank) to include assuring all
individual card transactions are properly posted in
the SAP general ledger and that the payment is
received and posted at the bank prior to the due
date;
(vi) Assist vendors to become Procard enabled including
facilitating the initial interaction with the Procard
provider's new account department and, if requested,
providing the vendor with assistance to obtain a
favorable transaction fee from the Procard provider;
and
(vii) Distribute Procard usage and management reports
generated from the purchase history accumulated by
the Procard provider to designated Tenneco personnel.
Any periodic volume/usage rebates paid by the Procard provider
and earned by Tenneco will be reported and netted against the
billing of services; and
o. Help Desk Support. Packaging will provide accounts payable
help desk support to answer questions from Tenneco vendors or
operations personnel from 7:00 a.m. CST to 6:00 p.m. CST,
Monday through Friday (except for mutually agreed upon
corporate holidays). This includes inquiry support for
Accounts Payable, T&E and Travel and Procurement Card
Programs.
24
<PAGE> 25
SCHEDULE A-2
PHASE-OUT SERVICES
1. Financial Reporting, Accounting and Consolidations. Packaging will
provide or cause to be provided (as set forth in the Agreement) the
following financial reporting, accounting and consolidations services
through August 15, 2000:
a. Preparation of monthly, quarterly and annual consolidated
financial statements including income statements, balance
sheets and cash flow statements, as well as consolidated
entries to eliminate the impact of intercompany activity in a
manner sufficient to meet internal and external reporting
requirements including all creditor requirements;
b. Preparation (in conjunction with Tenneco management) of
Management Discussion and Analysis schedules based upon the
consolidated financial statements, it being understood that
Packaging is not responsible for preparing related text;
c. Preparation of SEC compliant financial statements on a
quarterly and annual basis including balance sheets,
statements of income and cash flow, statements of changes in
owners' equity (this includes providing the financial data
necessary, as needed, for footnotes and management discussion
and analysis recognizing fiduciary responsibility rests with
Tenneco for regulatory filings);
d. Administration of currently assigned monthly general closing
activities which includes ensuring that journal entries,
interfaces and management reviews occur in sequence and in
accordance with the mutually agreed upon financial closing
schedule (referred to as a "Run Book"), preparation and
execution of recurring and nonrecurring financial journal
entries, clearing of SAP related interface error sessions
(daily, weekly or monthly) and ensuring the integrity of the
assigned general accounts and general ledger balances;
e. Reconciliation of assigned bank accounts. These
reconciliations will be sufficient in nature to fully account
for and display the components of each account balance, and
period over period changes; Tenneco and Packaging management
will participate in quarterly financial statement reviews in a
time frame sufficient to allow for required regulatory and
creditor filings;
f. Maintenance of the SAP fixed asset system to include creation
of project numbers within the SAP general ledger for the
accumulation of dollars spent against a project or fixed
asset purchase including: creation of a
25
<PAGE> 26
SAP fixed asset master record from the data captured by the
SAP internal order process (including determining the asset
valuation for depreciation purposes and placement into the
appropriate asset classification to determine the
depreciable life of the asset as provided by Packaging to
Tenneco); accounting for the transfer, retirement or sale of
assets within the SAP fixed asset system; posting
depreciation on a monthly basis; and reconciling SAP fixed
asset records to general ledger on a monthly basis. Tenneco
is responsible for providing Packaging with the financial
data necessary to execute the establishment and/or
maintenance of an asset in the SAP fixed asset system; and
g. Compilation and consolidation of data required to prepare
domestic and foreign government reports. Tenneco will assure
its operating locations provide the appropriate operating data
required to complete these reports and that this information
is made available to Packaging in accordance with the mutually
agreed upon data submission schedule. Tenneco will reimburse
Packaging of any costs incurred due to Tenneco's late
submission of data unless the late submission is caused by
Packaging.
2. Cash Management Administration. Packaging will provide or cause to be
provided (as set forth in the Agreement) the following cash management
services through June 30, 2000:
a. Management of daily cash position and funds movements
including:
(i) Establishment of Tenneco's daily cash position to
determine short-term borrowing or cash investment
needs;
(ii) Daily reporting and concentration of lockbox
receipts;
(iii) Daily reporting and funding of payroll and accounts
payable disbursement accounts;
(iv) Daily funding of other disbursement accounts
controlled by third party service providers (e.g.,
medical benefit payments, local property tax
payments, freight payments);
(v) Execution of other intercompany/divisional cash
transfers between Tenneco and its subsidiaries and/or
divisions;
(vi) Entering daily bank activity detail into XRT
(treasury cash management computerized workstation);
and
(vii) Daily reconciliation of XRT and bank cash receipts
and disbursement reports.
26
<PAGE> 27
b. Short-term Cash Flow Forecasting including: (a) maintaining a
forecast of daily receipts and disbursements for current month
using input from Tenneco's finance staff for use in planning
short-term borrowing and cash investing activity; and (b)
coordinating daily receipts and disbursements forecasts with
quarterly cash flow forecasts prepared by Tenneco's finance
staff;
c. Executing short-term borrowing for Tenneco based on daily cash
position and short-term cash flow forecasts under guidance
from Tenneco's finance staff. Packaging cash management
personnel will have authority from Tenneco to borrow under an
established bank facility within parameters established by
Tenneco's finance staff (frequency, single borrowing limits,
absolute bank debt limits, maximum interest rates, etc.);
d. Executing short-term cash investments for Tenneco based on
daily cash position and short-term cash flow forecasts.
Packaging cash management personnel will have authority from
Tenneco to invest surplus cash balances within parameters
established by Tenneco's finance staff (term, investment
counter parties, asset type, etc.);
e. Executing electronic payments to suppliers as directed by
Tenneco's accounts payable group;
f. Receiving, logging and forwarding to Tenneco lockboxes
miscellaneous checks received directly by Tenneco (e.g.,
customer payments not sent to lockboxes, employee checks,
etc.);
g. Assisting Tenneco's accounts receivable staff to promptly
identify and return remittances from Tenneco and Packaging
customers erroneously mailed to Packaging and Tenneco
lockboxes, respectively;
h. Executing foreign currency invoice payments up to USD 100,000
limit; spot purchasing of foreign currency; mailing checks or
executing international wires. Tenneco's finance staff will
handle larger FX transactions and any FX hedging activity;
i. Reviewing and analyzing monthly bank account analysis
statements for all operating banks, reviewing and approving
bank fee invoices for payment and resolving fee discrepancies
with banks;
j. Implementing and maintaining Tenneco's XRT cash management
system, writing XRT scripts (programs) to perform automated
cash management functions (e.g., generate bank activity and
balance reports, repetitive wire transfers, etc.) and working
with XRT vendor programmers to install updates/enhancements to
XRT system and resolve any system problems;
27
<PAGE> 28
k. Preparing documentation to (a) open and close bank accounts,
(b) establish and change authorized signatories and limits,
(c) fill out bank system security forms, and (d) establish and
revise other bank account operating instructions per direction
of Tenneco's finance staff (for control reasons Tenneco's
finance staff must sign and mail letters to banks), as well as
preparing new repetitive wire transfer authorizations for
approval by Tenneco's finance staff;
l. Generating and filing reports of daily receipts and
disbursements activity off the XRT cash management system, and
preparing monthly cash flow report showing actual daily
receipts and disbursements for Tenneco's finance staff; and
m. Preparing in collaboration with Tenneco's finance staff a
daily, weekly and monthly reconciliation process to ensure the
appropriate separation of Tenneco and Packaging cash;
3. Tax Services. Packaging will provide or cause to be provided (as set
forth in the Agreement):
a. the preparation and filing of Federal and State income and
franchise tax returns required to be filed through October
30, 2000; and
b. U.S. tax accounting, IRS audit assistance, preparation of
sales and use tax audits through October 30, 2000.
28
<PAGE> 29
SCHEDULE A-3
ITOC SERVICES
Packaging shall provide or have provided (as set forth in the
Agreement) to Tenneco (and its Affiliates) the following ITOC Services:
1. Telecommunications and Information Services.
a. Operations and technology management of the mainframe and SAP
UNIX systems at Tenneco's data center as set forth in
paragraph 8 of the FAS letter.
b. Help Desk Services set forth in paragraph 8 of the FAS
Letter.
c. Network Service and Support for WAN, LAN, voice and messaging
set forth in paragraph 8 of the FAS Letter;
d. Disaster Recovery Services set forth in paragraph 8 of the
FAS Letter.
e. Communications between the Automotive Business located at
Tenneco's Lake Forest facility and the ITOC (Information
Technology Operations Center) as set forth in paragraph 8 of
the FAS Letter.
f. Overall support of the Filenet imaging system from a
hardware/software/vendor management perspective. Tenneco will
be responsible for the cost of expanding the current remote
imaging user community. Tenneco will also be responsible for
providing desktop support for imaging software at Tenneco
locations.
g. Overall support of the Hyperion hardware/software platform
including system administration (maintenance, security, etc.).
h. Support of Lotus Notes Forms Request System (used for SAP
accounts payable, vendor maintenance and T&E processing)
including security administration and application support.
i. MCI telecommunications services that are currently provided to
the Automotive Business through December 31, 2001.
29
<PAGE> 30
SCHEDULE A-4
TENNECO SERVICES
Tenneco shall provide or cause to be provided (as set forth in
the Agreement) to Packaging (and its Affiliates) the following Tenneco Services:
1. Treasury and Cash Management Administration
a. Daily management of Tenneco Packaging (UK) Limited (Tenneco
Packaging's international finance company) in respect of
arranging intercompany loans, cash management, short term
borrowings, hedging of foreign exchange exposures. All
transactions will be recorded in Tenneco Europe's treasury
system IT/2.
b. Daily management of Sterling cashpool held at Barclays Bank.
c. Daily management of German cashpool held at Commerzbank.
d. Processing of intercompany and cross-border third party
payments through the Tenneco Netting System.
e. Assistance with setting up a new Tenneco Packaging
international treasury function and training of staff.
f. Treasury support function to process payment transfers, check
deal confirmations and maintain adequate internal controls.
2. Accounting Services
a. Prepare monthly management accounts for Tenneco Packaging
(UK) Limited and report into Hyperion.
b. Assist in transfer of accounting for Tenneco Packaging (UK)
Limited to a Tenneco Packaging accounting system.
3. Insurance Administration
a. For four (4) months only, provide insurance administration
Packaging requires for the operation of its
30
<PAGE> 1
REVERSE STOCK SPLIT PROPOSAL
<TABLE>
<CAPTION>
VOTES FOR VOTES AGAINST VOTES ABSTAIN
--------- ------------- -------------
<S> <C> <C>
138,533,392 8,254,821 1,175,919
</TABLE>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibits. The exhibits filed with this report are listed on the Exhibit
Index following the signature page of this report, which is incorporated herein
by reference.
(b) Reports on Form 8-K. Since the beginning of the third quarter of 1999,
Tenneco filed the following Current Reports on Form 8-K:
- Form 8-K dated July 14, 1999, including pursuant to item 5 financial and
other information that superseded comparable information included in
Tenneco's Annual Report on From 10-K for the year ended December 31, 1998
and Quarterly Report on Form 10-Q for the quarter ended March 31, 1999
(including the following financial statements: (1) Tenneco Inc. and
consolidated subsidiaries financial statements for the three months ended
March 31, 1999 and 1998; and (2) Tenneco Inc. and consolidated
subsidiaries financial statements for the three years in the period ended
December 31, 1998);
- Form 8-K dated August 20, 1999, including pursuant to item 5 financial
and other information that superseded comparable information included in
Tenneco's Annual Report on Form 10-K for the year ended December 31,
1998, Quarterly Report on Form 10-Q for the quarter ended March 31, 1999,
Quarterly Report on Form 10-Q for the quarter ended June 30, 1999 and
Current Report on Form 8-K dated July 14, 1999 (including the following
financial statements: (1) Tenneco Inc. and consolidated subsidiaries
financial statements for the three months ended March 31, 1999 and 1998;
(2) Tenneco Inc. and consolidated subsidiaries financial statements for
the three months and six months ended June 30, 1999 and 1998; and (3)
Tenneco Inc. and consolidated subsidiaries financial statements for the
three years in the period ended December 31, 1998);
- Form 8-K dated September 27, 1999, including pursuant to item 5 certain
information regarding the offering of senior subordinated notes by
Tenneco;
- Form 8-K dated October 4, 1999, as amended, including pursuant to item 5
certain financial information;
- Form 8-K dated October 4, 1999, including pursuant to item 5 certain
information regarding Packaging;
- Form 8-K dated October 7, 1999, including pursuant to item 5 certain
financial information and certain information regarding the offering of
senior subordinated notes by Tenneco;
- Form 8-K dated October 12, 1999, including pursuant to item 5 certain
information regarding the spin-off of Packaging and certain information
regarding the offering of senior subordinated notes by Tenneco;
- Form 8-K dated October 25, 1999, including pursuant to item 5 certain
information regarding Tenneco's special stockholders' meeting held on
October 25, 1999, certain information regarding Packaging and certain
financial information; and
- Form 8-K dated November 4, 1999, including pursuant to items 2 and 7
financial and other information regarding the spin-off of Packaging
(including an Unaudited Pro Forma Consolidated Balance Sheet of Tenneco
at June 30, 1999 and Unaudited Pro Forma Consolidated Statements of
Income for Tenneco for the six months ended June 30, 1999 and the year
ended December 31, 1998).
36
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM TENNECO
AUTOMOTIVE INC. AND CONSOLIDATED SUBSIDIARIES FINANCIAL STATEMENTS AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> SEP-30-1999
<CASH> 42
<SECURITIES> 0
<RECEIVABLES> 657
<ALLOWANCES> 0
<INVENTORY> 403
<CURRENT-ASSETS> 1,216
<PP&E> 1,936
<DEPRECIATION> 881
<TOTAL-ASSETS> 4,494
<CURRENT-LIABILITIES> 888
<BONDS> 796
0
0
<COMMON> 0
<OTHER-SE> 2,140
<TOTAL-LIABILITY-AND-EQUITY> 4,494
<SALES> 2,473
<TOTAL-REVENUES> 2,473
<CGS> 1,851
<TOTAL-COSTS> 1,851
<OTHER-EXPENSES> 413
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 58
<INCOME-PRETAX> 161
<INCOME-TAX> 60
<INCOME-CONTINUING> 80
<DISCONTINUED> (99)
<EXTRAORDINARY> (7)
<CHANGES> (134)
<NET-INCOME> (160)
<EPS-BASIC> (4.78)
<EPS-DILUTED> (4.78)
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM TENNECO
AUTOMOTIVE INC. AND CONSOLIDATED SUBSIDIARIES FINANCIAL STATEMENTS AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> SEP-30-1998
<CASH> 24
<SECURITIES> 0
<RECEIVABLES> 690
<ALLOWANCES> 0
<INVENTORY> 399
<CURRENT-ASSETS> 1,301
<PP&E> 1,887
<DEPRECIATION> 813
<TOTAL-ASSETS> 4,999
<CURRENT-LIABILITIES> 822
<BONDS> 822
0
0
<COMMON> 0
<OTHER-SE> 2,664
<TOTAL-LIABILITY-AND-EQUITY> 4,999
<SALES> 2,468
<TOTAL-REVENUES> 2,468
<CGS> 1,749
<TOTAL-COSTS> 1,749
<OTHER-EXPENSES> 443
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 49
<INCOME-PRETAX> 239
<INCOME-TAX> 48
<INCOME-CONTINUING> 169
<DISCONTINUED> 146
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 315
<EPS-BASIC> 9.34
<EPS-DILUTED> 9.31
</TABLE>
