REGISTRATION NO. 1-15401
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
POST-EFFECTIVE
AMENDMENT NO. 1 TO
FORM 10
GENERAL FORM FOR REGISTRATION OF SECURITIES
Pursuant to Section 12(b) or (g) of
the Securities Exchange Act of 1934
ENERGIZER HOLDINGS, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
MISSOURI 43-1863181
(STATE OF INCORPORATION) (I.R.S.EMPLOYER
IDENTIFICATION NO.)
800 CHOUTEAU
ST. LOUIS, MISSOURI 63102
(ADDRESS OF PRINCIPAL OFFICES) (ZIP CODE)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (314) 982-2970
Securities to be registered pursuant to Section 12(b) of the Act:
NAME OF EACH EXCHANGE ON WHICH EACH CLASS IS TO BE
TITLE OF EACH CLASS TO BE SO REGISTERED REGISTERED
------------------------------------------ -------------------
Common Stock, $.01 par value New York Stock Exchange, Inc.
Common Stock Purchase Rights New York Stock Exchange, Inc.
Securities to be registered pursuant to Section 12(g) of the Act: None
<PAGE>
II. INFORMATION NOT INCLUDED IN INFORMATION STATEMENT
Item 15. Financial Statements and Exhibits.
Item 15(b) of Registrant's Amendment No. 3 to Form 10 is hereby amended as
follows:
EXHIBIT NO. DESCRIPTION
- ------------ -----------
2.1 Agreement and Plan of Reorganization
2.2 Tax Sharing Agreement
2.3 Bridging Agreement
2.4 Form of Aircraft Joint Ownership Agreement
2.5 Lease Agreement
2.6 Intellectual Property Agreement
3.1 Articles of Incorporation of Energizer Holdings, Inc.
3.2 Bylaws of Energizer Holdings, Inc.
4.1 Agreement between Energizer Holdings, Inc. and
Continental Stock Transfer & Trust Company, as Rights Agent
10.1 Energizer Holdings, Inc. Incentive Stock Plan
10.2 Energizer Holdings, Inc. Non-Qualified Deferred
Compensation Plan
10.3 Form of Change of Control Employment Agreements
10.4 Form of Indemnification Agreements with Executive Officers
and Directors
10.5 Executive Savings Investment Plan
10.6 Executive Health Insurance Plan
10.7 Executive Long Term Disability Plan
10.8 Financial Planning Plan
10.9 Executive Group Personal Excess Liability Insurance Plan
10.10 Executive Retiree Life Plan
10.11 Supplemental Executive Retirement Plan
10.12 Form of Retention Letter
10.13 Debt Assignment, Assumption and Release Agreement by and among
Ralston Purina Co., Energizer Holdings, Inc. and Bank One, N.A.
10.14 364-Day Credit Agreement between Ralston Purina Company and
Bank One, N.A.
10.15 5-Year Revolving Credit Agreement between Ralston Purina
Company and Bank One, N.A.
10.16 Energizer Holdings, Inc. Private Placement Note Purchase
Agreement
10.17 Asset Securitization Receivable Purchase Agreement
between Energizer Holdings, Inc., Falcon Asset Securitization
Corporation and Bank One, NA
10.18 Bridge Loan Agreement No. 1
10.19 Bridge Loan Agreement No. 2
21 List of Energizer Subsidiaries
27 Financial Data Schedule
SIGNATURE
Pursuant to the requirements of Section 12 of the Securities Exchange Act
of 1934, the registrant has duly caused this Post-Effective Amendment No. 1
to Form 10 Registration Statement to be signed on its behalf by the
undersigned thereunto duly authorized.
ENERGIZER HOLDINGS, INC.
By:/s/ Daniel E. Corbin, Jr.
Daniel E. Corbin, Jr.
Executive Vice President,
Finance and Control
Energizer Holdings, Inc.
April 19, 2000
AGREEMENT AND PLAN OF REORGANIZATION
This AGREEMENT AND PLAN OF REORGANIZATION (the "Agreement"), dated as of
April 1, 2000, by and among Ralston Purina Company, a Missouri corporation
("Ralston") and Energizer Holdings, Inc. ("Energizer"), a Missouri corporation
and wholly owned Subsidiary of Ralston.
WITNESSETH:
WHEREAS, Ralston's businesses principally consist of the manufacture,
distribution and sale of pet products and battery and lighting products both
domestically and internationally; and
WHEREAS, the Board of Directors of Ralston (the "Ralston Board") has
determined that it is in the best interests of the Ralston shareholders to
separate Ralston's battery and lighting products business from its pet products
business by creating a new independent publicly held battery and lighting
products company, and to distribute the $.01 par value Energizer Stock
("Energizer Stock") to shareholders of its $.10 par value Ralston Purina Common
Stock ("Ralston Stock"); and
WHEREAS, in order to effect such separation, the Ralston Board has
determined that it is necessary and advisable to restructure the worldwide
battery and lighting products business and to transfer to Energizer the direct
stock ownership of those Subsidiaries that are engaged in the operation of the
battery and lighting products business, as well as other assets of Ralston used
in the battery and lighting products businesses, as more fully set forth below;
and
WHEREAS, in connection with such consolidation, Ralston caused Eveready
Battery Company, Inc. ("Eveready"), a Delaware corporation and indirectly wholly
owned Subsidiary of Ralston, to form Energizer effective September 23, 1999; and
effected the reincorporation of Eveready Battery International, Inc. ("EBII"), a
wholly owned Subsidiary of Eveready, from Delaware to Missouri by causing EBII
to be merged into Energizer, in connection with which Eveready, the sole
shareholder of EBII, surrendered all shares of capital stock in EBII in a
constructive exchange for all of the issued and outstanding shares of capital
stock of Energizer; and
WHEREAS, in order to effect such distribution of the ownership of Energizer
to the holders of Ralston Stock, the Ralston Board has determined that it is
necessary and desirable to distribute all outstanding shares of Energizer Stock
on a pro rata basis to the holders of Ralston Stock, such distribution being
hereinafter referred to as the "Distribution"; and
WHEREAS, the mergers and liquidations of certain affected subsidiaries are
intended to qualify as nontaxable under Sections 368(a)(1)(A) and 332 of the
Internal Revenue Code of 1986, as amended (the "Code"), the transfer of assets
is intended to qualify as nontaxable under Code Section 368(a)(1)(D) and 351,
and the distribution of Energizer Stock is intended to qualify as nontaxable
under Code Section 355; and
WHEREAS, the parties hereto have determined that it is necessary and
desirable to set forth the principal corporate transactions required to effect
the Distribution and to set forth other agreements that will govern certain
other matters prior to and following the Distribution;
NOW THEREFORE, in consideration of the premises and the mutual covenants
herein contained and intending to be legally bound thereby, the parties hereto
agree as follows:
ARTICLE I
DEFINITIONS
1.01 General. As used in this Agreement, the following terms shall
-------
have the following meanings (such meanings to be equally applicable to both the
singular and plural forms of the terms defined):
Action: any action, claim, suit, arbitration, inquiry, proceeding or
------
investigation by or before any court, governmental or other regulatory or
administrative agency or commission or any arbitration or other tribunal.
Affiliate: with respect to any specified Person, an "affiliate" as defined
---------
in Rule 405 promulgated pursuant to the Securities Act; provided, however, that
for purposes of this Agreement (i) Affiliates of Energizer shall not be deemed
to include Ralston or any corporation which will be a Subsidiary or affiliate of
Ralston following the Distribution; and (ii) Affiliates of Ralston shall not be
deemed to include Affiliates of Energizer.
Aircraft Agreement: as defined in Section 5.03 of this Agreement.
-------------------
Ancillary Agreements: the Tax Sharing Agreement, the Bridging Services
---------------------
Agreement, the Intellectual Property Agreement and the Aircraft Agreement.
Asset: any and all assets, rights and properties, tangible or intangible,
-----
including, but not limited to, the following: (i) cash, notes and trade
receivable accounts (whether current or non-current and including all rights
with respect thereto); (ii) certificates of deposit, bankers' acceptances,
stock, debentures, evidences of indebtedness, certificates of interest or
participation in profit-sharing agreements, collateral-trust certificates,
preorganization certificates, investment contracts, voting-trust certificates;
(iii) trade secrets and confidential information; statutory, common law and
registered trademarks, trade styles, service marks, service names, trade names,
trade dress, copyrights, moral rights, rights of privacy and publicity, Internet
or other electronic communication addresses (e.g., "energizer.com" and
1-800-982-ENRS), business addresses of a proprietary nature (e.g., "Ever Ready
House"), designs, inventions, know-how, issued and unissued patents, and other
property commonly considered intellectual property, all rights to recover for
past infringements of each of the foregoing, and the goodwill of the business to
the extent associated with any and all of the foregoing; (iv) rights under
leases, contracts, licenses, permits, and sales and purchase agreements; (v)
real estate and buildings and other improvements thereon and timber and mineral
rights of every kind; (vi) leasehold improvements, fixtures, trade fixtures,
machinery, equipment (including transportation and office equipment), tools,
dies and furniture; (vii) office supplies, production supplies, spare parts,
other miscellaneous supplies and other tangible property of any kind; (viii) raw
materials, work-in-process, finished goods, consigned goods and other
inventories; (ix) prepayments or prepaid expenses; (x) claims, causes of action,
choses in action, rights of recovery and rights of set-off of any kind; (xi) the
right to receive mail and other communications; (xii) lists of advertisers,
records pertaining to advertisers and accounts, lists and records pertaining to
suppliers, customers and agents, and books, ledgers, files and business records
of every kind; (xiii) advertising materials and other recorded, printed or
written materials; (xiv) goodwill as a going concern and other intangible
properties; (xv) personnel records and employee contracts, including any rights
thereunder to restrict an employee from competing in certain respects; and (xvi)
licenses and authorizations issued by any governmental authority.
Battery Business: Ralston's direct or indirect ownership of (i) the
-----------------
worldwide business of the manufacture, distribution and sale of primary
alkaline, carbon zinc, miniature, rechargeable and other types of batteries; and
flashlights and other lighting products; and (ii) all joint ventures involving
or associated with the businesses described in (i) next above.
Bridging Services Agreement: as defined in Section 5.03 of this Agreement.
---------------------------
Business: the Battery Business or the Ralston Business.
--------
Business Day: any day other than a Saturday, a Sunday or a day on which
-------------
banking institutions located in the State of Missouri are obligated by law or
executive order to close.
Cash: cash, checks deposited in lockboxes, marketable securities,
----
compensating balances used to secure debt financing, amounts held in margin
accounts, and such other items as have been or would be classified as cash
consistent with accounting policies of Ralston.
Code: the Internal Revenue Code of 1986, as amended, or any successor
----
legislation.
Current Plan Year: the plan year or fiscal year, to the extent applicable
------------------
with respect to any Plan, during which the Distribution Date occurs.
Distribution: as defined in the recitals to this Agreement.
------------
Distribution Date: April 1, 2000.
------------------
DuPont Agreement: an Agreement and Plan of Merger and Exchange dated as of
----------------
December 2, 1997, by and among E. I. du Pont de Nemours and Company, Ralston and
certain of their affiliates.
Energizer: as defined in the recitals to this Agreement.
---------
Energizer Assets: except to the extent provided in, and subject to the
-----------------
provisions of, any of the Ancillary Agreements, (i) all of the Assets used or
held by or on behalf of any member of the Energizer Group or the Ralston Group
immediately prior to the Distribution which are used or held for use
exclusively in the Battery Business, and which are not used or held for use in
the Ralston Business; including, but not limited to, the Assets set forth on
Schedule 1.01(a) but excluding the Assets set forth on Schedule 1.01(b); and
(ii) any office equipment and furniture used immediately prior to the
Distribution exclusively by Energizer Employees.
Energizer Board: the Board of Directors of Energizer Holdings, Inc. and
----------------
their duly elected or appointed successors.
Energizer Deferred Compensation Plan: as defined in Section 7.09 of this
--------------------------------------
Agreement.
Energizer Employee: any individual who (i) is on the Distribution Date, or
------------------
immediately following the Distribution will be, an employee of any member of the
Energizer Group, (ii) is on the Distribution Date employed by a member of the
Ralston Group but who, pending transfer of employment to a member of the
Energizer Group, performs duties primarily for the Energizer Group other than
pursuant to the Bridging Services Agreement; or (iii) is on leave (including,
but not limited to, leave for sickness or disability) or layoff from active
employment on the Distribution Date but who, immediately prior to commencement
of such leave or layoff, was employed in, or performed duties primarily for, the
Battery Business. Notwithstanding the foregoing, an Energizer Employee shall
not include any individual who, as of the Distribution Date, is employed by a
member of the Energizer Group but performs duties primarily for the Ralston
Group, pending subsequent transfer of employment to a member of the Ralston
Group or termination of employment.
Energizer Group: Energizer and its Affiliates after the Distribution.
----------------
Energizer Individual: any individual who is an Energizer Employee, a
---------------------
Former Energizer Employee, or a beneficiary or alternate payee of an Energizer
Employee or of a Former Energizer Employee.
Energizer Obligations: as defined in Article X of this Agreement.
----------------------
Energizer Retirement Plan: the Energizer Holdings, Inc. Retirement Plan, a
-------------------------
defined benefit pension plan.
Energizer Stock: Energizer common stock, par value $.01 per share.
----------------
ERISA: the Employee Retirement Income Security Act of 1974, as amended, or
-----
any successor legislation.
Exchange Act: the Securities Exchange Act of 1934, as amended, together
--------------
with the rules and regulations promulgated thereunder.
Executive Life Plan: the Ralston Purina Executive Life Plan.
---------------------
Executive SIP: the Ralston Purina Executive Savings Investment Plan.
--------------
Form 10: as defined in Section 2.06 of this Agreement.
--------
Former Battery Businesses: all of the following businesses which, as of
---------------------------
the Distribution Date, were no longer owned and/or conducted, directly or
indirectly, by Ralston, Energizer or their Subsidiaries, Affiliates or any
predecessors to the foregoing:
(i) former businesses and operations relating to the manufacture, sale and
distribution of battery, safety and lighting products conducted by Ralston
and/or its Subsidiaries after June 30, 1986, including, but not limited to, the
worldwide rechargeable Original Equipment Manufacturers' battery business and
the Eversafe line of products;
(ii) former businesses and operations relating to the manufacture, sale and
distribution of battery and lighting products conducted by Union Carbide
Corporation and/or its Subsidiaries and Affiliates through June 30, 1986, to the
extent assets and liabilities related to such businesses and operations were
acquired and assumed by Ralston and its Subsidiaries and Affiliates effective
June 30, 1986 pursuant to, or arising out of the transactions contemplated by,
the Omnibus Purchase and Sale Agreement by and between Union Carbide Corporation
and Ralston Purina Company, made April 7, 1986; and
(iii) all former joint ventures involving or associated with the businesses
described in (i) or (ii) above or the Battery Business.
Former Businesses: The Former Ralston Businesses and the Former Battery
------------------
Businesses.
Former Energizer Employee: an individual who was employed in, or performed
-------------------------
duties primarily for, the Battery Business or a Former Battery Business at the
time of his or her termination or retirement on or prior to the Distribution
Date and who was not subsequently, prior to the Distribution Date, employed in
the Ralston Business or in a Former Ralston Business.
Former Ralston Businesses: all of the businesses and operations directly
---------------------------
or indirectly owned and conducted by Ralston prior to, but not as of, the
Distribution Date, other than a Former Battery Business; and all former joint
ventures involving or associated with such businesses and operations.
Former Ralston Employee: an individual who was employed in, or performed
-------------------------
duties primarily for, the Ralston Business or a Former Ralston Business at the
time of his or her termination or retirement and who was not subsequently, prior
to the Distribution Date, employed in the Battery Business or a Former Battery
Business.
Group: the Ralston Group or the Energizer Group.
-----
Indebtedness of the Energizer Group: external obligations of a member or
-------------------------------------
members of the Energizer Group in the form of money that is borrowed from third
party banks and/or financial institutions, to the extent that such indebtedness
(i) is incurred in connection with, or arising out of the operations of, the
Battery Business or is assigned to Energizer or a member of its Group as set
forth in Section 2.01(j)(iii); and (ii) is or should be reflected and booked on
the balance sheet statements of the Battery Business in accordance with
accounting policies of Ralston; and in no event shall intercompany or
intracompany accounts between the Battery Business and the Ralston Business be
deemed to be Indebtedness of the Energizer Group.
Indemnifiable Loss: with respect to any claim by an Indemnitee for
-------------------
indemnification hereunder, any and all losses, liabilities, claims, damages,
obligations, payments, costs and expenses (including, without limitation, the
costs and expenses of any and all Actions, demands, claims and assessments, and
any and all judgments, settlements and compromises related thereto and
reasonable attorney's fees and expenses in connection therewith) incurred or
suffered by such Indemnitee with respect to such claim except as may arise in
connection with the performance of any of the Ancillary Agreements, which shall,
in each such case, be governed by the terms of such Ancillary Agreement.
Indemnitee: as defined in Section 4.02 of this Agreement.
----------
Indemnitor: as defined in Section 4.02 of this Agreement.
----------
Information: as defined in Section 6.02 of this Agreement.
-----------
Information Statement: the information statement sent to holders of
----------------------
Ralston Stock in connection with the Distribution, which sets forth appropriate
disclosures concerning the Battery Business, Energizer, the Distribution and
other related matters.
IP Agreement: as defined in Section 5.03 of this Agreement.
-------------
IRS: the Internal Revenue Service.
---
ISP: the Ralston Purina 1988, 1996 and 1999 Incentive Stock Plans.
---
Liabilities: all claims, debts, liabilities, royalties, license fees,
-----------
losses, costs, expenses, deficiencies, litigation proceedings, taxes, levies,
imposts, duties, deficiencies, assessments, attorneys' fees, charges,
allegations, demands, damages, judgments, guaranties, indemnities, or
obligations, whether absolute or contingent, matured or unmatured, liquidated or
unliquidated, accrued or unaccrued, known or unknown and whether or not the same
would properly be reflected on a balance sheet, including all costs and expenses
relating thereto.
Notice of Claim: as defined in Section 4.02 of this Agreement.
-----------------
NYSE: the New York Stock Exchange.
----
Operating Agreement: an agreement as described in Section 2.04(f) in
--------------------
effect during a period of beneficial ownership of the Energizer Assets or the
Ralston Assets.
Person: an individual, a partnership, a joint venture, a corporation, a
------
trust or other entity, an unincorporated organization or a government or any
department or agency thereof.
Plan: any plan, policy, arrangement, contract or agreement providing
----
benefits (including salary, bonuses, deferred compensation, incentive
compensation, savings, stock purchases, pensions, profit sharing, welfare
benefits or retirement or other retiree benefits, including retiree medical
benefits) for any group of employees or former employees or individual employee
or former employee, or the beneficiary or beneficiaries of any such employee or
former employee, whether formal or informal or written or unwritten and whether
or not legally binding, and including any means, whether or not legally
required, pursuant to which any benefit is provided by an employer to any
employee or former employee or the beneficiary or beneficiaries of any such
employee or former employee.
Qualified Plan: a Plan which is an employee pension benefit plan (within
---------------
the meaning of Section 3(2) of ERISA) and which constitutes or is intended in
good faith to constitute a Qualified Plan under Section 401(a) of the Code.
Ralston: as defined in the recitals to this Agreement.
-------
Ralston Assets: except to the extent provided in, and subject to the
---------------
provisions of, any of the Ancillary Agreements, all of the Assets, other than
the Energizer Assets, used or held immediately prior to the Distribution Date by
or on behalf of any member of either Group, including, but not limited to, the
Assets set forth on Schedule 1.01(c).
Ralston Board: the Board of Directors of Ralston Purina Company and their
--------------
duly elected or appointed successors.
Ralston Business: all of the businesses owned, directly or indirectly, by
-----------------
Ralston immediately prior to the Distribution Date, other than the Battery
Business.
Ralston Chilean Asset Purchase Price: Cash paid, after the Distribution,
---------------------------------------
to Energizer or its Affiliates by Ralston or its Affiliates to effect the
purchase, as set forth in Section 2.01(e), of the Assets and Liabilities of the
Ralston Business conducted by Eveready de Chile S.A.
Ralston Deferred Compensation Plan: the Ralston Purina Deferred
-------------------------------------
Compensation Plan for Key Employees.
Ralston Employee: any individual who, as of the day prior to the
-----------------
Distribution Date, is an employee of any member of either Group, other than an
Energizer Employee.
Ralston Group: Ralston and its Affiliates after the Distribution.
--------------
Ralston Individual: any individual who is a Ralston Employee, a Former
-------------------
Ralston Employee, or a beneficiary or alternate payee of a Ralston Employee or
of a Former Ralston Employee.
Ralston Option: the option defined in Section 7.08(b) of this Agreement.
---------------
Ralston Retirement Plan: the Ralston Purina Retirement Plan, a defined
-------------------------
benefit pension plan.
Ralston Stock: Ralston Purina Company common stock, $.10 par value.
--------------
Record Date: March 31, 2000, determined by the Board of Directors of
------------
Ralston as the record date for determining shareholders of Ralston Stock
entitled to receive the Distribution.
Rights: the rights to be issued by Energizer pursuant to the Rights
------
Agreement between Energizer and Continental Stock Transfer and Trust Company.
SEC: the Securities and Exchange Commission.
---
Securities Act: the Securities Act of 1933, as amended, together with the
---------------
rules and regulations promulgated thereunder.
Shared Liability: a Liability arising out of, or associated with, the
-----------------
ownership of both the Energizer Assets and the Ralston Assets; or the operation
of the Battery Business or a Former Battery Business, on the one hand, and the
Ralston Business or a Former Ralston Business, on the other hand, prior to the
Distribution.
SIP: a Savings Investment Plan.
---
Subsidiary: with respect to any specified Person, any corporation or other
----------
legal entity of which such Person or any of its Subsidiaries controls or owns,
directly or indirectly, 50% or more of the stock or other equity interest
entitled to vote on the election of members to the board of directors or similar
governing body of such corporation or other legal entity.
Survivor Life Insurance Plan: the 1996 Split Dollar Second-To-Die Plan.
-------------------------------
Tax Sharing Agreement: as defined in Section 5.03 of this Agreement.
-----------------------
Third-Party Claim: any Action or claim by a third party against or
------------------
otherwise involving an Indemnitee for which indemnification may be sought
pursuant to Article IV hereof.
Welfare Plan: any Plan which is not a Qualified Plan and which provides
-------------
medical, health, disability, accident, life insurance, death, dental or other
welfare benefits, including any post-employment benefits or retiree medical
benefits.
1.02 References to Time. All references to times of the day in this
--------------------
Agreement shall refer to St. Louis, Missouri time unless otherwise specifically
indicated.
ARTICLE II
CERTAIN RESTRUCTURING TRANSACTIONS
2.01 Restructuring Transactions. Prior to the Distribution Date or, as
--------------------------
indicated, as soon as practicable thereafter, the following shall have been or
shall be effected:
(a) Reincorporation Merger. Eveready, the sole shareholder of
-----------------------
Energizer and EBII, shall surrender all of the issued and outstanding shares of
capital stock of EBII in a constructive exchange for all of the issued and
outstanding shares of capital stock of Energizer, pursuant to the General and
Business Corporation Law of Missouri and Delaware General Corporation Law, in
connection with EBII's reincorporation from Delaware to Missouri and merger into
Energizer.
(b) United Kingdom Restructuring. Energizer UK Company ("Energizer
------------------------------
UK"), a United Kingdom unlimited company, shall wholly redeem EII's partnership
interest in Energizer UK (the "Partnership Interest") by distributing to EII (i)
---
all of the stock of Energizer Holdings UK Company ("Energizer Holdings UK"), a
United Kingdom unlimited company, which owns all of the stock of the following
subsidiaries: (a) Energizer Limited, (b) Ever Ready Ltd; (c) Ralston Energy
Systems U.K. Ltd.; (d) BCL (MVL) Limited; (e) Berec Overseas Investments Ltd.,
(f) Energizer Ireland Ltd., (g) WER (MVL) (1998) Ltd., and (h) Ralston Trust
Limited, and; (ii) cash proceeds resulting from (a) a loan to Energizer UK by
Tower Holding Company, Inc. ("Tower Holding"), a Delaware corporation, and (b) a
contribution of capital by Ralston, such that the fair market value of (i) and
(ii) will equal the fair market value of the Partnership Interest. The value of
the Partnership Interest and the value of Energizer Holdings UK shall be
determined by an independent appraisal.
(c) Mexican Restructuring. Ralston Purina Holdings Mexico S.A. de C.V.
---------------------
("RP Holdings Mexico"), a Mexican corporation, shall capitalize a portion of the
intercompany debt owed to it by its wholly owned Subsidiary, Eveready de Mexico
S.A. de C.V. ("Eveready Mexico"), such that the resulting value of Eveready de
Mexico will equal EII's interest in RPHM. Eveready de Mexico shall borrow from
outside parties an amount necessary to pay off its remaining intercompany debt
to RPHM prior to the Distribution. Prior to the Distribution Date, or as soon
as practicable thereafter, RP Holdings Mexico shall distribute all of the
capital stock of Eveready Mexico to EII in complete redemption of EII's entire
stock interest in RP Holdings Mexico.
(d) Brazilian Restructuring. EII shall form a new, wholly owned
------------------------
Subsidiary, Energizer do Brasil, Ltda.("Energizer do Brasil"), a Brazilian
corporation. Ralston Purina do Brasil Ltda.("RP do Brasil"), a Brazilian
corporation, shall sell to Energizer do Brasil all of the Assets and Liabilities
associated with its ownership and operation of the Battery Business in Brazil,
other than external debt, all of which RP do Brasil shall retain. The
purchase price shall be equal to the statutory net book value of such Business
as of March 31, 2000, excluding such external debt. Prior to the Distribution
Date, EII shall distribute to Ralston in the form of a dividend all of its stock
interest in RP do Brasil. Prior to the Distribution, EII will also assign to
Checkerboard Holding Company ("Checkerboard Holding"), a Delaware corporation,
an intercompany note evidencing debt owed from RP do Brasil to EII.
(e) Argentinean/Chilean Restructuring. Prior to the Distribution Date
----------------------------------
or as soon as practicable thereafter, Checkerboard Holding shall form a new
wholly owned Subsidiary, Ralston Purina Chile, S.A. ("RP Chile"), a Chilean
corporation. Eveready de Chile S.A. ("Eveready Chile"), a Chilean corporation,
will sell the Assets and Liabilities of the Ralston Business conducted by it to
RP Chile. The purchase price shall be determined by an independent appraisal
less debt. Prior to the Distribution Date, EII will transfer to Checkerboard
Holding, and Eveready Battery Company will transfer to Tower Holding, that
portion of the stock of Ralston Purina Argentina S.A. ("RP Argentina"), an
Argentinean corporation, held by each transferor company reflecting the relative
value of their respective interests in the Ralston Business conducted by RP
Argentina. Prior to the Distribution Date or as soon as practicable thereafter,
in accordance with Argentinean law, RP Argentina will divide into two
Argentinean corporations, one conducting the Battery Business and the other
conducting the Ralston Business, as follows: (i) RP Argentina will transfer all
of its stock interest in Eveready Chile, and the Assets and Liabilities of the
Battery Business conducted by RP Argentina to Energizer Argentina, a newly
created Argentinean corporation resulting from the division of RP Argentina,
having the same shareholders, with identical share ownership proportions, as RP
Argentina; and (ii) Checkerboard Holding and Tower Holding will then each
exchange their shares of Energizer Argentina for the shares of RP Argentina
held, respectively, by EII and Eveready. EII and Eveready will then be sole
shareholders of Energizer Argentina, which will conduct the Battery Business in
Argentina and will be the parent company of Eveready Chile; and Checkerboard
Holding and Tower Holding will then be sole shareholders of RP Argentina, which
will conduct the Ralston Business in Argentina.
(f) Spanish Restructuring. Ralston Energy Systems Iberica S.A.
----------------------
("RESIB"), a Spanish corporation, which indirectly conducts the Battery Business
in Spain through its 91% owned Subsidiary Energizer Iberia S.A., also a Spanish
corporation, will sell all of the issued and outstanding stock of its wholly
owned Subsidiary Ralston Purina Europe S.A ("RPE"), which directly conducts the
Ralston Business, to Checkerboard Holding for an amount determined by an
independent appraisal.
(g) Distribution of Energizer Stock to VCS Holding. Following (i) the
------------------------------------------------
transaction described in paragraph 2.01(a), and (ii) those of the transactions
described in paragraphs 2.01(b) through (f) which have been completed prior to
the Distribution Date, Eveready will distribute by dividend all the stock of
Energizer to VCS Holding Company ("VCS"), a Delaware corporation and wholly
owned Subsidiary of Ralston.
(h) Merger of VCS Holding into Ralston. Ralston and VCS shall enter
--------------------------------------
into an Agreement and Plan of Merger and Complete Liquidation pursuant to which
VCS shall be merged with and into Ralston pursuant to the General and Business
Corporation Law of Missouri and Delaware General Corporation Law, and in
accordance with the terms and conditions of such merger agreement. Prior to
such merger, VCS shall transfer to Tower Holding, as a contribution to capital,
all shares of capital stock of Interstate Bakeries Corporation held by VCS as
well as all receivables reflecting intercompany loans by VCS to Ralston.
Following the merger, VCS will cease to exist, and Ralston shall become the
direct owner of Energizer and all other stock interests and Assets owned by VCS
at the time of the merger, including, but not limited to, notes reflecting
intercompany loans by VCS to Eveready ("the Eveready Notes"). The intercompany
account owed by Ralston to VCS shall be extinguished incident to the merger of
VCS into Ralston.
(i) Canadian Restructuring. Ralston shall contribute a portion of its
-----------------------
capital stock in Ralston Purina Canada Inc. ("RP Canada") to Energizer so that
the number of shares of RP Canada stock owned by Energizer, when combined with
the number of shares of RP Canada stock owned by EII, will reflect, on a
combined stock ownership basis, an interest in RP Canada equal to the appraised
value of the Battery Business conducted by RP Canada. EII and Energizer will
form a new Canadian corporation, Energizer Canada Inc., and will each transfer
all of their stock in RP Canada to Energizer Canada Inc. in exchange for
Energizer Canada Inc. common stock of proportionate value. RP Canada will
transfer the Assets and Liabilities of the Battery Business conducted by it to
Energizer Canada Inc. in exchange for all of the issued and outstanding
preferred stock in Energizer Canada Inc. RP Canada will then issue a note to
Energizer Canada Inc. in complete redemption of the RP Canada common stock held
by Energizer Canada Inc., and Energizer Canada Inc. will issue to RP Canada a
note of equal value in redemption of the Energizer Canada Inc. preferred stock
held by RP Canada. The two notes will then be offset against one another and
each cancelled. Ralston will thereupon own all of the stock of RP Canada, which
will conduct only the Ralston Business, and EII and Energizer will in the
aggregate own all of the stock of Energizer Canada Inc., which will conduct only
the Battery Business.
(j) Other Post-Merger Transfers/Debt Assumption. Following the merger
--------------------------------------------
described in Section 2.01(h) and the restructuring described in Section 2.01(i),
the following transactions will take place prior to the Distribution Date:
(i) Ralston will transfer the Eveready Notes to MKTE, Inc., a newly
formed Delaware corporation and first tier Subsidiary of Ralston.
(ii) Ralston will transfer to Energizer all of the stock of Eveready;
will cause the transfer to Eveready of all of the stock of EII and MKTE; and
will cause the transfer to EII of all of the stock of Energizer Japan,
Inc., a Delaware corporation.
(iii) Ralston will enter into certain credit facility agreements to
borrow funds from third party banks and/or financial institutions and will
assign to Energizer all obligations, including, but not limited to, the
obligation to make payments of principal and interest to the lenders
arising out of or in connection with such credit facility agreements, other
than for certain fees set forth in Section 12.04. The sum of such debt
assumed by Energizer, plus other Indebtedness of the Energizer Group, is
intended to equal total Indebtedness of the Energizer Group, net of Cash, of
US$586.8 million as of the close of business on March 31, 2000.
2.02 Issuance of Stock. Prior to the Distribution Date, the parties
-------------------
hereto shall take all steps necessary so that immediately prior to the
Distribution Date, the number of shares of Energizer Stock outstanding and held
by Ralston shall equal the number of shares necessary to effect the
Distribution. The Distribution shall be effected by distributing, on a pro rata
basis to every holder of Ralston Stock, one share of Energizer Stock for every
three shares of Ralston Stock held as of the Record Date.
2.03 Share Purchase Rights Agreement; Articles of Incorporation;
-----------------------------------------------------------------
Bylaws. Prior to the Distribution Date, Energizer shall adopt an Energizer
Rights Agreement in substantially the form filed with the SEC as an exhibit to
the Form 10, and the Board of Directors of Energizer shall authorize a
distribution of one Right to every share of outstanding Energizer Stock, such
distribution to occur prior to the Distribution. Ralston and Energizer shall
take all action necessary so that, at the Distribution Date, the Articles of
Incorporation and Bylaws of Energizer shall be substantially in the forms filed
with the SEC as exhibits to the Form 10.
2.04 Transfer of Assets; Assumption of Liabilities.
--------------------------------------------------
(a) Prior to the Distribution Date, the parties hereto shall cooperate in
taking all action necessary to convey, assign and transfer to Energizer or its
Affiliates, effective no later than the Distribution Date, all of the right,
title and interest in the Energizer Assets held by any member of the Ralston
Group, and to convey, assign and transfer to Ralston or its Affiliates all of
the right, title and interest in the Ralston Assets held by any member of the
Energizer Group. Effective as of the Distribution Date, Energizer and its
Affiliates shall become the beneficial owners of all of the Energizer Assets,
and Ralston and its Affiliates shall remain the beneficial owners of all of the
Ralston Assets. The parties acknowledge that formal actions to effect fully the
legal transfers of such Assets may not be completed by the Distribution Date,
but that the entire beneficial title and interest in and to each Asset shall
pass to Energizer or remain with Ralston, as the case may be, as of the
Distribution Date. The parties shall take such action as is necessary in their
reasonable discretion, whether before or after the Distribution Date, to
complete the transfer of the Energizer Assets to the Energizer Group and the
Ralston Assets to the Ralston Group, as the case may be, and each party shall
cooperate fully with the other in such regard.
Ralston and Energizer shall cooperate in estimating the appropriate amount of
Cash to be transferred to or from members of the Energizer Group on or before
March 31, 2000 to cause the Energizer Group to hold, as of the close of business
on March 31, 2000, Cash in such an amount that would cause the Indebtedness of
the Energizer Group, at the close of business on such date, to equal US$586.8
million, net of such Cash. The parties shall use reasonable efforts to cause
the transfer of Cash to or from Energizer to effect this provision.
(b) As of the Distribution Date, Energizer and Ralston and, as
appropriate, other members of their respective Groups, shall assume or retain
all of the Liabilities, with respect to Energizer, of the Battery Business and
Former Battery Businesses and, with respect to Ralston, of the Ralston Business
and Former Ralston Businesses, of whatsoever type or nature, arising exclusively
out of or associated exclusively with the ownership of the Assets of such
Businesses or Former Businesses or the operation of such Businesses or Former
Businesses prior to the Distribution, whether such Liabilities become known
prior to or after, or are asserted prior to or after, the Distribution. Unless
otherwise provided in this Agreement or any Schedule hereto, Energizer and its
Affiliates and Ralston and its Affiliates shall assume (or retain, as the case
may be) a share of any Shared Liability in proportion, as applicable, to their
respective ownership of the relevant Assets, control of affected operations or
employment of affected individuals. Shared Liabilities shall include, but not
be limited to, those set forth on Schedule 2.04(b)(1). Notwithstanding the
foregoing, effective as of the Distribution Date, Energizer or another member of
the Energizer Group shall assume or retain Liabilities specifically described in
any other provision of this Agreement or any Ancillary Agreement, and
Liabilities described on Schedule 2.04(b)(2) to this Agreement. Ralston and
members of the Ralston Group shall, except as qualified hereinabove, assume or
retain the Liabilities specifically described in this Agreement or any Ancillary
Agreement, and the Liabilities specifically described on Schedule 2.04(b)(3) to
this Agreement.
(c) The parties agree and acknowledge that the assumption or retention by
Energizer or other members of the Energizer Group or Ralston or other members of
the Ralston Group, as the case may be, of all such Liabilities described herein
is part of a single plan to transfer the Battery Business and the Energizer
Assets to Energizer as of the Distribution Date. With regard to that plan, the
parties further agree that (i) the entire beneficial title and interest in and
to each and all of the Energizer Assets shall, regardless of when legal title to
any such asset is in fact transferred to Energizer or its Subsidiaries, remain
in Ralston until the Distribution Date at which time all beneficial title and
interest in all of the Energizer Assets will pass to Energizer, and all title
and interest in and to each and all of the Ralston Assets which is owned by a
member of the Energizer Group prior to the Distribution Date shall, regardless
of when legal title to any such asset is in fact transferred to Ralston or its
Subsidiaries after the Distribution Date, be beneficially owned by Ralston; (ii)
the economic burden of the assumption or retention by the members of the
Energizer Group or the Ralston Group, as the case may be, of each and all of the
Liabilities described herein shall pass to the Energizer Group or the Ralston
Group, as the case may be, as of the Distribution Date, regardless of when
Energizer or any other member of the Energizer Group or Ralston or any other
member of the Ralston Group, as the case may be, in fact assumes or becomes
legally obligated to the obligee of any one or more of such Liabilities; and
(iii) all operations of the Battery Business shall be for the account of Ralston
through 12:01 a.m. on the Distribution Date and shall be for the account of
Energizer thereafter.
(d) Ralston and Energizer shall, and shall cause their Affiliates to,
execute prior to, or as soon as practicable following, the Distribution Date,
such additional agreements and arrangements as may be necessary or appropriate
(i) to effect the restructuring transactions set forth in Section 2.01; (ii) to
transfer to the appropriate member of the Energizer Group or Ralston Group such
local product registrations, franchises, licenses, and any other governmental
authorizations or other rights owned or held by Ralston, Energizer or their
respective Groups that are necessary to the conduct of their Businesses in such
jurisdiction; (iii) to make all such further assignments and do all such other
acts as are necessary or desirable to carry out the intent of the parties that
each of the Businesses, as a going concern, be fully vested in the appropriate
party as of the Distribution Date and operated for its benefit and burden as of
12:01 a.m. on the Distribution Date; and (iv) to provide for, and negotiate in
good faith, such other agreements and arrangements relating to the foregoing as
the parties deem appropriate, including, but not limited to, any such agreements
or arrangements relating to the treatment of employees, benefit plans,
intellectual property and taxes.
(e) If any Energizer Asset or Ralston Asset is not owned, respectively,
by a member of the Energizer Group or Ralston Group or leased from a third party
or governmental entity by a member of the appropriate Group, as of the
Distribution Date, Ralston and Energizer shall use their reasonable best efforts
to transfer, assign and deliver such assets or leases to the appropriate member
of the other Group as soon as practicable thereafter.
Prior to such transfer or assignment, Ralston or Energizer, as the case may be,
shall use its reasonable best efforts to give the benefits of ownership of such
Assets to the appropriate member of the other Group. The entire economic
beneficial interest in and to, and the risk of loss with respect to, such Assets
shall, regardless of when legal title thereto shall be transferred to the
appropriate member of the Energizer or Ralston Group, pass to those entities as
of the Distribution. Ralston and Energizer shall, or shall cause their
Affiliates to, hold such Assets for the benefit and risk of the other and shall
cooperate with the other in any lawful and reasonable arrangements designed to
provide the benefits of ownership of the Assets to it, including, but not
limited to, properly recording evidence of such beneficial ownership and risk of
loss with appropriate governmental entities as required by applicable law.
In the event that the legal interest in such Assets or any claim, right or
benefit arising thereunder or resulting therefrom, is not capable of being sold,
assigned, transferred or conveyed hereunder as a result of the failure to
receive any consents or approvals required for such transfer, then the legal
interest in such Assets shall not be sold, assigned, transferred or conveyed
unless and until approval, consent or waiver thereof is obtained. Ralston and
Energizer shall, or shall cause their Affiliates, at their expense, to use
reasonable best efforts to cooperate in obtaining such consents or approvals as
may be necessary to complete such transfers and to obtain satisfaction of
conditions to transfer as soon as practicable.
Nothing in this Agreement shall be construed as an attempt to assign to a member
of the Energizer Group or the Ralston Group any legal interest in such Assets
which, as a matter of law or by the terms of any legally binding contract,
engagement or commitment to which the legal owner is subject, is not assignable
without the consent of any other Person, unless such consent shall have been
given.
(f) After the Distribution Date, Ralston and Energizer shall cause such
Assets (including the capital stock of any Affiliates) which are beneficially
owned by the other party to be managed at the direction of the beneficial owner
pursuant to one or more Operating Agreements until such Assets are actually
legally transferred and conveyed. Without limiting the foregoing, all revenues,
earnings and cash flows associated with the Assets following the Distribution
Date shall be for the account of the beneficial owner but shall be retained by
the respective legal owner until the transfers are legally effected. Following
the Distribution Date, neither Ralston nor Energizer shall be required to lend,
advance, contribute or use any of its own funds in connection with the
operations of such Assets except to the extent contemplated by the Operating
Agreements.
(g) Ralston and Energizer shall cooperate after the Distribution Date
in determining the actual Indebtedness of the Energizer Group and Cash held by
members of the Energizer Group as of the close of business on March 31, 2000 in
order to determine if a further transfer of Cash is required between the
parties. A preliminary determination of the actual Cash and Indebtedness of the
Energizer Group shall be made no later than 60 days after the Distribution Date
in order to make a preliminary adjustment of Cash from Ralston to Energizer or
vice versa, as the findings warrant.
In addition, the parties shall determine the value of checks and other forms of
electronic payments, written or authorized by Energizer or its Affiliates on
their U.S. bank accounts, which are outstanding and have not cleared as of March
31, 2000. If the aggregate value of such outstanding checks and payments was
less than $10 million, then the target Indebtedness of Energizer, net of Cash,
shall remain $586.8 million. If the aggregate value of such checks and payments
was greater than $10 million, then the target Indebtedness of Energizer, net of
Cash, shall be reduced dollar for dollar by an amount equal to the value of such
outstanding checks in excess of $10 million. For purposes of this Section
2.04(g), checks outstanding shall not be deemed to include checks issued in
connection with obligations under any Plans with respect to Energizer
Individuals.
If it is determined that actual Indebtedness of the Energizer Group, net of
Cash, exceeded US$586.8 million (adjusted, if applicable, pursuant to the
preceding paragraph) as of the close of business on March 31, 2000, Ralston
shall pay an amount equal to such excess to Energizer in US dollars.
Conversely, if it is determined that actual Indebtedness of the Energizer Group,
net of Cash, fell short of US$586.8 million (adjusted, if applicable, pursuant
to the preceding paragraph) as of the close of business on March 31, 2000,
Energizer shall pay an amount equal to such shortfall to Ralston in US dollars.
Alternatively, the parties may, by mutual consent, cause such amounts to be paid
by any member of one Group to any member of the other Group in local currency.
Any Cash paid to Ralston by Energizer pursuant to this Section 2.04(g) shall be
used to repay third party indebtedness of Ralston.
Ralston shall have the opportunity to review, to its satisfaction, the books and
records of Energizer and its Affiliates, bank records, loan documentation and
other relevant materials in order to enable Ralston to verify any amounts to be
transferred, and Energizer shall cooperate in Ralston's review. Payment of such
preliminary adjustment shall be made within fifteen (15) Business Days of such
determination. In addition, such amounts shall be increased by an amount equal
to simple interest accrued on such unpaid excess (or shortfall, as applicable)
at the rate of 7% per annum for the period from the Distribution Date until the
date such preliminary adjustment is paid to the party to which it is owed.
As soon as practicable after the end of its third fiscal quarter, but no later
than August 10, 2000, Energizer will present to Ralston a draft of its Quarterly
Report on Form 10Q for such quarter, indicating an opening shareholders' equity
balance for Energizer as of April 1, 2000, which balance shall reflect all asset
and liability transfers pursuant to the terms of this Agreement, including, but
not limited to, any Cash to be transferred between the parties under the
provisions of this Section 2.04(g), other than Cash which may be required to be
transferred pursuant to the following paragraph. Ralston shall have the
opportunity to review the books and records of Energizer and its Affiliates in
order to enable it to verify said shareholders' equity balance, and Energizer
shall cooperate in Ralston's review. As part of such review, Ralston shall
verify the calculations of the Indebtedness of the Energizer Group and Cash held
by Energizer and its Affiliates as of March 31, 2000, and shall make, if
necessary, a final adjustment to the amounts to be transferred as described
above. Such final adjustments shall be increased by an amount equal to simple
interest accrued on such adjustments at 7% per annum for the period from the
date of any preliminary adjustment as described above, until the date such final
adjustment is paid to the party to which it is owed. If such final adjustments
are made, the opening shareholders' equity balance for Energizer as of April 1,
2000, as described above, shall be revised to reflect such adjustments.
In the event that the opening shareholders' equity balance of Energizer as
of April 1, 2000, revised in the manner described above, is less than US$625
million, then Ralston shall pay to Energizer, no later than August 14, 2000, an
amount of Cash so as to cause the opening shareholders' equity balance to equal
US$625 million following such payment. If such additional payment is required,
the amount paid shall be increased by an amount equal to simple interest accrued
on such amount at the rate of 7% per annum for the period from the Distribution
Date until the date of payment. Energizer shall revise its Quarterly Report on
Form 10Q to reflect such revised opening shareholders' equity balance.
(h) Ralston shall pay to Energizer in US dollars, at the time of
payment of the Ralston Chilean Asset Purchase Price to a member of the Energizer
Group, an additional lump sum equal to interest on such purchase price,
denominated in US dollars at the time of payment to Energizer, accrued at the
simple interest rate of 7% per annum, for the period beginning on the
Distribution Date to the date such purchase price is paid to the Energizer
Affiliate.
(i) Calculations of equivalent values of US and foreign currencies
shall, for purposes of this Agreement, be based on foreign exchange rates for
the relevant date or dates as reflected in accordance with accounting practices
historically employed by Ralston.
2.05 Conduct of Business Pending the Distribution Date. Prior to the
---------------------------------------------------
Distribution Date, the Battery Business shall be operated for the sole benefit
of Ralston.
2.06 Registration and Listing. Prior to the Distribution Date:
--------------------------
(a) Ralston and Energizer shall prepare, and Energizer shall file with the
SEC, a Registration Statement on Form 10 pursuant to Section 12(b) of the
Exchange Act with respect to the Energizer Stock and associated Rights. Ralston
and Energizer shall use reasonable efforts to cause the Form 10 to become
effective under the Exchange Act, and, following such effectiveness, Ralston
shall mail the Information Statement to the holders of record of Ralston Stock
as of the close of business on the Record Date.
(b) The parties hereto shall take all such actions as may be necessary or
appropriate under state securities and Blue Sky laws in connection with the
Distribution.
(c) Ralston and Energizer shall prepare, and Energizer shall file and seek
to make effective, an application for the listing of the Energizer Stock and
associated Rights on the NYSE.
2.07 Ralston Purina Charitable Fund.
---------------------------------
(a) Energizer shall take, or cause to be taken, all necessary and
appropriate actions to establish, effective as of (or as soon as practicable
following) the Distribution Date, a charitable trust or a nonprofit corporation
which is exempt from Federal income taxation under Code Section 501(c)(3) (the
"Energizer Charitable Foundation"). Ralston shall, as soon as practicable
following the Distribution Date, in accordance with subparagraph (b) below,
cause the Trustee of the Ralston Purina Charitable Fund, a trust fund exempt
under Code Section 501(c)(3), to transfer to the Energizer Charitable
Foundation, an amount in cash and other liquid investment assets held in the
Ralston Purina Charitable Fund with an aggregate value equal to one-third (1/3)
of the fair market value of the assets of the Ralston Purina Charitable Fund as
of the Distribution Date, as determined by the Trustee of the Ralston Purina
Charitable Fund (the "Charitable Transfer Amount"). The date of such transfer
shall be the "Charitable Transfer Date." The Charitable Transfer Amount shall
include earnings (taking into account any appreciation or depreciation of the
assets) for the period from the Distribution Date to the Charitable Transfer
Date (the "Earnings Period"), net of a proportionate share of related investment
fees, expenses and any taxes incurred by the Ralston Purina Charitable Fund for
the Earnings Period. The earnings rate (which may be positive or negative)
shall be the investment rate of return on the assets of the Ralston Purina
Charitable Fund during the Earnings Period, as determined by the Ralston
Trustee.
Energizer shall cause the Energizer Charitable Foundation to assume, as of the
Distribution Date, the obligation to pay certain pledge commitments of the
Ralston Purina Charitable Fund as set forth in Schedule 2.07; provided however,
that the present value as of the Distribution Date, as determined by the Ralston
Trustee, of such pledge commitments assumed by the Energizer Charitable
Foundation shall be no greater than the Charitable Transfer Amount. Energizer
shall timely notify, or shall cause the Energizer Charitable Foundation to
timely notify, in writing the recipients of such pledge commitments of its
assumption of such obligations from the Ralston Purina Charitable Fund. Any
pledge commitments entered into by the Energizer Charitable Foundation
subsequent to the Distribution Date shall be the sole obligation of the
Energizer Charitable Foundation and shall not be satisfied prior to the
Charitable Transfer Date with any assets held by the Ralston Purina Charitable
Fund on behalf of the Energizer Charitable Foundation. The Energizer Charitable
Foundation shall have no obligation to assume or satisfy any pledge commitment
of the Ralston Purina Charitable Fund that arises subsequent to the Distribution
Date other than those set forth in Schedule 2.07.
(b) If any of the pledge commitments assumed by the Energizer
Charitable Foundation as set forth on Schedule 2.07 become due and payable prior
to the Charitable Transfer Date, the Ralston Purina Charitable Fund shall
satisfy such pledge commitments on behalf of the Energizer Charitable Foundation
and the Charitable Transfer Amount shall be reduced by the amount of such pledge
commitments paid by the Ralston Purina Charitable Fund. As used herein, a
"pledge commitment" shall mean any commitment of the Ralston Purina Charitable
Fund to make a contribution of cash or other property or services for a purpose
described in Code Section 170(c)(2)(B). Contributions received by the Ralston
Purina Charitable Fund subsequent to the Distribution Date shall be the sole
property of the Ralston Purina Charitable Fund and shall not be considered
assets subject to transfer under this Agreement. Contributions received by the
Energizer Charitable Foundation subsequent to the Distribution Date shall be the
sole property of the Energizer Charitable Foundation.
Notwithstanding the foregoing, the transfer of assets and the assumption of
pledge commitments described in subparagraph (a) (the "Charitable Transfer")
shall be conditioned upon the following: (i) the consummation of the
Distribution as contemplated under this Agreement; (ii) the receipt of a
determination letter from the Internal Revenue Service that the Energizer
Charitable Foundation, and any successor to the Ralston Purina Charitable Fund
if its formation is necessary to consummate the Charitable Transfer (the
"Ralston Successor Fund"), is exempt under Code Section 501(c)(3); (iii) the
receipt by Ralston of a private letter ruling from the Internal Revenue Service
(A) determining whether the Charitable Transfer imposes any "expenditure
responsibility" on Ralston or the Ralston Charitable Fund pursuant to Code
Section 4945; and (B) holding that the Charitable Transfer does not violate the
Code Section 501(c)(3) exemption of the Ralston Purina Charitable Fund or the
Ralston Successor Fund, nor result in any taxes under Code Section 507 or
Chapter 42 of the Code; and (iv) the execution by the Ralston Charitable Fund
and the Energizer Charitable Foundation of a grant agreement satisfactory to
Ralston, to the extent required under Code Section 4945. Ralston and Energizer
shall cooperate fully and use their best efforts to satisfy the conditions of
the Charitable Transfer. Ralston and Energizer shall, and shall cause each
member of the Ralston Group and Energizer Group, respectively, to refrain from
taking any action which would adversely impact the receipt of any favorable
ruling or determination letter obtained from the IRS or the continued validity
of such ruling or letter as contemplated in this subparagraph (b).
(c) Energizer shall cause the Energizer Charitable Foundation to
cooperate fully and take all steps necessary as requested by the Ralston
Charitable Fund to satisfy any "expenditure responsibility" Ralston or the
Ralston Charitable Fund may retain with respect to the Energizer Charitable
Foundation, in accordance with Code Section 4945. Ralston and Energizer shall
if feasible structure the Charitable Transfer in a manner that will minimize any
and all costs related to the Charitable Transfer, including any taxes imposed by
Code Section 507(c) and Chapter 42 of the Code.
ARTICLE III
THE DISTRIBUTION
3.01 Record Date and Distribution Date. Subject to the satisfaction of
---------------------------------
the conditions set forth in Section 12.01, the Ralston Board shall establish the
Record Date and the Distribution Date and any appropriate procedures in
connection with the Distribution. The determination of record holders of
Ralston Stock on the Record Date shall be as of the close of business on March
31, 2000, and the Distribution shall be effective as of 12:01 a.m. on the
Distribution Date.
3.02 Distribution. Ralston shall distribute all of the outstanding
------------
shares of Energizer Stock to holders of record of Ralston Stock on the Record
Date on the basis of one share of Energizer Stock for each three shares of
Ralston Stock outstanding as of 12:01 a.m. on the Distribution Date, subject to
the treatment of fractional shares set forth in Section 3.03. All shares of
Energizer Stock issued in the Distribution shall be duly authorized, validly
issued, fully paid and nonassessable.
3.03 Payment in Lieu of Fractional Shares. No fractional shares of
----------------------------------------
Energizer Stock shall be issued in the Distribution. In lieu thereof, a
distribution agent will aggregate fractional shares into whole shares and sell
them in the open market at then prevailing prices on behalf of holders who
otherwise would be entitled to receive fractional share interests, and such
distribution agent shall remit to each holder of Ralston Stock who would
otherwise be entitled to receive such fractional shares a cash payment equal to
such holder's pro rata share of the total gross sale proceeds (after making
appropriate deductions of the amount required to satisfy legal requirements).
Ralston shall bear the cost of commissions incurred in connection with such
sales.
ARTICLE IV
INDEMNIFICATION
4.01 Indemnification.
---------------
(a) From and after the Distribution Date, Ralston agrees to indemnify and
hold harmless Energizer against and in respect of any and all Liabilities
assumed or retained by Ralston pursuant to Section 2.04(b) of this Agreement
and/or related to, arising from, or associated with:
(i) any breach or violation of any covenant made in this Agreement or
any Ancillary Agreement by Ralston or any of its Affiliates;
(ii) any Third-Party Claim relating to the actions of the Ralston Board
in authorizing the Distribution;
(iii) the ownership, use or possession of the Ralston Assets or the
operation of the Ralston Business or Former Ralston Businesses, whether relating
to or arising out of occurrences prior to or after the Distribution, except to
the extent liability therefor is specifically assumed or retained by Energizer
or another member of the Energizer Group pursuant to Section 2.04(b) of this
Agreement; and all operations conducted by Ralston, its successors and their
Affiliates following the Distribution.
(iv) with respect to the operation or administration of Plans by
Ralston Employees, Former Ralston Employees or agents of Ralston or the Ralston
Business, Ralston's failure to comply with the provisions of a Plan or
applicable laws and regulations prior to or after the Distribution;
(v) any violations of the Code, or of federal or state securities laws,
in connection with the Distribution, the Information Statement and Form 10 or
any filings made with governmental agencies with respect thereto, except to the
extent that such violations, or allegations of violations, result from or are
related to the disclosure to Ralston's corporate staff of information, or
failure to disclose information, by officers, directors, employees, agents,
consultants or representatives of the Battery Business; and
(vi) any activity (other than the Charitable Transfer as
described in Section 2.07), operation, expenditure, distribution, act or
failure to act by the Ralston Purina Charitable Fund prior to the Charitable
Transfer, including any transferee or similar liability. Such indemnification
for any and all costs and expenses shall include any tax, penalty, interest or
litigation expense that may be incurred by or imposed on Energizer or
the Energizer Charitable Foundation.
Any indemnification provided for under this Section shall, to the extent legally
permissible, also be deemed to extend to other members of the Energizer Group,
Affiliates, Energizer Charitable Foundation, Energizer Employees, directors,
Plan fiduciaries, shareholders, agents, consultants, representatives,
successors, transferees and assigns of Energizer or members of the Energizer
Group.
(b) From and after the Distribution Date, Energizer agrees to indemnify
and hold harmless Ralston against and in respect of all Liabilities assumed or
retained by Energizer or another member of the Energizer Group pursuant to
Section 2.04(b) of this Agreement and/or related to, arising from, or associated
with:
(i) any breach or violation of any covenant made in this Agreement or
any Ancillary Agreement by Energizer or any of its Affiliates;
(ii) the ownership, use or possession of the Energizer Assets or the
operation of the Battery Business or Former Battery Businesses, whether relating
to or arising out of occurrences prior to or after the Distribution, except to
the extent liability therefor is specifically assumed or retained by Ralston or
another member of the Ralston Group pursuant to Section 2.04(b) of this
Agreement; and all operations conducted by Energizer, its successors and their
Affiliates following the Distribution;
(iii) with respect to the operation or administration of Plans by
Energizer Employees, Former Energizer Employees or agents of Energizer or the
Battery Business, Energizer's failure to comply with the provisions of a Plan or
applicable laws and regulations prior to or after the Distribution;
(iv) any violation or allegations of violations of federal or state
securities laws in connection with the Distribution, the Information Statement
and Form 10 or any filings made with governmental agencies with respect thereto,
to the extent that such violations, or allegations of violations, result from or
are related to, the disclosure to Ralston's corporate staff of information, or
failure to disclose information, by officers, directors, employees, agents,
consultants or representatives of the Battery Business;
(v) any and all obligations and Liabilities of Ralston (other than
certain fees set forth in Section 12.04) related to, or arising in connection
with, Energizer's establishment of a $175 million private placement of unsecured
notes, Ralston's and Energizer's establishment of a $450 million bank
syndication credit facility and Energizer's establishment of a $200 million
credit facility for the purpose of selling, on a revolving basis, undivided
ownership interest in accounts receivable of the Battery Business;
(vi) the Charitable Transfer, as described in Section 2.07 hereunder,
including any taxes imposed by Code Sections 170, 507(c), or Chapter 42 of the
Code, any penalty, interest or litigation expense that may be incurred by or
imposed on Ralston, the Ralston Purina Charitable Fund or Successor Fund,
including, without limitation, costs arising as a result of (i) the Ralston
Purina Charitable Fund's retaining expenditure responsibility with respect to
such assets; (ii) Ralston's status as a "substantial contributor" with respect
to the Energizer Charitable Foundation in accordance with Code Section 507;
(iii) the Charitable Transfer's being treated as a "significant disposition of
assets" under Code Section 507, and (iv) any failure of the Energizer Charitable
Foundation to satisfy the pledge commitments assumed from the Ralston Purina
Charitable Fund;
(vii) any occurrence, conduct or action of or involving Energizer,
any member of the Energizer Group, Energizer Affiliates, Energizer Indivi-
duals, directors, Plan fiduciaries, shareholders, agents, consultants, represen-
tatives, successors, transferees or assigns of Energizer or members of the
Energizer Group, which is alleged to constitute a breach or violation of
either Section 6.01 of the DuPont Agreement, or Section 5.01 of the Agree-
ment and Plan of Reorganization dated as of April 1, 1998 by and between Ral-
ston and Agribrands International, Inc; and
(viii) any Liabilities of Ralston arising out of any amendments which
may be adopted by Energizer or its Affiliates, as permitted under Section 7.18
of this Agreement, with respect to Plans affecting Energizer Individuals.
Any indemnification provided for under this Section shall, to the extent
legally permissible, also be deemed to extend to other members of the Ralston
Group, Affiliates, Ralston Employees, directors, Plan fiduciaries, the Ralston
Charitable Fund, shareholders, agents, consultants, representatives, successors,
transferees and assigns of Ralston or members of the Ralston Group.
(c) For purposes of this Section 4.01, an Energizer Employee or Former
Energizer Employee shall be considered an agent of Ralston or the Ralston
Business only if such individual acted pursuant to direction from a person who,
at the time of the direction, was an employee of the Ralston Business (including
employees of the corporate division of Ralston). A Ralston Employee or Former
Ralston Employee shall be considered an agent of Energizer or the Battery
Business only if such individual acted pursuant to direction from a person who,
at the time of the direction, was an employee of the Battery Business.
(d) Except with respect to Liabilities subject to Section 4.01(b)(vii), a
party shall have no right to indemnification under this Article IV until the
cumulative aggregate dollar amount of all Liabilities to which this Article
applies equals or exceeds US$250,000 with respect to such party. Liabilities of
any amount shall be included in the computation of the cumulative aggregate
dollar amount of Liabilities, but, except with respect to Liabilities subject to
Section 4.01(b)(vii), neither party shall be entitled to indemnification for any
single Liability of less than US$25,000. Energizer shall indemnify and hold
harmless Ralston against and in respect of all Liabilities subject to Section
4.01(b)(vii), regardless of the amount or nature thereof.
4.02 Actions and Claims Other Than Third-Party Claims; Notice and
------------------------------------------------------------------
Payment. Upon obtaining knowledge of any Action, Liability or claim, other than
Third-Party Claims, which any Person entitled to indemnification (the
"Indemnitee") believes may give rise to any Indemnifiable Loss, the Indemnitee
shall promptly notify the party liable for such indemnification (the
"Indemnitor") in writing of such Action or claim (such written notice being
hereinafter referred to as a "Notice of Claim"); provided, however, that failure
of an Indemnitee timely to give a Notice of Claim to the Indemnitor shall not
release the Indemnitor from its indemnity obligations set forth in this Article
IV except to the extent that such failure increases the amount of
indemnification which the Indemnitor is obligated to pay hereunder, in which
event the amount of indemnification which the Indemnitee shall be entitled to
receive shall be reduced to an amount which the Indemnitee would have been
entitled to receive had such Notice of Claim been timely given. A Notice of
Claim shall specify in reasonable detail the nature and estimated amount of any
such Action, Liability or claim giving rise to a right of indemnification. The
Indemnitor shall have ninety (90) Business Days after receipt of a Notice of
Claim to notify the Indemnitee whether or not it disputes its liability to the
Indemnitee with respect to such Action, Liability or claim or the amount
thereof, and setting forth the basis for such objection. If the Indemnitor
fails to respond to the Indemnitee within such ninety (90) Business Day period,
the Indemnitor shall be deemed to have acknowledged its responsibility for such
Indemnifiable Loss. If such Indemnifiable Loss is not contested, the Indemnitor
shall pay and discharge any such Indemnifiable Loss within one hundred twenty
(120) Business Days after its receipt of a Notice of Claim.
4.03 Insurance and Third-Party Obligations.
----------------------------------------
(a) Any indemnification otherwise payable pursuant to Section 4.01 shall
be reduced by the amount of any insurance or other amounts (net of deductibles
and allocated paid loss retro-premiums) that would be payable by any third party
to the Indemnitee or on the Indemnitee's behalf in the absence of this
Agreement. It is expressly agreed that no insurer or any other third party
shall be (i) entitled to a benefit it would not be entitled to receive in the
absence of the foregoing indemnification provisions, (ii) relieved of the
responsibility to pay any claims for which it is obligated, or (iii) entitled to
any subrogation rights with respect to any obligation hereunder.
(b) Ralston hereby assigns to Energizer any amounts payable to Ralston or
a member of the Ralston Group under any property or casualty insurance policy to
the extent that such amounts relate to claims associated solely with the Battery
Business or the Energizer Assets. To the extent any further documentation or
instruments are reasonably requested by Energizer to effect such assignment,
Ralston agrees to promptly execute the same. Ralston agrees to take all other
actions reasonably requested by Energizer to timely pursue Energizer's rights
and remedies under such policies, and Energizer shall bear any costs associated
with such actions.
4.04 Third-Party Claims; Notice, Defense and Payment. Promptly
----------------------------------------------------
following the earlier of (i) receipt of notice of the commencement of a
Third-Party Claim or (ii) receipt of information from a third party alleging the
existence of a Third-Party Claim, any Indemnitee who believes that it is or may
be entitled to indemnification by any Indemnitor under Section 4.01 with respect
to such Third-Party Claim shall deliver a Notice of Claim to the Indemnitor.
Failure of an Indemnitee timely to give a Notice of Claim to the Indemnitor
shall not release the Indemnitor from its indemnity obligations set forth in
this Section 4.04 except to the extent that such failure adversely affects the
ability of the Indemnitor to defend such Action, Liabilities or claim or
increases the amount of indemnification which the Indemnitor is obligated to pay
hereunder, in which event the amount of indemnification which the Indemnitee
shall be entitled to receive shall be reduced to an amount which the Indemnitee
would have been entitled to receive had such Notice of Claim been timely given.
Indemnitee shall not settle or compromise any Third-Party Claim in an amount in
excess of US$25,000 prior to giving a Notice of Claim to Indemnitor at least
twenty (20) Business Days in advance of such settlement. In addition, if an
Indemnitee settles or compromises any Third-Party Claims prior to giving such
Notice of Claim to an Indemnitor, the Indemnitor shall be released from its
indemnity obligations to the extent that the Indemnitor can sustain the burden
of proving that such settlement or compromise was not made in good faith and was
not commercially reasonable. Within ninety (90) days after receipt of such
Notice of Claim (or sooner if the nature of such Third-Party Claim so requires),
the Indemnitor may (A) by giving written notice thereof to the Indemnitee,
acknowledge liability for, and at its option elect to assume, the defense of
such Third-Party Claim at its sole cost and expense or (B) object to the claim
of indemnification set forth in the Notice of Claim delivered by the Indemnitee;
provided that if the Indemnitor does not within the same ninety (90) day period
give the Indemnitee written notice either objecting to such claim and setting
forth the grounds therefor or electing to assume the defense, the Indemnitor
shall be deemed to have acknowledged its responsibility to accept the defense
and its ultimate liability, if any, for such Third-Party Claim.
Any contest of a Third-Party Claim as to which the Indemnitor has elected to
assume the defense shall be conducted by attorneys employed by the Indemnitor
and reasonably satisfactory to the Indemnitee; provided that the Indemnitee
shall have the right to participate in such proceedings and to be represented by
attorneys of its own choosing at the Indemnitee's sole cost and expense. If the
Indemnitor assumes the defense of a Third-Party Claim, the Indemnitor may settle
or compromise the Third-Party Claim without the prior written consent of
Indemnitee only if such settlement or compromise involves the payment of
monetary damages for which the Indemnitor alone shall be responsible. If such
settlement or compromise involves any legal or equitable remedy or relief to be
applied against the Indemnitee, or any change or compromise to any contractual
or other rights of the Indemnitee, then such settlement or compromise shall only
be effected with the prior written consent of the Indemnitee, which consent
shall not be unreasonably withheld.
If the Indemnitor does not assume the defense of a Third-Party Claim for which
it has acknowledged liability for indemnification under Section 4.01, the
Indemnitee may require the Indemnitor to reimburse it on a current basis for its
reasonable expenses of investigation, reasonable attorney's fees and reasonable
out-of-pocket expenses incurred in defending against such Third-Party Claim and
the Indemnitor shall be bound by the result obtained with respect thereto by the
Indemnitee, provided that the Indemnitor shall not be liable for any settlement
effected without its consent, which consent shall not be unreasonably withheld.
The Indemnitor shall pay to the Indemnitee in cash the amount for which the
Indemnitee is entitled to be indemnified (if any) within thirty (30) days after
the final resolution of such Third-Party Claim (whether by settlement, a final
nonappealable judgment of a court of competent jurisdiction or otherwise) or, in
the case of any Third-Party Claim as to which the Indemnitor has not
acknowledged liability, within thirty (30) days after such Indemnitor's
objection has been resolved by settlement, compromise or arbitration pursuant to
the provisions of Article XI of this Agreement.
4.05 Remedies Cumulative; Survival of Indemnities. The remedies
------------------------------------------------
provided in this Article IV shall be cumulative and shall not preclude assertion
by any Indemnitee of any other rights or the seeking of any and all other
remedies against any Indemnitor. The obligations of each of the Ralston Group
and the Energizer Group under this Article IV shall survive the sale or other
transfer by it of any assets or businesses or the assignment by it of any
Liabilities, with respect to any claim of the other for any Indemnifiable Losses
related to such assets, businesses or Liabilities.
ARTICLE V
CERTAIN ADDITIONAL COVENANTS
5.01 Further Assurances. Each party hereto shall cooperate with the
-------------------
other parties, and execute and deliver, or use its best efforts to cause to be
executed and delivered, all instruments, including instruments of conveyance,
assignment and transfer, and to make all filings with, and to obtain all
consents, approvals or authorizations of, any governmental or regulatory
authority or any other Person under any permit, license, agreement, indenture or
other instrument, and take all such other actions as such party may reasonably
be requested to take by any other party hereto from time to time, consistent
with the terms of this Agreement, in order to effectuate the provisions and
purposes of this Agreement and the transfers of Assets and Liabilities and the
other transactions contemplated hereby or in any of the Ancillary Agreements.
If any such transfer of Assets or Liabilities is not consummated prior to or on
the Distribution Date, then the party hereto retaining such Asset or Liability
shall thereafter hold such Asset in trust for the use and benefit of the party
entitled thereto (at the expense of the party entitled thereto), or shall retain
such Liability for the account of the party by whom such Liability is to be
assumed pursuant hereto, as the case may be, and shall take such other action as
may be reasonably requested by the party to whom such Asset is to be
transferred, or by whom such Liability is to be assumed, as the case may be, in
order to place such party, insofar as reasonably possible, in the same position
as if such Asset or Liability had been transferred as contemplated hereby. If
and when any such Asset or Liability becomes transferable, such transfer shall
be effected forthwith. The parties hereto agree that, as of the Distribution
Date, each party hereto shall be deemed to have acquired complete and sole
beneficial ownership of all of the Energizer Assets, or Ralston Assets, as the
case may be, together with all rights, powers and privileges incident thereto,
and shall be deemed to have assumed in accordance with the terms of this
Agreement all of the Liabilities, and all duties, obligations and
responsibilities incident thereto, that such party is entitled to acquire or
required to assume pursuant to the terms of this Agreement.
5.02 Energizer Board. Prior to the Distribution Date, Energizer shall
----------------
take such actions as are necessary so that its Board of Directors is comprised
of those individuals named as directors in the Form 10.
5.03 Contractual Arrangements.
-------------------------
(a) Effective as of the Distribution Date, Ralston and Energizer shall
enter into a tax sharing agreement, substantially in the form attached to this
Agreement as Exhibit A ("Tax Sharing Agreement").
(b) Effective as of the Distribution Date, Ralston and Energizer shall
enter into a bridging services agreement, substantially in the form attached to
this Agreement as Exhibit B ("Bridging Services Agreement").
(c) Effective as of the Distribution Date, Ralston and Energizer shall
enter into an intellectual property agreement, substantially in the form
attached to this Agreement as Exhibit C ("IP Agreement").
(d) Effective as of the Distribution Date, Ralston and Energizer shall
enter into an Aircraft Agreement, substantially in the form attached to this
Agreement as Exhibit D.
5.04 Cash Management and Intercompany Accounts.
----------------------------------------------
(a) Through and including 12:01 a.m. local time on the Distribution
Date, Ralston and Energizer shall continue to employ cash management and other
business practices with respect to the Battery Business that are consistent with
those practices historically employed.
(b) Except as otherwise provided on Schedule 5.04(b)(1), all bank
accounts used exclusively in the Battery Business, and the balances therein
existing as of 12:01 a.m. local time on the Distribution Date, shall be
transferred to, or retained by, members of the Energizer Group effective as of
the Distribution Date. All bank accounts used exclusively in the Ralston
Business, and the balances therein existing as of 12:01 a.m. local time on the
Distribution Date, shall be transferred to, or retained by, members of the
Ralston Group effective as of the Distribution Date. Each party shall promptly
pay to the other any amounts collected by it following the Distribution through
any of its accounts, to the extent any of such amounts collected relate
exclusively to the Business of the other party.
(c) All intercompany services provided by the Ralston Business to the
Battery Business , and vice versa, shall terminate as of the Distribution Date
unless otherwise provided in the Bridging Services Agreement or any other
Ancillary Agreement. Effective as of the close of business on March 31, 2000,
all intercompany receivables or payables and loans then existing between any
member of one Group and any member of the other Group shall be forgiven, except
that trade receivables or payables arising out of intercompany sales of
inventories or other tangible goods, and claims between any member of the
Energizer Group and Checkerboard Insurance Company, shall be settled in the
normal course of business.
ARTICLE VI
ACCESS TO INFORMATION
6.01 Provision of Corporate Records. Subject to the terms of the
---------------------------------
Ancillary Agreements, prior to, or as promptly as practicable after, the
Distribution Date, Ralston shall deliver to Energizer, and Energizer shall
deliver to Ralston, all corporate books and records pertaining to the other
party's Business that each has in its possession. The parties shall also make
available for copying or, to the extent not detrimental, in the reasonable
opinion of the party in possession of the materials, to such party's interests,
originals of all books, records and data reasonably related to the Assets, the
Battery Business, and the Liabilities assumed or retained by the party
requesting such materials, including, but not limited to, all books, records and
data relating to the purchase of materials, supplies and services, financial
results, sale of products, records of the applicable Energizer or Ralston
Individuals, commercial data, catalogues, brochures, training and other manuals,
sales literature, advertising and other sales and promotional materials,
maintenance records and drawings, all active agreements, active litigation files
and government filings. To the extent that originals of such books, records and
data are provided to Energizer by Ralston or vice versa, the party to which the
originals are given shall provide to the other party copies thereof as
reasonably requested in writing.
Each party shall provide such copies of all books, records and data only to the
extent that such action is not prohibited by the terms of any agreements
pertaining to such information or is not prohibited by law. From and after the
Distribution Date, all books, records and copies so delivered shall be the
property of the party to which they were given. Notwithstanding the above,
neither party shall be required to make copies, other than pursuant to Section
6.02 of this Agreement, of any books, records and data which are more than seven
years old or which relate to events occurring more than seven (7) years prior to
the Distribution Date.
6.02 Access to Information. From and after the Distribution Date,
-----------------------
Ralston and Energizer shall afford, to the other and to the other's agents,
employees, accountants, counsel and other designated representatives, reasonable
access and duplicating rights during normal business hours to all records,
books, contracts, instruments, computer data and other data and information
("Information") within such party's possession relating to such other party's
businesses, assets or liabilities, insofar as such access is reasonably required
by such other party. Without limiting the foregoing, such Information may be
requested under this Section 6.02 for audit, accounting, claims, litigation and
tax purposes, as well as for purposes of fulfilling disclosure and reporting
obligations.
6.03 Retention of Records. Except as otherwise required by law or
----------------------
agreed in writing, or as otherwise provided in the Tax Sharing Agreement,
Ralston and Energizer shall retain, for a period of at least seven (7) years
following the Distribution Date, all significant Information in such party's
possession or under its control relating to the Business, Assets or Liabilities
of the other party and, after the expiration of such seven-year period, prior to
destroying or disposing of any of such Information, (i) the party proposing to
dispose of or destroy any such Information shall provide no less than 30 days'
prior written notice to the other party, specifying the Information proposed to
be destroyed or disposed of, and (ii) if, prior to the scheduled date for such
destruction or disposal, the other party requests in writing that any of the
Information proposed to be destroyed or disposed of be delivered to such other
party, the party proposing to dispose of or destroy such Information promptly
shall arrange for the delivery of the requested Information to a location
specified by, and at the expense of, the requesting party.
6.04 Confidentiality. From and after the Distribution Date, each Group
---------------
shall hold, in strict confidence, all Information obtained from the other Group
prior to the Distribution Date or furnished to it pursuant to this Agreement or
any other agreement referred to herein which relates to or concerns the business
conducted by such other Group, and such Information shall not be used by it to
the detriment of the other Group, or disclosed by it or its agents, officers,
employees or directors without the prior written consent of such other Group
unless and to the extent that:
(a) disclosure is compelled by judicial or administrative process or, in
the opinion of such Group's counsel, by other requirements of law; or
(b) such Group can show that such Information was:
(i) available to such Group on a nonconfidential basis prior to its dis-
closure by the other Group,
(ii) in the public domain through no fault of such Group,
(iii) lawfully acquired by such Group from other sources after the time
that it was furnished to such Group pursuant to this Agreement or any other
agreement referred to herein, or
(iv) independently developed by such Group.
Notwithstanding the foregoing, each Group shall be deemed to have satisfied its
obligations of confidentiality under this Section 6.04 with respect to any
Information concerning or supplied by the other Group if it exercises
substantially the same care with regard to such Information as it takes to
preserve confidentiality for its own similar Information.
6.05 Reimbursement. Each member of any Group providing Information
-------------
pursuant to Sections 6.02 or 6.03 to any member of the other Group shall be
entitled to receive from the recipient, upon presentation of an invoice
therefor, payment in U. S. dollars of all out-of-pocket costs and expenses as
may reasonably be incurred in providing such Information.
ARTICLE VII
EMPLOYEE MATTERS
7.01 Employee Liabilities; Continuation of Employment.
-----------------------------------------------------
After the Distribution, except as otherwise specifically provided for in
this Agreement and Plan of Reorganization, the Energizer Group shall be
responsible for all employment and benefit liabilities related to the Energizer
Individuals, and the Ralston Group shall be responsible for all employment and
benefit liabilities related to the Ralston Individuals, whether arising before,
coincident with or after the Distribution. Ralston and Energizer shall cause
each member of their respective Groups to cooperate with the members of the
other's Group to effect, as soon as practicable in a cost-effective manner, the
transfer of employment, where applicable, of Energizer Employees and Ralston
Employees to the appropriate Affiliate of either Group.
7.02 Ralston Purina Retirement Plan.
---------------------------------
(a) Effective as of the Distribution Date, Energizer shall take, or
cause to be taken, all actions necessary and appropriate to establish, effective
as of the Distribution Date, an Energizer Retirement Plan and trust intended to
qualify under Sections 401(a) and 501(a) of the Code, respectively, and to
provide benefits thereunder for all Energizer Individuals who, on the
Distribution Date, were participants in the Ralston Retirement Plan. All
liabilities for benefits accrued for Energizer Individuals under the Ralston
Retirement Plan shall be transferred to the Energizer Retirement Plan, the terms
of which will be substantially the same as those of the Ralston Retirement Plan
in respect of the Energizer Individuals. Such transfer and assumption of
liabilities shall be consistent with the spin-off of the Ralston Retirement
Plan, in accordance with Code Section 414(l) and the regulations thereunder.
The Energizer Retirement Plan shall give the Energizer Employees credit, for
purposes of eligibility, vesting and benefit accrual, for service on or prior to
the Distribution Date, to the extent such service was recognized under the
Ralston Retirement Plan. As soon as practicable after the Distribution Date,
Ralston shall cause the trustee of the Ralston Retirement Plan to transfer, in
one or more installments, to the trustee of the Energizer Retirement Plan, in
accordance with Sections 7.02(c) and (e) below, an amount in cash and other
liquid assets held in the trust equal to the following, adjusted as applicable
pursuant to Section 7.02(d) below (the "Transfer Amount"):
(i) the Projected Benefit Obligation ("PBO"), as defined in Financial
Accounting Standards 87, attributable to pension benefits (other than
PensionPlus Match Accounts) developed as of the Distribution Date with re-
spect to the Energizer Individuals under the Ralston Retirement Plan; plus
(ii) amounts credited to the PensionPlus Match Accounts as
developed for Energizer Individuals as of the Distribution Date; plus
(iii) a pro rata share of the assets, with a market value determined as of
March 31, 2000, of the Ralston Retirement Plan in excess of the assets
required to fund the PBO and PensionPlus Match Accounts developed for all
participants and beneficiaries in the Ralston Retirement Plan (the "Surplus
Assets"), such share of the Surplus Assets to be apportioned and
transferred to the Energizer Retirement Plan in the same proportion as the
PBO liabilities and the amounts credited to the PensionPlus Match Accounts,
developed for Energizer Individuals as of March 31, 2000, bear to the PBO
liabilities and the amounts credited to the PensionPlus Match Accounts
developed for all participants in the Ralston Retirement Plan as of
March 31, 2000; plus
(iv) interest with respect to each installment of the Transfer Amount
based on the investment rate of return of the assets of the Ralston Retirement
Plan from the Distribution Date to the actual transfer date, net of invest-
ment fees and expenses for that period; less
(v) the amount of benefits paid by the Ralston Retirement Plan to
Energizer Individuals between the Distribution Date and the date Plan
assets are transferred.
Calculations of PBO shall be made in accordance with terms of the Ralston
Retirement Plan, established administrative procedures and the economic
assumptions used by Ralston as of September 30, 1999 under FAS 87 (including a
discount rate of 7.00%) and the non-economic assumptions (including rates of
mortality, retirement, termination and disability) as set forth in Schedule B to
the 1999 Form 5500 for the Ralston Retirement Plan. For purposes of determining
the Transfer Amount, the PBO liability and the PensionPlus Match Accounts shall
be developed as of March 31, 2000 by calculating and measuring those amounts as
of October 1, 1999 on the basis described above - reflecting participant
information gathered as of October 1, 1999 as adjusted to reflect the transfer
of participants between the Energizer Business and the Ralston Business during
the period October 1, 1999 through March 31, 2000 - and projecting those amounts
forward to March 31, 2000. The projecting of the PBO liability shall take into
consideration (a) the additional liability attributable to benefits earned by
active participants in the Ralston Retirement Plan during the period October 1,
1999 through March 31, 2000 (as represented by 50% of the annual Service Cost -
as defined under FAS 87 - developed as of October 1, 1999); (b) the interest
accumulated on the liability during that six month period (as represented by 50%
of the annual Interest Cost - as defined under FAS 87 - developed using the PBO
calculated as of October 1, 1999 and reflecting the 7.00% discount rate
indicated above); and (c) the aggregate benefit payments anticipated to be
received during the six month period by all retirees reported as of October 1,
1999. The PensionPlus Match Accounts shall be projected to March 31, 2000 for
all participants by increasing the PensionPlus Match Account balances - measured
as of October 1, 1999 - by (a) six months of interest credited at a rate of
6.00% per annum; and (b) six months of anticipated contributions to the accounts
developed by assuming that the participants' after-tax supplemental
contributions to the Ralston SIP - measured as of October 1, 1999 - will remain
constant over the projection period and reflecting 50% of the participants' last
full calendar year of pensionable compensation collected as of October 1, 1999.
In no event will the Transfer Amount, as calculated pursuant to this Section
7.02(a) and, if applicable, adjusted pursuant to Section 7.02(d), be less than
the present value, determined in accordance with Section 417 of the Code, of
benefits of the Energizer Individuals accrued as of the Distribution Date, as
determined based on the actuarial assumptions of the Ralston Retirement Plan and
in compliance with Section 414(l) of the Code.
(b) No changes in the status of any Energizer Individual between the
Distribution Date and the date or dates funds are actually transferred pursuant
to this Section 7.02 shall affect the Transfer Amount to be calculated
hereunder.
(c) An initial portion of the Transfer Amount (the "Initial Transfer
Amount") shall be transferred to the trustee of the Energizer Retirement Plan as
soon as practicable after the expiration of the thirty-day waiting period
required by section 6058(b) of the Code. The transfer shall be conditioned upon
completion of the following items:
(i) Ralston's receipt of an opinion of counsel retained by Energi-
zer and reasonably satisfactory in form and substance to Ralston to the
effect that the Energizer Retirement Plan is a Qualified Plan and that the
trust established under such Plan is intended to be exempt from taxation under
Section 501(a) of the Code;
(ii) Ralston's filing with the Internal Revenue Service the notice
required by Section 6058(b) of the Code.
(d) Notwithstanding the foregoing Section 7.02(a), if an apportionment
of pension assets, including pension surplus, is not made with respect to the
Ralston Canadian Pension Plan and/or the Energizer/Ralston UK Pension Plan, as
defined below, in a manner similar to that described with respect to the Ralston
Retirement Plan, then the Transfer Amount shall be increased or decreased, as
applicable, in an amount equal to the value of such excess or shortfall in
allocation of surplus assets in those Plans effective as of the date the parties
mutually agree on the amount of such excess or shortfall. The equivalent value
of US and applicable Canadian or United Kingdom currencies shall be determined
in accordance with Section 2.04(i).
(e) The parties shall cooperate in transferring the final installment
or installments of the Transfer Amount as soon as practicable. The final
installment of the Transfer Amount shall be made when it has been determined to
the reasonable satisfaction of both parties.
(f) Upon completion of the transfers of such assets and liabilities,
the Ralston Retirement Plan and the Ralston Group shall have no further
liability therefor with respect to the Energizer Individuals.
7.03 Certain International Pension Plans.
--------------------------------------
(a) Canadian Pension Plans. Effective as of the Distribution Date,
subject to the transfer of assets referred to below, the Energizer Employees
participating in the registered pension plan sponsored by Ralston Purina Canada
Inc. (the "Ralston Canadian Pension Plan") shall cease to accrue benefits under
such Plan, and all liabilities for benefits accrued by Energizer Individuals as
of such Distribution Date shall be transferred to a new pension plan (the
"Energizer Canadian Pension Plan") established by Energizer Canada Inc., an
Affiliate of Energizer, the terms of which will be substantially the same as
those of the Ralston Canadian Pension Plan in respect of the Energizer
Individuals. The Energizer Canadian Pension Plan shall give the Energizer
Employees credit, for purposes of eligibility, vesting and benefit accrual, for
service on or prior to the Distribution Date, to the extent such service was
recognized under the Ralston Canadian Pension Plan.
Ralston shall, as soon as practicable after the receipt of all requisite
governmental and other approvals and consents referred to below, cause Ralston
Purina Canada Inc. to transfer from the Ralston Canadian Pension Plan to the
Energizer Canadian Pension Plan an amount of assets (the "Canadian Transfer
Amount") determined in accordance with the following formula:
(i) the fair market value of the assets attributable to the defined
benefit portion of the Ralston Canadian Pension Plan, determined as at March
31, 2000, shall be multiplied by a fraction, the numerator of which
shall be:
(A) the present value of defined benefits accrued by the Energizer Indivi-
duals under the Ralston Canadian Pension Plan as of March 31, 2000 determined
as the greater of the going concern or solvency liabilities in accordance with
Ralston Canadian Pension Plan documents and actuarial assumptions and methods
used in the last filed actuarial report, adjusted as necessary to com-
ply with legislation and the requirements of regulatory authorities ("Canadian
Energizer Defined Benefit Liabilities");
and the denominator of which shall be:
(B) the present value of defined benefits accrued by all members and
former members (including without limitation the Energizer Individuals)
under the Ralston Canadian Pension Plan as of March 31, 2000 determined on the
same basis as the Canadian Energizer Defined Benefit Liabilities;
(ii) investment gains and losses on the amount determined in clause
7.03(a)(i) above shall accrue based on the investment rate of return of the
assets of the Ralston Canadian Pension Plan from the Distribution Date to the
actual transfer date, net of investment fees and expenses for such period;
and
(iii) the amount of benefits paid by the Ralston Canadian Pension Plan
to Energizer Individuals between the Distribution Date and the date the Cana-
dian Transfer Amount is transferred shall be deducted from the aggregate
amount determined in accordance with clauses 7.03(a)(i) and 7.03(a)(ii)
above.
Such transfer shall be conditioned upon receipt of, and subject to, all
requisite governmental and other approvals and consents and if a different
Canadian Transfer Amount is required by applicable regulatory authorities, an
adjustment to the Canadian Transfer Amount will be made. Upon completion of the
transfer of such assets and liabilities, the Ralston Canadian Pension Plan and
the Ralston Group shall have no further liability for pension benefits for the
Energizer Individuals.
(b) United Kingdom Pension Plans. Effective as of the date of transfer
of the UK Transfer Amount as described below, the Ralston Individuals
participating in the pension plan offered by Ralston Trust Limited (the
"Energizer/Ralston UK Pension Plan") shall cease to accrue benefits under such
Plan, and all liabilities for benefits accrued by such Individuals as of such
date shall be transferred to a new pension plan (the "New Ralston UK Pension
Plan") established by Purina Pension Trust Limited, an Affiliate of Ralston, the
terms of which are substantially the same as those currently enjoyed by such
Individuals under the Energizer/Ralston UK Pension Plan. The transfer date and
the contributions to be paid to the Energizer/Ralston UK Pension Plan in respect
of the Ralston Individuals between March 31, 2000 and the transfer date is to be
agreed upon by the parties to this Agreement. The New Ralston UK Pension Plan
shall give the Ralston Employees credit, for purposes of eligibility, vesting
and benefit accrual, for service on or prior to the transfer date, to the extent
such service was recognized under the Energizer/Ralston UK Pension Plan.
Ralston shall cause the Purina Pension Trust Limited to, as soon as practicable
after the receipt of all requisite governmental and other approvals and consents
referred to below, seek a transfer from the Energizer/Ralston UK Pension Plan to
the New Ralston UK Pension Plan of an amount of assets (the "UK Transfer
Amount") determined in accordance with the following formula:
(i) The fair market value of the assets of the Energizer/Ralston UK
Pension Plan, determined as at March 31, 2000, shall be multiplied by a frac-
tion ("the Transfer Fraction"), the numerator of which shall be:
(A) the present value of benefits accrued by the Ralston Individuals under
the Energizer/Ralston UK Pension Plan as of March 31, 2000 determined as the
greater of the going concern or solvency liabilities in accordance with
Energizer/Ralston UK Pension Plan documents and actuarial assumptions and
methods used in the last filed actuarial report, adjusted as necessary to comply
with legislation and the requirements of regulatory authorities ("Ralston
Individuals Liabilities");
and the denominator of which shall be:
(B) the present value of benefits accrued by all members and former
members (including without limitation the Ralston Individuals) under the
Energizer/Ralston UK Pension Plan as of March 31, 2000 determined on the same
basis as the Ralston Individuals Liabilities.
(ii) Assets transferred to the Energizer/Ralston UK Pension Plan af-
ter the Distribution Date, in connection with the pension arrangements ari-
sing out of the acquisition by Ralston of the Edward Baker Pet Foods business,
shall be valued at fair market value as of the date such assets are
received by the Energizer/Ralston UK Pension Plan, and multiplied by the
Transfer Fraction.
(iii) Investment gains and losses on the amounts determined in
clauses 7.03(b)(i) and 7.03(b)(ii) above shall accrue based on the investment
rate of return of the assets of the Energizer/Ralston UK Pension Plan from
(A) with respect to clause 7.03(b)(i), the Distribution Date to the actual
transfer date; and (B) with respect to clause 7.03(b)(ii), the date such assets
are received by the Energizer/Ralston UK Pension Plan to the transfer date,
and the return on both amounts is to be net of investment fees and expenses
for the applicable period.
(iv) The amount of benefits paid by the Energizer/Ralston UK Pension
Plan to Ralston Individuals between the Distribution Date and the date the UK
Transfer Amount is transferred shall be deducted from the aggregate amount de-
termined in accordance with clauses 7.03(b)(i) and 7.03(b)(ii) above.
The sum of amounts calculated pursuant to 7.03(b)(i) and 7.03(b)(ii), adjusted
as provided under 7.03(b)(iii) and 7.03(b)(iv), shall constitute the UK Transfer
Amount. Transfer of the UK Transfer Amount shall be conditioned upon receipt of,
and subject to, all requisite trustee, governmental and other approvals and
consents and, if a different UK Transfer Amount is required by applicable
regulatory and fiduciary authorities, an adjustment to the UK Transfer Amount
will be made. Upon completion of the transfer of such assets and liabilities,
the Energizer/Ralston UK Pension Plan and the Energizer Group shall have no
further liability for pension benefits for the Ralston Individuals. The parties
may by mutual agreement, subject to approval of applicable regulatory and
fiduciary authorities, effect such transfer in one or more installments, taking
into consideration the effect of an initial transfer of assets on the
continuation of benefit accruals by the Ralston Individuals in the
Energizer/Ralston UK Pension Plan.
(c) Other Foreign Funded Retirement Plans. With respect to other
foreign funded retirement Plans in which the sole participants are either
Energizer Individuals or Ralston Individuals, Energizer and Ralston shall
cooperate in taking such actions as are necessary or desirable to ensure that
each such Plan in which assets funding pension benefits for such Energizer or
Ralston Individuals are held is transferred to, or retained by, a member of the
Energizer Group or Ralston Group, as appropriate, and that the members of the
other Group shall have no liability related to such pension Plan thereafter.
7.04 Savings Investment Plan.
-------------------------
(a) Effective as of the Distribution Date, Energizer and its Affiliates
shall cease to be co-sponsors of the Ralston Purina Company Savings Investment
Plan ("Ralston SIP"). Energizer shall take, or cause to be taken, all necessary
and appropriate actions to establish, effective as of the Distribution Date, and
administer a defined contribution Plan which will be a Qualified Plan and which
will also be subject to Section 401(k) of the Code ("Energizer SIP"), and to
provide benefits thereunder for all Energizer Individuals who, immediately prior
to the Distribution Date, were participants in the Ralston SIP. Energizer
agrees that each such Energizer Individual shall be, to the extent applicable,
entitled, for all purposes under the Energizer SIP, to be credited with the term
of service and any account balance credited to such Energizer Individual as of
the Distribution Date under the terms of the Ralston SIP as if such service had
been rendered to the Energizer Group and as if such account balance had
originally been credited to such Energizer Individual under the Energizer SIP.
Ralston agrees to provide Energizer, as soon as practicable after the
Distribution Date (with the cooperation of Energizer to the extent that relevant
information is in the possession of the Energizer Group), with a list of the
Energizer Individuals who were, to the best knowledge of Ralston, participants
in the Ralston SIP immediately prior to the Distribution Date, together with a
listing, if requested by Energizer, of each such Energizer Individual's term of
service for eligibility and vesting purposes under such Plan and a listing of
each such Energizer Individual's account balance thereunder. Ralston shall, as
soon as practicable after the Distribution Date, provide Energizer with such
additional information (in the possession of the Ralston Group and not already
in the possession of the Energizer Group) as may be reasonably requested by
Energizer and necessary in order for Energizer to establish and administer
effectively the Energizer SIP.
The Energizer SIP receiving transfers of accounts from the Ralston SIP shall
contain an "Energizer Stock Fund", and Energizer Individuals for whom a portion
of the account balances are to be transferred to the Energizer SIP from the
Ralston SIP in the form of Energizer Stock, as described below, shall be
permitted to elect to retain their investment of that portion of their account
in the Energizer Stock Fund.
(b) Ralston shall, as soon as practicable following the Distribution
Date, direct the trustee of the Ralston Purina Company Savings Investment Trust
to transfer to the trustee of the Energizer SIP an amount equal to the account
balances credited to the Energizer Individuals as of the date of transfer. Such
transfer amount shall include cash, notes evidencing participant loans, shares
of Ralston Stock, and shares of Energizer Stock distributed with respect to
shares of Ralston Stock held in the Ralston SIP as of the Distribution, to the
extent allocated to accounts of Energizer Individuals. Such transfer shall be
consistent with and adjusted, if and to the extent necessary, to comply with
Section 414(l) of the Code and the regulations promulgated thereunder.
(c) In connection with the transfers described in Section 7.04(b),
Ralston and Energizer shall cooperate in making any and all appropriate filings
required under the Code or ERISA, and the regulations thereunder, and any
applicable securities laws and take all such action as may be necessary and
appropriate to cause such transfers to take place as soon as practicable after
the Distribution Date; provided, however, that each such transfer shall not take
place until as soon as practicable after the earlier of (i) the receipt of a
favorable IRS determination letter with respect to the qualification of the
Energizer SIP under Section 401(a) of the Code or (ii) the receipt by Ralston of
an opinion of counsel retained by Energizer and reasonably satisfactory in form
and substance to Ralston to the effect that the Plan is a Qualified Plan and
that the trust established thereunder is intended to be exempt from federal
income tax under Section 501(a) of the Code. Ralston and Energizer agree to
provide to such counsel such information in the possession of the Ralston Group
and the Energizer Group, respectively, as may be reasonably requested by such
counsel in connection with the issuance of such opinion.
(d) Except as specifically set forth in this Section 7.04, upon
completion of the transfers of assets and liabilities from the Ralston SIP to
the Energizer SIP, the Ralston SIP and the Ralston Group shall have no further
liability therefor with respect to the Energizer Individuals.
7.05 U.S. Welfare Plans
--------------------
(a) Except as otherwise specifically provided herein, Energizer shall
take, or cause to be taken, all actions necessary and appropriate on behalf of
itself and the Energizer Group to adopt such Welfare Plans ("Energizer Welfare
Plans") as necessary to provide, effective as of the Distribution Date, welfare
benefits to the Energizer Individuals substantially similar to those offered to
them prior to the Distribution Date. In connection with the foregoing, Ralston
agrees to provide Energizer or its designated representative with such
information (in the possession of the Ralston Group and not already in the
possession of the Energizer Group) as may be reasonably requested by Energizer
and necessary for the Energizer Group to establish any such Welfare Plan.
Energizer agrees to retain or, if Energizer or one of its Affiliates is not a
policyholder as of the Distribution Date, assume all rights and obligations,
including any Liabilities of Ralston, relating to life insurance benefits under
a Metropolitan Life insurance policy for Energizer Individuals who became
disabled between July 1, 1986 and December 31, 1987 while covered under such
policy.
(b) Except as otherwise noted in this Section 7.05, Energizer shall
cause the Energizer Welfare Plans to assume, or cause one or more members of the
Energizer Group to assume, and be solely responsible for, all welfare benefit
claims paid to Energizer Individuals on or after 12:01 a.m. on the Distribution
Date. The Ralston Welfare Plans shall retain liability for welfare benefit
claims paid to Energizer Individuals under the Ralston Welfare Plans before
12:01 a.m. on the Distribution Date.
With respect to Plans providing health benefits:
(i) all checks outstanding as of the Distribution in connection with
benefits paid through First Health for Energizer Individuals shall remain the
obligation of the Purina Health Plan;
(ii) all checks outstanding as of the Distribution in connection with
benefits paid through United Health Care for Energizer Individuals shall
be the obligation of the Energizer Plan offering health benefits; and
(iii) invoices received before the Distribution Date for dental
benefits received by Energizer Individuals shall remain the obligation of
the Purina Health Plan, and invoices received on or after the Distribution Date
for dental benefits received by Energizer Individuals shall be the
obligation of the Energizer Plan offering dental benefits.
(c) As of 12:01 a.m. on the Distribution Date, Energizer shall cease to
be a sponsoring employer of the Welfare Plans sponsored by Ralston. Energizer
Individuals will cease participating in Welfare Plans maintained by any member
of the Ralston Group, except for:
(i) any Energizer Individual who has timely elected or will timely
elect continued coverage under Ralston's health benefit Plans pursuant
to the Consolidated Omnibus Budget Reconciliation Act with respect to a
"qualifying event", as defined under such Act, that occurs on or prior to the
Distribution Date;
(ii) any Energizer Individual who elects to continue coverage under
the Partnership Life Plan as a terminated employee;
(iii) an Energizer Individual who is receiving installment disability
benefits as of the Distribution Date under the Group Life Plan;
(iv) an Energizer Individual who, under the Production Disability Plan
insured by Aetna, is receiving disability benefits as of the Distribution Date
or who after the Distribution Date is determined to be eligible to receive
benefits under the Plan because of a finding of disability that commenced
prior to the Distribution Date; and
(v) an Energizer Individual who is receiving benefits under the Long
Term Disability Plan insured by UNUM.
The parties shall cooperate in seeking and effecting the assignment to Energizer
or one of its Affiliates of all rights and obligations of Ralston under the UNUM
insurance policy described in Section 7.05(c)(v) above. In addition, the
parties agree that Energizer shall bear the cost of any Liabilities of Ralston
related to or arising out of the participation, on or after the Distribution
Date, by Energizer Individuals in the insured Welfare Plans of Ralston described
in this Section 7.05(b)(iii) and (iv); and, until such time as the insurance
contract is assigned to Energizer or one of its Affiliates, Section 7.05(b)(v).
(d) Subject to paragraph (b) above, Energizer and the Energizer Group
shall retain all liabilities for retiree medical and retiree life insurance
benefits with respect to Energizer Individuals, and no Energizer Individuals
shall be entitled to retiree medical and life insurance benefits from Welfare
Plans sponsored by Ralston and the Ralston Group after the Distribution Date.
For purposes of this Section 7.05, the distribution of ownership of the
Energizer Group to shareholders of Ralston Stock shall not be deemed a
termination of employment of Energizer Employees. As of the Distribution Date,
Energizer shall adopt an Energizer Executive Health Plan and an Energizer
Executive Life Plan, and Ralston shall transfer to Energizer, and Energizer
shall assume, all liabilities for retiree benefits for Energizer Individuals who
are eligible for retiree health and life coverage under such Plans. Claims for
retiree health and life benefits paid prior to the Distribution Date with
respect to Energizer Individuals shall be treated in the manner set forth in
paragraph (b) above.
(e) Ralston and Energizer shall cooperate in causing the transfer, as
soon as practicable after the Distribution Date, of certain plan assets from the
Ralston Group Life Plan and the Purina Long Term Disability Plan (collectively
the "Ralston Group Life/LTD Plans") to a Voluntary Employee Benefit Association
Trust, as defined in Code Section 501(c)(9) established by Energizer (the
"Energizer VEBA"), which assets shall be used to provide life insurance benefits
and long term disability benefits to Energizer Individuals participating in the
Energizer Group Life Plan and the Energizer Long Term Disability Plan, which
shall benefit the same class or classes of Energizer Individuals that formerly
participated in the Ralston Group Life/LTD Plans. Subject to the provisions set
forth herein, Ralston shall cause the Ralston Group Life/LTD Plans, or the
Trustee of the Purina Benefit Association (the "Ralston VEBA"), as applicable,
to transfer to the Energizer VEBA a pro rata share of the respective assets of
the Ralston Group Life/LTD Plans with a market value determined as of March 31,
2000, such share of assets to be calculated in the same proportion as the
present value of liabilities relating to Energizer Individuals under each such
Ralston Plan (excluding liabilities retained by the Ralston Group Life Plan
relating to Energizer Individuals receiving installment disability benefits)
bears to the present value of liabilities relating to all Energizer and Ralston
Individuals under each such Plan.
Notwithstanding the foregoing, the transfer of assets contemplated in this
subparagraph shall be conditioned upon (i) the receipt of either, in the sole
discretion of Ralston, (A) an opinion of counsel retained by Energizer and
reasonably satisfactory in form and substance to Ralston to the effect that the
Energizer VEBA is intended to qualify under Section 501(c)(9) of the Code and
that the VEBA is intended to be exempt from taxation under Code Section 501(a);
or (B) a favorable determination letter from the IRS of the tax exempt status of
the Energizer VEBA under Code Sections 501(a) and 501(c)(9); and (ii) an
opinion of counsel retained by Energizer and reasonably satisfactory in form and
substance to Ralston to the effect that the transfer of such plan assets from
the Ralston Group Life/LTD Plans to the Energizer VEBA and the stated purpose
for the utilization of such assets is in compliance with ERISA, including but
not limited to, ERISA Section 403, and any applicable state law or regulations
relating to insurance.
(f) As of the Distribution Date, Energizer will establish a Health Care
and Dependent Care Reimbursement Plan (the "Energizer Reimbursement Plan"),
complying with Code Sections 105, 125 and 129, with terms substantially similar
to the terms of the Ralston Purina Reimbursement Accounts Plan (the "Ralston
Reimbursement Plan"). As of the Distribution Date, Energizer Individuals shall
cease participating in the Ralston Reimbursement Plan, and all liabilities for
benefits with respect to such Energizer Individuals under the Ralston
Reimbursement Plan shall be provided under the Energizer Reimbursement Plan as
of the Distribution Date.
7.06 International Welfare Plans
-----------------------------
Ralston and Energizer shall each retain all liabilities related to
international welfare plans in which only Ralston Individuals or Energizer
Individuals, respectively, are enrolled. With respect to welfare plans in which
both Ralston Individuals and Energizer Individuals are participants, Ralston and
Energizer shall cause each member of their respective Groups to cooperate with
members of the other Group to establish additional separate welfare plans as
soon as practicable after the Distribution Date in order to enroll the Energizer
Individuals and Ralston Individuals in separate plans. During the period after
the Distribution that an Energizer Individual continues to participate in a
welfare plan sponsored by a member of the Ralston Group, or vice versa, the
sponsor (or sponsor's plan, as appropriate) shall be reimbursed for the costs of
providing such coverage in excess of premiums paid by the covered Energizer or
Ralston Individual. Ralston and Energizer, or their respective Welfare Plans as
applicable, shall share proportionately in any refunds of contributions or
stabilization reserves payable on account of experience prior to the
Distribution.
7.07 Internationalist Retirement Plan.
----------------------------------
As of the Distribution Date, Energizer shall assume, and be solely
responsible for, all benefits accrued with respect to Energizer Individuals
based on participation by Energizer Employees and Former Energizer Employees in
the unfunded Internationalist Retirement Plan. No Ralston Individuals are
participants in such Plan as of the Distribution Date, and Ralston shall have no
liability for payment of benefits under such Plan after the Distribution.
Energizer agrees to cause benefits accrued with respect to the Energizer
Individuals to be paid in a manner and amount consistent with the terms of the
Internationalist Retirement Plan.
7.08 Stock Options and Restricted Stock; Stock Purchase Plan.
--------------------------------------------------------------
(a) The stock options and phantom stock options held by Energizer
Individuals as of the Distribution Date shall be administered in accordance with
the terms of such agreements and the ISP under which they were granted. For
purposes of restricted stock awards and stock options, including phantom stock
options, granted under the ISPs, the Distribution shall be deemed to constitute
an involuntary termination, other than for cause, of employment of Energizer
Employees.
(b) Effective immediately after the Distribution Date, the number of
shares of Ralston Stock subject to, and the exercise price of, each
non-qualified option to acquire Ralston Stock granted pursuant to the terms of
an ISP ("Ralston Option") which immediately prior to the Record Date is
outstanding and not exercised shall be adjusted in order to reflect the
difference in the fair market value of the Ralston Stock attributable to the
Distribution, in accordance with the requirements of Section 424 of the Code and
the regulations promulgated thereunder, based upon (i) the average of the
closing prices on the NYSE Composite Index for the Ralston Stock, trading
regular way with due bills for the Energizer Stock, for such period prior to the
Distribution Date as the Ralston Board determines, and (ii) the average of the
closing prices on the NYSE Composite Index for the Ralston Stock, trading
regular way, for such period following the Distribution Date as the Ralston
Board determines. Outstanding phantom stock options held by certain Energizer
Individuals shall also be adjusted in a similar manner.
(c) Energizer agrees that, upon notice of the exercise of a phantom
stock option by an Energizer Individual, it shall promptly reimburse Ralston in
an amount equal to one half of the gross proceeds of the exercise payable to
such Energizer Individual.
(d) Ralston and Energizer agree that Ralston, as sole shareholder of
the outstanding capital stock of Energizer, will approve the adoption by the
Board of Energizer, prior to the Distribution, of a Plan to be administered by
the Nominating and Executive Compensation Committee of the Energizer Board,
under which the Committee shall have authority to grant stock options,
restricted stock awards and other awards payable in Energizer Stock, to
directors of Energizer and eligible Energizer Employees, including executive
officers.
(e) Effective as of the Distribution Date, Energizer Employees shall
cease to be eligible to participate in the Ralston Purina Company Stock Purchase
Plan. All benefit obligations arising under the Plan prior to such date with
respect to Energizer Individuals shall be paid in accordance with the terms of
the Plan.
7.09 Unfunded Executive Deferred Compensation and Retirement Plans.
-----------------------------------------------------------------
(a) Ralston shall retain liability for all unpaid benefits, obligations
and liabilities with respect to benefits for Energizer Individuals arising from
deferrals of compensation by Energizer Employees and Former Energizer Employees
under the Fixed Benefit Option of the Ralston Purina Company Deferred
Compensation Plan for Key Employees ("Ralston Deferred Compensation Plan").
(b) As of the Distribution Date, Energizer will establish a Deferred
Compensation Plan, which shall be a non-qualified unfunded deferred compensation
plan ("Energizer Deferred Compensation Plan"). Effective as of the
Distribution, Ralston shall amend the Ralston Deferred Compensation Plan to
permit the transfer to the Energizer Deferred Compensation Plan of that portion
of the Ralston Deferred Compensation Plan liabilities accrued as of March 31,
2000 with respect to Energizer Individuals under all investment Options of such
Plan other than the Fixed Benefit Option (including the company matching
accruals based on deferrals under the Equity Option), and Energizer shall cause
the Energizer Deferred Compensation Plan to accept such liabilities. In
connection therewith, Ralston shall assign to Energizer all its right, title and
obligations under the deferred compensation agreements associated with such
accrued benefits.
(c) As of the Distribution Date, Energizer will establish an Executive
Savings Investment Plan, which shall be a non-qualified unfunded deferred
compensation plan ("Energizer Executive SIP"). Ralston shall amend the Ralston
Purina Executive SIP ("Ralston Executive SIP") to cause the transfer to the
Energizer Executive SIP of that portion of the liabilities of the Ralston
Executive SIP relating to the benefits accrued as of March 31, 2000 by the
Energizer Individuals, and Energizer shall cause the Energizer Executive SIP to
accept such liabilities.
(d) As of the Distribution Date, Energizer will establish a Supple-
mental Retirement Plan, which shall be a non-qualified unfunded supplemental
retirement plan ("Energizer SERP"). Ralston shall amend the Ralston Purina
Supplemental Retirement Plan ("Ralston SERP") to cause the transfer to the
Energizer SERP of that portion of the liabilities of the Ralston SERP
relating to the benefits accrued as of March 31, 2000 by the Energizer
Individuals, and Energizer shall cause the Energizer SERP to accept such
liabilities. Accrued liabilities under the Ralston SERP shall be deemed to
include, but not be limited to, liabilities arising out of Supplemental
Retirement Awards given to Energizer Employees and Former Energizer Employees.
(e) After the Distribution Date, Energizer shall be solely responsible
for the payment of all liabilities and obligations for benefits with respect to
Energizer Individuals under the Energizer Deferred Compensation Plan, the
Energizer Executive SIP and the Energizer SERP, which shall include all
liabilities and obligations transferred pursuant to 7.09(b), (c) and (d) above,
and Ralston shall have no liability with respect thereto.
7.10 Partnership Life Insurance Plan. Energizer Employees or Former
-------------------------------
Energizer Employees who, immediately prior to the Distribution Date, were
participants in or otherwise entitled to benefits under the Partnership Life
Insurance Plan, will, as of the Distribution Date, be treated as terminated
employees for purposes of such Partnership Life Insurance Plan, and will be
afforded all rights and benefits to which all terminated employees are entitled
under the terms of such Plan. Ralston will retain ownership of any individual
life insurance contracts then insuring the life of any Energizer Employee or
Former Energizer Employee in accordance with the terms of the Partnership Life
Insurance Plan.
7.11 Survivor Life Insurance Plan. Effective as of the Distribution
-------------------------------
Date, all of Ralston's obligations under the Survivor Life Insurance Plan
including, but not limited to, the obligation to pay any premiums on life
insurance policies subject to such Plan (the "Policies"), shall cease with
respect to the Energizer Employees who participated in the Plan immediately
prior to the Distribution Date ("Survivor Life Participants"). Promptly
following the Distribution Date, but conditioned upon its reimbursement by
Energizer of all premiums paid by Ralston with respect to such Policies, Ralston
shall assign to Energizer all of its rights, interests and obligations under
each of the 1996 Split Dollar Agreements between Ralston and either a Survivor
Life Participant or, if applicable, the trustee of a trust created by a Survivor
Life Participant for the purpose of holding such Policies (the "Trustees"). In
accepting such assignment, Energizer shall agree to be bound by the terms and
provisions of such 1996 Split Dollar Agreements.
Upon reimbursement of such premiums, Ralston shall release all of its rights
under the 1996 Collateral Assignments between Ralston and the Survivor Life
Participants, or the Trustees, in accordance with their terms, vesting full
ownership rights in the Policies to the Survivor Life Participants or the
Trustees, as appropriate, subject to the 1996 Split Dollar Agreements. Energizer
shall, or shall cause the appropriate Energizer Affiliate to, adopt a
substantially identical Survivor Life Insurance Plan with respect to all
Survivor Life Participants, and shall enter into substantially identical
Collateral Assignments with the Survivor Life Participants, or the Trustees, in
accordance with such Split Dollar Agreements and such Plan effective immediately
after the Distribution Date.
7.12 Vacation Pay/Paid Time Off. Energizer and the Energizer Group
-----------------------------
will assume (or, as applicable, retain) all liability for unpaid vacation pay
and other paid time off accrued by Energizer Employees and Former Energizer
Employees prior to the Distribution Date. On and after the Distribution Date,
Ralston and the Ralston Group will have no liability for vacation pay or other
paid time off for Energizer Employees and Former Energizer Employees. Ralston
and the Ralston Group will retain (or, as applicable, assume) all liability for
unpaid vacation pay and other paid time off accrued by Ralston Employees and
Former Ralston Employees prior to the Distribution Date. After the Distribution
Date, Energizer and the Energizer Group will have no liability for vacation pay
or other paid time off for Ralston Employees and Former Ralston Employees.
7.13 U. S. Severance Pay.
----------------------
(a) Ralston and Energizer agree that, with respect to individuals who,
in connection with the Distribution, cease to be employees of the Ralston Group
and become employees of the Energizer Group, such cessation shall not be deemed
a severance of employment from either Group for purposes of any Plan that
provides for the payment of severance, salary continuation or similar benefits
and shall, in connection with the Distribution, if and to the extent
appropriate, obtain waivers from individuals against any such assertion.
(b) The Ralston Group shall assume and be solely responsible for all
liabilities and obligations whatsoever in connection with claims made by or on
behalf of Ralston Individuals and the Energizer Group shall assume and be solely
responsible for all liabilities and obligations whatsoever in connection with
claims made by or on behalf of Energizer Individuals in respect of severance
pay, salary continuation and similar obligations relating to the termination or
alleged termination of any such person's employment either before, to the extent
unpaid, or on or after the Distribution Date. On or prior to the Distribution
Date, Energizer shall amend its Plans relating to severance and other
termination benefits to incorporate the terms of the special severance payment
schedule in effect in Ralston's Severance Pay Plan with respect to employees of
the Corporate Division of Ralston who transfer to Energizer and who are
involuntarily terminated without cause by Energizer on or prior to September 30,
2000.
7.14 International Severance Pay.
-----------------------------
(a) Ralston and Energizer agree that, with respect to individuals who,
in connection with the Distribution, cease to be employees of the Ralston Group
and become employees of the Energizer Group or vice versa, such cessation shall
not be deemed a severance of employment from either Group except to the extent
so required by the terms of any benefit plan, labor agreement, applicable law or
governmental regulation that provides for the payment of severance pay, salary
continuation, termination indemnity or similar benefits. The parties agree, if
and to the extent appropriate, to obtain waivers from individuals against any
such assertion.
(b) To the extent severance pay, salary continuation or termination
indemnity is payable with respect to an Energizer Individual or Ralston
Individual, the respective Group shall assume and be solely responsible for all
liabilities and obligations whatsoever in connection with claims for such
benefits made by or on behalf of such Individuals relating to the termination or
alleged termination of any such person's employment either before, to the extent
unpaid, or on or after the Distribution Date.
7.15 Bonus Plans. Energizer and its Affiliates shall be responsible
------------
for all liabilities with respect to Energizer Employees arising under bonus
plans, programs or policies applicable to such Employees, including liabilities
related to service prior to the Distribution Date. Notwithstanding the
foregoing, Ralston shall retain liability for amounts payable to Energizer
Employees who are participants in the 1998 Leveraged Incentive Plan.
7.16 Financial Planning Program. Except for benefits that have been
----------------------------
paid by Ralston prior to the Distribution, Energizer shall be responsible for
all liabilities with respect to Energizer Individuals arising under the
Financial Planning program for executives.
7.17 Other Balance Sheet Adjustments. To the extent not otherwise
----------------------------------
provided in this Agreement, Ralston and Energizer shall take such action as is
necessary to effect an adjustment to the books of the members of the Ralston
Group and the Energizer Group so that, as of the Distribution Date, the prepaid
expense balances and accrued employee liabilities with respect to any employee
liability or obligation assumed or retained as of the Distribution Date by the
Ralston Group or the Energizer Group are appropriately reflected on the
consolidated balance sheets as of the Distribution Date of Ralston and
Energizer, respectively.
7.18 Preservation of Rights to Amend or Terminate Plans. Subject to
-----------------------------------------------------
the provisions of this Article VII, no provision of this Agreement, including
the agreement of Ralston or Energizer that it, or any member of the Ralston
Group or the Energizer Group, will make a contribution or payment to or under
any Plan herein referred to for any period, shall be construed as a limitation
on the right of Ralston or Energizer or any member of the Ralston Group or the
Energizer Group to amend such Plan or terminate its participation therein which
Ralston or Energizer or any member of the Ralston Group or the Energizer Group
would otherwise have under the terms of such Plan or otherwise, and no provision
of this Agreement shall be construed to create a right in any Ralston Individual
or Energizer Individual under a Plan which such Individual would not otherwise
have under the terms of the Plan itself.
7.19 Reimbursement. Each of the parties hereto acknowledges that the
-------------
Ralston Group, on the one hand, and the Energizer Group, on the other hand, may
incur costs and expenses (including contributions to Plans and the payment of
insurance premiums) arising from or related to any of the Plans which are, as
set forth in this Agreement, the responsibility of the other party hereto.
Ralston and Energizer agree that they, or the appropriate members of their
respective Groups, shall reimburse the appropriate members of the other's Group,
as soon as practicable but in any event within 30 days of receipt from the other
party of appropriate verification, for all such costs and expenses.
7.20 Further Transfers. For a period of six months following the
------------------
Distribution Date, no member of either Group shall, directly or indirectly,
without the prior written consent of a corporate officer of the other Group,
solicit or attempt to solicit any employee or officer of such other Group for
the purpose of obtaining his or her services for hire, or otherwise causing such
employee to leave employment with such other Group, and no member of either
Group, without the prior written consent of a corporate officer of the other
Group, will, for such period of six months, hire such employee or officer;
provided, however, if the employment of any officer or employee of one Group is
terminated by that Group at any time following the Distribution, a member of the
other Group may employ such person without the consent of the other Group.
Subject to the preceding paragraph in this Section 7.20, Ralston and Energizer
recognize that there may be Energizer Employees who will, after the Distribution
Date, become employed by Ralston or a Ralston Affiliate and vice versa with
respect to Ralston Employees. With respect to such employees who transfer
employment within six months of the Distribution Date directly from one Group to
the other, the assets and liabilities of either the Ralston Retirement Plan or
the Energizer Retirement Plan, as applicable, associated with benefits accrued,
with respect to such employee, through the date that the employee transfers to
the other Group will be transferred to the corresponding Plan for the other
Group, and the employee will be given the same service credit, for purposes of
eligibility, vesting and benefit accrual, for service that the employee had
under the transferring Group's Plan. In addition, the transferring Group shall
also, as soon as practicable, transfer such employee's account balance held in
either the Ralston SIP or the Energizer SIP, as applicable, to the corresponding
SIP for the other Group, and the employee will be given the same service credit,
for purposes of eligibility and vesting, that the employee had under the
transferring Group's SIP.
7.21 Other Liabilities. Subject to the provisions of Article Four, as
------------------
of the Distribution Date, Energizer and Ralston shall each assume and be solely
responsible for all Liabilities whatsoever with respect to claims made by, in
the case of Energizer, Energizer Individuals and, in the case of Ralston,
Ralston Individuals, relating to any Liability not otherwise expressly provided
for in this Agreement, including, but not limited to, earned salaries, wages,
severance payments, bonus accruals or other compensation, regardless of whether
such Liability was incurred before or after the Distribution Date.
7.22 Compliance. Notwithstanding anything to the contrary in this
----------
Article VII, to the extent any actions of the parties contemplated in this
Article are determined prior to the Distribution to violate law or result in
unintended tax liability for Ralston Individuals or Energizer Individuals, such
action may be modified by mutual consent of the parties hereto to avoid such
violation of law or unintended tax liability.
7.23 Agreement of Parties. Notwithstanding anything herein to the
----------------------
contrary, the agreements contained in this Article VII shall be binding only as
between the parties to this Agreement, no Ralston Individual or Energizer
Individual or other Person shall have any right with respect to any such
agreement, and no Person other than the parties to this Agreement shall have any
rights to enforce any provision hereof.
ARTICLE VIII
POST-DISTRIBUTION OBLIGATIONS
8.01 Energizer's Post-Distribution Obligations.
-------------------------------------------
(a) Energizer shall, and shall cause each member of the Energizer Group
to, comply with each representation and statement made, or to be made, to the
IRS in connection with any ruling obtained, or to be obtained, by Ralston from
the IRS with respect to any transaction contemplated by this Agreement. Neither
Energizer nor any member of the Energizer Group shall, for a period, following
the Distribution Date, of thirty months with respect to transactions described
in subparagraphs (b)(i), (iii), (iv), (v) and (vi) below; and of twenty-four
months with respect to the transaction described in subparagraph (b)(ii) below,
engage in any of the following transactions, unless, in the sole discretion of
Ralston, either
(i) an opinion in form and substance satisfactory to Ralston is obtained
from counsel to Energizer, the selection of which counsel is agreed to by Ral-
ston; or
(ii) a supplemental ruling is obtained from the IRS;
in either case to the effect that such transactions would not adversely affect
the tax consequences of the transactions described in Articles II and III of
this Agreement to Ralston or any member of the Ralston Group; Energizer or any
member of the Energizer Group; or the Ralston shareholders.
(b) The transactions subject to this provision are:
(i) making a material disposition (including transfers from one member
of the Energizer Group to another member of the Energizer Group), by means of a
sale or exchange of assets or capital stock, a distribution to share-
holders, or otherwise, of any of its assets (other than the transactions
contemplated by this Agreement) except in the ordinary course of
business;
(ii) repurchasing any Energizer Stock, unless such repurchase satis-
fies the requirements of Section 4.05(1)(b) of Revenue Procedure 96-30 or any
successor Revenue Procedure;
(iii) issuing capital stock of Energizer (or a successor to Energizer), whe-
ther incident to a stock offering, an acquisition transaction or otherwise, or
participating in a transaction in which shareholders of Energizer (or a
successor to Energizer) exchange or otherwise dispose of their stock in
Energizer (or a successor to Energizer), if the aggregate amount of shares
issued or disposed of in any such transactions represents a "fifty percent (50%)
or greater interest" in the total issued and outstanding stock of Energizer (or
a successor to Energizer) within the meaning of Section 355(d)(4) of the Code;
provided that Energizer further agrees to notify Ralston in advance of any such
transactions that would result in the issuance or disposition of an aggregate
amount of shares representing a ten percent (10%) or greater interest in the
total issued and outstanding stock of Energizer;
(iv) liquidating or merging with any other corporation (including a mem-
ber of the Energizer Group);
(v) ceasing to engage in the active conduct of a trade or business within
the meaning of Section 355(b)(2) of the Code; or
(vi) any other transaction, action or event which is, in any material re-
spect, inconsistent with any of the representations or statements set forth on
Schedule 8.01(b)(vi).
Energizer hereby represents that neither Energizer nor any member of the
Energizer Group has any present intention to undertake any of the transactions
set forth above, except as set forth in the ruling request submitted to the IRS
with respect to the Distribution.
8.02 Ralston's Post-Distribution Obligations. Ralston shall, and shall
----------------------------------------
cause each member of the Ralston Group to, refrain from taking any action which
would adversely impact any ruling obtained, or to be obtained, by Ralston from
the IRS with respect to any transaction contemplated by this Agreement.
8.03 Indemnification of Shareholders. In the event that Ralston or
---------------------------------
Energizer breaches or violates any covenant made in this Article VIII, the
breaching party shall indemnify and hold harmless:
(i) all shareholders of Ralston as of the Record Date, and
(ii) if the breaching party is Energizer, Ralston,
against and in respect of any and all costs, expenses, deficiencies, litigation,
proceedings, taxes, levies, assessments, attorneys' fees, damages or judgments
of any kind or nature whatsoever, related to, arising from, or associated with
such breach or violation.
ARTICLE IX
NO REPRESENTATIONS OR WARRANTIES; EXCEPTIONS
Energizer understands and agrees that, except as set forth in Article VIII,
no member of the Ralston Group is, in this Agreement or in any Ancillary
Agreement or other agreement or document, implicitly or explicitly representing
or warranting to Energizer in any way as to the Energizer Assets, the Battery
Business or the Liabilities of the Energizer Group or as to any consents or
approvals required in connection with the consummation of the transactions
contemplated by this Agreement, it being agreed and understood that the
Energizer Group shall take all of the Energizer Assets "as is, where is" and
that, except as provided in Section 2.04, the Energizer Group shall bear the
economic and legal risk that conveyances of the Energizer Assets shall prove to
be insufficient or that the title of any member of the Energizer Group to any
Energizer Assets shall be other than good and marketable and free from
encumbrances.
ARTICLE X
GUARANTEES AND SURETY BONDS OF RALSTON
Energizer agrees that, as soon as practicable following the Distribution
Date, it will substitute surety bonds obtained by it for each of the surety
bonds of any member of the Ralston Group, if any, relating to any Energizer
Asset, the Battery Business or any Liability assumed by Energizer or its
Subsidiaries or Affiliates hereunder. Energizer agrees that it shall enter
indemnification agreements in its name with each provider of a surety bond
obtained with respect to the Energizer Assets, the Battery Business or any
Liability assumed by Energizer. Energizer shall use its best efforts to obtain
the complete release and discharge of any member of the Ralston Group from all
obligations (including any obligations upon any renewal or extension) related to
the Energizer Assets, the Battery Business or any Liability assumed by Energizer
on which any member of the Ralston Group is directly or contingently obligated
as a guarantor or assignor or otherwise contingently liable (including, without
limitation, any letter of credit) (the " Energizer Obligations").
In the event that Energizer is unable to obtain any such release, Energizer
agrees that
(a) it shall not extend the term or otherwise modify any such Energizer
Obligation in a manner which would expand Ralston's financial exposure under
such Energizer Obligation,
(b) it shall use its best efforts to substitute itself or another
member of the Energizer Group as primary guarantor of such Energizer Obli-
gations, and
(c) Energizer or any member of the Energizer Group shall not assign any
such Energizer Obligation or directly or indirectly transfer, sell or
assign any assets securing such Energizer Obligation or comprising all or any
substantial portion of a project, the financing of which gave rise to
such Energizer Obligation, including, but not limited to, the transfer, sale
or assignment of the capital stock of any Affiliate holding title to such
assets, unless Ralston or the appropriate member of the Ralston Group, as the
case may be, is released and discharged of all liabilities with respect to
such Energizer Obligation.
Without limiting any other obligation of indemnification under this Agreement or
any agreement described herein, Energizer shall defend, indemnify and hold
harmless each member of the Ralston Group and their respective Affiliates,
Subsidiaries, directors, officers and employees against any and all Liabilities
whatsoever incurred or suffered by any of them as a result of any Energizer
Obligation.
ARTICLE XI
NEGOTIATION
If any question shall arise in regard to (i) the interpretation of any
provision of this Agreement or, except to the extent provided otherwise therein,
any Ancillary Agreement, or (ii) the rights or obligations of either Group
hereunder or thereunder, each Group shall designate a senior executive within
its organization who shall, within thirty days after such question arises, meet
with the designated executive of the other Group to negotiate and attempt to
resolve such question in good faith. Such senior executives may, if they so
desire, consult outside advisors for assistance in arriving at such a
resolution. In the event that a resolution is not achieved within sixty days
following such initial meeting, then the parties may seek other legal means of
resolving such question, including but not limited to mediation or binding or
non-binding arbitration.
ARTICLE XII
MISCELLANEOUS
12.01 Conditions to the Distribution.
---------------------------------
(a) The obligation of Ralston to make the Distribution is subject to
the satisfaction of each of the following conditions:
(i) The transactions contemplated by Article II shall have been
consummated in all material respects;
(ii) Ralston shall have received rulings from the IRS, in form and
substance satisfactory to Ralston's tax counsel and independent auditors, that
the contributions, transfers, assumptions, mergers and Distribution described in
Articles II and III of this Agreement will not be subject to federal income
taxation at the corporate or shareholder level;
(iii) The Energizer Stock and associated Rights shall have been approved
for listing on the NYSE, subject to official notice of issuance;
(iv) The Form 10 shall have been filed with the SEC and shall have become
effective, and no stop order with respect thereto shall be in effect;
(v) All authorizations, consents, approvals and clearances of all federal,
state, local and foreign governmental agencies required to permit the valid
consummation by the parties hereto of the transactions contemplated by this
Agreement shall have been obtained; and no such authorization, consent, approval
or clearance shall contain any conditions which would have a material adverse
effect on (A) the Ralston Business or the Battery Business, (B) the Assets,
results of operations or financial condition of the Ralston Group or the
Energizer Group, in each case taken as a whole, or (C) the ability of Ralston or
Energizer to perform its obligations under this Agreement; and all statutory
requirements for such valid consummation shall have been fulfilled;
(vi) Ralston shall have provided the NYSE with the prior written notice of
the Record Date required by Rule 10b-17 of the Exchange Act and the rules and
regulations of the NYSE;
(vii) No preliminary or permanent injunction or other order, decree or
ruling issued by a court of competent jurisdiction or by a government,
regulatory or administrative agency or commission, and no statute, rule,
regulation or executive order promulgated or enacted by any governmental
authority, shall be in effect preventing the payment of the Distribution;
(viii) The Distribution shall be payable in accordance with applicable
law;
(ix) All necessary consents, waivers or amendments to each bank credit
agreement, debt security or other financing facility to which any member of the
Ralston Group or the Energizer Group is a party or by which any such member is
bound shall have been obtained, or each such agreement, security or facility
shall have been refinanced, in each case on terms satisfactory to Ralston and
Energizer and to the extent necessary to permit the Distribution to be
consummated without any material breach of the terms of such agreement, security
or facility; and
(x) One or more members of the Energizer Group shall have been
substituted, as of the Distribution Date in respect of all Ralston Group debt
obligations assumed by Energizer or another member of the Energizer Group
pursuant to this Agreement.
(b) Any determination made by the Ralston Board in good faith
concerning the satisfaction or waiver of any or all of the conditions set forth
in Section 12.01(a) shall be conclusive.
12.02 Survival of Agreements. All covenants and agreements of the
------------------------
parties hereto contained in this Agreement shall survive the Distribution Date.
12.03 Entire Agreement. This Agreement, the Exhibits and Schedules
-----------------
hereto and the Ancillary Agreements shall constitute the entire agreement
between the parties hereto with respect to the subject matter hereof superseding
all previous negotiations, commitments and writings with respect to such subject
matter. To the extent that the provisions of this Agreement are inconsistent
with the provisions of any Ancillary Agreement, the provisions of such Ancillary
Agreement shall prevail.
12.04 Expenses of the Distribution. Except as otherwise provided in
-------------------------------
this Agreement and the Ancillary Agreements, after the Distribution, Ralston
shall remain obligated to pay the following costs and expenses:
(a) costs and expenses (including attorneys' and accountants' fees, legal
costs and expenses) associated with the registration of shares of Energizer's
common stock in connection with the Distribution;
(b) costs of paying shareholders cash in lieu of fractional shares, as
set forth in Section 3.03;
(c) costs and expenses (including attorneys' and accountants' fees, legal
costs and expenses) associated with effecting the restructuring transactions,
as set forth in Section 2.01;
(d) costs and expenses (including attorneys' and accountants' fees, legal
costs and expenses) related to the transfer of Energizer Assets, as set
forth in Section 2.04(a);
(e) costs and expenses incurred in connection with the establishment
of the Energizer SIP and the registration of Energizer Stock to be offered
under the Energizer SIP;
(f) reasonable fees and expenses (including attorneys' and accountants'
fees, legal costs, underwriting fees and expenses) related to Energizer's
establishment of a $175 million private placement of unsecured notes; Ralston's
and Energizer's establishment of a $450 million bank syndication credit
facility; and Energizer's establishment of a $200 million credit facility for
the purpose of selling, on a revolving basis, undivided ownership interest in
accounts receivable of the Energizer Group. In no event, however, shall Ralston
be responsible for any fees, including underwriting fees, costs and expenses,
related to the drawdown of funds under any of the foregoing except the initial
drawdown of funds by Ralston under the $450 million credit facility.
12.05 GOVERNING LAW; JURISDICTION AND VENUE. THIS AGREEMENT IS MADE
----------------------------------------
AND ENTERED INTO IN, AND SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH THE LAWS OF, THE STATE OF MISSOURI, UNITED STATES OF AMERICA,
WITHOUT REGARD TO ITS CONFLICTS OF LAW PRINCIPLES, AS TO ALL MATTERS, INCLUDING
MATTERS OF VALIDITY, CONSTRUCTION, EFFECT, PERFORMANCE AND REMEDIES UNDER THIS
AGREEMENT. ALL MATTERS RELATING TO THIS AGREEMENT SHALL, SUBJECT TO THE
PROVISIONS OF ARTICLE XI OF THIS AGREEMENT, BE ADJUDICATED EXCLUSIVELY IN THE
COURTS OF THE STATE OF MISSOURI LOCATED IN ST. LOUIS, MISSOURI, OR WITHIN THE
UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF MISSOURI; AND EACH
PARTY HEREBY CONSENTS TO THE EXCLUSIVE JURISDICTION AND VENUE OF SUCH COURTS FOR
ALL SUCH MATTERS.
12.06 Notices. All notices, requests, claims, demands and other
-------
communications hereunder (collectively, "Notices") shall be in writing and shall
be given (and shall be deemed to have been duly given upon receipt) by delivery
in person, by cable, telegram, telex, facsimile or other standard form of
telecommunications, or by registered or certified mail, postage prepaid, return
receipt requested, addressed as follows:
If to a member of the Ralston Group:
Ralston Purina Company
Checkerboard Square
St. Louis, Missouri 63164
Attention: General Counsel
If to a member of the Energizer Group:
Energizer Holdings, Inc.
800 Chouteau Avenue
St. Louis, Missouri 63102
Attention: General Counsel
or to such other address as either Group may have furnished to the other Group
by a notice in writing in accordance with this Section 12.06.
12.07 Amendment and Modification; Non-Waiver. This Agreement may be
-----------------------------------------
amended, modified or supplemented, or rights, powers or options hereunder waived
or impaired, only by a written agreement signed by a corporate officer of
Ralston and Energizer and attested by their respective corporate secretaries.
Neither party shall be deemed to have waived or impaired any right, power or
option created or reserved by this Agreement (including without limitation, each
party's right to demand compliance with every term herein, or to declare any
breach a default and exercise its rights in accordance with the terms hereof) by
virtue of:
(a) any custom or practice of the parties at variance with the terms
hereof;
(b) any failure, refusal or neglect to exercise any right hereunder, or
to insist upon compliance with any term;
(c) any waiver, forbearance, delay, failure or omission to exercise any
right or option, whether of the same, similar or different natures, under this
Agreement or in any other circumstances; or
(d) the acceptance by either party of any payment or other
consideration from the other following any breach of this Agreement.
The rights and remedies set forth in this Agreement are in addition to any other
rights or remedies which may be granted by law.
12.08 Successors and Assigns; No Third-Party Beneficiaries. This
---------------------------------------------------------
Agreement and all of the provisions hereof shall be binding upon and inure to
the benefit of each Group and their respective successors and permitted assigns,
but neither this Agreement nor any of the rights, interests and obligations
hereunder shall be assigned by either Group without the prior written consent of
the other Group (which consent shall not be unreasonably withheld). Except for
the provisions of Sections 4.02 and 4.03 relating to Indemnities, which are also
for the benefit of the Indemnitees, this Agreement is solely for the benefit of
each Group and is not intended to confer upon any other Person any rights or
remedies hereunder.
12.09 Counterparts. This Agreement may be executed in two or more
------------
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
12.10 Interpretation.
--------------
(a) The Article and Section headings contained in this Agreement are
solely for the purpose of reference, are not part of the agreement of the
parties hereto and shall not in any way affect the meaning or interpretation of
this Agreement.
(b) The parties hereto intend that, for federal income tax purposes,
the contributions, transfers, assumptions, Distribution and Merger contemplated
hereby shall qualify for non-recognition treatment under Sections 332, 336, 337,
355, 357(a), 361, 368(a)(1)(D) and 1032 of the Code.
12.11 Legal Enforceability. Any provision of this Agreement or any of
---------------------
the Ancillary Agreements which 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. Any such prohibition or unenforceability in any jurisdiction
shall not invalidate or render unenforceable such provision in any other
jurisdiction. Each party acknowledges that money damages would be an inadequate
remedy for any breach of the provisions of this Agreement or any of the
Ancillary Agreements and agrees that the obligations of the parties hereunder
and thereunder shall be specifically enforceable.
12.12 References; Construction. References to any "Article",
-------------------------
"Exhibit", "Schedule" or "Section", without more, are to Articles, Exhibits,
Schedules and Sections to or of this Agreement. Unless otherwise expressly
stated, clauses beginning with the term "including" set forth examples only and
in no way limit the generality of the matters thus exemplified.
12.13 Termination. Notwithstanding any provision hereof, this
-----------
Agreement may be terminated and the Distribution abandoned at any time prior to
the Distribution Date by and in the sole discretion of the Ralston Board without
the approval of any other party hereto or of Ralston's shareholders. In the
event of such termination, no party hereto shall have any Liability to any
Person by reason of this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
ENERGIZER HOLDINGS, INC. RALSTON PURINA COMPANY
By: /s/ Harry L. Strachan By: /s/ James R. Elsesser
Harry L. Strachan James R. Elsesser
Vice President and General Vice President Chief
Counsel Financial Officer and Treasurer
TAX SHARING AGREEMENT
-----------------------
BETWEEN
-------
RALSTON PURINA COMPANY
----------------------
AND
---
ENERGIZER HOLDINGS, INC.
------------------------
THIS AGREEMENT (the "Agreement") dated as of April 1, 2000 is made by and
between RALSTON PURINA COMPANY ("Ralston"), a corporation organized under the
laws of the State of Missouri, and ENERGIZER HOLDINGS, INC. ("Energizer"), a
corporation organized under the laws of the State of Missouri.
WHEREAS, Ralston is the common parent of an affiliated group of domestic
corporations within the meaning of Section 1504(a) of the U. S. Internal Revenue
Code of 1986, as amended (the "Code"), which group includes Energizer (such
corporations hereinafter referred to collectively as the "Ralston Domestic
Subsidiaries" and individually as a "Ralston Domestic Subsidiary", and such
affiliated group shall be referred to as the "Ralston Group");
WHEREAS, Ralston is also the parent of certain directly or indirectly owned
foreign corporations (such corporations hereinafter referred to collectively as
the "Ralston Foreign Affiliates", and individually as a "Ralston Foreign
Affiliate"), as more specifically defined below.
WHEREAS, on or before April 1, 2000, Energizer will become the common
parent of an affiliated group of domestic corporations within the meaning of
Code Section 1504(a) (such corporations hereinafter referred to collectively as
the "Energizer Domestic Subsidiaries" and individually as a "Energizer Domestic
Subsidiary", and such affiliated group shall be referred to as the "Energizer
Group");
WHEREAS, on or before April 1, 2000, Energizer will also become the parent
of certain directly or indirectly owned foreign corporations (such corporations
hereinafter referred to collectively as the "Energizer Foreign Affiliates" and
individually as the "Energizer Foreign Affiliate"), as more specifically defined
below.
WHEREAS, Ralston intends to distribute to its shareholders all of its stock
in Energizer (the "Distribution") in accordance with the terms and conditions of
the Agreement and Plan of Reorganization between Ralston and Energizer dated as
of April 1, 2000 (the "Plan of Reorganization") on April 1, 2000 (the
"Distribution Date") in accordance with a favorable ruling from the Internal
Revenue Service ("IRS") dated February 4, 2000 that the Distribution qualifies
as a nontaxable distribution of stock of a controlled corporation under Code
Section 355; and that certain ancillary transactions also qualify as nontaxable
under Code Section 355, 368(a)(1)(D), 332, 351 and 367; and,
WHEREAS, Ralston and Energizer believe that it is in their mutual best
interests to set forth in this Agreement the rights, obligations and duties of
each party with respect to various tax matters relating to the Energizer Group,
the Ralston Group, the Ralston Foreign Affiliates and the Energizer Foreign
Affiliates which may arise as a result of the Distribution.
NOW, THEREFORE, in consideration of the premises and of the agreements
herein set forth, Ralston, (on its own behalf and on behalf of the Ralston
Domestic Subsidiaries and the Ralston Foreign Affiliates) and Energizer (on its
own behalf and on behalf of the Energizer Domestic Subsidiaries and the
Energizer Foreign Affiliates), hereby agree as follows:
ARTICLE I. DEFINITIONS
For purposes of the provisions set forth in this Agreement,
(a) The term "Audit(s)" shall mean any audit or examination undertaken
by a Tax authority with respect to Taxes.
(b) The term "Battery Business" shall have the same meaning as the term
is given in the Plan of Reorganization.
(c) The term "Controversy(ies)" shall mean any action involving a Tax
authority before any administrative or judicial body which results from a
disagreed Tax adjustment proposed during the course of an Audit.
(d) The term "Domestic" as used herein to modify the terms "Tax",
"Taxes" or "Return", shall mean with respect to any U.S. federal, territorial,
state or local government.
(e) The terms "Energizer Employee" or "Former Energizer Employee" shall
have the same meaning as such term is given in the Plan of Reorganization.
(f) The term "Energizer Foreign Affiliate" shall mean any entity which
on or after the Distribution Date is owned directly or indirectly (or, pur-
suant to the Agreement and Plan of Reorganization, is owned beneficially)
by Energizer, and is formed under the laws of a government other than the
United States, its states or territories.
(g) The term "Foreign" as used herein to modify the terms "Tax",
"Taxes" or "Return", shall mean with respect to any government which is
not an U.S. federal, territorial, state or local government.
(h) The term "Former Battery Business" shall have the same meaning as
the term is given in the Plan of Reorganization.
(i) The term "Former Ralston Business" shall have the same meaning as
the term is given in the Plan of Reorganization.
(j) The term "Joint Foreign Affiliate" shall mean any Foreign entity
that currently or formerly conducted a Ralston Business or a Former Ralston
Business and a Battery Business or a Former Battery Business, provided, however,
that, for purposes of this Agreement, after the Distribution Date any such Joint
Foreign Affiliate shall thereinafter be treated as a Ralston Foreign Affiliate
or Energizer Foreign Affiliate, as the case may be.
(k) The term "Ralston Business" shall have the same meaning as the term
is given in the Plan of Reorganization.
(l) The term "Ralston Employee" shall have the same meaning as the term
is given in the Plan of Reorganization.
(m) The term "Ralston Foreign Affiliate" shall mean any entity which on
or after the Distribution Date is owned directly or indirectly (or, pursuant to
the Agreement and Plan of Reorganization, is owned beneficially) by Ralston, is
formed under the laws of a government other than the United States, its states
or territories, and is not an Energizer Foreign Affiliate.
(n) Tax or Taxes. As used herein, "Tax" or "Taxes" shall mean any and
-------------
all taxes, charges, fees, levies or other assessments, however denominated,
including any interest, penalties, fines, or other additions that may become
payable in respect thereof, that are imposed, by any governmental entity,
whether foreign or domestic, federal, territorial, state or local, or any agency
or political subdivision of any such governmental entity; including, but not
limited to, all income, profits, gross receipts, earnings, net worth, payroll,
withholding, unemployment insurance, Social Security, Medicare Hi, sales, use,
ad valorem, excise, franchise, license, occupation, real or personal property,
stamp, transfer, value-added, recording, registration, other governmental
charges, and other government obligations of the same or of a similar nature to
any of the foregoing, which any member of the Ralston Group or Energizer Group,
or any Ralston Foreign Affiliate or Energizer Foreign Affiliate, is required to
pay, withhold or collect. With respect to Foreign Taxes allocated between or
among the Ralston Business, the Battery Business, any Former Ralston Business,
or any Former Battery Business currently or formerly conducted by a Joint
Foreign Affiliate, Taxes shall mean the Taxes that would have been imposed had
the Battery Business or Former Battery Business been the sole business of a
single Foreign Affiliate, in accordance with Article III 1(b)(i) and (ii)
hereof.
(o) The term "Tax Return" or "Return" shall mean any return, filing,
questionnaire, information report or other document required to be filed,
including without limitation any amended returns, any documents with respect to
or accompanying payments of estimated Taxes, that may be filed, for any Tax
period with any Tax authority (domestic or foreign) in connection with any Tax
or Taxes (whether or not payment is required to be made with respect to such
filing). As used herein, "Consolidated Tax Return" shall mean a U.S. federal
income Tax Return described in Code Section 1501.
Any other capitalized terms not defined herein shall have the same meaning as in
the Agreement and Plan of Reorganization.
ARTICLE II. DOMESTIC TAXES
1. Domestic taxes - Preparation and Filing of Tax Returns, Payment of Taxes,
-------------------------------------------------------------------------
Adjustments, Audits and Controversies.
- ----------------------------------------
(a) Preparation and Filing of Domestic Returns.
-----------------------------------------------
(i) The preparation and filing of any Domestic Tax Return for Energi-
zer or the Energizer Domestic Subsidiaries for any Tax period ending prior
to the Distribution Date shall be the responsibility of Ralston. Ralston
shall consistently prepare and file such Domestic Tax Returns in accordance
with its historical practices. To the extent practicable, Ralston shall permit
Energizer to review and comment on, prior to filing, any such Domestic
Tax Return.
(ii) Energizer hereby designates and Energizer agrees to cause each
of the Energizer Domestic Subsidiaries to designate Ralston irrevocably as its
agent for the purpose of taking any and all action necessary or incidental
to the filing of any Consolidated Return or any other Domestic Tax Return, as
necessary for any Tax period ending prior to the Distribution Date.
(iii) The preparation and filing of any Domestic Tax Return for
Energizer or the Energizer Domestic Subsidiaries for any Tax period
beginning on or after the Distribution Date shall be the responsibility
of Energizer. In addition, Energizer shall be responsible for the preparation
and filing of any Energizer Domestic Subsidiary Domestic Tax Return for Tax
periods beginning before and ending after the Distribution Date. For purposes
of the preceding sentence, and to the extent practicable, Energizer shall
permit Ralston to review and comment on, prior to filing, any such
Domestic Tax Return.
(b) Liability for Domestic Taxes.
-------------------------------
(i) Pre-Distribution Date. Ralston shall be liable for, shall indemnify and
---------------------
hold the Energizer Group harmless against, and shall make payment of any
Domestic Tax which is attributable to the Energizer Group, for any and all Tax
periods (or portions of periods) ending prior to the Distribution Date and that
portion of any Tax period straddling the Distribution Date that ends on the day
before the Distribution Date, including any such liabilities resulting from the
Audit or other adjustment to previously filed Domestic Tax Returns with respect
to any such Tax period (or portion thereof). Subject to subparagraph (iii)
hereof, Ralston shall be entitled to any and all refunds of such Domestic Taxes
for any such Tax period, including but not limited to refunds described in
subparagraph (v) hereof. For purposes of this subparagraph (b), Ralston will be
credited for any estimated Domestic Tax payments made for such Tax periods.
(ii) Post-Distribution Date. Energizer shall be liable for, shall indemnify
----------------------
and hold the Ralston Group harmless against, and make payment of any
Domestic Tax due which is attributable to the Energizer Group for all Tax
periods beginning on or after the Distribution Date and that portion of any Tax
period straddling the Distribution Date that begins on the Distribution Date and
shall be entitled to any and all refunds of such Domestic Taxes for that portion
of any such Tax period.
(iii) Proration of Taxes. To the extent permitted by law or administrative
-------------------
practice, the Tax periods of the Energizer Group and each Energizer Domestic
Subsidiary shall end on the day immediately preceding the Distribution Date.
For purposes of determining the liability for Domestic Taxes of an Energizer
Subsidiary for a portion of a taxable year or period that begins before and ends
after the Distribution Date, as necessary under applicable law, the
determination of the Domestic Taxes for the portion of the year or period ending
immediately prior to, and the portion of the year or period beginning on or
after, the Distribution Date shall be determined by assuming that the taxable
year or period ended on the day immediately preceding the Distribution Date,
except that exemptions, allowances or deductions that are calculated on an
annual basis and annual property Taxes shall be prorated on the basis of the
number of days in the applicable annual period elapsed through the day
immediately preceding the Distribution Date.
(iv) Energizer's Carryback of Post-Distribution Deductions, Losses or
----------------------------------------------------------------------
Credits. If (A) Energizer or any Energizer Domestic Subsidiary, shall be
- ------- entitled to carry back any net operating loss, capital loss, or other
similar losses, deductions or credits derived with respect to any period begin-
ning on or after the Distribution Date to any Tax period commencing prior
to the Distribution Date, and (B) any such carry back results in a decrease in
Domestic Taxes paid by Ralston or any Ralston Domestic Subsidiary (as com-
Pared to the Taxes Ralston or such member of the Ralston Group would
otherwise have paid solely without giving effect to such carry back), an
amount equal to any such Tax refunds (plus interest) received by Ralston
or the Ralston Domestic Subsidiaries as a result of such carrybacks
shall be promptly remitted to Energizer. Ralston and Energizer agree to,
and shall cause the appropriate member(s) of their respective Groups to,
cooperate with each other in order to obtain such refunds. Energizer agrees
to reimburse the members of the Ralston Group for any reasonable out-of-
pocket expenses related thereto.
(v) Energizer's Claiming, Receiving or Using Refunds and Overpayments. If
-------------------------------------------------------------------
on or after the Distribution Date, a member of the Energizer Group receives any
refund or utilizes the benefit of any overpayment of Domestic Taxes which, in
either case, relates to Domestic Taxes paid by a member of the Ralston Group
with respect to a taxable period or portion thereof ending on or prior to the
Distribution Date, then Energizer shall promptly transfer, or cause to be
transferred to Ralston an amount equal to the entire amount of the refund or
overpayment (including interest) received or utilized by the Energizer Group.
Energizer agrees to notify Ralston within thirty (30) days after the discovery
of a right to claim any such refund or overpayment and the receipt of any such
refund or utilization of any such overpayment. Energizer agrees to, or to cause
the appropriate member of the Energizer Group to, claim any such refund or
to utilize any such overpayment as soon as possible and to furnish to Ralston
all information, records and assistance necessary to verify the amount of the
refund or overpayment. Ralston and Energizer agree to, and shall cause the
appropriate member(s) of their respective Groups to, cooperate with each other
in order to obtain such refunds or overpayments and Ralston agrees to reimburse
Energizer for any reasonable out-of-pocket expenses related thereto.
(vi) Tax Liabilities/Benefits Resulting from Post Distribution Stock Option
-----------------------------------------------------------------------
Exercises by Energizer Employees, Former Energizer Employees and Post
- -----------------------------------------------------------------------------
Distribution Energizer Employees. Energizer shall be liable for any and all
- ----------------------------------
Taxes, including but not limited to, payroll, Social Security, and Medicare Hi
Taxes, imposed on an employer (the "Employer Taxes") with respect to
compensation resulting from the exercise of Ralston stock options on or after
the Distribution Date by any Energizer Employee, Former Energizer Employee or
other individual who becomes employed by a member of the Energizer Group after
the Distribution Date, if at the time of the grant of such stock option, the
recipient was an employee of the Battery Business or identified on payroll
records as an employee of the Battery Business. In the event that Ralston,
acting on behalf of Energizer, pays and deposits such Employer Taxes with
respect to such compensation, then Ralston shall be entitled to reimbursement
from Energizer for such Employer Taxes, net of the tax benefit derived from any
income tax deduction to Ralston attributable to such Employer Taxes. If as a
result of such exercise of a Ralston stock option, Energizer shall be entitled
to claim on the appropriate Tax Return a corresponding income tax deduction for
the compensation expense, resulting in an actual diminution of any Domestic
Taxes, then Energizer shall pay Ralston the amount of such actual diminution of
Domestic Taxes as well as any reimbursement for Employer Taxes provided herein
within thirty (30) days after written notification of Energizer by Ralston of
such option exercise.
(vii) Tax Liabilities Resulting from Post Distribution Stock Option
--------------------------------------------------------------------
Exercises by all Other Employees. Ralston shall be liable for all Employer
- ------------------------------------
Taxes with respect to compensation resulting from the exercise of Ralston stock
options on or after the Distribution Date by any Energizer Employee or Former
Energizer Employee, if at the time of the award of the grant of the stock
option, the recipient was an employee of Ralston Purina Company or otherwise
employed by a Ralston Business. Ralston shall be entitled to claim on the
appropriate Tax Return a corresponding income tax deduction for the compensation
expense and related Employer Taxes paid. To the extent that Ralston is
entitled to such income tax deduction but Energizer is determined by a Tax
authority to be liable for such Employer Taxes, Ralston shall pay Energizer an
amount equal to such Employer Taxes, net of the tax benefit derived from any
income tax deduction to Energizer attributable to such Employer Taxes, within
thirty (30) days after a final determination by a court or administrative
authority that Energizer is so liable.
(viii) Tax Liabilities/Benefits Resulting from Other Deferred Compensation
---------------------------------------------------------------------
Payable Post Distribution. Energizer shall be liable with respect to any
- ---------------------------
Employer Taxes with respect to payments by Ralston under the Fixed Benefit
Option of the Ralston Purina Company Deferred Compensation Plan for Key
Employees ("Ralston Deferred Compensation Plan") to any Energizer Employee,
Former Energizer Employee or individual who becomes employed by a member of the
Energizer Group after the Distribution Date, if at the time of the award of a
benefit under the Ralston Deferred Compensation Plan, the recipient was an
employee of the Battery Business or identified on payroll records as an employee
of the Battery Business. In the event that Ralston, acting on behalf of
Energizer, pays and deposits such Employer Taxes for which Energizer is liable
under this provision with respect to such compensation, then Ralston shall be
entitled to reimbursement from Energizer for such Employer Taxes for which it is
liable under this provision, net of the tax benefit derived from any income tax
deduction to Ralston attributable to such Employer Taxes. If as a result of
such payment of compensation by Ralston, Energizer shall be entitled to claim on
the appropriate Tax Return a corresponding income tax deduction for the
compensation expense, resulting in an actual diminution of any Domestic Taxes,
then Energizer shall pay Ralston the amount of such actual diminution of
Domestic Taxes as well as any reimbursement for Employer Taxes provided herein
within thirty (30) days after written notification of Energizer of such payment.
Ralston shall be liable for all Employer Taxes with respect to payments
under the Ralston Deferred Compensation Plan on or after the Distribution Date
to any Energizer Employee or Former Energizer Employee, if at the time of the
award of a benefit under the Ralston Deferred Compensation Plan the recipient
was an employee of Ralston Purina Company or otherwise employed by a Ralston
Business. Ralston shall be entitled to claim on the appropriate Tax Return a
corresponding income tax deduction for the compensation expense and related
Employer Taxes paid. To the extent that Ralston is entitled to such income tax
deduction but Energizer is determined by a Tax authority to be liable for such
Employer Taxes, Ralston shall pay Energizer an amount equal to such Employer
Taxes, net of the tax benefit derived from any income tax deduction to Energizer
attributable to such Employer Taxes, within thirty (30) days after a final
determination by a court or administrative authority that Energizer is so
liable.
(ix) Reimbursement of Other Tax Benefits. Energizer shall reimburse Ralston
-----------------------------------
to the extent of Domestic Tax benefits derived by any member of the
Energizer Group, for payments made by Ralston to third parties on or after the
Distribution Date, which result in a tax deduction to Energizer or an Energizer
Domestic Subsidiary ("Ralston Payments"), provided such Ralston Payments (a) are
not claimed as a deduction by Ralston for Domestic Tax purposes, (b) are
deductible on a Domestic Tax Return of the Energizer Group, and (c) result in a
reduction of Domestic Taxes of Energizer, the Energizer Group, or any Energizer
Domestic Subsidiary. The amount of the payment required hereunder for any
taxable period of Energizer shall be equal to the actual diminution of any
Domestic Taxes by reason of any Ralston Payments. Provided, however, if for any
taxable period, (X) Energizer or Ralston files an amended Domestic Tax Return
(or files a carryback or carryforward claim relating to a net operating loss),
or (Y) the IRS adjusts any item on any Energizer or Ralston Domestic Tax Return,
the amount of the payment required under this paragraph shall be recomputed
(either at the time of the filing of the amended return, or carryover or
carryback claim, or at the time of the final determination of the IRS
adjustment) to reflect such amended return, claim, or IRS adjustment, and, at
such time, either (I) Ralston shall repay any overpayment by Energizer under
this paragraph of this Article II.1(b)(ix) to Energizer, or (II) Energizer shall
pay any underpayment under this paragraph of this Article II.1(b)(ix) to
Ralston.
Ralston shall reimburse Energizer to the extent of Domestic Tax benefits
derived by any member of the Ralston Group for payments made by Energizer to
third parties on or after the Distribution Date, which result in a tax deduction
to Ralston or a Ralston Domestic Subsidiary ("Energizer Payments") for any
period beginning after the Distribution Date, provided such Energizer Payments
(a) are not claimed as a deduction by Energizer for Domestic Tax purposes, (b)
are deductible on a Domestic Tax Return of the Ralston Group for any period
beginning after the Distribution Date, and (c) result in a reduction of Domestic
Taxes of Ralston, the Ralston Group, or any Ralston Domestic Subsidiary. The
amount of the payment required hereunder for any taxable period of Ralston shall
be equal to the actual diminution of any Domestic Taxes by reason of any
Energizer Payments. Provided, however, if for any taxable period, (X) Ralston
or Energizer files an amended Domestic Tax Return (or files a carryback or
carryforward claim relating to a net operating loss), or (Y) the IRS adjusts any
item on any Ralston or Energizer Domestic Tax Return, the amount of the payment
required under this paragraph shall be recomputed (either at the time of the
filing of the amended return, or carryover or carryback claim, or at the time of
the final determination of the IRS adjustment) to reflect such amended return,
claim, or IRS adjustment, and, at such time, either (I) Energizer shall repay
any overpayment by Ralston under this paragraph of this Article II.1(b)(ix) to
Ralston, or (ii) Ralston shall pay any underpayment under this paragraph of this
Article II.1(b)(ix) to Energizer.
Ralston or Energizer, as the case may be, will provide, in a timely manner
(but in no event more than thirty (30) days after written request therefor),
such information as is reasonably necessary to substantiate the deduction for a
Ralston Payment or an Energizer Payment, as the case may be, so as to permit
inclusion of such deduction on the appropriate Domestic Tax Return of Energizer,
the Energizer Group, or any Energizer Domestic Subsidiary or Ralston, the
Ralston Group, or any Ralston Domestic Subsidiary, as the case may be. At
Ralston's or Energizer's written request, as the case may be, to the extent that
"substantial authority" (as defined in Section 6662 of the Code) exists
therefor, Energizer or Ralston, as the case may be, (a) shall claim the
deduction for (and shall not report income with respect to) a Ralston Payment or
an Energizer Payment, as the case may be, on the appropriate federal, state or
local income tax return, and (b) shall contest any claim by a taxing authority
relating to the Ralston Payment or the Energizer Payment, as the case may be,
provided Ralston or Energizer, as the case may be has agreed to indemnify the
other in a manner reasonably satisfactory to Energizer or Ralston, as the case
may be, for any liability or loss (including (i) interest and penalties on
Taxes, and (ii) any reasonable out-of-pocket expenses) incurred by Energizer or
Ralston, as the case may be, as a result of taking such return position or
pursuing such contest.
(c) Domestic Audits and Controversies.
------------------------------------
(i) Ralston shall, at its own expense, exclusively control and
direct any Tax Audit or Controversy with respect to any Domestic Taxes for any
Tax period ending prior to the Distribution Date. Energizer, however, shall
have the right, at its own expense, to participate in any such Audit or
Controversy to the extent such Audit or Controversy would impact the Domestic
Taxes for which Energizer is liable in accordance with this Agreement, as
determined by Energizer, and Ralston shall not consent to any resolution,
compromise or conclusion of such Audit or Controversy without the written
approval of Energizer, which approval shall not be unreasonably withheld.
Notwithstanding the foregoing, in the event Ralston shall compromise or settle
any such deficiency of Domestic Tax without the prior consent of Energizer,
Ralston shall hold Energizer and any Energizer Domestic Subsidiary harmless
against any losses, costs, or damages, including Taxes resulting from such
compromise or settlement.
(ii) Energizer shall, at its own expense, exclusively control and
direct any Audit or Controversy with respect to any Domestic Taxes attributable
to the Energizer Group for a Tax period which begins on or after the
Distribution Date and for any Tax period straddling the Distribution Date.
Ralston, however, shall have the right, at its own expense, to participate in
any such Audit or Controversy to the extent such Audit or Controversy would
impact the Domestic Taxes for which Ralston is liable in accordance with this
Agreement, as determined by Ralston, and Energizer shall not consent to any
resolution, compromise or conclusion of such Audit or Controversy without the
written approval of Ralston, which approval shall not be unreasonably withheld.
Notwithstanding the foregoing, in the event Energizer shall compromise or settle
any such deficiency of Domestic Tax without the prior consent of Ralston,
Energizer shall hold Ralston and any Ralston Domestic Subsidiary harmless
against any losses, costs, or damages, including Taxes resulting from such
compromise or settlement.
(d) Domestic Tax Adjustments.
--------------------------
(i) If the IRS, or any state or local taxing authority, shall make
an adjustment to any Domestic Tax Return of (A) the Ralston Group, (B) any
Ralston Domestic Subsidiary, (C) Energizer, or (D) any Energizer Domestic
Subsidiary for any Tax period ending prior to the Distribution Date, and such
adjustment (including but not limited to adjustments to tax basis determination,
a tax accounting method with respect to its property and accounts included in
and carried forward from Ralston or the Ralston Domestic Subsidiaries prior to
the Distribution Date), consistently applied would require Energizer or the
Energizer Domestic Subsidiaries to make a corresponding adjustment to their
Domestic Tax Returns for periods beginning on or after the Distribution Date,
then,
(A) if such corresponding adjustment in a Domestic Tax Return
of Energizer or any Energizer Domestic Subsidiary results in an actual
diminution of any Domestic Taxes for any such period beginning on or after the
Distribution Date, whether or not an actual amended return is filed, Energizer
shall pay Ralston the amount of such Domestic Tax either (I) when such refund
and related interest are received and required to be remitted within the period
provided in Article VI 3 hereof, or (II) within thirty (30) days of written
notice by Ralston to Energizer of such corresponding adjustment, if an amended
return is not filed.
(B) if such corresponding adjustment in a Domestic Tax
Return of Energizeror any Energizer Domestic Subsidiary results in an increase
of any Domestic Tax for Energizer for such period beginning on or after the
Distribution Date, and an actual diminution of any Domestic Tax for
Ralston, Ralston shall pay Energizer the amount of such Domestic Tax, either
due (I) when such refund and related interest are received and required to
be remitted within the period provided in Article VI.3 hereof, or (II)
within thirty (30) days of written notice by Energizer to Ralston of such
corresponding adjustment, if an amended return is not filed.
No payment shall be due under this Article II.1(d) to the extent that any
payment is made, or would be required to be made for the same adjustment, under
Article II.1(b)(ix) hereof.
(e) Domestic Transfer Taxes. Ralston shall pay any and all Domestic
-------------------------
Taxes required upon, or by virtue of, any transfer of property contemplated
under the Plan of Reorganization including the transfer of shares of stock of
Energizer Domestic Subsidiaries in connection with the Distribution.
(f) Domestic Tax Attributes.
-------------------------
(i) Any Domestic Tax attribute generated by Ralston or Energizer
shall, to the extent permitted by the applicable law of the Tax jurisdiction in
question, remain with Ralston or Energizer, respectively, or the appropriate
entity. In any case where the applicable law of the Tax jurisdiction in
question requires such Tax attribute to be allocated between Ralston and
Energizer, such allocation shall be made as provided by the law of such
jurisdiction.
Notwithstanding the foregoing, any state or local net operating
losses or Tax credits generated by a member of the Energizer Group for any Tax
period beginning prior to the Distribution Date shall be for the benefit of
Ralston. As permitted by the applicable law of the appropriate Tax
jurisdiction, such net operating losses or Tax credits shall be first carried
back to prior Tax periods. In the event that (i) the applicable law of the Tax
jurisdiction does not permit the carryback of such losses or Tax credits, or
(ii) such losses or Tax credits cannot be fully utilized in an allowable
carryback, then Energizer shall pay Ralston the amount of the actual diminution
of any state or local Taxes of Energizer resulting from the utilization by any
member of the Energizer Group of such losses or credits within thirty (30) days
of the filing of the Tax Return reflecting the utilization of such loss or Tax
credit, in accordance with Article VI, 3 hereof.
(ii) Any excess Foreign Tax credits of the Ralston Group, as of
the Distribution Date, as finally determined by Ralston in accordance with Code
Section 904, shall be allocated between the Ralston Group and the Energizer
Group, in accordance with Reg. 1.1502-79(d).
(iii) Any earnings and profits of the Ralston Group as of the
Distribution Date, as finally determined by Ralston, shall be allocated between
the Ralston Group and the Energizer Group in accordance with Reg. 1.312-10(a).
(iv) Any Capital Loss Carryovers of the Ralston Group, as of the
end of the fiscal year that includes the Distribution Date, as finally
determined by Ralston, shall be allocated between the Ralston Group and the
Energizer Group in accordance with
Reg. 1.1502-22T.
(g) Dual Resident Corporations. Energizer shall timely enter into any
---------------------------
closing agreement with Ralston and the IRS in accordance with Regs Section
1503-2(g)(2)(iv)(B)(2), to the extent necessary to avoid recapture of any "dual
consolidated loss", within the meaning of Regs. Section 1.1503-2(c)(5) generated
by any Energizer Domestic Subsidiary, which constitutes a "dual resident
corporation" within the meaning of Regs. Section 1.1503-2(c)(2). To the extent
Energizer causes the recapture of any "dual consolidated loss" created prior to
the Distribution Date, Energizer shall pay or reimburse Ralston for any taxes
and interest due as a result of the recapture.
(h) Gain Recognition Agreements. Energizer shall timely file any
-----------------------------
annual certifications required by any Agreements to Recognize Gain pursuant
to Reg. 1.367(a)-3T(g) entered into by Ralston to defer gain on a transaction
including an Energizer Foreign Affiliate. To the extent Energizer causes the
recognition of any such deferred gain after the Distribution Date, Energizer
shall pay or reimburse Ralston for any Domestic Taxes and interest due as a
result of the recognition of such gain.
ARTICLE III. FOREIGN TAXES
1. Preparation and Filing of Ttax Returns, Payment of Taxes, Adjustments,
-------------------------------------------------------------------------
Audits and Controversies.
- --------------------------
(a) Preparation and Filing of Foreign Returns.
----------------------------------------------
(i) Energizer shall be responsible for the preparation and filing
of any Foreign Tax Return of any Energizer Foreign Affiliate for all Tax
Periods.
(ii) Ralston shall be responsible for the preparation and filing
of any Foreign Tax Return of any Ralston Foreign Affiliate for all Tax Periods.
(iii) In the case of any Joint Foreign Affiliate, which, after the
Distribution Date, shall become a Ralston Foreign Affiliate or an Energizer
Foreign Affiliate, as the case may be, consistent with the definition herein of
"Joint Foreign Affiliate," with the cooperation and assistance of Ralston and
Energizer, shall prepare and file any Foreign Tax Return of such entity for any
Tax period ending prior to, or straddling, the Distribution Date.
(b) Liability for Foreign Taxes.
------------------------------
(i) Except in respect of (A) the Foreign Transfer Taxes described
in subparagraph (c) below, and (B) any Foreign Taxes with respect to the (I)
U.K. Restructuring, (II) Brazilian Restructuring, (III) Mexican Restructuring,
(IV) Argentinean/Chilean Restructuring, or (V) Canadian Restructuring, as
described in Article II of the Plan of Reorganization, or (VI) the
pre-Distribution Date transactions listed on the attached Schedule A. Energizer
shall be liable for, shall indemnify and hold the Ralston Group and the Ralston
Foreign Affiliates harmless against, and shall make payment of all Foreign Taxes
attributable to the Battery Business and any Former Battery Business, for any
and all Tax periods commencing before, on, or after the Distribution Date,
including any Foreign Taxes attributable to the Battery Business and the Former
Battery Business conducted by any Joint Foreign Affiliate and including any such
liabilities resulting from an Audit or other adjustment to previously filed Tax
Returns. Other than refunds of the Foreign Transfer Taxes and Foreign Taxes
with respect to the Restructurings, described in (A) and (B) above, Energizer
shall be entitled to any refund of Foreign Taxes attributable to the Battery
Business and any Former Battery Business for any such Tax periods, including any
Foreign Taxes attributable to the Battery Business and any Former Battery
Business conducted by any Joint Foreign Affiliate. The allocation of any such
Foreign Taxes between or among the Ralston Business, the Battery Business, the
Former Ralston Business or any Former Battery Business of a Joint Foreign
Affiliate shall be determined in accordance with the books and records of
Ralston, any Ralston Foreign Affiliate and any Joint Foreign Affiliate, as
though the Battery Business or Former Battery Business were deemed to have been
conducted as the sole business of such Joint Foreign Affiliate.
(ii) Ralston shall be liable for, shall indemnify and hold the
Energizer Group and the Energizer Foreign Affiliates harmless against, and shall
make payments of, all (A) Foreign Taxes owed by any Ralston Businesses and
Former Ralston Businesses, for any and all Tax periods commencing before, on, or
after the Distribution Date, including any such Foreign Taxes attributable to
the Ralston Businesses or the Former Ralston Businesses conducted by any Joint
Foreign Affiliate prior to the Distribution Date, and including any such
liabilities resulting from an Audit or other adjustment to previously filed Tax
Returns and (B) any Foreign Taxes with respect to the Restructurings. Ralston
shall be entitled to any refund of such Foreign Taxes for any Tax period. The
allocation of any such Foreign Taxes between or among the Ralston Businesses,
the Battery Business, any Former Ralston Businesses or any Former Battery
Businesses of a Joint Foreign Affiliate shall be determined in accordance with
the books and records of Ralston, any Ralston Foreign Affiliate and any Joint
Foreign Affiliate, as may be appropriate, as though the Battery Business or
Former Battery Business were deemed to have been conducted as the sole business
of such Joint Foreign Affiliate.
(iii) If, in accordance with this Article III 1(b), either Ralston
or Energizer is liable for any portion of the Foreign Taxes payable in
connection with any Foreign Tax Return to be filed by the other, the party
responsible for filing such Return (the "Preparer") shall prepare and deliver to
the other party (the "Payor") a copy of such return and any schedules, work
papers and other documentation then available that are relevant to the
preparation of the portion of such return for which the Payor is or may be
liable hereunder not later than the earlier of (A) twenty (20) days prior to the
due date for such Tax Return (including applicable extensions) (the "Due Date"),
or (B) the date the information is available in the normal course of business.
The Preparer shall not file such return until the earlier of either the receipt
of written notice from the Payor indicating the Payor's consent thereto, or five
(5) days prior to the Due Date to ensure timely receipt of the return by the
taxing jurisdiction.
The Payor shall have the option of providing to the Preparer, at
any time at least ten (10) days prior to the Due Date, written instructions as
to how the Payor wants any, or all, of the items for which it may be liable in
full reflected on such Tax Return. Failure by the Payor to give written
instructions at least ten (10) days prior to the Due Date shall constitute a
waiver by the Payor of its right to provide instructions, to the extent such
failure is prejudicial to the Preparer.
The Preparer shall, in preparing such Return, cause the items for
which the Payor is liable hereunder to be reflected in accordance with the
Payor's instructions unless the Preparer determines that such manner of
reporting is in contravention of applicable law. In the absence of having
received instructions from Payor, such items shall be reported in the manner
determined by the Preparer, which is not in contravention of applicable law, and
consistent with historic business practices, as applicable. The Payor shall
timely pay the Preparer an amount equal to the Foreign Taxes for which it is
liable consistent with the Return, and in accordance with Article VI 3 hereof.
(c) Foreign Transfer Taxes. Ralston shall pay or shall reimburse
------------------------
Energizer or an Energizer Foreign Affiliate as appropriate, for payment of any
and all Foreign Taxes upon, or by virtue of, any transfer of property
contemplated under the Plan of Reorganization, including the transfer of shares
of stock of Energizer Foreign Affiliates to Energizer in connection with the
Distribution. Foreign Tax Returns required to be prepared and filed by
Energizer relating to the transfer of shares of stock of Energizer Foreign
Affiliates to Energizer, must be provided to Ralston by Energizer at least ten
(10) days prior to the due date for such Tax Returns so that Ralston may timely
make any payment of Foreign Transfer Taxes due with respect to such Foreign Tax
Return. Ralston shall reimburse Energizer, or an Energizer Foreign Affiliate,
as appropriate, for any such Foreign Transfer Taxes paid, within thirty (30)
days of presentation of a receipt evidencing payment of such Taxes by the
Foreign Affiliate.
(d) Foreign Audits and Controversies.
-----------------------------------
(i) Energizer, at its expense, shall exclusively control and
direct any Audit or Controversy with respect to any Energizer Foreign Affiliate.
Ralston, however, shall have the right to participate in any such Audit or
Controversy to the extent such Audit or Controversy would impact the Foreign
Taxes or Domestic Taxes for which Ralston is liable in accordance with this
Agreement. Energizer shall not consent to any resolution, compromise or
conclusion of such Audit or Controversy without the written approval of Ralston,
which approval shall not be unreasonably withheld. Notwithstanding the
foregoing, in the event Energizer shall compromise or settle any such deficiency
of Foreign Tax without the prior consent of Ralston, Energizer shall indemnify
and hold Ralston and any Ralston Foreign Affiliate harmless against any losses,
costs, or damages, including Taxes resulting from such compromise or settlement.
(ii) Ralston, at its expense, shall exclusively control and direct
any Tax Audit or Controversy as to any Foreign Tax with respect to any Ralston
Foreign Affiliate. Energizer, however, shall have the right to participate in
any such Audit or Controversy to the extent such Audit or Controversy would
impact the Foreign Taxes for which Energizer is liable in accordance with this
Agreement. Ralston shall not consent to any resolution, compromise or
conclusion of such Audit or Controversy without the written approval of
Energizer, which approval shall not be unreasonably withheld. Notwithstanding
the foregoing, in the event Ralston shall compromise or settle any such
deficiency of Foreign Tax without the prior consent of Energizer, Ralston shall
indemnify and hold Energizer and any Energizer Foreign Affiliate harmless
against any losses, costs, or damages, including Taxes resulting from such
compromise or settlement.
(e) Foreign Tax Attributes.
------------------------
Subject to subparagraph (c) above regarding Foreign Transfer Taxes,
any Foreign Tax attribute generated by Ralston or Energizer shall, to the extent
permitted by the applicable law of the Tax jurisdiction in question, remain with
Ralston or Energizer, respectively, or the appropriate entity. In any case
where the applicable law of the Tax jurisdiction in question requires such Tax
attribute to be allocated between Ralston and Energizer, such allocation shall
be made as provided by the law of such jurisdiction. In the event the
applicable law of the Tax jurisdiction requires that such Tax Attribute be
allocated between the parties based on a method of allocation agreed to by the
parties, Ralston and Energizer shall apply an allocation method reasonably
agreed to by both parties.
(f) Competent Authority.
--------------------
If, as a result of a Tax Audit for any Tax Period ending prior to the
Distribution Date (a) the IRS proposes a deficiency with respect to Ralston or
any Ralston Domestic Subsidiary or Energizer or any Energizer Domestic
Subsidiary or (b) any foreign Tax authority proposes a deficiency with respect
to any Ralston Foreign Affiliate or Energizer Foreign Affiliate, in either case
attributable to a proposed adjustment in transfer prices with respect to any of
the foregoing entities, and such adjustment, if sustained, would result in
liability for double Domestic or Foreign Taxes to Ralston or Energizer, to the
extent available under applicable tax treaties and the procedures applied by the
IRS and/or the foreign tax authority, Ralston or Energizer, depending on which
party would be subject to such double taxation, decides to request "competent
authority" (within the meaning of Rev. Proc. 96-13, 1996-1 C.B. 616) assistance
of the appropriate Tax authority or its equivalent ("Competent Authority"), then
the following provisions shall apply: The party initiating the Competent
Authority process, at its expense, shall diligently pursue such Competent
Authority assistance, including without limitation, filing any required amended
Tax Return, in connection with any such Tax Audit and complying with the
applicable procedures of such Competent Authority process. To the extent that
Ralston, as a result of such Competent Authority process, receives a refund of
double Foreign Taxes relating to a Tax Audit of Domestic Taxes of Energizer for
which Ralston is or was liable under this Agreement or utilizes the benefit of
any overpayment of such Foreign Taxes, Ralston shall retain such refund or
utilize the benefit of any such overpayment of Foreign Taxes and to the extent
that Energizer, as a result of such Competent Authority process, receives a
refund of double Foreign Taxes relating to a Tax Audit of Domestic Taxes of
Energizer for which Ralston is or was liable under this Agreement or utilizes
the benefit of such overpayment, Energizer shall pay an amount equal to such
refund or overpayment to Ralston . To the extent that Ralston, as a result of
such Competent Authority process, receives a refund of double Domestic Taxes
relating to a Tax Audit of Foreign Taxes of Energizer for which Energizer is or
was liable under this Agreement or utilizes the benefit of any overpayment of
such Domestic Taxes, Ralston shall pay an amount equal to such refund or
overpayment to Energizer, and, to the extent that Energizer, as a result of such
Competent Authority process, receives a refund of such double Domestic Taxes
relating to a Tax Audit of Foreign Taxes of Energizer for which Energizer is or
was liable under this Agreement or utilizes the benefit of any overpayment of
such Domestic Taxes, Energizer shall retain such refund or utilize the benefit
of such overpayment.
(g) Reimbursement of Other Tax Benefits.
---------------------------------------
Energizer shall reimburse Ralston to the extent of Foreign Tax
benefits derived by any member of the Energizer Group, for payments made by
Ralston to third parties on or after the Distribution Date, which result in a
Tax deduction to Energizer or an Energizer Foreign Affiliate ("Ralston
Payments"), provided such Ralston Payments (a) are not claimed as a deduction by
Ralston for Foreign Tax purposes, (b) are deductible on a Foreign Tax Return of
the Energizer Group, and (c) result in a reduction of Foreign Taxes of
Energizer, the Energizer Group, or any Energizer Foreign Affiliate. The amount
of the payment required hereunder for any taxable period of Energizer shall be
equal to the actual diminution of any Foreign Taxes by reason of any Ralston
Payments. Provided, however, if for any taxable period, (X) Energizer or
Ralston files an amended Foreign Tax Return (or files a carryback or
carryforward claim relating to a net operating loss), or (Y) the Foreign Tax
authority adjusts any item on any Energizer or Ralston Foreign Tax Return, the
amount of the payment required under this paragraph shall be recomputed (either
at the time of the filing of the amended return, or carryover or carryback
claim, or at the time of the final determination of the adjustment) to reflect
such amended return, claim, or adjustment, and, at such time, either (I) Ralston
shall repay any overpayment by Energizer under this paragraph to Energizer, or
(II) Energizer shall pay any underpayment under this paragraph to Ralston.
ARTICLE IV. NEGOTIATION
For the purposes of this Agreement, all computations or recomputations of
Tax liability, and all computations or recomputations of any amount or any
payment (including, but not limited to, computations of the amount of the tax
liability, any loss or credit or deduction, statutory tax rate for a year,
interest payments, and adjustments) and all determinations of payments or
repayments, or determination of any other nature required to be made pursuant to
this Agreement, shall be based on the assumptions and conclusions of the party
making the computations. If either Ralston or Energizer objects thereto in
writing, addressed to the other party, the provisions of Article XI of the Plan
of Reorganization shall be applicable to resolve any issues under this Tax
Sharing Agreement.
ARTICLE V. ENERGIZER POST-DISTRIBUTION TRANSACTIONS
1. Energizer shall, and shall cause each member of the Energizer Group and
each Energizer Foreign Affiliate to comply with each representation and
statement made, or to be made, to the IRS in connection with any ruling
obtained, or to be obtained, by Ralston from the IRS with respect to any
transaction contemplated by the Plan of Reorganization. Neither Energizer nor
any member of the Energizer Group shall for a period of thirty (30) months, with
respect to transactions described in subparagraphs I, III, IV, V, and VI, below;
and twenty-four months with respect to the transaction described in subparagraph
II below, following the Distribution Date engage in any of the following
transactions, unless, in the sole discretion of Ralston, either (a) an opinion
in form and substance satisfactory to Ralston is obtained from counsel to
Energizer, the selection of which counsel is agreed to by Ralston or (b) a
supplemental ruling is obtained from the IRS, in either case to the effect that
such transactions would not adversely affect the tax consequences of the
transactions contemplated by the Plan of Reorganization to (i) Ralston or any
member of the Ralston Group, (ii) Energizer or any member of the Energizer
Group, or (iii) the Ralston shareholders. The transactions subject to this
provision include: (I) making a material disposition (including transfers from
one member of the Energizer Group to another member of the Energizer Group), by
means of a sale or exchange of assets or shares of stock, a distribution to
shareholders, or otherwise, of any of its assets (other than the transactions
contemplated by the Plan of Reorganization) except in the ordinary course of
business; (II) repurchasing any Energizer Shares, unless such repurchase
satisfies the requirements of Section 4.05(1)(b) of Revenue Procedure 96-30;
(III) issuing capital stock of Energizer (or a successor to Energizer), whether
incident to a stock offering, an acquisition transaction, or otherwise, or
participating in a transaction in which shareholders of Energizer (or a
successor to Energizer) exchange or otherwise dispose of their stock in
Energizer (or a successor to Energizer), if the aggregate amount of shares
issued or disposed of in any such transactions represents a "fifty percent (50%)
or greater interest" in the total issued and outstanding stock of Energizer (or
a successor to Energizer) within the meaning of section 355(d)(4) of the Code;
provided that Energizer further agrees to notify Ralston in advance of any such
transactions that would result in the issuance or disposition of an aggregate
amount of shares representing a ten percent (10%) or greater interest in the
total issued and outstanding stock of Energizer; (IV) liquidating or merging
with any other corporation (including a member of the Energizer Group); (V)
ceasing to engage in the active conduct of a trade or business within the
meaning of Section 355(b)(2) of the Code; or (VI) any other transaction, action,
or event which in any material respect is inconsistent with the representations
and statements set forth on Schedule 8.01(b)(vi) to the Agreement and Plan of
Reorganization. Energizer hereby represents that neither Energizer nor any
member of the Energizer Group has any present intention to undertake any of the
transactions set forth above, except as set forth in the ruling request
submitted to the IRS with respect to the Distribution.
2. Ralston shall, and shall cause each member of the Ralston Group and each
Ralston Foreign Affiliate to refrain from taking any action which would
adversely impact any ruling obtained, or to be obtained, by Ralston from the IRS
with respect to any transaction contemplated by the Agreement of Reorganization.
ARTICLE VI. MISCELLANEOUS PROVISIONS
1. Mutual Cooperation. Ralston and Energizer shall, and shall cause each of
------------------
their Domestic Subsidiaries and Foreign Affiliates to, cooperate with each other
in filing any Tax Returns or consents contemplated by this Agreement and to take
such actions as the other party may reasonably request, including but not
limited to the following: (a) provide data for the preparation of Tax Returns,
including schedules, and make elections that may be required by the other party;
(b) provide required documents and data and cooperate in Audits or
investigations of Tax Returns and execute appropriate powers of attorney in
favor of the other party and/or its agents; (c) file protests or otherwise
contest proposed or asserted tax deficiencies, including filing petitions for
redetermination or prosecuting actions for refund in court, and pursuing the
appeal of such actions; (d) take any of the actions of the type described in
Regulation Section 1.1502-77(a) of the Code (describing the scope of the agency
of the common parent of a group of affiliated corporations); and (v) file
requests for the extension of time within which to file Tax Returns.
2. Maintenance of Books and Records. Until the applicable statute of
------------------------------------
limitations (including periods of waiver), or statute of similar import, has
expired in accordance with laws governing Domestic or Foreign Taxes and Tax
Returns, Ralston and Energizer shall, and shall cause each Domestic Subsidiary
and Foreign Affiliate to, retain all Tax workpapers and related materials
including applicable financial reports in its possession and under its control
used in the preparation of any Tax Return for Tax periods commencing prior to or
on the Distribution Date. Ralston and Energizer will notify the other party
sixty (60) days prior to disposing of any of the aforementioned records and will
deliver to the other party, at the other party's expense, any such records
requested by the other party. In addition, Energizer shall generate and retain
for IRS audit use (i) all necessary electronic data processing ("EDP") records
in accordance with existing agreements with the IRS, and (ii) any necessary
computer hardware or source codes needed to process EDP records for the IRS. As
requested, from time to time, by Energizer or Ralston, Ralston and Energizer
shall each provide the other with timely access to, and right to copy, any
records and other information reasonably requested concerning tax matters
affecting Energizer and Ralston and the cooperation of their respective
accountants and auditors, including, without limitation, information concerning
stock and asset bases, holding period, earnings and profits, intercompany
transactions, balance sheet and income statement tax provisions, reserves and
deferred tax accounts. In no event shall such access to available information
be provided more than thirty (30) days after written request therefor.
3. Payment. Failure to make any payment required under this Agreement will
-------
result in the accrual of interest on such amount due. Any interest payment
required hereunder shall be calculated from the same date and at the rate used
by the IRS, any foreign, state, or local tax authority, as applicable, in
computing the interest payable by it or to it. Unless otherwise provided, all
payments required to be made under this Agreement from one party to another
shall be made within thirty (30) days after the event which gives rise to the
requirement for payment occurs. Any payments made pursuant to this Agreement
are to be adjusted in the event that future events or new information would, had
they occurred or been known at the time of a payment, have altered the amount of
such payment, so that at the time of such future events or knowledge of such
information, appropriate adjustments shall be made retroactively to include the
consequences of such event or information in the original computation.
4. Treatment of Intercompany Payments. To the extent that any payments are
------------------------------------
made between Energizer and Ralston pursuant to this Agreement, for purposes of
Domestic Tax treatment, such payments to Ralston by Energizer shall be treated
as a distribution under Section 301 of the Code by Energizer to Ralston at a
time when the two corporations filed a consolidated federal income tax return,
and such payments by Ralston to Energizer shall be treated as a nontaxable
contribution by Ralston to the capital of Energizer immediately prior to the
Distribution Date. In any event, any payments made between Energizer and Ralston
pursuant to this Agreement shall be subject to any required withholding of Taxes
and shall be made net of any such Taxes required to be withheld on such
payments, provided, however, to the extent feasible, such payments shall be
structured so as to be free of withholding Taxes or to minimize withholding
Taxes. Whenever any such withholding Taxes are payable by or on behalf of the
payor, as promptly as possible thereafter, the payor shall send to the payee a
certified copy or an original official receipt received by the payor showing
payment thereof.
5. Energizer Domestic Tax Accruals. Prior to the Distribution Date,
----------------------------------
Energizer will transfer to the books of Ralston any Domestic Tax accrual
balances (credits) recorded on any books of any Energizer Domestic Subsidiary as
of the Distribution Date. Prior to the Distribution Date, Ralston will transfer
to the books of Energizer any Domestic Tax accrual balances (credits) recorded
on any books of Ralston as of the Distribution Date relating to Foreign Taxes
for which Energizer is, or may become, liable under this Agreement.
6. Tax Sharing Agreements. Any other tax sharing or tax allocation or
------------------------
similar agreement or arrangement in effect between Energizer and Ralston,
whether oral or in writing, shall terminate as between Energizer and Ralston on
the Distribution Date and, notwithstanding anything in such agreement to the
contrary, any rights or obligations of Energizer and Ralston under any such
agreement or arrangement shall be superseded by the terms of this Agreement.
7. No Double Tax Benefit. Anything in this Agreement to the contrary
------------------------
notwithstanding, neither Ralston nor Energizer shall be entitled to any double
benefit both (i) by reason of any payment otherwise required to be made between
the parties under this Agreement and (ii) any Tax benefit or avoidance of any
Tax detriment under applicable Domestic or Foreign Tax law, including, without
limitation, (x) being required to make any payment to the other for any loss of
Tax benefit under this Agreement to the extent that such party is entitled to,
and actually receives, such Tax benefit under applicable Tax law or (y) entitled
to receive any payment under this Agreement for any apparent Tax detriment to
the extent such party is entitled to, and actually is able to, avoid such Tax
detriment, under such Tax law.
8. Governing Law. This Agreement shall be governed and construed in
--------------
accordance with the laws of the State of Missouri, and the United States of
America, notwithstanding any conflict of law provision to the contrary, and
shall be binding on the successors and assigns of the parties hereto.
9. Entire Agreement. Unless otherwise specified, this Agreement contains
-----------------
the entire agreement between the parties hereto with respect to the subject
matter hereof and supersedes all prior written agreements, memoranda,
negotiations and oral understandings, if any, and may not be amended,
supplemented or discharged except by performance or by an instrument in writing
signed by all of the parties hereto.
10. Controlling Agreement. In the case of a conflict between the Plan of
----------------------
Reorganization and this Agreement, this Agreement shall control.
Notwithstanding anything in this Agreement to the contrary any rights or
obligations with respect to Taxes affecting the Ralston Purina Charitable Trust
shall be controlled by Section 2.07 of the Agreement and Plan of Reorganization.
11. Counterpart. This Agreement may be executed simultaneously in two or
-----------
more counterparts, each of which shall be deemed an original, but which together
shall constitute one and the same instrument.
12. Intellectual Property. Notwithstanding anything in this Agreement to the
---------------------
contrary, Ralston shall not be liable for any Taxes resulting from the transfer
or registration of any intellectual property for which Ralston does not bear
responsibility for costs under the Intellectual Property Agreement as defined in
Section 5.04 of the Plan of Reorganization between Ralston and Energizer.
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as
of the date first above written.
RALSTON PURINA COMPANY
BY /s/ James R. Elsesser
James R. Elsesser
Vice President Chief Financial Officer
and Treasurer
ENERGIZER HOLDINGS, INC.
BY /s/ Harry L. Strachan
Harry L. Strachan
Vice President and General Counsel
BRIDGING SERVICES AGREEMENT
---------------------------
This Bridging Services Agreement (the "Agreement") is made as of this 1st day of
---
April, 2000, (the "Effective Date") by and between Ralston Purina Company, a
- -----
Missouri Corporation ("Ralston"), and Energizer Holdings, Inc., a Missouri
corporation ("Energizer").
WHEREAS, the parties have entered into an Agreement and Plan of
Reorganization ("Plan of Reorganization") dated as of April 1, 2000;
WHEREAS, Ralston and Eveready Battery Company, Inc., a Delaware corporation
("Eveready") have executed a lease agreement beginning as of April 1, 2000
pursuant to which Eveready will lease certain office space from Ralston (the
"Lease");
WHEREAS, pursuant to the Plan of Reorganization, the parties have agreed
that Ralston and Energizer desire to provide each other and their respective
affiliates with certain services as more fully described on Schedules 1 through
-
31, (and any exhibits attached thereto), all of which are attached hereto and
incorporated herein by reference, (collectively, the "Services"), on an interim
basis after April 1, 2000;
WHEREAS, Ralston and Energizer desire to enter into this Agreement to
confirm the terms and conditions pursuant to which each party will provide to
the other party, for a limited time from and after the Effective Date, the
Services.
NOW, THEREFORE, in consideration of the mutual covenants contained herein,
and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties agree as follows:
1. Services. Subject to the terms of this Agreement, from and after the
---------
Effective Date, the party providing the particular Services (the "Provider")
shall make such Services available to the party receiving such Services (the
"Recipient") in accordance with the practices in effect as of the Effective Date
or as specifically set forth in the Schedules.
2. Price for Services. In consideration for the Services, the Recipient
--------------------
shall pay to the Provider the fee or other charge set forth opposite each such
Service on the applicable Schedule and each Service provided will be separately
invoiced to Recipient in accordance with the billing provisions set forth in the
Schedule with respect to such Service. Unless otherwise provided for in the
applicable Schedule, the basis for price determinations will be cost to the
Provider plus 10%, plus any travel or other out of pocket expenses. Cost shall
be determined by the Provider in a reasonable manner, which absent manifest
error or inaccuracy shall be binding on the parties. Upon written request by
Recipient, Provider will furnish such written documentation as it shall
reasonably determine is necessary to support its cost determination. Unless
otherwise provided for in the applicable Schedule, the price for Services shall
be subject to adjustment effective October 1, 2000, and annually thereafter, to
accommodate annual fiscal year increases in the cost to Provider in providing
the Services. Prices for Services shall also be subject to adjustment upon
thirty (30) days prior written notice from Provider to Recipient, if such
adjustment is the result of an actual cost adjustment by a third party provider
or outside vendor to Provider.
3. Limitations. The following limitations on responsibility and liability
-----------
shall apply to both Providers in connection with their provision of Services
hereunder:
(a) Neither Provider shall be obligated to (i) hire any additional
personnel; (ii) maintain the employment of any person; (iii) purchase, lease,
license or otherwise obtain any equipment, facilities, software, or other items;
or (iv) pay any extraordinary cost or suffer any extraordinary expense in
transferring, converting, preserving, storing or maintaining any records,
information or data belonging to either Recipient. Upon termination of this
Agreement or any applicable Schedule, each Recipient shall promptly return to
each Provider any equipment or other property owned, leased or licensed by or to
such Provider which is in the Recipient's possession, custody or control.
(b) Neither Provider shall be liable to either Recipient for any
liabilities, claims, losses, demands, obligations, costs, expenses, proceedings,
taxes, levies, imposts, duties, deficiencies, assessments, charges, damages or
judgments of any kind, name, nature or description, including without limitation
attorney's fees and expenses (collectively, "Liabilities"), unless such
Liabilities arise solely and directly from the willful misconduct of the
Provider. In such event, the liability of the Provider shall be limited to the
lesser of (i) the Provider's correction of the defect in the Service provided;
or (ii) the return of a pro-rata portion of the fee charged for the Service that
is attributable to the defect in the Service provided.
(c) The provision of any Service hereunder by either Provider shall be
deemed an unqualified acceptance of such Service by the Recipient, and no claim
relating to any defect in Service provided (which shall, in all cases, be
limited by the terms of Section 3(b) hereof) shall be made against the Provider
of the Service more than thirty (30) days after such Service is rendered. All
such claims shall be in writing, stating in reasonable detail the defect in
Service claimed.
(d) Neither Provider shall be liable to any affiliate, contractor, agent or
employee of either Recipient, or to any third party whatsoever, for any
Liabilities arising from or relating to the Provider's performance of this
Agreement.
(e) Neither Provider shall in any event be liable to either Recipient, or to
any of such Recipient's affiliates, contractors, agents or employees, or to any
third party whatsoever, for any special, indirect, incidental, consequential or
punitive damages alleged to arise out of or relate to the performance of this
Agreement.
(f) Neither Provider shall be liable to either Recipient to the extent that
Services provided under a Schedule are terminated, in whole or in part, earlier
than the stated duration if the basis for providing such Services requires the
consent or cooperation of a third party, and such third party refuses to give
such consent or cooperation. In such case, Provider shall be immediately
relieved of any obligation to provide those Services to the Recipient, and
Recipient shall be relieved of any obligation to pay for any Services not yet
performed.
4. Indemnification. Each Recipient of Services hereunder agrees and hereby
----------------
does indemnify and hold harmless each Provider of Services hereunder from and
against any and all Liabilities (as defined in Section 3 (b) hereof) arising out
of or relating to the performance of this Agreement, including any Liabilities
alleged to result solely from the negligence of the Provider, and saving only
such Liabilities as may arise solely and directly from the willful misconduct of
the Provider.
5. Additional Services. If a party to this Agreement wants the other to
---------------------
provide any service other than the Services provided for in the Schedules, such
party shall notify the other in writing, and within thirty (30) days following
the giving of such notice, such other party shall decide, in its sole
discretion, whether to provide such additional service. If such other party
agrees to be a Provider with respect to such additional service, the Recipient
and Provider shall mutually agree on the fee for such service and shall set
forth the terms of their agreement with respect to the additional service in a
separate schedule that shall be incorporated herein. The provision by Provider
of any such additional services shall be considered "Services" hereunder and
subject to all other provisions of this Agreement, as if those additional
services had originally been part of the Schedules to this Agreement.
6. Confidentiality. The parties will use their best efforts to restrict
----------------
any information (including, but not limited to, confidential information) which
is exchanged between the parties under this Agreement to those employees or
agents who are required to know or utilize such information in order to provide
the Services hereunder. Any and all information which is not generally known to
the public and which is exchanged between the parties in connection with this
Agreement, and which consists of employee information (including payroll
records, benefits information, and personnel files), business or marketing
plans, forecasts, financial records, financing information, capital and
operating budgeting information, tax return preparation information, plus any
other information that is identified in writing as "CONFIDENTIAL" by either
party within ten (10) days of disclosure thereof, whether of a technical or
business nature, shall be considered to be confidential. The parties agree that
confidential information shall not be disclosed to any third party or parties
without the prior written consent of the other party. In the event that either
party shall receive a subpoena, order or official request for the disclosure of
the other's confidential information, it shall promptly (and if possible, no
later than seven (7) days prior to the return date) advise the other party of
such subpoena, order or request, in order to enable such other party to seek
relief or appropriate protection from such subpoena, order or official request.
Each party shall take reasonable measures to protect against nondisclosure of
confidential information by its officers, employees and agents. Confidential
information shall not include any information (i) which is or becomes part of
the public domain; (ii) which is obtained from third parties who are not bound
by confidentiality obligations; (iii) which is required to be disclosed by law,
regulation, legal process or the rules of any state or federal regulatory agency
or the New York Stock Exchange; or (iv) which was independently developed by or
for the receiving party. All confidentiality provisions shall expire two years
from April 1, 2000 or the date of disclosure of the confidential information,
whichever is later, unless otherwise specifically agreed to in writing or
provided by law.
7. Legal Advice. The parties acknowledge that none of the Services provided
------------
hereunder shall constitute legal advice or the rendering of legal services.
Each party shall rely solely on its own legal counsel for any legal advice or
legal services.
8. Assignment. Notwithstanding anything to the contrary in this Agreement,
-----------
this Agreement shall not be assignable by either party hereto, to any other
person, firm or entity without the prior written consent of the other party in
its sole and absolute discretion; provided, however, that the Agreement in its
entirety, or any portion of the rights and obligations established hereunder,
may be assigned by either party hereto to one of its directly or indirectly
wholly owned subsidiaries without the prior written consent of the other party.
Except as expressly provided herein, nothing herein shall create or be deemed to
create any third party beneficiary rights in any person or entity not a party to
this Agreement.
9. Waiver, Amendment or Modification. No waiver, amendment or modification
-----------------------------------
of this Agreement shall be valid unless in writing and duly executed by both
parties to this Agreement.
10. Entire Agreement. This Agreement, and the Schedules hereto (including
------------------
any exhibits), constitutes the entire agreement of the parties concerning the
subject matter hereof and supersedes all previous agreements between the
parties, whether written or oral, with respect to such subject matter. To the
extent that the provisions of this Agreement are inconsistent with the
provisions of any Exhibit to a Schedule, the provisions of such Exhibit shall
prevail.
11. Governing Law, Language and Currency. Despite any different result
----------------------------------------
required by any conflicts of law provisions, this Agreement shall be governed by
the laws of the State of Missouri, United States of America. This Agreement is
originally drafted in the English language. Should it be translated into any
other language, the English version shall govern any interpretation thereof.
The price for Services in each Schedule shall be in U.S. dollars unless
otherwise indicated.
12. Notices. All notices, requests, demands, waivers and other
-------
communications (hereinafter "Notices") required or permitted to be given
pursuant to this Agreement shall be in writing and shall be deemed to have been
duly given (i) at the time of delivery, if delivered by hand; (ii) on the date
of transmission, if sent by facsimile, telegram or other standard form of
telecommunications; or (iii) three (3) business days after mailing, if mailed
registered or certified first-class mail, postage prepaid, return receipt
requested. Notices shall be delivered or sent, as the case may be, to the
following addresses or to such other addresses as the parties may hereinafter
designate by like notice similarly provided:
If to Energizer: Energizer Holdings, Inc.
Checkerboard Square
St. Louis, MO 63164
Attn: General Counsel
If to Ralston: Ralston Purina Company
Checkerboard Square
St. Louis, MO 63164
Attn: General Counsel
13. Force Majeure. Anything else in this Agreement notwithstanding, the
---------------
Provider shall be excused from providing Services hereunder while, and to the
extent that, its performance is prevented by fire, drought, explosion, flood,
invasion, rebellion, earthquake, civil commotion, strike or labor disturbance,
governmental or military authority, act of God, mechanical failure or any other
event or casualty beyond the reasonable control of the Provider, whether similar
or dissimilar to those enumerated in this paragraph (hereinafter a "Casualty").
In the event of a Casualty, the Recipient shall be responsible at its own cost
for making its own alternative arrangements with respect to the interrupted
Services.
14. Independent Contractor. The relationship of Provider and Recipient
------------------------
which is created hereunder is that of an independent contractor. This Agreement
is not intended to create and shall not be construed as creating between
Energizer and Ralston the relationship of affiliate, principal and agent, joint
venture, partnership, or any other similar relationship, the existence of which
is hereby expressly denied. Notwithstanding the foregoing, nothing in the
Schedules attached hereto shall cause any employee of the Provider to become a
leased employee or an independent contractor of the Recipient.
15. Billing and Payment. Unless otherwise provided in the applicable
----------------------
Schedule, the Provider shall bill the Recipient on a monthly basis for the
amounts due to the Provider for Services provided pursuant to the terms of this
Agreement. All such bills shall contain reasonable detail and shall be due
thirty (30) days after receipt unless any Schedules hereto provide for a
different payment period in which case such different payment period shall apply
to the applicable Services. The failure of the Recipient to pay any bill on
time shall result in the Recipient owing the Provider an additional handling
charge equal to one percent (1%) per month of the amount due from the date due
to the payment date.
16. Duration of Services. It is intended that the Services be provided by
-----------------------
each party hereto as a temporary accommodation to the other. Each party shall
arrange for the relevant Services to be provided by its own employees or by
third-party providers as soon as is practicable, even if such arrangements
result in greater cost to it than it would incur if the Services were provided
by the other party. In no event, however, shall either party be obligated to
provide any Services after March 31, 2001. Notwithstanding the foregoing, if
any Schedules hereto provide for the provision of Services for a longer period,
such longer period shall govern the provision of such Services. If provided for
in the Schedules, either party may give the other party written notice of its
intent to terminate any one or more of the Services prior to the stated
termination of the Services.
17. Termination. This Agreement shall remain in full force and effect for
-----------
as long as any Services are being provided pursuant to the Schedules attached
hereto. If any person who is not at the effective date of this Agreement an
affiliate of either party should acquire (by any means, including without
limitation by operation of law) a voting or equity interest of twenty percent
(20%) or more in such party, then the other party may terminate this Agreement
(without penalty and without further cause) upon thirty (30) days written notice
to such party.
18. Waiver. The failure of either party at any time or times to enforce or
-------
require performance of any provision hereof shall in no way operate as a waiver
or affect the right of such party at a later time to enforce the same. No
waiver by either party of the breach of any provision contained in this
Agreement shall be construed as a waiver of any subsequent breach of any
provision.
19. Severability. If any provision of this Agreement shall hereafter be
-------------
held to be invalid or unenforceable for any reason, that provision shall be
reformed to the maximum extent permitted to preserve the parties' original
intent, failing which it shall be severed from this Agreement with the balance
of the Agreement continuing in full force and effect. Such occurrence shall not
have the effect of rendering the provision in question invalid in any other
jurisdiction or in any other case or circumstances or of rendering invalid any
other provisions contained herein to the extent that such other provisions are
not themselves actually in conflict with any applicable law.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
on the day and year first above written.
RALSTON PURINA COMPANY ENERGIZER HOLDINGS, INC.
By:/s/ James Elsesser By: /s/ Harry Strachan
Name: James Elsesser Name: Harry Strachan
Title: Vice President, Chief Title: Vice President and General
Financial Officer Counsel
and Treasurer
LEASE AGREEMENT
This lease made this 15th day of February, 2000, by and between Ralston
Purina Company hereinafter called Lessor, whose address is:
c/o Howard T. Nelson
Legal Department - 9T
Checkerboard Square
St. Louis, Missouri 63164
and Eveready Battery Company, Inc. hereinafter called Lessee, whose address is:
c/o
Checkerboard Square
St. Louis, Missouri 63164
1. The following premises are hereby leased by Lessor to Lessee to have and
to hold for the term, the uses and the rent specified below and subject to the
options, if any, hereinafter provided.
A. PREMISES: Situated in the City of St. Louis, State of Missouri
being more particularly described as:
Per Exhibits A and E attached hereto and made a part hereof, and
also including common areas and common and reserved parking areas
B. USES: Lessee may use the premises for only: Business office
C. TERM: Beginning April 1, 2000, and ending March 31, 2001 or a total
term of one (1) year.
D. OPTIONS: Lessee shall have and is hereby given one option to extend
this lease for up to 5 years in 6 months increments to follow consecutively upon
the initial term of this lease. Such option shall be exercisable by Lessee upon
giving written notice to Lessor of Lessee's intention to exercise the same not
less than sixty (60) days prior to the expiration date of the existing term. If
this lease is extended persuant hereto, all its terms and conditions shall
remain the same, excepting rent, which shall be adjusted on October 1 of each
year.
During the option period, Lessee may terminate this Lease at any time
upon giving Lessor six (6) months written notice.
D. RENT: Per Rent Schedule attached hereto and made a part hereof
Exhibit B, per month payable in advance commencing on the 1st day of April, 2000
and on the same day of each succeeding month for the term of this lease. For
subsequent years, Lessor represents that Lessee shall pay monthly no more than
the prevailing rent being charged all occupants of the building for office space
in the building in which the premises are located. Rent shall be paid to Lessor
at address designated by Lessor.
Lessee shall pay a penalty of $250.00 for all delinquent rent
payments. Rent shall be deemed delinquent if not paid by the fifth working day
of each month. Lessee shall be given written notice of delinquency, and 10 days
to cure.
2. Subject to modifications hereinafter appearing, if any, the parties agree
as follows:
A. COVENANTS OF LESSOR: Lessor hereby covenants that: Lessor has good
and merchantable title in fee simple to the premises and improvements; Lessor is
and shall be in possession on the date this lease commences; Lessor has good
right to make this lease for the full term hereby granted, including any period
for which the Lessee has the right to effect the extension hereunder. Lessee
shall have access to all common areas and adequate rights-of-way from the
premises to all streets and alleys upon, adjacent to or serving the property of
Lessor on which the premises are situated. Lessor, shall maintain, repair and
replace all exterior areas, including but not limited to foundation, exterior
walls, structural members and roof, general building systems including HVAC
equipment, plumbing, sewer, and electrical systems, and also grounds, sidewalks,
driveways, and parking areas. Lessee shall have the duty of notifying Lessor
in writing whenever Lessee becomes aware that such repairs are necessary.
Lessor shall use its best efforts to initiate any repairs within forty-eight
(48) hours after receiving written notice from Lessee. Lessor shall be
responsible for ADA and city code compliance.
B. DAMAGE BY ELEMENTS, ETC.: If by fire, lightning, explosion, wind,
earthquake, water, ice, hail, snow, termites, settling or impact, the premises
are so damaged that their utility for the Lessee's purposes is substantially
impaired, Lessor shall have the option to repair such damage. If Lessor can not
repair such damage within one hundred eighty (180) days of the date of damage,
Lessee may cancel this lease at any time. In case of such damage, the rent
shall abate in a just proportion to the resulting unfitness of the premises so
long as such unfitness shall continue; and if the lease is canceled as
aforesaid, the rent shall be payable ratably to the date of cancellation.
Lessee's rights to abatement of rent shall not be applicable if such damage is
caused by Lessee's negligence.
C. MAINTENANCE, ETC.: Lessee shall not permit the existence of any
nuisance on the said premises and shall keep and maintain the same in a proper,
clean, safe condition in compliance with federal, state, and local regulations,
free and clear of any explosive, inflammable, or combustible material which
would increase or tend to increase the risk of fire or explosion. Lessee shall
commit no waste, damage or injury to the premises or any part thereof and shall
take all reasonable precautions to prevent others from doing so; Lessee shall
keep, observe and comply with all federal, state and municipal regulations,
ordinances and laws, and with the regulations of any duly constituted legal
authority having jurisdiction over the premises, and Lessee at its sole cost
shall make any and all improvements, alterations, repairs and additions and
install all appliances required as a result of Lessee's use of said premises by
or under any such regulations, ordinances or laws; the Lessee shall, at Lessee's
sole cost and expense, keep the premises hereby demised in good condition, and
shall make all repairs, renewals and replacements that from time to time may be
necessary to keep the premises in good condition and ready and fit for
occupancy, and for the operations for which they are intended; and on
termination of said leasehold, either by expiration of the terms hereof or by
cancellation, Lessee shall surrender said premises in the same condition as when
Lessee took possession hereunder, ordinary wear and tear excepted. If Lessee
fails to fulfill these obligations, Lessor may do any work required hereunder,
and Lessee shall reimburse Lessor for the cost and expense thereof.
D. ALTERATION AND RESTORATION BY LESSEE: Lessee shall have the right,
after Lessor's prior written approval, which approval shall not be unreasonably
- -----
withheld, at its own expense, to advertise upon and to paint and decorate the
premises inside and out, and to make such alterations, installations or
improvements in and upon the same as Lessee may desire. Lessor's approval shall
be contingent upon receipt and evaluation of the following:
1) Specifications
2) Contract or estimate of cost
Lessee's failure to obtain Lessor's prior written approval shall be an
act of default. Lessee shall maintain and repair (at Lessee's expense) all said
alterations, installations or improvements.
If, at any time during the term of this Lease, any liens or claims of
mechanics, laborers, or material men shall be filed against the Premises for any
work, labor, or materials furnished or alleged to have been furnished pursuant
to the written agreement by Lessee or any person holding thereunder, Lessee
within thirty (30) days (or lesser time if the Premises are threatened with sale
or foreclosure) after the date Lessee receives actual notice (as distinguished
from constructive notice), the filing or recording of any such lien from Lessor
shall cause the same to be discharged by payment, bond, or otherwise. In the
event Lessee contests any lien or claim, Lessee shall prosecute the contest with
reasonable diligence, and LESSEE shall at all time effectually stay or prevent
any official or judicial sale of the Premises.
E. TERMINATION: Upon the termination of this lease in any manner
herein provided, Lessee shall forthwith surrender to Lessor possession of the
premises and shall remove all improvements added by Lessee after the effective
date hereof and restore the premises to the same state which they were in prior
to the addition of such improvements, ordinary wear and tear excepted, and in
case Lessee shall fail, within sixty (60) days after the date of such
termination to make such removal or restoration, then Lessor may, at its
election, to be exercised within thirty (30) days thereafter, either take and
hold such improvements as its sole property; or remove such improvements and
restore the premises for the account of Lessee, and in such latter event Lessee
shall, within thirty (30) days after the rendition of a bill therefor, reimburse
Lessor for the cost so incurred. If Lessee defaults in any of the covenants and
agreements to be performed by Lessee as required herein, Lessor, at Lessor's
option, may take and hold such improvements as its sole property, or require
removal as provided above.
F. INSURANCE: Lessee shall maintain and pay for the following
insurance with an insurer satisfactory to the Lessor and shall furnish Lessor
with a certificate from each such insurer which shall reflect the coverage set
forth herein and in which the insurer shall agree that there shall be no
cancellation or change in the policy until Lessor shall have been given ten (10)
days' written notice thereof:
1) Workers' Compensation Insurance
2) Comprehensive General Liability Insurance including contractual
coverage and Automobile Liability Insurance, each with minimum coverage of
$1,000,000 for bodily injury and $1,000,000 for property damage.
Lessee shall not be entitled to possession of the premises herein
until the above insurance certificates as specified are obtained and are
furnished to Lessor.
G. LESSOR shall maintain and pay for standard form fire and extended
coverage insurance on the premises (including replacements and improvements) for
the full replacement value thereof.
H. INDEMNIFICATION AND HOLD HARMLESS AGREEMENT: Lessee agrees to
indemnify, protect, defend and hold Lessor harmless from and against any and all
claims, actions, demands, liabilities and costs, including attorney's fees,
arising from loss, damage or injury, including death, actual or claimed, of
whatsoever kind or character, to any property or persons whatsoever or
whomsoever, occurring or allegedly occurring in, on or about the premises or
arising out of the use of said premises or common areas or resulting from the
negligence of Lessee, during the term of the lease or any extension, or holding
over period hereof, and upon notice from Lessor, Lessee shall defend Lessor in
any action or proceeding brought therein.
Lessor agrees to indemnity, protect, defend, and hold Lessee harmless
from and against any and all claims, actions, demands, liabilities, and costs,
including attorney's fees, arising from loss, damage, or injury, including
death, actual or claimed, of whatsoever kind or character, to any property or
person whatsoever or whomsoever, occurring or allegedly occurring in, on, or
about the Premises or common areas resulting from the negligence of Lessor,
during the term of the Lease, or holding over period hereof, and upon notice
from Lessee, Lessor shall defend Lessee in any action or proceeding brought
therein.
I. TAXES: Lessor shall pay all taxes and special assessments levied
upon the premises or the use thereof.
J. UTILITIES: Lessor shall provide the premises with water, heat, gas,
and electricity. Lessee shall pay Lessor a monthly electric utility surcharge
of $1,606.00 for Lessee's computer room.
K. ASSIGNING, SUBLETTING: Lessee may not assign this lease or sublet
the premises, other than to an affiliate or subsidiary of Lessee or EVEREADY
BATTERY COMPANY, INC. If Lessee assigns or sublets without consent of Lessor,
Lessor may terminate this lease immediately.
L. RE-ENTRY UPON DEFAULT:
Act of Default. The term "act of default" shall mean and include any
---------------
one or more of the following events:
1) A petition in bankruptcy, reorganization, composition,
arrangement or for the appointment of a receiver is filed by or against Lessee
under the federal bankruptcy laws or any other state or federal bankruptcy or
insolvency laws or any laws relating to the relief of debtors, which is not
discharged within thirty (30) days from the date of filing; or
2) Lessee commits an act of bankruptcy; or
3) The making of any assignment for the benefit of creditors by
Lessee or the acquiescence by Lessee to the filing by another of a petition in
bankruptcy against Lessee; or
4) The failure by Lessee to use the premises in the ordinary
course or permitting the premises to remain vacant for a period of sixty (60)
consecutive days during the term hereof; or
5) Lessee's default in any monthly payments or rent or other
payments required to be made by Lessee hereunder when due as herein provided and
such default continues for ten (10) days after notice thereof in writing to
Lessee; or
6) Lessee's default in any of the other covenants and agreements
herein contained to be kept, observed and performed by Lessee, and such default
continues for sixty (60) days after notice thereof in writing to Lessee;
provided, however, if such default cannot with due diligence be cured within a
period of sixty (60) days, and if Lessee prior to the expiration of sixty (60)
days from the giving of such notice, commences to cure such default and proceeds
diligently and with reasonable dispatch to cure such default and does so cure
such default, then Lessor shall not be entitled to exercise its rights as to
such act of default.
Lessor's Remedies: In addition to all other rights and elections
------------------
provided in this lease and all other legal or equitable remedies or damages
provided by law, in the event of an act of default Lessor may elect by thirty
(30) days' prior written notice to Lessee to:
1) Perform any of the covenants and agreements to be performed by
Lessee as required herein, and any sums expended including but not limited to
reasonable attorneys fees shall be due and payable on demand.
2) Terminate this lease and re-enter and retake possession by
summary proceedings and Lessee shall thereupon be obligated to pay to Lessor as
damages, a sum of money equal to the cost of recovering the premises, including
but not limited to attorneys fees.
3) Terminate Lessee's right of possession without terminating this
lease and re-enter and retake possession by summary proceedings, and relet the
premises for the Lessee's account and receive the rent therefrom. Lessor shall
make reasonable efforts to relet the premises at such rent and other terms as
Lessor may deem advisable. Lessor may, on behalf of Lessee, perform any of the
covenants and agreements to be performed by Lessee as required herein, and any
sums so expended shall become due and payable on demand. Lessee shall be
obligated to pay to Lessor all sums due as aforesaid, the costs of reletting
(including but not limited to attorneys fees) and the minimum rental provided
for herein, less any sums received by Lessor upon reletting of the premises.
M. LESSOR'S EXPENSES: Lessee shall reimburse Lessor for any
out-of-pocket expenses (including but not limited to reasonable attorneys' fees
and court costs) incurred by Lessor in enforcing Lessee's covenants and
agreements under this lease.
LESSEE'S EXPENSES: Lessor shall reimburse Lessee for any expenses
(including but not limited to attorney's fees and court costs) incurred by
Lessee in enforcing Lessor's covenants and agreements under this Lease.
N. CONDEMNATION: If a part of the premises are taken by any public or
quasipublic authority, rent shall abate in proportion to the extent to which
Lessee's utilization of the premises is adversely affected. If the premises are
rendered unusable for the purposes set forth herein as a result of such
condemnation, Lessee shall have the right to terminate this lease, which right
must be exercised within sixty (60) days from the date the property becomes
unusable, but Lessee shall have no other rights or claims to the condemnation
award or against the Lessor due to the termination or abatement of this lease
due to the aforesaid condemnation.
O. HOLDING OVER: If Lessee should continue to occupy the premises
following expiration of the term hereunder or any final term for which this
lease may by express agreement be extended, and rent is thereafter accepted by
Lessor, Lessee shall be deemed a month-to-month tenant, and all the terms hereof
shall be applicable.
P. LANDLORD'S LIEN: Any sum which Lessee is obligated to pay under the
provisions of this agreement shall constitute, when due and unpaid, a lien
enforceable at law by Lessor upon any building, improvements or other property
of Lessee located on the said premises.
Q. RE-ENTRY, WAIVER: Lessor upon twenty-four (24) hours prior notice
shall have the right to re-enter the premises at any reasonable time for the
purpose of showing said premises, such showings to be carried out in a manner
designed not to unreasonably interfere with the use and enjoyment of the
premises by Lessee. A waiver by Lessor of a default under any covenant of this
lease shall not be deemed a waiver of any subsequent default of the Lessee.
R. NOTICES, REPRESENTATIVES: All notices and payments under this lease
shall be directed to the address hereto appearing of the party for whom the same
are intended or of such party's representative, if any, herein named, and any
such representative shall have authority to receive said notices and payments,
except as otherwise provided in this lease or in the written instructions to the
sender. Notices under this lease shall be given by first class mail and shall
be deemed given when properly addressed with sufficient postage affixed, and
deposited in the U.S. mails. Postmark on the envelope transmitting notice shall
determine date of notice.
3. This lease shall bind and inure to the benefit of the respective
permitted assigns and successors of all parties hereto.
4. No party hereto shall be chargeable with any agreement or representation,
either past, present or future, enlarging the obligations or modifying or
annulling the rights of such party as Lessee or Lessor, unless such agreement or
representation be expressed in a subsequent writing signed by the parties
hereto.
5. Lessee shall have access to the following Lessor facilities on the same
basis as the same are available to Lessor and its employees, officers, agents,
affiliates, and subsidiaries:
a. Cafeterias
b. Store
c. Fitness Center
d. Day Care
Lessee shall pay monthly to the Lessor the prevailing assessment per
employee. Rate as of April 1, 2000 is $56.00 per employee per month.
Lessee shall also pay monthly to Lessor the prevailing assessment per
contractor. Rate as of April 1, 2000 is $52.00 per contractor per month.
6. Lessee's visitors may use Lessor's visitor parking spaces and common area
parking spaces. Lessee's employees may put their names on a waiting list for a
reserved parking space. All reserved parking spaces will be numbered and color
coded. Lessee's employees will pay monthly to Lessor the prevailing charge for
reserved parking. Lessor shall provide adequate unreserved parking for 50
employees of Lessee.
7. Lessee shall have access to Lessor's conference rooms, meeting rooms, and
library, on an as-used basis, at prevailing rates.
8. Lessor shall provide mail service. Current rate is $2,761.00 per month.
Lessee shall also pay Lessor monthly postage and surcharge as used.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have duly executed this agreement as
of the date above written.
LESSOR: Ralston Purina Company
By /s/ James R. Elsesser
Title: Vice President, Chief Financial Officer
and Treasurer
LESSEE: Eveready Battery Company, Inc.
By /s/ Harry L. Strachan, III
Title: Vice President and General Counsel
INTELLECTUAL PROPERTY AGREEMENT
-------------------------------
THIS INTELLECTUAL PROPERTY AGREEMENT dated as of April 1, 2000 is by and between
RALSTON PURINA COMPANY, a corporation organized under the laws of the State of
Missouri, having its principal office at Checkerboard Square, St. Louis,
Missouri 63164 (hereinafter "Ralston") and ENERGIZER HOLDINGS, INC. a
corporation organized under the laws of the State of Missouri, having its
principal office at 800 Chouteau Avenue, St. Louis, Missouri 63102 (hereinafter
"Energizer").
WITNESSETH
WHEREAS, the parties have entered into an Agreement and Plan of Reorganization
of even date herewith; and
WHEREAS, pursuant to said Agreement and Plan of Reorganization, the parties have
agreed to divide certain intellectual property heretofore used in the business
of Ralston, Energizer, and/or its/their Affiliates;
NOW, THEREFORE, in consideration of the mutual covenants herein contained, and
for other good and valuable consideration, the parties agree as follows:
1. Definitions
(a) Affiliates
Hereunder, an "Affiliate" of, or persons "Affiliated" with, a
specified person, is a person that directly, or indirectly through one or more
intermediaries, controls, is controlled by or is under common control with the
person specified.
(b) Battery Business
Hereunder, "Battery Business" shall mean a business or portion of a
business devoted to batteries and/or lighting products, including components
therefor and collateral goods related thereto.
(c) Closing
Hereunder "Closing" shall have the same meaning as "Distribution Date"
in the Agreement and Plan of Reorganization.
(d) Intellectual Property
Hereunder, "Intellectual Property" shall include, but not be limited
to, trade secrets and confidential information; statutory, common law and
registered trademarks, trade styles, service marks, service names trade names,
trade dress, copyrights, moral rights, rights of privacy and publicity, Internet
or other electronic communication addresses (e.g., "energizer.com" and
1-800-982-ENRS), business addresses of a proprietary nature (e.g., "Ever Ready
House"), designs, inventions, know-how, issued and unissued patents, and other
property commonly considered intellectual property, all rights to recover for
past infringements of each of the foregoing, and the goodwill of the business to
the extent associated with any and all of the foregoing.
(e) Newco
Hereunder, except as limited hereinbelow, "Newco" shall mean Energizer
and any and all subsidiaries and Affiliates of Energizer. "Newco" shall not,
however, include Ralston and any of its Affiliates whose shares will be owned,
whether directly or indirectly, by Ralston following Closing.
(f) Oldco
Hereunder, "Oldco" shall mean Ralston and any and all of its
Affiliates whose shares it will directly or indirectly own following Closing.
(g) Trademark
Hereinafter "Trademark" shall mean a word, symbol, or device
registrable as a trademark or service mark.
(h) Trade Name
Hereinafter "Trade Name" shall mean corporate name and/or other
business name including, but not limited to, names of corporations,
partnerships, and joint ventures, and domain names.
2. Intellectual Property
(a) Assignments
(i) Except for Trademarks the parties agree to cancel, at or
before Closing, or at such date or dates as Newco may elect, Oldco will assign,
or will have assigned, to Newco, all of Oldco's rights, if any, in Intellectual
Property Oldco owns which is exclusively associated with Oldco's and/or Newco's
Battery Business. Registrations and applications to register Trademarks to be
so assigned or canceled include, but are not necessarily limited to, those
listed on Schedule 2(a)(i) attached hereto and incorporated by reference herein.
(ii) Anything in this Intellectual Property Agreement to the
contrary notwithstanding, Oldco will not assign to Newco any Intellectual
Property consisting of or containing the words, RALSTON, PURINA, CHOW,
CHECKERBOARD, or other word meaning "Checkerboard," the 9-Square Checkerboard or
other Checkerboard or Checkerband designs, any Intellectual Property consisting
of or containing any Intellectual Property now owned by any exclusively
non-Battery-Business Affiliate of Ralston, any Intellectual Property not
exclusively associated with Oldco's and/or Newco's Battery Business, or any
Intellectual Property confusingly similar to any of the Intellectual Property
comprehended by this Subparagraph 2(a)(ii). To the extent any such Intellectual
Property is currently owned by Newco, it will be assigned to Oldco or canceled
on or before Closing or at such date or dates thereafter as Oldco may elect.
(iii) All assignments contemplated by this Intellectual Property
Agreement will be on a quitclaim basis. The assignee will assume all
limitations, undertakings and liabilities related to such assigned Intellectual
Property, including, but not limited to, limitations in contracts relating to
such Intellectual Property entered into by the assignor and binding upon its
successors and/or assigns, and liability for any charge that any such
Intellectual Property infringes rights of any third party, without regard to
whether any such charge arises before or after Closing.
(iv) With respect to Intellectual Property to be assigned pursuant
to this Intellectual Property Agreement in cases where such property exists in
the name of a single owner in more than one jurisdiction, the assignor will
deliver to the assignee at or before Closing a beneficial, multi-jurisdiction
assignment of such Intellectual Property. The assignor shall thereafter
promptly execute and return to the assignee one or more jurisdiction-specific
assignments of such Intellectual Property prepared by the assignee and delivered
to the assignor for such purpose.
(v) With respect to Intellectual Property to be assigned pursuant
to this Intellectual Property Agreement in cases where all such property owned
by a single Affiliate exists in a single jurisdiction, the assignor will
promptly deliver to the assignee at or before Closing, or thereafter as
necessary, a jurisdiction-specific assignment of such property in recordable
form.
(vi) Intellectual Property which is to be assigned pursuant to
Subparagraph 2(a)(v) hereinabove, but which is not assigned at Closing, will be
maintained by its putative assignor for a reasonable period of time for the
benefit of the person to whom it is to be assigned; however, the putative
assignee shall reimburse the putative assignor for all out-of-pocket expenses
incurred for such maintenance.
(vii) Battery-Business-related Intellectual Property, whether or
not assigned hereunder, remains the responsibility of Newco; and Newco retains
such Intellectual Property subject to all limitations, undertakings and
liabilities related to such Intellectual Property, including, but not limited
to, undertakings in contracts relating to such Intellectual Property and
liability for any charge that any such Intellectual Property infringes rights of
any third party, without regard to whether such charge arises before or after
the Closing.
(viii) Non-Battery-Business-related Intellectual Property whether
or not assigned hereunder remains the responsibility of Oldco; and Oldco
retains such Intellectual Property subject to all limitations, undertakings
and liabilities related to such Intellectual Property, including, but not
limited to, undertakings in contracts relating to such Intellectual Property
and liability for any charge that any such Intellectual Property infringes the
rights of any third party, without regard to whether such charge arises
before the Closing.
(ix) At Closing, the parties will execute general Intellectual
Property Assignments in the form shown on Schedule 2(a)(ix)(A) and 2(a)(ix)(B)
Attached hereto and incorporated by reference herein.
(b) Costs of Assignment and Recordation
Oldco shall pay the costs (including attorneys' and accountants` fees,
costs and expenses) of preparing and recording jurisdiction-specific assignments
contemplated by Subparagraph 2(a)(v) above. Oldco shall pay the costs of
preparing and recording jurisdiction-specific assignments contemplated by
Subparagraph 2(a)(iv) above to the extent such costs relate to Trademarks for
which the Oldco assignor is record owner or for which an application to record
such Oldco assignor as record owner was pending more than one month prior to
Closing. Otherwise, such costs shall be borne by Newco.
An application to record shall be deemed pending if instructions to
record the same were sent to such Oldco assignor's attorneys or agents more than
one month prior to Closing. The parties agree that such instructions were sent
to record Energizer UK Company as record owner of Trademarks heretofore owned by
Ever Ready Limited in the jurisdictions listed in Schedule 2(b) hereto; however,
applications to record Energizer UK Company as record owner have not yet been
filed in such jurisdictions. Newco agrees that to the extent Newco does not
confirm its instructions to its outside attorneys or agents to record Energizer
UK Company's ownership of the Trademarks previously owned by Ever Ready Limited
(and, where required, that of Ever Ready Limited's predecessor(s)) in the
jurisdictions listed in Schedule 2(b) within three months following Closing,
then to the extent such failure to confirm such prior instructions results in
the need to record Energizer UK Company's name-change as a necessary step to
record assignments from Energizer UK Company to Energizer Limited, the costs to
record such name-change shall be borne by Newco.
3. Name Changes
(a) Newco Name Changes
Without limitation as to duration or territory, Newco agrees not to
use, register or maintain any Trademark, Trade Name, or other Intellectual
Property consisting of or containing the word RALSTON, PURINA, "Checkerboard,"
"Checkerboard Square," or any word, phrase, symbol or device confusingly similar
thereto, in connection with any product, service or activity. To the extent a
Newco Trademark or Trade Name consists of or contains the word "Ralston" or
other word, phrase, symbol, or device proscribed by this Subparagraph 3(a),
Newco will cancel or change such Trademark or Trade Name within six months
following Closing to eliminate such proscribed word, phrase symbol, or device.
(b) Oldco Name Changes
Without limitation as to duration or territory, Oldco agrees not to
use, register or maintain any Trademark, Trade Name or other Intellectual
Property consisting containing the word ENERGIZER, EVEREADY, EVER READY,
Energizer Bunny, or any word, symbol, or device confusingly similar thereto, in
connection with any product, service, or activity. To the extent an Oldco
Trademark or Trade Name consists of or contains the word ENERGIZER or other
word, phrase, symbol or device proscribed by this Subparagraph 3(b), Oldco will
cancel or change such Trademark or Trade Name within six months following
Closing to eliminate such proscribed word, phrase, symbol, or device.
(c) Costs of Name Changes
Oldco agrees to pay the costs (including attorneys` and accountants`
fees, costs and expenses) of name changes and cancellations required by
Paragraphs 3(a) and 3(b) above, including the cost, where necessary, of
recording the name change against Trademarks and recorded Trademark-related
agreements for which the company whose name is changed is record owner.
4. Costs, General
Except as otherwise provided in this Intellectual Property Agreement, Oldco
shall pay the costs (including attorneys` and accountants` fees, costs and
expenses) necessarily incurred to transfer, divide or cancel Intellectual
Property to the extent required by this Intellectual Property Agreement. Among
costs deemed necessarily incurred hereunder are (a) costs reasonably incurred to
the extent required by this Intellectual Property Agreement to cancel or replace
cancelled intellectual-property-related agreements between an Oldco company and
a Newco company with an equivalent agreement between two Newco companies, (b)
costs reasonably incurred to replace, modify or change
intellectual-property-related agreements between Newco Affiliates to the extent
required as a result of name changes required by this Intellectual Property
Agreement, (c) costs to record, where required by law, such new or modified
intellectual-property-related agreements and (d) costs to cancel Intellectual
Property in lieu of assignments otherwise required by this Intellectual Property
Agreement. Not included among costs deemed necessarily incurred hereunder are
(e) costs incurred in completing and/or recording assignments of Intellectual
Property from Ever Ready Limited to Energizer UK Company, and (f) any costs
resulting from Newco company name changes not required by this Intellectual
Property Agreement.
5. Third-Party Agreements
(a) To the extent assignable without third-party consent, and, if not,
to the extent such consent is obtained, at Closing, license agreements and other
contracts between Oldco and unaffiliated third parties, to the extent related to
the rights in Intellectual Property to be owned by Newco at Closing, will be
assigned from Oldco to Newco. Newco agrees to assume Oldco's obligations under
such agreements and to indemnify Oldco with respect to any of Newco's breaches
or failures to perform thereunder.
(b) To the extent assignable without third-party consent, and, if not,
to the extent such consent is obtained, at Closing, license agreements and other
contracts between Newco and unaffiliated third parties, to the extent related to
rights in Intellectual Property to be owned by Oldco at Closing, will be
assigned from Newco to Oldco. Oldco agrees to assume Newco's obligations under
such agreements and to indemnify Newco with respect to any of Oldco's breaches
or failures to perform thereunder.
6. Phase-Out of Intellectual Property Assigned to or Retained by Others
Newco agrees to remove all Oldco Intellectual Property not assigned to
Newco as well as Intellectual Property assigned from Newco to Oldco, from
Newco's labels, packaging, advertising, signs, letterhead, business cards, and
other materials within six (6) months following Closing. Oldco agrees to remove
all Intellectual Property assigned to Newco from Oldco's labels, packaging,
advertising, signs, letterhead, business cards, and other materials within the
same six (6) month period.
7. Heritage
Oldco, Newco and their successors and assigns, will each be allowed to
refer to its or their pre-spin-off heritage in good faith in truthful articles,
histories and the like to the extent such references do not express or imply a
continuing relationship between Oldco and Newco.
8. Good Faith
The parties agree not to do indirectly, through subsidiaries, Affiliates or
otherwise, what they could not do directly under this Intellectual Property
Agreement.
9. Scope and Modification
This Intellectual Property Agreement, including its schedules, sets forth
the entire agreement between the parties relating to the subject matter hereof
and it supersedes all prior agreements and understandings relating to such
subject matter. None of the terms of this Intellectual Property Agreement may
be waived or modified except as expressly agreed to, in writing, by both
parties.
10. Successors and Assigns
This Intellectual Property Agreement shall be binding upon and inure to the
benefit of the parties and each of their successors and assigns.
11. Interpretation
The section headings in this Intellectual Property Agreement are solely for
the purpose of reference, are not part of the agreement of the parties hereto,
and shall not in any way affect the meaning or interpretation of this
Intellectual Property Agreement.
12. Counterparts
This Intellectual Property Agreement may be executed in two or more
counterparts, each of which may be deemed an original, but all of which together
shall constitute one and the same instrument.
13. Governing Law
This Intellectual Property Agreement is made and entered into, and shall be
governed by and construed and interpreted in accordance with the laws of the
State of Missouri, United States of America, without regard to its conflicts of
laws principles, as to all matters, including those relating to validity,
construction, performance, effect and remedies under this Intellectual Property
Agreement. All matters relating to this Intellectual Property Agreement shall
be adjudicated exclusively in the courts of the State of Missouri located in St.
Louis, Missouri, or in the United States District Court for the Eastern District
of Missouri; and each party hereto consents to the exclusive jurisdiction and
venue of such courts for all such matters.
14. Amendment and Modification; Non-Waiver
This Intellectual Property Agreement may be amended, modified or
supplemented, or rights, powers or options thereunder waived or impaired,
only by a written agreement signed by an officer of Ralston and Energizer.
Neither party shall be deemed to have waived or impaired any right, power or
Option created or reserved by this Intellectual Property Agreement
(including without limitation, each party's right to demand compliance with
every term herein, or to declare any breach a default and exercise its rights in
accordance with the terms hereof) by virtue of: (i) any custom or practice of
the parties at variance with the terms hereof; (ii) any failure, refusal or
neglect to exercise any right hereunder, or to insist upon compliance with any
term; (iii) any waiver, forbearance, delay, failure or omission to exercise
any right or option, whether of the same, similar, or different natures, under
this Intellectual Property Agreement or in any other circumstances; or (iv)
the acceptance by either party of any payment or other consideration from the
other following any breach of this Intellectual Property Agreement. The
rights and remedies set forth in this Intellectual Property Agreement are
in addition to any other rights or remedies which may be granted by law.
15. Additional Documents
The parties agree to execute such additional documents as may be reasonably
required to give effect to their undertakings in this Intellectual Property
Agreement.
IN WITNESS WHEREOF, the parties have executed this Intellectual Property
Agreement as of the date first above written.
RALSTON PURINA COMPANY ENERGIZER HOLDINGS, INC.
By:/s/ James R. Elsesser By:/s/ Harry Strachan
Title: Vice President Chief Financial Title: Vice President & General
Officer and Treasurer Counsel
RIGHTS AGREEMENT
This Rights Agreement (the "Rights Agreement"), effective as of March 16,
2000 between Energizer Holdings, Inc., a Missouri corporation (the "Company"),
and Continental Stock Transfer & Trust Company (the "Rights Agent").
W I T N E S S E T H
WHEREAS, on March 16, 2000, the Board of Directors of the Company
authorized and declared a dividend of one common share purchase right for each
share of the Company's common stock outstanding at the opening of business on
March 31, 2000, (the "Record Date"), each such right representing the right to
purchase one share of the Company's common stock upon the terms and subject to
the conditions therein set forth. At that time the Board further authorized and
directed the issuance of one common share purchase right with respect to each
share of the Company's common stock that becomes outstanding between the Record
Date and the Distribution Date (as hereinafter defined);
Accordingly, in consideration of the premises and the mutual agreements
herein set forth, the parties hereby agree as follows:
SECTION 1
CERTAIN DEFINITIONS
For purposes of this Rights Agreement, the following terms have the meanings
indicated:
(a) "Acquiring Person" shall mean any Person who or which, together with all
Affiliates and Associates of such Person, shall become, at any time after the
date of this Rights Agreement (whether or not such status continues for any
period), the Beneficial Owner of Common Shares representing 20% or more of the
Common Shares then outstanding, other than as a result of a Permitted Offer.
Notwithstanding the foregoing, (A) the term "Acquiring Person" shall not include
(i) the Company, any Subsidiary of the Company, any employee benefit plan or
compensation arrangement of the Company or any Subsidiary of the Company, or any
entity holding Common Shares for or pursuant to the terms of any such plan or
compensation arrangement, or (ii) any Person, who or which together with all
Affiliates and Associates of such Person becomes the Beneficial Owner of 20% or
more of the then outstanding Common Shares as a result of the acquisition of
Common Shares directly from the Company (provided, however, that if, after such
acquisition, such Person, or an Affiliate or Associate of such Person, becomes
the Beneficial Owner of any additional Common Shares in an acquisition not made
directly from the Company, then such Person shall be deemed an Acquiring
Person), and (B) no Person shall be deemed to be an "Acquiring Person" either
(X) as a result of the acquisition of Common Shares by the Company which, by
reducing the number of Common Shares outstanding, increases the proportionate
number of Common Shares beneficially owned by such Person together with all
Affiliates and Associates of such Person to 20% or more of the Common Shares
then outstanding; except that if (i) a Person would become an Acquiring Person
(but for the operation of this subclause (X)) as a result of the acquisition of
Common Shares by the Company, and (ii) after such share acquisition by the
Company, such Person, or an Affiliate or Associate of such Person, becomes the
Beneficial Owner of any additional Common Shares, then such Person shall be
deemed an Acquiring Person, or (Y) if (i) such Person, or an Affiliate or
Associate of such Person, inadvertently becomes the Beneficial Owner of 20% or
more of the outstanding Common Shares, (ii) within 8 days thereafter such Person
notifies the Board of Directors that such Person did so inadvertently and (iii)
promptly after such notification, such Person is the Beneficial Owner of less
than 20% of the outstanding Common Shares.
(b) "Affiliate" and "Associate" shall have the respective meanings ascribed
to such terms in Rule 12b-2 of the General Rules and Regulations under the
Exchange Act.
(c) A Person shall be deemed the "Beneficial Owner" of and shall be deemed
to have acquired "beneficial ownership" of, or to "beneficially own", any
securities:
(i) which such Person or any of such Person's Affiliates or Associates
beneficially owns, directly or indirectly, as determined pursuant to Rule 13d-3
of the General Rules and Regulations under the Exchange Act in effect as of the
date hereof;
(ii) which such Person or any of such Person's Affiliates or Associates
has (A) the right to acquire (whether such right is exercisable immediately or
only after the passage of time) pursuant to any agreement, arrangement or
understanding (other than customary agreements with and between underwriters and
selling group members with respect to a bona fide public offering of
securities), or upon the exercise of conversion rights, exchange rights, rights
(other than the Rights), warrants or options, or otherwise; provided, however,
that a Person shall not be deemed the Beneficial Owner of, or to beneficially
own, securities tendered pursuant to a tender or exchange offer made by or on
behalf of such Person or any of such Person's Affiliates or Associates until
such tendered securities are accepted for purchase or exchange; or (B) the right
to vote pursuant to any agreement, arrangement or understanding; provided,
however, that a Person shall not be deemed the Beneficial Owner of, or to
beneficially own, any security for purposes of this clause (ii) if the
agreement, arrangement or understanding to vote such security (1) arises solely
from a revocable proxy or consent given to such Person in response to a public
proxy or consent solicitation made pursuant to, and in accordance with, the
applicable rules and regulations promulgated under the Exchange Act and (2) is
not also then reportable on Schedule 13D or Schedule 13G under the Exchange Act
(or any comparable or successor report); or
(iii) which are beneficially owned, directly or indirectly, by any
other Person with which such Person or any of such Person's Affiliates or
Associates has any agreement, arrangement or understanding (other than customary
agreements with and between underwriters and selling group members with respect
to a bona fide public offering of securities) for the purpose of acquiring,
holding, voting (except to the extent contemplated by the proviso to Section
1(c)(ii)(B)) or disposing of any securities of the Company.
Notwithstanding anything in this definition of "Beneficial Owner" to the
contrary, the phrase "then outstanding", when used with reference to a Person's
Beneficial Ownership of securities of the Company, shall mean the number of such
securities then issued and outstanding together with the number of such
securities not then actually issued and outstanding which such Person would be
deemed to own beneficially hereunder.
(d) "Business Day" shall mean any day other than a Saturday, a Sunday, or a
day on which banking institutions in New York, New York are authorized or
obligated by law or executive order to close.
(e) "Close of Business" on any given date shall mean 5:00 P.M., New York
time, on such date; provided, however, that if such date is not a Business Day
it shall mean 5:00 P.M., New York time, on the next succeeding Business Day.
(f) "Common Shares" when used with reference to the Company shall mean
shares of the Company's common stock, par value $.01 per share, and any other
class or classes or series of common stock of the Company resulting from any
subdivision, combination, recapitalization or reclassification of shares of such
common stock. "Common Shares" when used with reference to any Person other than
the Company shall mean the capital stock (or equity interest) with the greatest
voting power of such other Person or, if such other Person is a Subsidiary of
another Person, of the Person or Persons which ultimately control such
first-mentioned Person.
(g) "Company" shall have the meaning set forth in the recitals to this
Rights Agreement.
(h) "Distribution Date" shall have the meaning set forth in Section 3(a)
hereof.
(i) "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
(j) "Exchange Ratio" shall have the meaning set forth in Section 24 hereof.
(k) "Final Expiration Date" shall have the meaning set forth in Section 7(a)
hereof.
(l) "NASDAQ" shall have the meaning set forth in Section 11(d) hereof.
(m) "Permitted Offer" shall mean a tender or exchange offer which is for all
outstanding Common Shares at a price and on terms determined, prior to the
purchase of shares under such tender or exchange offer, by at least a majority
of the members of the Board of Directors who are not officers of the Company and
who are not (or would not be, if the offer were consummated) Acquiring Persons
or Affiliates, Associates, nominees or representatives of an Acquiring Person,
to be adequate and otherwise in the best interests of the Company and its
stockholders (other than the Person or any Affiliate or Associate thereof on
whose basis the offer is being made). In determining whether an offer is
adequate or in the best interests of the Company and its shareholders, the Board
may take into account all factors that it deems relevant including, without
limitation, (1) the consideration being offered in the proposal in relation to
the Board's estimate of: (i) the current value of the Company in a freely
negotiated sale of either the Company by merger, consolidation or otherwise, or
all or substantially all of the Company's assets, (ii) the current value of the
Company if orderly liquidated, and (iii) the future value of the Company over a
period of years as an independent entity discounted to current value; (2) then
existing political, economic and other factors bearing on security prices
generally or the current market value of the Company's securities in particular;
(3) whether the proposal might violate federal, state or local laws; (4) social,
legal and economic effects on employees, suppliers, customers and others having
similar relationships with the Company, and the communities in which the Company
conducts its businesses; (5) the financial condition and earnings prospects of
the person making the proposal including the person's ability to service its
debt and other existing or likely financial obligations; and (6) the competence,
experience and integrity of the person making the acquisition proposal.
(n) "Person" shall mean any individual, firm, partnership, corporation,
trust, association, joint venture or other entity, and shall include any
successor (by merger or otherwise) of such entity.
(o) "Principal Party" shall have the meaning set forth in Section 13(b)
hereof.
(p) "Purchase Price" shall have the meaning set forth in Section 7(a)
hereof.
(q) "Record Date" shall have the meaning set forth in the recitals to this
Rights Agreement.
(r) "Redemption Date" shall have the meaning set forth in Section 7(a)
hereof.
(s) "Redemption Price" shall have the meaning set forth in Section 23
hereof.
(t) "Rights" shall mean the rights to purchase Common Shares authorized by
the Board of Directors of the Company after the Record Date.
(u) "Rights Agent" shall have the meaning set forth in the recitals to this
Rights Agreement.
(v) "Rights Agreement" shall have the meaning set forth in the recitals to
this Rights Agreement.
(w) "Rights Certificates" shall have the meaning set forth in Section 3(a)
hereof.
(x) "Securities Act" shall mean the Securities Act of 1933, as amended.
(y) "Shares Acquisition Date" shall mean the first date of a public
announcement (which, for purposes of this definition, shall include, without
limitation, a report filed pursuant to Section 13(d) under the Exchange Act) by
the Company or an Acquiring Person that an Acquiring Person has become such, or
the date onn which the Company first has notice that an Acquiring Person has
become such; provided, that, if such Person is determined not to have become an
Acquiring Person pursuant to Section 1(a) hereof, then no Shares Acquisition
Date shall be deemed to have occurred.
(z) "Subsidiary" of any Person shall mean any corporation or other entity of
which a majority of the voting power of the voting equity securities or equity
interest is owned, directly or indirectly, by such Person.
(aa) "Summary of Rights" shall have the meaning set forth in Section 3(b)
hereof.
(bb) "Trading Day" shall have the meaning set forth in Section 11(d) hereof.
(cc) "Voting Securities" shall have the meaning set forth in Section 13(a)
hereof.
<PAGE>
SECTION 2
APPOINTMENT OF RIGHTS AGENT
The Company hereby appoints the Rights Agent to act as agent for the Company and
the holders of the Rights (who, in accordance with Section 3 hereof, shall prior
to the Distribution Date also be the holders of the Common Shares) in accordance
with the terms and conditions hereof, and the Rights Agent hereby accepts such
appointment. The Company may from time to time appoint such co-Rights Agents as
it may deem necessary or desirable. In the event that the Company appoints one
or more Co-Rights Agents, the respective duties of the Rights Agent and any
Co-Rights Agents shall be as the Company shall determine.
SECTION 3
ISSUE OF RIGHTS CERTIFICATES
(a) Until the earlier of (i) the Close of Business on the tenth day after
the Shares Acquisition Date or (ii) the Close of Business on the tenth Business
Day (or such later date as may be determined by action of the Board of Directors
of the Company prior to such time as any Person becomes an Acquiring Person)
after the date that a tender or exchange offer by any Person (other than the
Company, any Subsidiary of the Company, any employee benefit plan or
compensation arrangement of the Company or of any Subsidiary of the Company or
any entity holding Common Shares for or pursuant to the terms of any such plan
or compensation arrangement is first published or sent or given within the
meaning of Rule 14d-2 of the General Rules and Regulations under the Exchange
Act, if upon consummation thereof, such Person would be the Beneficial Owner of
20% or more of the shares of Common Stock then outstanding; the earlier of such
dates being herein referred to as the "Distribution Date"), (x) the Rights will
be evidenced (subject to the provisions of Section 3(b) hereof) by the
certificates for the Common Shares registered in the names of the holders
thereof (which certificates shall also be deemed to be certificates for Rights)
and not by separate certificates, and (y) the Rights (and the right to receive
separate certificates ("Rights Certificates")) will be transferable only in
connection with the transfer of the underlying Common Shares (including a
transfer to the Company) as more fully set out below. As soon as practicable
after the Distribution Date, the Company will prepare and execute, the Rights
Agent will countersign, and the Company will send or cause to be sent (and the
Rights Agent will, if requested, send) by first-class, postage-prepaid mail, to
each record holder of Common Shares as of the close of business on the
Distribution Date, at the address of such holder shown on the records of the
Company, a Rights Certificate, which shall be in substantially the form of
Exhibit A hereto (the "Rights Certificate"), evidencing one Right for each
Common Share so held. As of and after the Distribution Date, the Rights will be
evidenced solely by such Rights Certificates.
(b) As promptly as practicable following the Record Date, the Company will
send a copy of a Summary of Rights to Purchase Common Shares, in substantially
the form of Exhibit B hereto (the "Summary of Rights"), by first-class,
postage-prepaid mail, to each record holder of Common Shares as of the close of
business on the Record Date, at the address of such holder shown on the records
of the Company. Until the Distribution Date (or the earlier of the Redemption
Date or the Final Expiration Date), the surrender for transfer of any
certificate for Common Shares outstanding, with or without a copy of the Summary
of Rights attached thereto, shall also constitute the transfer of the Rights
associated with the Common Shares.
(c) Certificates for Common Shares which become outstanding (including,
without limitation, reacquired shares which are subsequently disposed of by the
Company) after the Record Date but prior to the earliest of the Distribution
Date, the Redemption Date or the Final Expiration Date shall have impressed on,
printed on, written on or otherwise affixed to them the following legend (or one
substantially similar):
"This certificate also evidences and entitles the holder hereof to certain
rights as set forth in a Rights Agreement, as it may from time to time be
supplemented or amended, between Energizer Holdings, Inc. and Continental Stock
Transfer & Trust Company, (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 Energizer Holdings, Inc. Under certain
circumstances, as set forth in the Rights Agreement, such rights may be redeemed
or exchanged, may expire, or may be evidenced by separate certificates and no
longer be evidenced by this certificate. Energizer Holdings, Inc. will mail to
the holder of this certificate a copy of the Rights Agreement without charge
within five days after receipt of a written request therefor. Under certain
circumstances, rights issued to or held by Acquiring Persons or their Affiliates
or Associates (as defined in the Rights Agreement) and any subsequent holder of
such rights may become null and void."
With respect to such certificates containing the foregoing legend, until the
Distribution Date, the Redemption Date or the Expiration Date, the Rights
associated with the Common Shares represented by such certificates shall be
evidenced by such certificates alone, and the surrender for transfer of any such
certificate shall also constitute the transfer of the Rights associated
therewith. In the event that the Company purchases or acquires any Common
Shares prior to the Distribution Date, any Rights associated with such Common
Shares shall be deemed canceled and retired unless and until such Common Shares
are subsequently issued by the Company so that the Company shall not be entitled
to exercise any Rights associated with the Common Shares which are no longer
outstanding.
SECTION 4
FORM OF RIGHT CERTIFICATES
(a) The Right Certificates (and the forms of election to purchase and of
assignment to be printed on the reverse thereof) shall be substantially the same
as provided for in Section 3(a) hereof and may have such marks of identification
or designation and such legends, summaries or endorsements printed thereon as
the Company may deem appropriate and as are not inconsistent with the provisions
of this Rights Agreement, or as may be required to comply with any applicable
law or with any rule or regulation made pursuant thereto or with any rule or
regulation of any stock exchange on which the Rights may from time to time be
listed, or to conform to customary usage. Subject to the provisions of Section
22 hereof, the Right Certificates, whenever issued, shall be dated as of the
Record Date and shall entitle the holders thereof to purchase such number and
kind of Common Shares as shall be set forth therein at the price per share set
forth therein, but the number and kind of such Common Shares and the price per
share shall be subject to adjustment as provided herein.
(b) Any Right Certificate issued pursuant to Section 3(a) or Section 22
hereof that represents Rights which are null and void pursuant to the second
paragraph of Section 11(a)(ii) of this Rights Agreement and any Right
Certificate issued pursuant to Section 6, Section 11 or Section 22 hereof upon
transfer, exchange, replacement or adjustment of any other Right Certificate
referred to in this sentence, shall contain (to the extent feasible) the
following legend:
"The Rights represented by this Right Certificate are or were beneficially
owned by a Person who was or became an Acquiring Person or an Affiliate or
Associate of an Acquiring Person (as such terms are defined in the Rights
Agreement). Accordingly, this Right Certificate and the Rights represented
hereby are null and void."
Notwithstanding the above provision, failure to place such legend on any Rights
Certificate representing Rights which are otherwise null and void pursuant to
the terms of this Rights Agreement, shall not affect the null and void status of
such Rights.
SECTION 5
COUNTERSIGNATURE AND REGISTRATION
(a) The Right Certificates shall be executed on behalf of the Company by
its Chairman of the Board, its Chief Executive Officer, its President, any of
its Vice Presidents, or its Treasurer, either manually or by facsimile
signature, shall have affixed thereto the Company's seal or a facsimile thereof,
and shall be attested by the Secretary or an Assistant Secretary of the Company,
either manually or by facsimile signature. The Right Certificates shall be
manually countersigned by the Rights Agent and shall not be valid for any
purpose unless countersigned. In case any officer of the Company who shall have
signed any of the Right Certificates shall cease to be such officer of the
Company before countersignature by the Rights Agent and issuance and delivery by
the Company, such Right Certificates, nevertheless, may be countersigned by the
Rights Agent and issued and delivered with the same force and effect as though
the person who signed such Right Certificates had not ceased to be such officer
of the Company; and any Right Certificate may be signed on behalf of the Company
by any person who, at the actual date of the execution of such Right
Certificate, shall be a proper officer of the Company to sign such Right
Certificate, although at the date of the execution of this Rights Agreement any
such person was not such an officer.
(b) Following the Distribution Date, the Rights Agent will keep or cause to
be kept, at its principal office or offices designated as the appropriate place
for surrender of such Right Certificate or transfer, books for registration and
transfer of the Right Certificates issued hereunder. Such books shall show the
names and addresses of the respective holders of the Right Certificates, the
number of Rights evidenced on its face by each of the Right Certificates and the
date of each of the Right Certificates.
SECTION 6
TRANSFER, SPLIT UP, COMBINATION AND EXCHANGE OF RIGHT CERTIFICATES; MUTILATED,
DESTROYED, LOST OR STOLEN RIGHT CERTIFICATES
(a) Subject to the provisions of Sections 4(b), 7(c) and 14 hereof, at any
time after the Close of Business on the Distribution Date, and at or prior to
the Close of Business on the earlier of the Redemption Date or the Final
Expiration Date, any Right Certificate or Right Certificates (other than Right
Certificates representing Rights that have become void pursuant to the second
paragraph of Section 11(a)(ii) hereof or that have been exchanged pursuant to
Section 24 hereof) may be transferred, split up, combined or exchanged for
another Right Certificate or Right Certificates, entitling the registered holder
to purchase a like number and kind of Common Shares as the Right Certificate or
Right Certificates surrendered then entitled such holder to purchase. Any
registered holder desiring to transfer, split up, combine or exchange any Right
Certificate or Right Certificates shall make such request in writing delivered
to the Rights Agent, and shall surrender the Right Certificate or Right
Certificates to be transferred, split up, combined or exchanged at the principal
office or offices of the Rights Agent designated for such purpose. Thereupon,
the Rights Agent shall countersign and deliver to the Person entitled thereto a
Right Certificate or Right Certificates, as the case may be, as so requested.
The Company may require payment of a sum sufficient to cover any tax or
governmental charge that may be imposed in connection with any transfer, split
up, combination or exchange of Right Certificates.
(b) Upon receipt by the Company and the Rights Agent of evidence reasonably
satisfactory to them of the loss, theft, destruction or mutilation of a Right
Certificate, and, in case of loss, theft or destruction, of indemnity or
security reasonably satisfactory to them, and, at the Company's request,
reimbursement to the Company and the Rights Agent of all reasonable expenses
incidental thereto, and upon surrender to the Rights Agent and cancellation of
the Right Certificate if mutilated, the Company will make and deliver a new
Right Certificate of like tenor to the Rights Agent for delivery to the
registered holder in lieu of the Right Certificate so lost, stolen, destroyed or
mutilated.
SECTION 7
EXERCISE OF RIGHTS; PURCHASE PRICE; EXPIRATION DATE OF RIGHTS
(a) Subject to the second paragraph of Section 11(a)(ii) hereof, the
registered holder of any Right Certificate may exercise the Rights evidenced
thereby (except as otherwise provided herein) in whole or in part at any time
after the Distribution Date upon surrender of the Right Certificate, with the
form of election to purchase on the reverse side thereof duly executed, to the
Rights Agent at the principal office or offices of the Rights Agent designated
for such purpose, together with payment of the price per share (rounded up to
the nearest cent) provided for in paragraph (b) below (the "Purchase Price") for
each Common Share as to which the Rights are exercised, at or prior to the
earliest of (i) the close of business on March 31, 2010 (the "Final Expiration
Date"), (ii) the time at which the Rights are redeemed as provided in Section 23
hereof (the "Redemption Date"), or (iii) the time at which such Rights are
exchanged as provided in Section 24 hereof.
(b) The Purchase Price for each Common Share pursuant to the exercise of a
Right shall initially be $150, subject to adjustment from time to time as
provided in Sections 11 and 13 hereof, and shall be payable in lawful money of
the United States of America in accordance with paragraph (c) below.
(c) Upon receipt of a Right Certificate representing exercisable Rights,
with the form of election to purchase duly executed, accompanied by payment of
the Purchase Price for the Common Shares to be purchased and an amount equal to
any applicable transfer tax required to be paid by the holder of such Right
Certificate in accordance with Section 9 hereof by certified check, cashier's
check or money order payable to the order of the Company, the Rights Agent shall
thereupon promptly (i) requisition from any transfer agent of the Common Shares
certificates for the number and kind of Common Shares to be purchased (or
depository receipts when appropriate) and the Company hereby irrevocably
authorizes its transfer agents to comply with all such requests, (ii) when
appropriate, requisition from the Company the amount of cash to be paid in lieu
of issuance of fractional shares in accordance with Section 14 hereof, (iii)
after receipt of such certificates, cause the same to be delivered to or upon
the order of the registered holder of such Right Certificate, registered in such
name or names as may be designated by such holder and (iv) when appropriate,
after receipt, deliver such cash to or upon the order of the registered holder
of such Right Certificate.
(d) In case the registered holder of any Right Certificate shall exercise
less than all the Rights evidenced thereby, a new Right Certificate evidencing
Rights equivalent to the Rights remaining unexercised shall be issued by the
Rights Agent to the registered holder of such Right Certificate or to his duly
authorized assigns, subject to the provisions of Section 14 hereof.
(e) So long as the Common Shares issuable upon the exercise of Rights may
be listed on any national securities exchange or national quotation system, the
Company shall use its best efforts to cause all such shares which will be issued
upon exercise to be listed on such exchange upon official notice of issuance
upon such exercise.
(f) Notwithstanding anything in this Agreement ot the contrary, neither the
Rights Agent nor the Company shall be obligated to undertake any action with
respect to a registered holder upon the occurrence of any purported exercise as
set forth in this Section 7 unless the certificate contained in the appropriate
form of election to purchase set forth on the reverse side of the Right
Certificate surrendered for such exercise shall have been properly completed and
duly executed by the registered holder thereof and the Company shall have been
provided with such additional evidence of the identity of the Beneficial Owner
(or former Beneficial Owner) or Affiliates or Associates thereof as the Company
shall reasonably request.
SECTION 8
CANCELLATION AND DESTRUCTION OF
RIGHT CERTIFICATES
All Right Certificates surrendered for the purpose of exercise, transfer, split
up, combination or exchange shall, if surrendered to the Company or to any of
its agents, be delivered to the Rights Agent for cancellation or in canceled
form, or, if surrendered to the Rights Agent, shall be canceled by it, and no
Right Certificates shall be issued in lieu thereof except as expressly permitted
by any of the provisions of this Rights Agreement. The Company shall deliver to
the Rights Agent for cancellation and retirement, and the Rights Agent shall so
cancel and retire, any other Right Certificate purchased or acquired by the
Company otherwise than upon the exercise thereof. The Rights Agent shall
deliver all canceled Right Certificates to the Company, or shall, at the written
request of the Company, destroy such canceled Right Certificates, and in such
case shall deliver a certificate of destruction thereof to the Company.
SECTION 9
AVAILABILITY OF COMMON SHARES
(a) The Company covenants and agrees that it will take all such action as
may be necessary to ensure that all Common Shares delivered upon exercise of
Rights shall, at the time of delivery of the certificates for such shares
(subject to payment of the Purchase Price), be duly and validly authorized and
issued and fully paid and nonassessable Common Shares.
(b) The Company covenants and agrees that it will pay when due and payable
any and all federal and state transfer taxes and charges which may be payable in
respect of the issuance or delivery of the Right Certificates or of any Common
Shares upon the exercise of Rights. The Company shall not, however, be required
to pay any transfer tax which may be payable in respect of any transfer or
delivery of Right Certificates to a person other than, or the issuance or
delivery of certificates or depository receipts for the Common Shares in a name
other than that of, the registered holder of the Right Certificate evidencing
Rights surrendered for exercise or to issue or to deliver any certificates for
Common Shares upon the exercise of any Rights until any such tax shall have been
paid (any such tax being payable by the holder of such Right Certificate at the
time of surrender) or until it has been established to the Company's reasonable
satisfaction that no such tax is due.
SECTION 10
RECORD HOLDERS OF COMMON SHARES
ISSUED UPON EXERCISE OF RIGHTS
Each person in whose name any certificate for Common Shares is issued upon the
exercise of Rights shall for all purposes be deemed to have become the holder of
record of the Common Shares represented thereby on, and such certificate shall
be dated, the date upon which the Right Certificate evidencing such Rights was
duly surrendered and payment of the Purchase Price (and any applicable transfer
taxes) was made; provided, however, that if the date of such surrender and
payment is a date upon which the Company's transfer books for the Common Shares
are closed, such person shall be deemed to have become the record holder of such
shares on, and such certificate shall be dated, the next succeeding Business Day
on which such transfer books are open. Prior to the exercise of the Rights
evidenced thereby, the holder of a Right Certificate shall not be entitled to
any rights of a holder of Common Shares for which the Rights evidenced thereby
shall be exercisable, including, without limitation, the right to vote, to
receive dividends or other distributions or to exercise any preemptive rights,
and shall not be entitled to receive any notice of any proceedings of the
Company, except as provided herein.
SECTION 11
ADJUSTMENT OF PURCHASE PRICE,
NUMBER AND KIND OF COMMON
SHARES OR NUMBER OF RIGHTS
The Purchase Price, the number of Common Shares or other securities covered by
each Right, and the number of Rights outstanding are subject to adjustment from
time to time as provided in this Section 11.
(a) (i) In the event the Company shall at any time after the Record Date
(A) declare a dividend on the Common Shares payable in Common Shares, (B)
subdivide the outstanding Common Shares into a greater number of such shares,
(C) combine the outstanding Common Shares into a smaller number of such shares,
or (D) issue any shares of its capital stock in a reclassification of Common
Shares (including any such reclassification in connection with a consolidation
or merger in which the Company is the continuing or surviving corporation),
except as otherwise provided in this Section 11(a), the Purchase Price in effect
for Rights at the time of the record date for such dividend or of the effective
date of such subdivision, combination or reclassification, and the number and
kind of shares of capital stock (including Common Shares) issuable on such date,
shall be proportionately adjusted so that the holder of any Right exercised
after such time shall, upon payment of the Purchase Price then in effect, be
entitled to receive the aggregate number and kind of shares of capital stock
which, if such Right had been exercised immediately prior to such date and at a
time when the Common Shares transfer books of the Company were open, he would
have owned upon such exercise and been entitled to receive by virtue of such
dividend, subdivision, combination or reclassification; provided, however, that
in no event shall the consideration to be paid upon the exercise of one such
Right be less than the per share par value of the Common Shares. If an event
occurs which would require an adjustment under both Section 11(a)(i) and the
second paragraph of Section 11(a)(ii), the adjustment provided for in this
Section 11(a)(i) shall be in addition to, and shall be made prior to, any
adjustment required pursuant to the second paragraph of Section 11(a)(ii).
(ii) Subject to Section 24 of this Rights Agreement, in the event any
Person becomes an Acquiring Person, then the Purchase Price for each Common
Share issuable upon exercise of Rights shall be reduced to an amount equal to
33-1/3% of the then current market price per share of such Common Share
(determined pursuant to Section 11(d)) on the Shares Acquisition Date.
Notwithstanding the above, if the transaction that would otherwise give rise to
the foregoing adjustment is also subject to the provisions of Section 13 hereof,
then only the provisions of Section 13 hereof shall apply and no adjustment
shall be made pursuant to this Section 11(a)(ii).
From and after the occurrence of the event described above, any Rights that
are or were acquired or beneficially owned by any Acquiring Person (or any
Associate or Affiliate of such Acquiring Person) shall be void and any holder of
such Rights shall thereafter have no right to exercise such Rights under any
provision of this Rights Agreement. No Right Certificate shall be issued
pursuant to Section 3 that represents Rights beneficially owned by an Acquiring
Person whose Rights would be void pursuant to the preceding sentence or any
Associate or Affiliate thereof; no Right Certificate shall be issued at any time
upon the transfer of any Rights to or from an Acquiring Person whose Rights
would be void pursuant to the preceding sentence or any Associate or Affiliate
thereof or to or from any nominee of such Acquiring Person, Associate or
Affiliate; and any Right Certificate delivered to the Rights Agent for transfer
to or from an Acquiring Person (or any Associate, Affiliate or nominee of such
Acquiring Person) whose Rights would be void pursuant to the preceding sentence
shall be canceled.
(iii) In the event that there shall not be sufficient Common Shares issued
but not outstanding or authorized but unissued to permit the exercise in full of
the Rights in accordance with the foregoing subparagraphs (i) and (ii), and the
Rights become exercisable, notwithstanding any other provisions of this
Agreement, the Company shall, to the extent permitted by applicable law and
agreements in effect on the date hereof to which the Company is a party, take
all such action as may be necessary to authorize additional Common Shares for
issuance upon exercise of the Rights, including the calling of a meeting of
shareholders; provided, however, if the Company is unable to cause the
-------- -------
authorization of additional Common Shares then the Company, to the extent
necessary and permitted by applicable law and any agreements or instruments in
effect on the date thereof to which it is a party, shall, at its option (A) pay
cash equal to twice the applicable Purchase Price (as adjusted pursuant to this
Section 11) in lieu of issuing any such Common Shares and requiring payment
therefor, or (B) issue equity securities having a value equal to the market
price of Common Shares which otherwise would have been issuable pursuant to the
foregoing subparagraphs (i) and (ii), which value shall be determined by the
Board of Directors of the Company, whose determination shall be described in a
statement filed with the Rights Agent and shall be binding on the Rights Agent,
or (C) distribute a combination of Common Shares, cash and/or other equity
securities having a value equal to the market price of the shares of the Common
Shares which otherwise would have been issuable pursuant to the foregoing
subparagraphs (i) and (ii), determined in accordance with the preceding clause
(B), upon exercise of the related Rights.
(b) In case the Company shall fix a record date for the issuance of rights
(other than the Rights), options or warrants to all holders of Common Shares
entitling them (for a period expiring within 90 calendar days after such record
date) to subscribe for or purchase Common Shares (or securities having the same
or more favorable rights, privileges and preferences as the Common Shares
("equivalent common shares")), or securities convertible into Common Shares at a
price per share (or having a conversion price per share, if a security
convertible into Common Shares) less than the then current per share market
price (as defined in Section 11(d)) of the Common Shares on such record date,
the Purchase Price to be in effect after such record date shall be determined by
multiplying the Purchase Price in effect immediately prior to such record date
by a fraction, the numerator of which shall be the number of Common Shares
outstanding on such record date plus the number of Common Shares which the
aggregate offering price of the total number of Common Shares or equivalent
common shares so to be offered (and/or the aggregate initial conversion price of
the convertible securities so to be offered) would purchase at such current
market price and the denominator of which shall be the number of Common Shares
outstanding on such record date plus the number of additional Common Shares
and/or equivalent common shares to be offered for subscription or purchase (or
into which the convertible securities so to be offered are initially
convertible); provided, however, that in no event shall the consideration to be
paid upon the exercise of one Right be less than the per share par value of the
shares of capital stock of the Company issuable upon exercise of one Right. In
case such subscription price may be paid in a consideration part or all of which
shall be in a form other than cash, the value of such consideration shall be as
determined in good faith by the Board of Directors of the Company, whose
determination shall be described in a statement filed with the Rights Agent and
shall be binding on the Rights Agent. Common Shares owned by or held for the
account of the Company shall not be deemed outstanding for the purpose of any
such computation. Such adjustment shall be made successively whenever such a
record date is fixed; and in the event that such rights, options or warrants are
not so issued, the Purchase Price shall be adjusted to be the Purchase Price
which would then be in effect if such record date had not been fixed.
(c) In case the Company shall fix a record date for the making of a
distribution to all holders of Common Shares (including any such distribution
made in connection with a consolidation or merger in which the Company is the
continuing or surviving corporation), of evidences of indebtedness or assets
(other than a regular quarterly cash dividend, a dividend payable in Common
Shares or other distribution referred to in Section 11(a) hereof) or
subscription rights or warrants (excluding those referred to in Section 11(b)
hereof), the Purchase Price to be in effect after such record date shall be
determined by multiplying the Purchase Price in effect immediately prior to such
record date by a fraction, the numerator of which shall be the then current per
share market price of the Common Shares on such record date, less the fair
market value (as determined in good faith by the Board of Directors of the
Company, whose determination shall be described in a statement filed with the
Rights Agent and shall be binding on the Rights Agent) of the portion of such
assets or evidences of indebtedness so to be distributed or of such subscription
rights or warrants applicable to one Common Share and the denominator of which
shall be such current per share market price of the Common Shares; provided,
however, that in no event shall the consideration to be paid upon the exercise
of one Right be less than the per share par value of the shares of capital stock
of the Company to be issued upon exercise of one Right. Such adjustments shall
be made successively whenever such a record date is fixed; and in the event that
such distribution is not so made, the Purchase Price shall again be adjusted to
be the Purchase Price which would then be in effect if such record date had not
been fixed.
(d) For the purpose of any computation hereunder, the "current per share
market price" of a Common Share on any date shall be deemed to be the average of
the daily closing prices per share of a Common Share for the 30 consecutive
Trading Days immediately prior to such date; provided, however, that in the
event that the current per share market price of a Common Share is determined
during a period following the announcement by the Company of (A) a dividend or
distribution on the Common Shares, payable in Common Shares or securities
convertible into Common Shares, or (B) any subdivision, combination or
reclassification of the Common Shares, and prior to the expiration of 30 Trading
Days after the ex-dividend date for such dividend or distribution, or the record
date for such subdivision, combination or reclassification, then, and in each
such case, the current per share market price shall be appropriately adjusted to
reflect the current market price per share of a Common Share. The closing price
for each day shall be the last sale price, regular way, or, in case no such sale
takes place on such day, the average of the closing bid and asked prices,
regular way, in either case as reported in the principal consolidated
transaction reporting system with respect to securities listed or admitted to
trading on the New York Stock Exchange or, if the Common Shares are not listed
or admitted to trading on the New York Stock Exchange, as reported in the
principal consolidated transaction reporting system with respect to securities
listed on the principal national securities exchange on which the Common Shares
are listed or admitted to trading or, if Common Shares are not listed or
admitted to trading on any national securities exchange, the last quoted price
or, if not so quoted, the average of the high bid and low asked prices in the
over-the-counter market, as reported by the National Association of Securities
Dealers, Inc. Automated Quotations System ("NASDAQ") or such other system then
in use, or, if on any such date Common Shares are not quoted by any such
organization, the average of the closing bid and asked prices as furnished by a
professional market maker making a market in Common Shares, selected by the
Board of Directors of the Company. If on any such date no market-maker is
making a market in Common Shares, the fair value of Common Shares on such date
as determined in good faith by the Board of Directors of the Company shall be
used, whose determination shall be described in a statement filed with the
Rights Agent. The term "Trading Day" shall mean a day on which the principal
national securities exchange on which Common Shares are listed or admitted to
trading is open for the transaction of business or, if Common Shares are not
listed or admitted to trading on any national securities exchange or included in
the Nasdaq National Market, a Business Day. If Common Shares are not publicly
held or so listed or traded, "current per share market price" shall mean the
fair value per share as determined in good faith by the Board of Directors of
the Company, whose determination shall be described in a statement filed with
the Rights Agent and shall be conclusive for all purposes.
(e) Anything herein to the contrary notwithstanding, no adjustment in the
Purchase Price shall be required unless such adjustment would require an
increase or decrease of at least 1% in the Purchase Price; provided, however,
that any adjustments which by reason of this Section 11(e) are not required to
be made shall be carried forward and taken into account in any subsequent
adjustment. All calculations under this Section 11 shall be made to the nearest
cent or to the nearest one ten-thousandth of a share as the case may be.
Notwithstanding the first sentence of this Section 11(e), any adjustment
required by this Section 11 shall be made no later than the earlier of (i) three
years from the date of the transaction which mandates such adjustment or (ii)
the Expiration Date.
(f) If as a result of an adjustment made pursuant to Section 11(a) hereof,
the holder of any Right thereafter exercised shall become entitled to receive
any shares of capital stock of the Company other than Common Shares, thereafter
the number of such other shares so receivable upon exercise of any Right shall
be subject to adjustment from time to time in a manner and on terms as nearly
equivalent as practicable to the provisions with respect to the Common Shares
contained in Section 11(a) through (c), inclusive, and the provisions of
Sections 7, 9, 10, 13 and 14 with respect to the Common Shares shall apply on
like terms to any such other shares.
(g) All Rights originally issued by the Company subsequent to any
adjustment made hereunder to the Purchase Price applicable thereto shall
evidence the right to purchase, at the adjusted Purchase Price, the number of
Common Shares or other capital stock purchasable from time to time hereunder
upon exercise of such Rights, all subject to further adjustment as provided
herein.
(h) Unless the Company shall have exercised its election as provided in
Section 11(i), upon each adjustment of the Purchase Price as a result of the
calculations made in Sections 11(b) and (c), each related Right outstanding
immediately prior to the making of such adjustment shall thereafter evidence the
right to purchase, at the adjusted Purchase Price, the number of Common Shares
(calculated to the nearest one ten-thousandth of a share) obtained by (i)
multiplying (x) the number of Common Shares covered by such Right immediately
prior to this adjustment by (y) the Purchase Price in effect immediately prior
to such Purchase Price adjustment and (ii) dividing the product so obtained by
the Purchase Price in effect immediately after such Purchase Price adjustment.
(i) The Company may elect on or after the date of any adjustment of the
Purchase Price to adjust the number of Rights in substitution for any adjustment
in the number of Common Shares purchasable upon the exercise of a Right. Each
of such Rights outstanding after such adjustment of the number of such Rights
shall be exercisable for the number of Common Shares for which such Right was
exercisable immediately prior to such adjustment. Each such Right held of
record prior to such adjustment of the number of Rights shall become that number
of such Rights (calculated to the nearest one ten-thousandth) obtained by
dividing the Purchase Price in effect immediately prior to adjustment of such
Purchase Price by the Purchase Price in effect immediately after such
adjustment. The Company shall make a public announcement of its election to
adjust the number of Rights indicating the record date for the adjustment, and,
if known at the time, the amount of the adjustment to be made. This record date
may be the date on which the Purchase Price is adjusted or any day thereafter,
but, if the Right Certificates have been issued, shall be at least 10 days later
than the date of the public announcement. If Right Certificates have been
issued, upon each adjustment of the number of such Rights pursuant to this
Section 11(i), the Company shall, as promptly as practicable, cause to be
distributed to holders of record of such Right Certificates on such record date
additional Rights to which such holders shall be entitled as a result of such
adjustment, or, at the option of the Company, shall cause to be distributed to
such holders of record in substitution and replacement for such Right
Certificates held by such holders prior to the date of adjustment, and upon
surrender thereof, if required by the Company, new Right Certificates evidencing
all the Rights to which such holders shall be entitled after such adjustment.
Right Certificates so to be distributed shall be issued, executed and
countersigned in the manner provided for herein and shall be registered in the
names of the holders of record of Right Certificates on the record date
specified in the public announcement.
(j) Irrespective of any adjustment or change in the Purchase Price or the
number of Common Shares issuable upon the exercise of the Rights, the Right
Certificates theretofore and thereafter issued may continue to express the
Purchase Price and the number of Common Shares which were expressed in such
Right Certificates theretofore issued hereunder.
(k) Before taking any action that would cause an adjustment reducing the
Purchase Price below the then par value, if any, of the Common Shares issuable
upon exercise of the Rights, the Company shall take any corporate action which
may, in the opinion of its counsel, be necessary in order that the Company may
validly and legally issue fully paid and nonassessable Common Shares at such
adjusted Purchase Price.
(l) In any case in which this Section 11 shall require that an adjustment
in the Purchase Price be made effective as of a record date for a specified
event, the Company may elect to defer until the occurrence of such event the
issuing to the holder of any related Right exercised after such record date of
the Common Shares and other capital stock or securities of the Company, if any,
issuable upon such exercise over and above the Common Shares and other capital
stock or securities of the Company, if any, issuable upon such exercise on the
basis of the Purchase Price in effect prior to such adjustment; provided,
however, that the Company shall deliver to such holder a due bill or other
appropriate instrument evidencing such holder's right to receive such additional
shares upon the occurrence of the event requiring such adjustment.
(m) Anything in this Section 11 to the contrary notwithstanding, the
Company shall be entitled to make such reductions in the Purchase Price in
addition to those adjustments expressly required by this Section 11, as and to
the extent that it in its sole discretion shall determine to be advisable in
order that (i) any consolidation or subdivision of the Common Shares, (ii)
issuance wholly for cash of any Common Shares at less than the current market
price, (iii) issuance wholly for cash of Common Shares or securities which by
their terms are convertible into or exchangeable for Common Shares, (iv)
dividends on Common Shares payable in Common Shares or (v) issuance of rights,
options or warrants referred to hereinabove in Section 11(b), hereafter made by
the Company to holders of Common Shares, shall not be taxable to such
stockholders.
(n) The Company covenants and agrees that, after the Distribution Date, it
will not, except as permitted by Sections 23 or 27 hereof, take (or permit any
Subsidiary to take) any action the purpose of which is to, or if at the time
such action is taken it is reasonably foreseeable that the effect of such action
is to, materially diminish or otherwise eliminate the benefits intended to be
afforded by the Rights.
SECTION 12
CERTIFICATE OF ADJUSTMENT
Whenever an adjustment is made as provided in Sections 11 or 13 hereof, the
Company shall promptly (a) prepare a certificate setting forth such adjustment,
and a brief statement of the facts accounting for such adjustment, (b) promptly
file with the Rights Agent and with each transfer agent for the Common Shares a
copy of such certificate and, (c) include a brief summary thereof in the next
quarterly or current report filed pursuant to the Exchange Act by the Company,
and, following the Distribution Date, mail such summary to each holder of a
Right Certificate in accordance with Section 25 hereof.
SECTION 13
CONSOLIDATION, MERGER OR SALE OR TRANSFER OF ASSETS OR EARNING POWER
(a) In the event that, on or following the Distribution Date, directly or
indirectly, (x) the Company shall consolidate with, or merge with and into any
other Person, (y) the Company shall consolidate with, or merge with, any other
Person, and the Company shall be the continuing or surviving corporation of such
consolidation or merger (other than, in a case of any transaction described in
(x) or (y), a merger or consolidation which would result in the voting power
represented by all of the securities generally entitled to vote in the election
of directors ("voting securities") of the Company outstanding immediately prior
thereto continuing to represent (either by remaining outstanding or by being
converted into securities of the surviving entity) all of the voting securities
of the Company or such surviving entity outstanding immediately after such
merger or consolidation and the holders of such securities not having changed as
a result of such merger or consolidation), or (z) the Company shall sell or
otherwise transfer (or one or more of its Subsidiaries shall sell or otherwise
transfer), in one or a series of related transactions, assets or earning power
aggregating more than 50% of the assets or earning power of the Company and its
Subsidiaries (taken as a whole) to any other Person (other than the Company or
any Subsidiary of the Company in one or more transactions each of which does not
violate Section 11(n) hereof), then, and in each such case (except as provided
in Section 13(d) hereof), proper provision shall be made so that (i) each holder
of a Right, except as provided in the second paragraph of Section 11(a)(ii)
hereof, shall thereafter have the right to receive, upon the exercise thereof at
a price equal to the then current Purchase Price (without giving effect to any
adjustment to such Purchase Price pursuant to Section 11(a)(ii)) multiplied by
the number of Common Shares for which such Right is then exercisable, in
accordance with the terms of this Rights Agreement, such number of freely
tradable Common Shares of the Principal Party, not subject to any liens,
encumbrances, rights of call or first refusal or other adverse claims, as shall
equal the result obtained by (A) multiplying the then current Purchase Price
(without giving effect to any adjustment to such Purchase Price pursuant to
Section 11(a(ii)) by the number of Common Shares for which such Right is then
exercisable and dividing that product by (B) 50% of the then current per share
market price of the Common Shares of such Principal Party (determined pursuant
to Section 11(d) hereof) on the date of consummation of such consolidation,
merger, sale or transfer; (ii) such Principal Party shall thereafter be liable
for, and shall assume, by virtue of such consolidation, merger, sale or
transfer, all the obligations and duties of the Company pursuant to this Rights
Agreement; (iii) the term "Company" shall thereafter be deemed to refer to such
Principal Party, it being specifically intended that the provisions of Section
11 hereof shall apply only to such Principal Party following the first
occurrence of an event described in this Section 13; and (iv) such Principal
Party shall take such steps (including, but not limited to, the reservation of a
sufficient number of its Common Shares in accordance with Section 9 hereof) in
connection with such consummation as may be necessary to assure that the
provisions hereof shall thereafter be applicable, as nearly as reasonably may
be, in relation to the Common Shares thereafter deliverable upon the exercise of
the Rights.
(b) "Principal Party" shall mean
(i) in the case of any transaction described in clause (x) or (y) of
the first sentence of Section 13(a), the Person that is the issuer of any
securities into which Common Shares of the Company are converted in such merger
or consolidation, and if no securities are so issued, the Person that is the
other party to such merger or consolidation (including, if applicable, the
Company if it is the surviving corporation); and
(ii) in the case of any transaction described in clause (z) of the
first sentence of Section 13(a), the Person that is the party receiving the
greatest portion of the assets or earnings power transferred pursuant to such
transaction or transactions; provided, however, that in any of the foregoing
cases, (1) if the Common Shares of such Person are not at such time and have not
been continuously over the preceding twelve (12) month period registered under
Section 12 of the Exchange Act, and such Person is a direct or indirect
Subsidiary or Affiliate of another Person the Common Shares of which are and
have been so registered, "Principal Party" shall refer to such other Person; (2)
in case such Person is a Subsidiary, directly or indirectly, of more than one
Person, the Common Shares of two or more of which are and have been so
registered, "Principal Party" shall refer to whichever of such Persons is the
issuer of the common shares having the greatest aggregate market value; and (3)
in case such Person is, or is owned, directly or indirectly, by a partnership or
joint venture formed by two or more Persons that are not owned, directly or
indirectly, by the same Person, the rules set forth in (1) and (2) above shall
apply to each of the chains of ownership having an interest in such joint
venturers as if such party were a "Subsidiary" of both or all of such joint
ventures and the Principal Parties in each such chain shall bear the obligations
set forth in this Section 13 in the same ratio as their direct or indirect
interests in such Person bear to the total of such interests.
(c) The Company shall not consummate any such consolidation, merger, sale
or transfer unless the Principal Party shall have a sufficient number of its
authorized Common Shares which have not been issued or reserved for issuance to
permit the exercise in full of the Rights in accordance with this Section 13 and
unless prior thereto the Company and such Principal Party and each other Person
who may become a Principal Party as a result of such consolidation, merger, sale
or transfer shall have executed and delivered to the Rights Agent a supplemental
agreement providing for the terms set forth in paragraphs (a) and (b) of this
Section 13 and further providing that, as soon as practicable after the date of
any consolidation, merger, sale or transfer mentioned in paragraph (a) of this
Section 13, the Principal Party at its own expense shall:
(i) prepare and file a registration statement under the Securities Act of
1933, as amended, with respect to the Rights and the securities purchasable upon
exercise of the Rights on an appropriate form, and will use its best efforts to
cause such registration statement to (A) become effective as soon as practicable
after such filing and (B) remain effective (with a prospectus at all times
meeting the requirements of such Act) until the Final Expiration Date;
(ii) use its best efforts to qualify or register the Rights and the
securities purchasable upon exercise of the Rights under the blue sky laws of
such jurisdictions as may be necessary or appropriate; and
(iii) deliver to holders of the Rights historical financial statements for
the Principal Party which comply in all respects with the requirements for
registration on Form 10 under the Exchange Act.
The provisions of this Section 13 shall similarly apply to successive
mergers or consolidations or sales or other transfers. In the event that the
events described in this Section 13 shall occur at any time after the occurrence
of the events described in the second paragraph of Section 11(a)(ii), the Rights
which have not theretofore been exercised shall thereafter become exercisable in
the manner described in Section 13(a).
(d) Notwithstanding anything in this Agreement to the contrary, Section 13
shall not be applicable to a transaction described in subparagraphs (x) and (y)
of Section 13(a) if (I) such transaction is consummated with a Person or Persons
who acquired Common Shares pursuant to a Permitted Offer (or a wholly owned
subsidiary of any such Person or Persons), (ii) the price per share of the
Common Shares offered in such transaction is not less than the price per share
of Common Shares whose shares were purchased pursuant to such tender offer or
exchange offer and (iii) the form of consideration being offered to the
remaining holders of shares of Common Shares pursuant to such transaction is the
same as the form of consideration paid pursuant to such tender offer or exchange
offer. Upon consummation of any such transaction contemplated by this Section
13(d), all Rights hereunder shall expire.
SECTION 14
FRACTIONAL RIGHTS AND
FRACTIONAL SHARES
a) The Company shall not be required to issue fractions of Rights or to
distribute Right Certificates which evidence fractional Rights. In lieu of
such fractional Rights, there shall be paid to the registered holders of the
Right Certificates with regard to which such fractional Rights would otherwise
be issuable, an amount in cash equal to the same fraction of the current market
value of a whole Right. For the purposes of this Section 14(a), the current
market value of a whole Right shall be the closing price of such Rights for the
Trading Day immediately prior to the date on which such fractional Rights would
have been otherwise issuable. The closing price for any day shall be the last
sale price, regular way, or, in case no such sale takes place on such day, the
average of the closing bid and asked prices, regular way, in either case as
reported in the principal consolidated transaction reporting system with respect
to securities listed or admitted to trading on the New York Stock Exchange or,
if the Rights are not listed or admitted to trading on the New York Stock
Exchange, as reported in the principal consolidated transaction reporting system
with respect to securities listed on the principal national securities exchange
on which the Rights are listed or admitted to trading or, if such Rights are not
listed or admitted to trading on any national securities exchange, the last
quoted price or, if not so quoted, the average of the high bid and low asked
prices in the over-the-counter market, as reported by NASDAQ or such other
system then in use or, if on any such date the Rights are not quoted by any such
organization, the average of the closing bid and asked prices as furnished by a
professional market maker making a market in such Rights selected by the Board
of Directors of the Company. If on any such date no such market maker is
making a market in the Rights, the fair value of such Rights on such date as
determined in good faith by the Board of Directors of the Company, whose
determination shall be described in a statement filed with the Rights Agent,
shall be used and shall be conclusive for all purposes.
(b) The Company shall not be required to issue fractions of Common Shares
upon (i) exercise of the Rights or exchange of the Rights for Common Shares
pursuant to Section 24 of this Rights Agreement, or to distribute certificates
which evidence fractional shares of Common Shares. Fractions of Common Shares
may, at the election of the Company, be evidenced by depository receipts,
pursuant to an appropriate agreement between the Company and a depositary
selected by it; provided that such agreement shall provide that the holders of
such depositary receipts shall have the rights, privileges and preferences to
which they are entitled as beneficial owners of the Common Shares represented by
such depositary receipts. In lieu of fractional Common Shares or depositary
receipts, the Company may pay to the registered holders of Right Certificates at
the time such Rights are exercised as herein provided an amount in cash equal to
the same fraction of the current market value of one Common Share. For the
purposes of this Section 14(b), the current market value of a Common Share shall
be the closing price of a Common Share (as determined pursuant to the second
sentence of Section 11(d) hereof) for the Trading Day immediately prior to the
date of such exercise.
(c) The holder of a Right by the acceptance of such Right expressly waives
his right to receive any fractional Rights or any fractional shares upon
exercise of a Right (except as provided in this Section 14).
SECTION 15
RIGHTS OF ACTION
All rights of action in respect of this Rights Agreement, excepting the
rights of action given to the Rights Agent under Sections 18 or 20 hereof, are
vested in the respective registered holders of the Right Certificates (and,
prior to the Distribution Date, the registered holders of the Common Shares);
and any registered holder of any Right Certificate (or, prior to the
Distribution Date, of the Common Shares), without the consent of the Rights
Agent or of the holder of any other Right Certificate (or, prior to the
Distribution Date, of the Common Shares), may, in his own behalf and for his own
benefit, enforce, and may institute and maintain any suit, action or proceeding
against the Company to enforce, or otherwise act in respect of, his right to
exercise the Rights evidenced by such Right Certificate in the manner provided
in such Right Certificate and in this Rights Agreement. Without limiting the
foregoing or any remedies available to the holders of Rights, it is specifically
acknowledged that the holders of Rights would not have an adequate remedy at law
for any breach of this Rights Agreement and will be entitled to specific
performance of the obligations under, and injunctive relief against actual or
threatened violations of the obligations of any Person subject to, this Rights
Agreement. Holders of Rights shall be entitled to recover the reasonable costs
and expenses, including attorneys' fees, incurred by them in any action to
enforce the provisions of this Agreement.
SECTION 16
AGREEMENT OF RIGHT HOLDERS
Every holder of a Right, by accepting the same, consents and agrees with the
Company and the Rights Agent and with every other holder of a Right that:
(a) prior to the Distribution Date, the Rights will be transferable only in
connection with the transfer of the Common Shares;
(b) after the Distribution Date, the Right Certificates are transferable
only on the registry books of the Rights Agent if surrendered at the principal
office of the Rights Agent, duly endorsed or accompanied by a proper instrument
of transfer; and
(c) the Company and the Rights Agent may deem and treat the person in whose
name the Right Certificate (or, prior to the Distribution Date, the associated
certificates for Common Shares) is registered as the absolute owner thereof and
of the Rights evidenced thereby (notwithstanding any notations of ownership or
writing on the Right Certificates or the associated certificates for Common
Shares made by anyone other than the Company or the Rights Agent) for all
purposes whatsoever, and neither the Company nor the Rights Agent shall be
affected by any notice to the contrary; and
(d) notwithstanding anything in this Rights Agreement to the contrary,
neither the Company nor the Rights Agent shall have any liability to any holder
of a Right or a beneficial interest in a Right or other Person as a result of
its inability to perform any of its obligations under this Rights Agreement by
reason of any preliminary or permanent injunction or other order, decree or
ruling issued by a court of competent jurisdiction or by a governmental,
regulatory or administrative agency or commission, or any statute, rule,
regulation or executive order promulgated or enacted by any governmental
authority, prohibiting or otherwise restraining performance of such obligation;
provided, however, the Company must use its best efforts to have any such order,
decree or ruling lifted or otherwise overturned as soon as possible.
SECTION 17
RIGHT CERTIFICATE HOLDER NOT
DEEMED A STOCKHOLDER
No holder, as such, of any Right Certificate shall be entitled to vote, receive
dividends or be deemed for any purpose the holder of the Common Shares or any
other securities of the Company which may at any time be issuable on the
exercise of the Rights represented thereby, nor shall anything contained herein
or in any Right Certificate be construed to confer upon the holder of any Right
Certificate, as such, any of the rights of a stockholder of the Company or any
right to vote for the election of directors or upon any matter submitted to
stockholders at any meeting thereof, or to give or withhold consent to any
corporate action, or to receive notice of meetings or other actions affecting
stockholders (except as provided in Section 25 hereof), or to receive dividends
or subscription rights, or otherwise, until the Right or Rights evidenced by
such Right Certificate shall have been exercised in accordance with the
provisions hereof.
SECTION 18
CONCERNING THE RIGHTS AGENT
The Company agrees to pay to the Rights Agent reasonable compensation for all
services rendered by it hereunder and, from time to time, on demand of the
Rights Agent, its reasonable expenses and counsel fees and other disbursements
incurred in the administration and execution of this Rights Agreement and the
exercise and performance of its duties hereunder. The Company also agrees to
indemnify the Rights Agent for, and to hold it harmless against, any loss,
liability, or expense, incurred without gross negligence, bad faith or willful
misconduct on the part of the Rights Agent, for anything done or omitted by the
Rights Agent in connection with the acceptance and administration of this Rights
Agreement, including the costs and expenses of defending against any claim of
liability in the premises. The indemnity provided for herein shall survive the
expiration of the Rights and the termination of this Rights Agreement.
The Rights Agent shall be protected and shall incur no liability for, or in
respect of any action taken, suffered or omitted by it in connection with, its
administration of this Rights Agreement in reliance upon any Right Certificate
or certificate for the Common Shares or for other securities of the Company,
instrument of assignment or transfer, power of attorney, endorsement, affidavit,
letter, notice, direction, consent, certificate, statement, or other paper or
document believed by it to be genuine and to be signed, executed and, where
necessary, verified or acknowledged, by the proper Person or Persons, or
otherwise upon the advice of counsel as set forth in Section 20 hereof.
SECTION 19
MERGER OR CONSOLIDATION OR
CHANGE OF NAME OF RIGHTS AGENT
(a) Any Person into which the Rights Agent or any successor Rights Agent
may be merged or with which it may be consolidated, or any Person resulting from
any merger or consolidation to which the Rights Agent or any successor Rights
Agent shall be a party, or any Person succeeding to the stock transfer,
shareholder services or all or substantially all of the corporate trust business
of the Rights Agent or any successor Rights Agent, shall be the successor to the
Rights Agent under this Rights Agreement without the execution or filing of any
paper or any further act on the part of any of the parties hereto, provided that
such corporation would be eligible for appointment as a successor Rights Agent
under the provisions of Section 21 hereof. In case at the time such successor
Rights Agent shall succeed to the agency created by this Rights Agreement any of
the Right Certificates shall have been countersigned but not delivered, any such
successor Rights Agent may adopt the countersignature of the predecessor Rights
Agent and deliver such Right Certificates so countersigned; and in case at that
time any of the Right Certificates shall not have been countersigned, any
successor Rights Agent may countersign such Right Certificates either in the
name of the predecessor Rights Agent or in the name of the successor Rights
Agent; and in all such cases such Right Certificates shall have the full force
provided in the Right Certificates and in this Rights Agreement.
(b) In case at any time the name of the Rights Agent shall be changed and
at such time any of the Right Certificates shall have been countersigned but not
delivered, the Rights Agent may adopt the countersignature under its prior name
and deliver Right Certificates so countersigned; and in case at that time any of
the Right Certificates shall not have been countersigned, the Rights Agent may
countersign such Right Certificates either in its prior name or in its changed
name; and in all such cases such Right Certificates shall have the full force
provided in the Right Certificates and in this Rights Agreement.
SECTION 20
DUTIES OF RIGHTS AGENT
The Rights Agent undertakes the duties and obligations imposed by this Rights
Agreement upon the following terms and conditions, by all of which the Company
and the holders of Right Certificates, by their acceptance thereof, shall be
bound:
(a) The Rights Agent may consult with legal counsel (who may be legal
counsel for the Company or its own in-house counsel), and the opinion of such
counsel shall be full and complete authorization and protection to the Rights
Agent as to any action taken or omitted by it in good faith and in accordance
with such opinion.
(b) Whenever in the performance of its duties under this Rights Agreement
the Rights Agent shall deem it necessary or desirable that any fact or matter be
proved or established by the Company prior to taking or suffering any action
hereunder, such fact or matter (unless other evidence in respect thereof be
herein specifically prescribed) may be deemed to be conclusively proved and
established by a certificate signed by any one of the Chairman of the Board, the
Chief Executive Officer, the President, any Vice President, the Treasurer or the
Secretary of the Company and delivered to the Rights Agent; and such certificate
shall be full authorization to the Rights Agent for any action taken or suffered
in good faith by it under the provisions of this Rights Agreement in reliance
upon such certificate.
(c) The Rights Agent shall be liable hereunder to the Company and any other
Person only for its own gross negligence, bad faith or willful misconduct.
(d) The Rights Agent shall not be liable for or by reason of any of the
statements of fact or recitals contained in this Rights Agreement or in the
Right Certificates (except its countersignature on such Rights Certificates) or
be required to verify the same, but all such statements and recitals are and
shall be deemed to have been made by the Company only.
(e) The Rights Agent shall not be under any responsibility in respect of
the validity of this Rights Agreement or the execution and delivery hereof
(except the due execution hereof by the Rights Agent) or in respect of the
validity or execution of any Right Certificate (except its countersignature
thereof); nor shall it be responsible for any breach by the Company of any
covenant or condition contained in this Rights Agreement or in any Right
Certificate; nor shall it be responsible for any change in the exercisability of
the Rights (including the Rights becoming void pursuant to the second paragraph
of Section 11(a)(ii) hereof) or any adjustment in the terms of the Rights
(including the manner, method or amount thereof) provided for in Sections 3, 11,
13, 23 or 24, or the ascertaining of the existence of facts that would require
any such change or adjustment (except with respect to the exercise of Rights
evidenced by Right Certificates after actual notice that such change or
adjustment is required); nor shall it by any act hereunder be deemed to make any
representation or warranty as to the authorization or reservation of any Common
Shares to be issued pursuant to this Rights Agreement or any Right Certificate
or as to whether any Common Shares will, when issued, be validly authorized and
issued, fully paid and nonassessable.
(f) The Company agrees that it will perform, execute, acknowledge and
deliver or cause to be performed, executed, acknowledged and delivered all such
further and other acts, instruments and assurances as may reasonably be required
by the Rights Agent for the carrying out or performing by the Rights Agent of
the provisions of this Rights Agreement.
(g) The Rights Agent is hereby authorized and directed to accept
instructions with respect to the performance of its duties hereunder from any
one of the Chairman of the Board, the Chief Executive Officer, the President,
any Vice President, the Secretary or the Treasurer of the Company, and to apply
to such officers for advice or instructions in connection with its duties, and
it shall not be liable for any action taken or suffered by it in good faith in
accordance with instructions of any such officer or for any delay in acting
while waiting for those instructions.
(h) The Rights Agent and any stockholder, director, officer or employee of
the Rights Agent may buy, sell or deal in any of the Rights or other securities
of the Company or become pecuniarily interested in any transaction in which the
Company may be interested, or contract with or lend money to the Company or
otherwise act as fully and freely as though it were not Rights Agent under this
Rights Agreement. Nothing herein shall preclude the Rights Agent from acting in
any other capacity for the Company or for any other legal entity.
(i) The Rights Agent may execute and exercise any of the rights or powers
hereby vested in it or perform any duty hereunder either itself or by or through
its attorneys or agents, and the Rights Agent shall not be answerable or
accountable for any act, default, neglect or misconduct of any such attorneys or
agents or for any loss to the Company resulting from any such act, default,
neglect or misconduct, provided reasonable care was exercised in the selection
and continued employment thereof.
SECTION 21
CHANGE OF RIGHTS AGENT
The Rights Agent or any successor Rights Agent may resign and be discharged from
its duties under this Rights Agreement upon 30 days' notice in writing mailed to
the Company and to each transfer agent of the Common Shares by registered or
certified mail, and to the holders of the Right Certificates by first-class
mail. The Company may remove the Rights Agent or any successor Rights Agent
upon 30 days' notice in writing, mailed to the Rights Agent or successor Rights
Agent, as the case may be, and to each transfer agent of the Common Shares by
registered or certified mail, and to the holders of the Right Certificates by
first-class mail or, prior to the Distribution Date, through any filing made by
the Company pursuant to the Securities Exchange Act of 1934, as amended. If the
Rights Agent shall resign or be removed or shall otherwise become incapable of
acting, the Company shall appoint a successor to the Rights Agent. If the
Company shall fail to make such appointment within a period of 30 days after
giving notice of such removal or after it has been notified in writing of such
resignation or incapacity by the resigning or incapacitated Rights Agent or by
the holder of a Right Certificate (who shall, with such notice, submit his Right
Certificate for inspection by the Company), then the registered holder of any
Right Certificate may apply to any court of competent jurisdiction for the
appointment of a new Rights Agent. Any successor Rights Agent, whether
appointed by the Company or by such a court, shall be (a) a corporation or other
entity organized and doing business under the laws of the United States or of
any state of the United States, in good standing, which is authorized under such
laws to exercise corporate trust, shareholder services or stock transfer powers
and is subject to supervision or examination by federal or state authority and
which has at the time of its appointment as Rights Agent a combined capital and
surplus of at least $25 million, or (b) an affiliate of a corporation or other
entity described in clause (a) of this sentence. After appointment, the
successor Rights Agent shall be vested with the same powers, rights, duties and
responsibilities as if it had been originally named as Rights Agent without
further act or deed; but the predecessor Rights Agent shall deliver and transfer
to the successor Rights Agent any property at the time held by it hereunder, and
execute and deliver any further assurance, conveyance, act or deed necessary for
the purpose. Not later than the effective date of any such appointment the
Company shall file notice thereof in writing with the predecessor Rights Agent
and each transfer agent of the Common Shares and mail a notice thereof in
writing to the registered holders of the Right Certificates or, prior to the
Distribution Date, through any filing made by the Company pursuant to the
Securities Exchange Act of 1934, as amended. Failure to give any notice
provided for in this Section 21, however, or any defect therein, shall not
affect the legality or validity of the resignation or removal of the Rights
Agent or the appointment of the successor Rights Agent, as the case may be.
SECTION 22
ISSUANCE OF NEW RIGHT CERTIFICATES
Notwithstanding any of the provisions of this Rights Agreement or of the Rights
to the contrary, the Company may, at its option, issue new Right Certificates
evidencing Rights in such form as may be approved by its Board of Directors to
reflect any adjustment or change in the Purchase Price and the number or kind or
class of shares or other securities or property purchasable under the Right
Certificates made in accordance with the provisions of this Rights Agreement.
In addition, in connection with the issuance or sale of Common Shares
following the Distribution Date and prior to the earlier of the Redemption Date
and the Final Expiration Date, the Company (a) shall with respect to Common
Shares so issued or sold pursuant to the exercise of stock options or under any
employee plan or arrangement, or upon the exercise, conversion or exchange of
securities, notes or debentures issued by the Company, and (b) may, in any other
case, if deemed necessary or appropriate by the Board of Directors of the
Company, issue Right Certificates representing the appropriate number of Rights
in connection with such issuance or sale; provided, however, that (i) the
Company shall not be obligated to issue any such Right Certificates if, and to
the extent that, the Company shall be advised by counsel that such issuance
would create a significant risk of material adverse tax consequences to the
Company or the Person to whom such Right Certificate would be issued, and (ii)
no Right Certificate shall be issued if, and to the extent that, appropriate
adjustment shall otherwise have been made in lieu of the issuance thereof.
SECTION 23
REDEMPTION
(a) The Board of Directors of the Company may, at its option, at any time
prior to such time as any Person becomes an Acquiring Person, redeem all but not
less than all of the then outstanding Rights at an initial redemption price of
$.01 per Right ("Redemption Price"). The Redemption Price shall be
appropriately adjusted to reflect any stock split, stock dividend or similar
transaction occurring after the date hereof. The redemption of the Rights by
the Board of Directors may be made effective at such time, on such basis and
with such conditions as the Board of Directors in its sole discretion may
establish.
(b) Immediately upon the action of the Board of Directors of the Company
ordering the redemption of the Rights pursuant to paragraph (a) of this Section
23, evidence of which shall be promptly filed with the Rights Agent, or, when
approprate, immediately upon the time or satisfaction of such conditions as the
Board of Directors may have established, and without any further action and
without any notice, the right to exercise the Rights will terminate and the only
right thereafter of the holders of Rights shall be to receive the Redemption
Price. The Company shall promptly give public disclosure of any such
redemption; provided, however, that the failure to give, or any defect in, any
such disclosure shall not affect the validity of such redemption. Within 10
days after such action of the Board of Directors ordering the redemption of the
Rights, the Company shall mail a notice of redemption to all the holders of the
then outstanding Rights at their last addresses as they appear upon the registry
books of the Rights Agent or, prior to the Distribution Date, on the registry
books of the transfer agent for the Common Shares. Any notice which is mailed
in the manner herein provided shall be deemed given, whether or not the holder
receives the notice. Each such notice of redemption will state the method by
which the payment of the Redemption Price will be made. Neither the Company nor
any of its Affiliates or Associates may redeem, acquire or purchase for value
any Rights at any time in any manner other than that specifically set forth in
this Section 23 or in Section 24 hereof, and other than in connection with the
purchase of Common Shares prior to the Distribution Date.
SECTION 24
EXCHANGE
(a) The Board of Directors of the Company may, at its option, at any time
after any Person becomes an Acquiring Person, exchange all or part of the then
outstanding and exercisable Rights (which shall not include Rights that have
become void pursuant to the provisions of the second paragraph of Section
11(a)(ii) hereof) for Common Shares at an exchange ratio of one Common Share per
Right, appropriately adjusted to reflect any stock split, stock dividend or
similar transaction occurring after the date hereof (such exchange ratio being
hereinafter referred to as the "Exchange Ratio"). Notwithstanding the
foregoing, the Board of Directors shall not be empowered to effect such exchange
at any time after any Person (other than the Company, any Subsidiary of the
Company, any employee benefit plan or compensation arrangement of the Company or
any such Subsidiary, or any entity holding Common Shares for or pursuant to the
terms of any such plan or any trust agreement entered into by the Company to
secure benefits payable under any employee benefit plan or compensation
arrangement of the Company or any Subsidiary of the Company), together with all
Affiliates and Associates of such Person, becomes the Beneficial Owner of Common
Shares representing 50% or more of the Common Shares then outstanding.
(b) Immediately upon the action of the Board of Directors of the Company
ordering the exchange of any Rights pursuant to subsection (a) of this Section
24 and without any further action and without any notice, the right to exercise
such Rights shall terminate and the only right thereafter of a holder of such
Rights shall be to receive that number of Common Shares equal to the number of
such Rights held by such holder multiplied by the Exchange Ratio. The Company
shall promptly give public notice of any such exchange; provided, however, that
the failure to give, or any defect in, such notice shall not affect the validity
of such exchange. The Company shall promptly mail a notice of any such exchange
to all of the holders of such Rights at their last addresses as they appear upon
the registry books of the Rights Agent. Any notice which is mailed in the
manner herein provided shall be deemed given, whether or not the holder receives
the notice. Each such notice of exchange will state the method by which the
exchange of the Common Shares for Rights will be effected and, in the event of
any partial exchange, the number and kind of Rights which will be exchanged.
Any partial exchange shall be effected pro rata based on the number of Rights
being exchanged (other than Rights which have become void pursuant to the
provisions of the second paragraph of Section 11(a)(ii) hereof) held by each
holder of such Rights.
(c) In the event that there shall not be sufficient Common Shares issued
but not outstanding or authorized but unissued to permit any exchange of Rights
as contemplated in accordance with this Section 24, the Company shall take all
such action as may be necessary to authorize additional Common Shares for
issuance upon exchange of the Rights.
SECTION 25
NOTICE OF CERTAIN EVENTS
(a) In case the Company, following the Distribution Date, shall propose (i)
to pay any dividend payable in stock of any class or series to holders of Common
Shares or to make any other distribution to holders of Common Shares (other than
a regular quarterly cash dividend) or to effect a subdivision, combination or
consolidation of the Common Shares (by reclassification or otherwise than by
payment of dividends in Common Shares), (ii) to offer to holders of Common
Shares rights or warrants to subscribe for or to purchase any additional Common
Shares or any other securities, rights or options, (iii) to effect any
reclassification of Common Shares (other than a reclassification involving only
the subdivision of outstanding Common Shares), (iv) to effect any consolidation
or merger into or with, or to effect any sale or other transfer (or to permit
one or more of its Subsidiaries to effect any sale or other transfer), in one or
more transactions, of 50% or more of the assets or earning power of the Company
and its Subsidiaries (taken as a whole) to, any other Person (other than the
Company and/or any of its Subsidiaries in one or more transactions each of which
does not violate Section 11(n) hereof), or (v) to effect the liquidation,
dissolution or winding up of the Company, then, in each such case, the Company
shall give to each holder of a Right Certificate, in accordance with Section 26
hereof, a notice of such proposed action to the extent feasible, which shall
specify the record date for the purposes of such stock dividend, or distribution
of rights or warrants, or the date on which such reclassification,
consolidation, merger, sale, transfer, liquidation, dissolution, or winding up
is to take place and the date of participation therein by holders of Common
Shares if any such date is to be fixed, and such notice shall be so given in the
case of any action covered by clause (i) or (ii) above at least 10 days prior to
the record date for determining holders of Common Shares for purposes of such
action, and in the case of any such other action, at least 10 days prior to the
date of the taking of such proposed action or the date of participation therein
by holders of Common Shares, whichever shall be the earlier. The failure to
give notice required by this Section 25 or any defect therein shall not affect
the legality or validity of the action taken by the Company or the vote upon any
such action.
(b) In case any of the events set forth in Section 11(a)(ii) (except for an
event described in the second paragraph of that Section) hereof shall occur,
then the Company shall as soon as practicable thereafter give to each holder of
a Right Certificate, in accordance with Section 26 hereof, a notice of the
occurrence of such event, which notice shall describe such event and the
consequences of such event to holders of Rights under the second paragraph of
Section 11(a)(ii) hereof.
SECTION 26
NOTICES
Notices or demands authorized by this Rights Agreement to be given or made by
the Rights Agent or by the holder of any Right Certificate to or on the Company
shall be sufficiently given or made if sent by first-class mail, postage
prepaid, addressed (until another address is filed in writing with the Rights
Agent) as follows:
Energizer Holdings, Inc.
800 Chouteau Avenue
St. Louis, Missouri 63102
Attention: Secretary
Subject to the provisions of Section 21 hereof, any notice or demand authorized
by this Rights Agreement to be given or made by the Company or by the holder of
any Right Certificate to or on the Rights Agent shall be sufficiently given or
made if sent by first-class mail, postage prepaid, addressed (until another
address is filed in writing with the Company) as follows:
Continental Stock Transfer & Trust Company
2 Broadway
New York, New York 10004
Attn: Compliance Department
Notices or demands authorized by this Rights Agreement to be given or made by
the Company or the Rights Agent to the holder of any Right Certificate shall be
sufficiently given or made if sent by first-class mail, postage prepaid,
addressed to such holder at the address of such holder as shown on the registry
books of the Company.
SECTION 27
SUPPLEMENTS AND AMENDMENTS
Prior to the Distribution Date, the Company and the Rights Agent shall, if the
Company so directs, supplement or amend any provision of this Rights Agreement
without the approval of any holders of certificates representing Common Shares.
From and after the Distribution Date, the Company and the Rights Agent shall, if
the Company so directs, supplement or amend this Rights Agreement without the
approval of any holders of Right Certificates in order (i) to cure any
ambiguity, (ii) to correct or supplement any provision contained herein which
may be defective or inconsistent with any other provisions herein, (iii) to
shorten or lengthen any time period hereunder (including, without limitation, to
extend the Final Expiration Date) or (iv) to change or supplement the provisions
hereunder in any manner which the Company may deem necessary or desirable and
which shall not adversely affect the interests of the holders of Right
Certificates (other than an Acquiring Person or an Affiliate or Associate of an
Acquiring Person); provided, however, that this Rights Agreement may not be
supplemented or amended to lengthen, pursuant to clause (iii) of this sentence,
(A) a time period relating to when the Rights may be redeemed at such time as
the Rights are not then redeemable, or (B) any other time period unless such
lengthening is for the purpose of protecting, enhancing or clarifying the rights
of, and/or the benefits to, the holders of Rights; provided further that the
Company shall have the right to make unilaterally any changes necessary to
facilitate the appointment of a successor Rights Agent, which such changes shall
be set forth in a writing by the Company or by the Company and such successor
Rights Agent. Without limiting the foregoing, the Company may at any time prior
to such time as any Person becomes an Acquiring Person amend this Rights
Agreement to lower the thresholds set forth in Sections 1(a) and 3(a) hereof
from 20% to not less than the greater of (i) any percentage greater than the
largest percentage of the then outstanding Common Shares then known by the
Company to be beneficially owned by any Person (other than the Company, any
Subsidiary of the Company, any employee benefit plan or compensation arrangement
of the Company or any Subsidiary of the Company, or any entity holding Common
Shares for or pursuant to the terms of any such plan or compensation
arrangement) together with all Affiliates or Associates of such Person, or (ii)
10%. Upon the delivery of a certificate from an appropriate officer of the
Company which states that the proposed supplement or amendment is in compliance
with the terms of this Section 27, the Rights Agent shall execute such
supplement or amendment, provided that such supplement or amendment does not
adversely affect the rights or obligations of the Rights Agent under Section 18
or Section 20 of this Rights Agreement. Prior to the Distribution Date, the
interests of the holders of Rights shall be deemed coincident with the interests
of the holders of Common Shares.
SECTION 28
SUCCESSORS
All the covenants and provisions of this Rights Agreement by or for the
benefit of the Company or the Rights Agent shall bind and inure to the benefit
of their respective successors and assigns hereunder.
SECTION 29
DETERMINATIONS AND ACTIONS BY
THE BOARD OF DIRECTORS
For all purposes of this Rights Agreement, any calculation of the number of
Common Shares outstanding at any particular time, including for purposes of
determining the particular percentage of such outstanding Common Shares of which
any Person is the Beneficial Owner, shall be made in accordance with the last
sentence of Rule 13d-3(d)(1)(i) of the General Rules and Regulations under the
Exchange Act. The Board of Directors of the Company shall have the exclusive
power and authority to administer this Rights Agreement and to exercise all
rights and powers specifically granted to the Board or to the Company, or as may
be necessary or advisable in the administration of this Rights Agreement,
including, without limitation, the right and power to (i) interpret the
provisions of this Rights Agreement, and (ii) make all determinations deemed
necessary or advisable for the administration of this Rights Agreement
(including a determination to redeem or not redeem the Rights or to amend the
Rights Agreement or a determination that an adjustment to the Redemption Price
or Exchange Ratio is or is not appropriate). All such actions, calculations,
interpretations and determinations (including, for purposes of clause (y) below,
all omissions with respect to the foregoing) which are done or made by the Board
in good faith, shall (x) be final, conclusive and binding on the Company, the
Rights Agent, the holders of the Rights and all other parties, and (y) not
subject the Board to any liability to the holders of the Rights.
SECTION 30
BENEFITS OF THIS RIGHTS AGREEMENT
Nothing in this Rights Agreement shall be construed to give to any person
or corporation other than the Company, the Rights Agent and the registered
holders of the Right Certificates (and, prior to the Distribution Date, the
Common Shares) any legal or equitable right, remedy or claim under this Rights
Agreement; but this Rights Agreement shall be for the sole and exclusive benefit
of the Company, the Rights Agent and the registered holders of the Right
Certificates (and, prior to the Distribution Date, the Common Shares).
SECTION 31
SEVERABILITY
If any term, provision, covenant or restriction of this Rights Agreement is
held by a court of competent jurisdiction or other authority to be invalid, void
or unenforceable, the remainder of the terms, provisions, covenants and
restrictions of this Rights Agreement shall remain in full force and effect and
shall in no way be affected, impaired or invalidated. It is the intent of the
parties hereto to enforce the remainder of the terms, provisions, covenants and
restrictions of this Agreement to the maximum extent permitted by law.
SECTION 32
GOVERNING LAW
This Rights Agreement and each Right Certificate issued hereunder shall be
deemed to be a contract made under the laws of the State of Missouri and for all
purposes shall be governed by and construed in accordance with the laws of such
State applicable to contracts to be made and performed entirely within such
State.
SECTION 33
COUNTERPARTS
This Rights Agreement may be executed in any number of counterparts and
each of such counterparts shall for all purposes be deemed to be an original,
and all such counterparts shall together constitute but one and the same
instrument.
SECTION 34
DESCRIPTIVE HEADINGS
Descriptive headings of the several Sections of this Rights Agreement are
inserted for convenience only and shall not control or affect the meaning or
construction of any of the provisions hereof.
IN WITNESS WHEREOF, the parties hereto have caused this Rights Agreement to be
duly executed and attested, all as of the day and year first above written.
ENERGIZER HOLDINGS, INC.
Attest:
By: /s/ Harry L. Strachan By: /s/ Timothy L. Grosch
Title: Vice President and Title: Secretary
General Counsel
CONTINENTAL STOCK TRANSFER
& TRUST COMPANY
Attest:
By: By: /s/ Michael Nelson
Title: Title: President
<PAGE>
EXHIBIT A
FORM OF RIGHT CERTIFICATE
Certificate No. R- Rights
NOT EXERCISABLE AFTER MARCH 31, 2010 OR EARLIER IF REDEMPTION OR EXCHANGE
OCCURS. THE RIGHTS ARE SUBJECT TO REDEMPTION AT $.01 PER RIGHT AND TO EXCHANGE
ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT. [THE RIGHTS REPRESENTED BY THIS
RIGHT CERTIFICATE WERE ISSUED TO A PERSON WHO WAS AN ACQUIRING PERSON OR AN
AFFILIATE OR AN ASSOCIATE OF AN ACQUIRING PERSON. THIS RIGHT CERTIFICATE AND
THE RIGHTS REPRESENTED HEREBY ARE VOID IN THE CIRCUMSTANCES SPECIFIED IN THE
SECOND PARAGRAPH OF SECTION 11(a)(ii) OF THE RIGHTS AGREEMENT.]
Right Certificate
ENERGIZER HOLDINGS, INC.
This certifies that or registered assigns, is the
registered owner of the number of Rights set forth above, each of which entitles
the owner thereof, subject to the terms, provisions and conditions of the Rights
Agreement, dated as of April 1, 2000 (the " Rights Agreement"), between
Energizer Holdings, Inc., a Missouri corporation (the "Company") and Continental
Stock Transfer & Trust Company (the "Rights Agent"), to purchase from the
Company at any time after the Distribution Date (as such term is defined in the
Rights Agreement) and prior to 5:00 P.M., St. Louis time, on March 31, 2010, at
the principal office of the Rights Agent, or at the office of its successor as
Rights Agent, one fully paid non-assessable share of Energizer Holdings, Inc.
common stock, par value $.01 per share (the "Common Shares"), at a purchase
price of $___ per Common Share (the "Purchase Price"), upon presentation and
surrender of this Right Certificate with the Form of Election to Purchase duly
executed. The number of Rights evidenced by this Right Certificate (and the
number of Common Shares which may be purchased upon exercise hereof) set forth
above, and the Purchase Price set forth above, are the number and Purchase Price
as of _________________ based on the outstanding Common Shares at such date. As
provided in the Rights Agreement, the Purchase Price and the number of Common
Shares which may be purchased upon the exercise of the Rights evidenced by this
Right Certificate are subject to modification and adjustment upon the happening
of certain events.
This Right Certificate is subject to all of the terms, provisions and
conditions of the Rights Agreement, which terms, provisions and conditions are
hereby incorporated herein by reference and made a part hereof and to which
Rights Agreement reference is hereby made for a full description of the rights,
limitations of rights, obligations, duties and immunities hereunder of the
Rights Agent, the Company and the holders of the Right Certificates. Copies of
the Rights Agreement are on file at the principal executive offices of the
Company and the above-mentioned offices of the Rights Agent (and are available
upon the written request of the Company).
This Right Certificate, with or without other Right Certificates, upon
surrender at the principal office of the Rights Agent, may be exchanged for
another Right Certificate or Certificates of like tenor and date evidencing
Rights entitling the holder to purchase a like aggregate number of Common Shares
as the Rights evidenced by the Right Certificate or Certificates surrendered
shall have entitled such holder to purchase. If this Right Certificate shall be
exercised in part, the holder shall be entitled to receive upon surrender hereof
another Right Certificate or Certificates for the number of whole Rights not
exercised.
Subject to the provisions of the Rights Agreement, the Rights evidenced by
this Right Certificate (i) may be redeemed by the Company at its option at a
redemption price of $.01 per Right or (ii) may be exchanged in whole or in part
by the Company, at its option, for one Common Share per Right, following the
Stock Acquisition Date and prior to the time an Acquiring Person, as that term
is defined in the Rights Agreement, owns 50% or more of the outstanding Common
Shares, as that term is defined in the Rights Agreement, of the Company.
No fractional shares will be issued upon the exercise of any Right or
Rights evidenced hereby, but in lieu thereof a cash payment will be made, as
provided in the Rights Agreement.
No holder of this Right Certificate shall be entitled to vote or receive
dividends or be deemed for any purpose the holder of the Common Shares or of any
other securities of the Company which may at any time be issuable on the
exercise hereof, nor shall anything contained in the Rights Agreement or herein
be construed to confer upon the holder hereof, as such, any of the rights of a
shareholder of the Company or any right to vote for the election of directors or
upon any matter submitted to shareholders at any meeting thereof, or to give or
withhold consent to any corporate action, or to receive notice of meetings or
other actions affecting shareholders (except as provided in the Rights
Agreement), or to receive dividends or subscription rights, or otherwise, until
the Right or Rights evidenced by this Right Certificate shall have been
exercised as provided in the Rights Agreement.
This Right Certificate shall not be valid or obligatory for any purpose
until it shall have been countersigned by the Rights Agent.
<PAGE>
Witness the facsimile signature of the proper officers of the Company and
its corporate seal. Dated: ______________________.
ATTEST: ENERGIZER HOLDINGS, INC.
By:
Countersigned:
CONTINENTAL STOCK TRANSFER & TRUST COMPANY
By:
Authorized Officer
EXHIBIT A - FORM OF REVERSE SIDE OF RIGHT
CERTIFICATE
FORM OF ASSIGNMENT
- --------------------
(To be executed by the registered holder if such holder desires to transfer the
Right Certificate.)
FOR VALUE RECEIVED hereby sells, assigns and transfers
unto
(Please print name and address of transferee)
- - - - - - - - - - - - - - - - - - - - - - - - -
this Right Certificate, together with all right, title and interest therein, and
does hereby irrevocably constitute and appoint ,
Attorney, to transfer the within Right Certificate on the books of the
within-named Company, with full power of substitution.
Dated: , 20
Signature
Signature Guaranteed:
Signatures must be guaranteed by a member or a participant in the
Securities Transfer Agent Medallion Program, the New York Stock Exchange
Medallion Signature Program or the Stock Exchange Medallion Program.
CERTIFICATE
The undersigned hereby certifies by checking the appropriate boxes that:
(1) this Right Certificate [ ] is [ ] not being sold, assigned and
transferred by or on behalf of a Person who is or was an Acquiring Person or an
Affiliate or Associate of any such Acquiring Person (as such terms are defined
pursuant to the Rights Agreement);
(2) after due inquiry and to the best knowledge of the undersigned, it
[ ] did [ ] did not acquire the Rights evidenced by this Right
Certificate from any Person who is, was or subsequently became an Acquiring
Person or an Affiliate or Associate of an Acquiring Person.
Dated: ______________________
__________________________________
Signature
(Signature must conform in all respects to name of holder as specified on
the face of this Right Certificate.)
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to exercise the Right Certificate.)
To [NAME OF COMPANY]:
The undersigned hereby irrevocably elects to exercise _____________ Rights
represented by this Right Certificate to purchase the Common Shares issuable
upon the exercise of such Rights and requests that certificates for such shares
be issued in the name of:
Name: _________________________________
Address: _______________________________
Social Security
or taxpayer identification
number: ______________________________
If such number of Rights shall not be all the Rights evidenced by this Right
Certificate, a new Right Certificate for the balance remaining of such Rights
shall be registered in the name of and delivered to:
Name: ______________________________
Address:_____________________________
Social Security
or taxpayer identification
number: _____________________________
Dated: ______________________________
_______________________________
Signature
(Signature must conform in all respect to name of holder as specified on the
face of this Right Certificate)
Signature Guaranteed:
Signatures must be guaranteed by a member or a participant in the
Securities Transfer Agent Medallion Program, the New York Stock Exchange
Medallion Signature Program or the Stock Exchange Medallion Program.
CERTIFICATE
The undersigned hereby certifies by checking the appropriate boxes that:
(1) the Rights evidenced by this Right Certificate [ ] are [ ] are
not being exercised by or on behalf of a Person who is or was an Acquiring
Person or an Affiliate or Associate of any such Acquiring Person (as such terms
are defined pursuant to the Rights Agreement);
(2) this Right Certificate [ ] is [ ] not being sold, assigned and
transferred by or on behalf of a Person who is or was an Acquiring Person or an
Affiliate or Associate of any such Acquiring Person (as such terms are defined
pursuant to the Rights Agreement);
(3) after due inquiry and to the best knowledge of the undersigned, it
[ ] did [ ] did not acquire the Rights evidenced by this Right
Certificate from any Person who is, was or subsequently became an Acquiring
Person or an Affiliate or Associate of an Acquiring Person.
Dated:____________________________
_________________________________
Signature
(Signature must conform in all respects to name of holder as specified on the
face of this Right Certificate)
NOTICE
The signature in the foregoing Forms of Assignment and Election must
conform to the name as written upon the face of this Right Certificate in every
particular, without alteration or enlargement or any change whatsoever.
In the event the certification set forth above in the form of Assignment or
the form of Election to Purchase, as the case may be, is not completed, the
Company and the Rights Agent will deem the beneficial owner of the Rights
evidenced by this Right Certificate to be an Acquiring Person or an Affiliate or
Associate thereof (as defined in the Rights Agreement) and such Assignment or
Election to Purchase will not be honored as described in the second paragraph of
Section 11(a)(ii) of the Rights Agreement.
EXHIBIT B
SUMMARY OF RIGHTS TO
PURCHASE COMMON SHARES
Effective as of March 16, 2000, the Board of Directors of Energizer
Holdings, Inc. (the "Company") adopted a Rights Agreement (the "Rights
Agreement") and authorized and declared a dividend of one common share purchase
right (a "Right") for each outstanding share of common stock, par value $.01 per
share of the Company (the "Common Shares"). The dividend was payable as of the
opening of business on March 31, 2000, to the shareholders of record on that
date (the "Record Date"), and with respect to Common Shares issued thereafter
until the Distribution Date (as hereinafter defined) or the expiration or
earlier redemption or exchange of the Rights. Except as set forth below, each
Right entitles the registered holder to purchase from the Company, at any time
after the Distribution Date one Common Share at a price per share of $150,
subject to adjustment (the "Purchase Price"). The description and terms of the
Rights are as set forth in the Rights Agreement.
Initially the Rights will be evidenced by all certificates representing
Common Shares then outstanding, and no separate Right Certificates will be
distributed. The Rights will separate from the Common Shares upon the earlier to
occur of (i) 10 business days after the public announcement of a person's or
group of affiliated or associated persons' having acquired in a transaction that
is not a Permitted Offer (as defined below) beneficial ownership of 20% or more
of the outstanding Common Shares (such person or group being hereinafter
referred to as an "Acquiring Person"); or (ii) 10 business days (or such later
date as the Board may determine) following the commencement of, or announcement
of an intention to make, a tender offer or exchange offer, the consummation of
which would result in a person or group's becoming an Acquiring Person (the
earlier of such dates being called the "Distribution Date"). A Permitted Offer
is a tender or exchange offer which is for all outstanding Common Shares at a
price and on terms which a majority of certain members of the Board of Directors
determines to be adequate and in the best interests of the Company, its
shareholders and other relevant constituencies, other than such Acquiring
Person, its affiliates and associates.
The Rights Agreement provides that, until the Distribution Date (or earlier
redemption or expiration of the Rights), the Rights will be transferred with,
and only with, the Common Shares. Until the Distribution Date (or earlier
redemption or expiration of the Rights), new Common Share certificates issued
after the Record Date upon transfer or new issuance of Common Shares will
contain a notation incorporating the Rights Agreement by reference. Until the
Distribution Date (or earlier redemption or expiration of the Rights), the
surrender for transfer of any certificates for Common Shares outstanding as of
the Record Date, even without such notation or a copy of this Summary of Rights,
will also constitute the transfer of the Rights associated with the Common
Shares represented by such certificate. As soon as practicable following the
Distribution Date, separate certificates evidencing the Rights ("Right
Certificates") will be mailed to holders of record of the Common Shares as of
the close of business on the Distribution Date, and such separate Right
Certificates alone will then evidence the Rights.
The Rights are not exercisable until the Distribution Date. The Rights
will expire on March 31, 2010 (the "Final Expiration Date"), unless the Final
Expiration Date is extended or unless the Rights are earlier redeemed or
exchanged by the Company, in each case, as described below.
In the event that any person becomes an Acquiring Person, each holder of a
Right will thereafter have the right (the "Flip-In Right") to acquire a Common
Share for a purchase price equal to 33 1/3% of the then current market price of
a Common Share. Notwithstanding the foregoing, all Rights that are, or were,
beneficially owned by any Acquiring Person or any affiliate or associate thereof
will be null and void and not exercisable.
In the event that, at any time following the Distribution Date, (i) the
Company is acquired in a merger or other business combination transaction in
which the holders of all of the outstanding Common Shares immediately prior to
the consummation of the transaction are not the holders of all of the surviving
corporation's voting securities, or (ii) more than 50% of the Company's assets
or earning power is sold or transferred, then each holder of a Right (except
Rights which have been voided as set forth above) shall thereafter have the
right (the "Flip-Over Right") to receive, upon exercise and payment of the
Purchase Price, common shares of the acquiring company having a value equal to
two times the Purchase Price. If a transaction would otherwise result in a
holder's having a Flip-In as well as a Flip-Over Right, then only the Flip-Over
Right will be exercisable; if a transaction results in a holder's having a
Flip-Over Right subsequent to a transaction resulting in a holder's having a
Flip-In Right, a holder will have Flip-Over Rights only to the extent such
holder's Flip-In Rights have not been exercised.
The Purchase Price payable, and the number of Common Shares or other
securities or property issuable, upon exercise of Rights are subject to
adjustment from time to time to prevent dilution (i) in the event of a stock
dividend on, or a subdivision, combination or reclassification of Common Shares,
(ii) upon the grant to holders of Common Shares of certain rights or warrants to
subscribe for or purchase Common Shares at a price, or securities convertible
into Common Shares with a conversion price, less than the then current market
price of Common Shares, or (iii) upon the distribution to holders of Common
Shares of evidences of indebtedness or assets (excluding regular periodic cash
dividends paid out of earnings or retained earnings or dividends payable in
Common Shares) or of subscription rights or warrants (other than those referred
to above). However, no adjustment in the Purchase Price will be required until
cumulative adjustments require an adjustment of at least 1%.
No fractional Common Shares will be issued and in lieu thereof, an
adjustment in cash will be made based on the market price of Common Shares on
the last trading day prior to the date of exercise.
At any time prior to the time a person becomes an Acquiring Person, the
Board of Directors of the Company may redeem the Rights in whole, but not in
part, at a price of $.01 per Right (the "Redemption Price"). The redemption of
the Rights may be made effective at such time on such basis and with such
conditions as the Board of Directors in its sole discretion may establish.
Immediately upon any redemption of the Rights, the right to exercise the Rights
will terminate and the only right of the holders of Rights will be to receive
the Redemption Price.
At any time after any person becomes an Acquiring Person and prior to the
acquisition by such person or group of Common Shares representing 50% or more of
the then outstanding Common Shares, the Board of Directors of the Company may
exchange the Rights (other than Rights which have become null and void), in
whole or in part, at an exchange ratio of one Common Share per Right.
All of the provisions of the Rights Agreement may be amended prior to the
Distribution Date by the Board of Directors of the Company for any reason it
deems appropriate. Prior to the Distribution Date, the Board is also
authorized, as it deems appropriate, to lower the thresholds for distribution
and Flip-In Rights to not less than the greater of (i) any percentage greater
than the largest percentage then held by any shareholder, or (ii) 10%. After
the Distribution Date, the provisions of the Rights Agreement may be amended by
the Board in order to cure any ambiguity, defect or inconsistency, but such
changes may not adversely affect the interests of holders of Rights (excluding
the interests of any Acquiring Person).
Until a Right is exercised, the holder thereof, as such, will have no
rights as a shareholder of the Company, including, without limitation, the right
to vote or to receive dividends. While the distribution of the Rights will not
be taxable to shareholders of the Company, shareholders may, depending upon the
circumstances, recognize taxable income should the Rights become exercisable or
upon the occurrence of certain events thereafter.
A copy of the Rights Agreement has been filed with the Securities and
Exchange Commission as an Exhibit to the Company's Registration Statement on
Form 10 filed with the Securities and Exchange Commission (Commission File No.
1-15401). A copy of the Rights Agreement is available free of charge from the
Company. This summary description of the Rights does not purport to be complete
and is qualified in its entirety by reference to the Rights Agreement, which is
hereby incorporated herein by reference.
The portions of the legend in brackets shall be inserted only if applicable.
ENERGIZER HOLDINGS, INC.
2000 INCENTIVE STOCK PLAN
Section I. General Provisions
<PAGE>
A. Purpose of Plan
The purpose of the Energizer Holdings, Inc. Incentive Stock Plan (the "Plan") is
to enhance the profitability and value of the Company for the benefit of its
shareholders by providing for stock options and other stock awards to attract,
retain and motivate officers and other key employees who make important
contributions to the success of the Company, and to provide equity-linked
compensation for directors.
B. Definitions of Terms as Used in the
Plan
"Affiliate" shall mean any entity fifty percent or more of whose outstanding
voting securities, or beneficial ownership for entities other than corporations,
is owned, directly or indirectly, by the Company, or which otherwise controls,
is controlled by, or is under common control with, the Company.
"Award" shall mean an Option, including a Restoration Option, or any Other Stock
Award, granted under the terms of the Plan.
"Award Agreement" shall mean the document or documents evidencing an Award
granted under the Plan.
"Board" shall mean the Board of Directors of the Company.
"Code" shall mean the Internal Revenue Code of 1986, as amended, and the
regulations promulgated thereunder.
"Committee" shall mean the Nominating and Executive Compensation Committee of
the Board, or any successor committee the Board may designate to administer the
Plan. Each member of the Committee shall be (i) an "outside director" within
the meaning of Section 162(m) of the Code, subject to any transitional rules
applicable to the definition of outside director, and (ii) a "Non-Employee
Director" within the meaning of Rule 16b-3 under the Exchange Act, or otherwise
qualified to administer the Plan as contemplated by that Rule or any successor
Rule under the Exchange Act.
"Common Stock" shall mean Energizer Holdings, Inc. $.01 par value Common Stock,
and, at the discretion of the Board, may also mean any other authorized class or
series of common stock of an Affiliate or common stock of the Company
outstanding upon the reclassification of the Common Stock or any other class or
series of common stock, including, without limitation, by means of any stock
split, stock dividend, creation of targeted stock, or other distributions of
stock in respect of stock, or any reverse stock split, or by reason of any
recapitalization, merger or consolidation of the Company.
"Company" shall mean Energizer Holdings, Inc.
"Corporate Officer" shall mean any President, Chief Executive Officer, Corporate
Vice President, Controller, Secretary or Treasurer of the Company, and any other
officers designated as corporate officers by the Board.
"Director" shall mean any member of the Board.
"Employee" shall mean any person who is employed by the Company or an Affiliate,
including Corporate Officers.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended.
"Fair Market Value" of the Common Stock shall mean the closing price as reported
on the Composite Tape of the New York Stock Exchange, Inc. on the date that such
Fair Market Value is to be determined, or if no shares were traded on the
determination date, the immediately preceding day on which the Common Stock was
traded, or the fair market value as determined by any other method adopted by
the Committee (or with respect to Awards granted to Directors, by the Board)
which the Committee or the Board, as the case may be, may deem appropriate under
the circumstances, or as may be required in order to comply with or to conform
to the requirements of applicable laws or regulations.
"Incentive Stock Options" shall mean Options that qualify as such under Section
422 of the Code.
"Non-Qualified Stock Options" shall mean Options that do not qualify as
Incentive Stock Options.
"Option" shall mean the right, granted under the Plan, to purchase a specified
number of shares of Common Stock, at a fixed price for a specified period of
time.
"Other Stock Award" shall mean any Award granted under Section III of the Plan.
"Phantom Stock Option" shall mean an Option, granted under the Plan, which
provides that in lieu of receiving shares of Common Stock upon exercise, the
recipient will receive an amount equal to the excess of the Fair Market Value of
the Common Stock at exercise over the exercise price set forth in the Award
Agreement for the Phantom Stock Option.
"Restoration Option" shall mean an Option granted upon exercise of an
outstanding Option, provided that the exercise price is paid by tendering
previously owned shares of Common Stock by the Employee or Director.
"Restricted Stock Award" shall mean an Award of shares of Common Stock on which
are imposed restrictions on transferability or other shareholder rights,
including, but not limited to, restrictions which subject such Award to a
"substantial risk of forfeiture" as defined in Section 83 of the Code.
"Stock Appreciation Right" shall mean a right granted under the terms of the
Plan to receive an amount equal to the excess of the Fair Market Value of one
share of Common Stock as of the date of exercise of the Stock Appreciation Right
over the price per share of Common Stock specified in the Award Agreement of
which it is a part.
"Termination for Cause" shall mean an Employee's termination of employment with
the Company or an Affiliate because of the Employee's willful engaging in gross
misconduct, provided, however, that a Termination for Cause shall not include
termination attributable to (i) poor work performance, bad judgment or
negligence on the part of the Employee, (ii) an act or omission believed by the
Employee in good faith to have been in or not opposed to the best interests of
the Company and reasonably believed by the Employee to be lawful, or (iii) the
good faith conduct of the Employee in connection with a change of control of the
Company (including opposition to or support of such change of control).
C. Scope of Plan and Eligibility
Any Employee selected by the Committee, and any member of the Board, shall be
eligible for any Award contemplated under the Plan.
D. Authorization and Reservation
The Company shall establish a reserve of authorized shares of Common Stock in
the amount of 15,000,000 shares. This reserve shall represent the total number
of shares of Common Stock that may be presently issued pursuant to Awards,
including Restoration Options, subject to increase as described below. The
reserves may consist of authorized but unissued shares of Common Stock or of
reacquired shares, or both. Upon the forfeiture or expiration of an Award, all
shares of Common Stock not issued thereunder shall become available for the
granting of additional Awards. In addition, when a Restoration Option is
granted upon the tendering of shares of Common Stock in payment of the exercise
price of any Options, the reserve shall be increased in an amount equal to the
number of shares so tendered, and such additional reserved shares shall become
available for the granting of additional Awards. Awards under the Plan which
are payable in cash will not be counted against the reserve unless actual
payment is made in shares of Common Stock instead of cash.
E. Grant of Awards and Administration of the Plan
1. The Committee shall determine those Employees eligible to receive Awards and
the amount, type and terms of each Award, subject to the provisions of the Plan,
and it shall have the power to delegate responsibility to others to select
Employees other than Corporate Officers eligible to receive Awards and the
amount of each such Award, on terms determined by the Committee. The Board
shall determine the amount, type and terms of each Award to a Director, subject
to the provisions of the Plan. In making any determinations under the Plan, the
Committee or the Board, as the case may be, shall be entitled to rely on
reports, opinions or statements of officers or employees of the Company, as well
as those of counsel, public accountants and other professional or expert
persons. All determinations, interpretations and other decisions under or with
respect to the Plan or any Award by the Committee or the Board, as the case may
be, shall be final, conclusive and binding upon all parties, including without
limitation, the Company, any Employee or Director, and any other person with
rights to any Award under the Plan, and no member of the Board or the Committee
shall be subject to individual liability with respect to the Plan.
2. The Committee shall administer the Plan and, in connection therewith, it
shall have full power to construe and interpret the Plan, establish rules and
regulations and perform all other acts it believes reasonable and proper,
including the power to delegate responsibility to others to assist it in
administering the Plan. To the extent, however, that such construction and
interpretation or establishment of rules and regulations relates to or affects
any Awards granted to Directors, the Board must ratify such construction,
interpretation or establishment.
3. During the term of the Plan, the aggregate number of shares of Common Stock
that may be the subject of performance-based Awards (as defined in Section
162(m) of the Code), excluding Restoration Options, that may be granted to an
Employee or Director during any one fiscal year may not exceed 1,900,000. The
aggregate number of shares of Common Stock that may be the subject of
Restoration Options that may be granted to an Employee or Director during any
one fiscal year may not exceed 950,000. These amounts are subject to adjustment
as provided in Section VI. F. below. The maximum number of shares with regard
to which Options and Stock Appreciation Rights may be granted to any individual
during any one fiscal year is 1,900,000. Any stock-related deferred
compensation will not be applied against this limit. Awards granted in a fiscal
year but cancelled during that same year will continue to be applied against the
annual limit for that year, despite cancellation.
4. Awards granted under the Plan shall be evidenced in the manner prescribed by
the Committee from time to time in accordance with the terms of the Plan. The
terms of each Award shall be set forth in an Award Agreement, and the Committee
may require that a recipient execute and deliver the Award Agreement to the
Company in order to evidence his or her acceptance of the Award.
Section II. Stock Options
A. Description
The Committee or, in the case of Awards granted to Directors, the Board, may
grant Incentive Stock Options and it may grant Non-Qualified Stock Options. At
the discretion of the Committee or the Board, in the case of Options granted to
Directors, an Employee or Director may also be eligible to receive a Restoration
Option in connection with an Option exercise, as more particularly set forth
below.
B. Terms and Conditions
1. Each Option shall be set forth in a written Award Agreement containing such
terms and conditions as the Committee, or in the case of Awards granted to
Directors, the Board, may determine, subject to the provisions of the Plan.
2. The option price of shares of Common Stock subject to any Option shall not
be less than the Fair Market Value of the Common Stock at the time that the
Option is granted.
3. The Committee, or in the case of Awards granted to Directors, the Board,
shall determine the vesting schedules and the terms, conditions and limitations
governing exercisability of Options granted under the Plan. Unless accelerated
in accordance with its terms, an Option may not be exercised until a period of
at least one year has elapsed from the date of grant, and the term of any Option
granted hereunder shall not exceed ten years.
4. The purchase price of any shares of Common Stock pursuant to exercise of any
Option must be paid in full upon such exercise. The payment shall be made in
cash, in United States dollars, or by tendering shares of Common Stock owned by
the Employee or Director (or the person exercising the Option). If shares of
Common Stock are tendered, they must have been owned at least six months prior
to the date of tender (or such other time period as may be determined by the
Committee).
5. The terms and conditions of any Incentive Stock Options granted hereunder
shall be subject to and shall be designed to comply with, the provisions of
Section 422 of the Code, and any other administrative procedures adopted by the
Committee from time to time. Incentive Stock Options may not be granted to any
person who is not an Employee at the time of grant.
C. Restoration Options
The Committee, or, in the case of Awards granted to Directors, the Board, may
provide either at the time of grant or subsequently that an option include the
right to acquire a Restoration Option. An option which provides for the grant
of a Restoration Option shall entitle the Employee or Director, upon exercise of
the option (in whole or in part) prior to termination of employment or
retirement or resignation as a Director, and payment of the exercise price in
shares of Common Stock, to receive a Restoration Option. In addition to any
other terms and conditions set forth in the Award Agreement, the Restoration
Option shall be subject to the following terms: (i) the number of shares of
Common Stock which are the subject of the Restoration Option shall not exceed
the number of shares used to satisfy the option price of the original option
(which shares must have been owned for the time period described in B.4. above),
(ii) the grant date of the Restoration Option will be the date of exercise of
the original option, (iii) the exercise price per share shall be the Fair Market
Value on the Restoration Option grant date, (iv) the Restoration Option, unless
accelerated, in accordance with its terms, shall be exercisable no earlier than
one year after its grant date, (v) the term of the Restoration Option shall not
extend beyond the term of the original option, and (vi) the Restoration Option
will comply with all other provisions of the Plan. The Committee, or in the
case of Awards granted to Directors, the Board, shall, in addition to all other
powers granted to it under the Plan, have the power to designate any limitations
on the frequency of the grants of Restoration Options to any Employee or
Director, and may require, as a condition to the grant of Restoration Options,
that the recipient agree not to resell shares received upon exercise of the
original option (which original option may be a Restoration Option) for a
specific period.
Section III. Other Stock Awards
In addition to Options, the Committee or, in the case of Awards granted to
Directors, the Board may grant Other Stock Awards payable in Common Stock or
cash, upon such terms and conditions as the Committee or Board may determine,
subject to the provisions of the Plan. Other Stock Awards may include, but are
not limited to, the following types of Awards:
A. Restricted Stock Awards
The Committee or, in the case of Awards granted to Directors, the Board may
grant Restricted Stock Awards, each of which consists of a grant of shares of
Common Stock, subject to terms and conditions determined by the Committee or
Board in its sole discretion as well as to the provisions of the Plan. Such
terms and conditions shall be set forth in a written Award Agreement. The
shares of Common Stock granted will be restricted and may not be sold, pledged,
transferred or otherwise disposed of until the lapse or release of restrictions
in accordance with the terms of the Award Agreement and the Plan. Prior to the
lapse or release of restrictions, all shares of Common Stock which are the
subject of a Restricted Stock Award are subject to forfeiture in accordance with
Section IV of the Plan. Shares of Common Stock issued pursuant to a Restricted
Stock Award will be issued for no monetary consideration.
B. Stock Related Deferred Compensation
The Committee may, in its discretion, permit the deferral of payment of an
Employee's cash bonus or other cash compensation in the form of either Common
Stock or Common Stock equivalents (with each such equivalent corresponding to a
share of Common Stock), under such terms and conditions as the Committee may
prescribe in the Award Agreement relating thereto, including the terms of any
deferred compensation plan under which such Common Stock equivalents may be
granted. In addition, the Committee may, in any fiscal year, provide for an
additional matching deferral to be credited to an Employee's account under such
deferred compensation plans. The Committee may also permit account balances of
other cash or mutual fund accounts maintained pursuant to such deferred
compensation plans to be converted, at the discretion of the participant, into
the form of Common Stock equivalents, or to permit Common Stock equivalents to
be converted into account balances of such other cash or mutual fund accounts,
upon the terms set forth in such plans as well as such other terms and
conditions as the Committee may, in its discretion, determine. The Committee
may, in its discretion, determine whether any deferral in the form of Common
Stock equivalents, including deferrals under the terms of any deferred
compensation plans of the Company, shall be paid on distribution in the form of
cash or in shares of Common Stock.
C. Stock Appreciation Rights and Phantom Stock Options
The Committee or in the case of Awards granted to Directors, the Board, may, in
its discretion, grant Stock Appreciation Rights or Phantom Stock Options to
Employees or Directors, subject to terms and conditions determined by the
Committee or Board in its sole discretion. Such terms and conditions shall be
set forth in a written Award Agreement. Each Stock Appreciation Right or
Phantom Stock Option shall entitle the holder thereof to elect, prior to its
cancellation or termination, to exercise such unit or option and receive either
cash or shares of Common Stock, or both, as the Committee or Board may
determine, in an aggregate amount equal in value to the excess of the Fair
Market Value of the Common Stock on the date of such election over the Fair
Market Value on the date of grant of the Stock Appreciation Right or Phantom
Stock Option; except that if an option is amended to include Stock Appreciation
Rights, the designated Fair Market Value in the applicable Award Agreement may
be the Fair Market Value on the date that the Option was granted. The Committee
or Board may provide that a Stock Appreciation Right shall be automatically
exercised on one or more specified dates. Stock Appreciation Rights may be
granted on a "free-standing" basis or in conjunction with all or a portion of
the shares of Common Stock covered by an Option, either at the time of grant of
the Option or at any time thereafter during the term of the Option. In addition
to any other terms and conditions set forth in the Award Agreement, Stock
Appreciation Rights and Phantom Stock Options shall be subject to the following
terms: (i) Stock Appreciation Rights and Phantom Stock Options, unless
accelerated in accordance with their terms, may not be exercised within the
first year after the date of grant, (ii) the Committee or Board, as the case may
be, may, in its sole discretion, disapprove an election to surrender any Stock
Appreciation Right or Phantom Stock Option for cash in full or partial
settlement thereof, provided that such disapproval shall not affect the
recipient's right to surrender the Stock Appreciation Right or Phantom Stock
Option at a later date for shares of Common Stock or cash, and (iii) no Stock
Appreciation Right or Phantom Stock Option may be exercised unless the holder
thereof is at the time of exercise an Employee or Director and has been
continuously since the date the Stock Appreciation Right or Phantom Stock Option
was granted, except that the Committee or Board may permit the exercise of any
Stock Appreciation Right or Phantom Stock Option for any period following the
recipient's termination of employment or retirement or resignation from the
Board, not in excess of the original term of the Award, on such terms and
conditions as it shall deem appropriate and specify in the related Award
Agreement.
D. Performance-Based Other Stock Awards
The payment under any Other Stock Award that may be the subject of a
performance-based Award (as defined in Section 162(m) of the Code) (hereinafter
"Target Award") shall be contingent upon the attainment of one or more
pre-established performance goals established by the Committee in writing within
ninety (90) days of the commencement of the Target Award performance period (or
in the case of a newly hired Employee, before 25% of such Employee's service for
such Target Award performance period has lapsed). Such performance goals will
be based upon one or more of the following performance-based criteria: (a)
earnings per share; (b) income or net income; (c) return measures (including,
but not limited to, return on assets, capital, equity or sales); (d) cash flow
return on investments which equals net cash flows divided by owners equity; (e)
controllable earnings (a division's operating profit, excluding the amortization
of goodwill and intangible assets, less a charge for the interest cost for the
average working capital investment by the division); (f) operating earnings or
net operation earnings; (g) cost control; (h) share price (including, but not
limited to, growth measures); (i) total shareholder return (stock price
appreciation plus dividends); (j) economic value added; (k) EBITDA; (l)
operating margin (m) market share and (n) cash flow from operations.
Performance may be measured on an individual, corporate group, business unit, or
consolidated basis and may be measured absolutely or relatively to the Company's
peers. In establishing the Performance Goals, the Committee may account for the
effects of acquisitions, divestitures, extraordinary dividends, stock split-ups,
stock dividends or distributions, issuances of any targeted stock,
recapitalizations, warrants or rights issuances or combinations, exchanges or
reclassifications with respect to any outstanding class or series of Stock, or a
corporate transaction, such as any merger of the Company with another
corporation, any consolidation of the Company and another corporation into
another corporation, any separation of the Company or its business units
(including a spinoff or other distribution of stock or property by the Company),
any reorganization of the Company (whether or not such reorganization comes
within the definition of such term in Code Section 368) or any partial or
complete liquidation by the Company, or sale of all or substantially all of the
assets of the Company, or other extraordinary items.
The Committee, in its discretion, may cancel or decrease an earned Target Award,
but, except as otherwise permitted by Treasury Regulation Section
1.162-27(e)(2)(iii)(C), may not, under any circumstances, increase such award.
Before payments are made under a Target Award, the Committee shall certify in
writing that the performance goals justifying the payment under Target Award
have been met.
Section IV. Forfeiture of Awards
A. Unless the Committee, or in the case of a Director, the Board, shall have
determined otherwise, the recipient of any Award pursuant to the Plan shall
forfeit the Award, to the extent not then payable or exercisable, upon the
occurrence of any of the following events:
1. The recipient is Terminated for Cause.
2. The recipient voluntarily terminates his or her employment other than by
retirement after attainment of age 62, or such other age as may be provided for
in the Award Agreement.
3. The recipient engages in competition with the Company or any Affiliate.
4. The recipient engages in any activity or conduct contrary to the best
interests of the Company or any Affiliate, including, but not limited to,
conduct that breaches the recipient's duty of loyalty to the Company or an
Affiliate or that is materially injurious to the Company or an Affiliate,
monetarily or otherwise. Such activity or conduct may include: (i) disclosing
or misusing any confidential information pertaining to the Company or an
Affiliate; (ii) any attempt, directly or indirectly, to induce any Employee of
the Company or any Affiliate to be employed or perform services elsewhere, or
(iii) any direct or indirect attempt to solicit, or assist another employer in
soliciting, the trade of any customer or supplier or prospective customer of the
Company or any Affiliate.
B. The Committee or the Board, as the case may be, may include in any Award
Agreement any additional or different conditions of forfeiture it may deem
appropriate, and may waive any condition of forfeiture stated above or in the
Award Agreement.
C. In the event of forfeiture, the recipient shall lose all rights in and to
portions of the Award which are not vested or which are not exercisable. Except
in the case of Restricted Stock Awards as to which restrictions have not lapsed,
this provision, however, shall not be invoked to require any recipient to
transfer to the Company any Common Stock already received under an Award.
D. Such determinations as may be necessary for application of this Section,
including any grant of authority to others to make determinations under this
Section, shall be at the sole discretion of the Committee, or in the case of
Awards granted to Directors, of the Board, and such determinations shall be
conclusive and binding.
Section V. Beneficiary Designation; Death of Awardee
A. An Award recipient may file with the Committee a written designation of a
beneficiary or beneficiaries (subject to such limitations as to the classes and
number of beneficiaries and contingent beneficiaries as the Committee may from
time to time prescribe) to exercise, in the event of the death of the recipient,
an Option, Stock Appreciation Right or Phantom Stock Option, or to receive, in
such event, any Other Stock Awards. The Committee reserves the right to review
and approve beneficiary designations. A recipient may from time to time revoke
or change any such designation or beneficiary and any designation of beneficiary
under the Plan shall be controlling over any other disposition, testamentary or
otherwise. However, if the Committee shall be in doubt as to the right of any
such beneficiary to exercise any Option, Stock Appreciation Right or Phantom
Stock Option, or to receive any Other Stock Award, the Committee may determine
to recognize only an exercise by, or right to receive of, the legal
representative of the recipient, in which case the Company, the Committee and
the members thereof shall not be under any further liability to anyone.
B. Upon the death of an Award recipient, the following rules shall apply:
1. An Option, to the extent exercisable on the date of the recipient's death,
may be exercised at any time within three years after the recipient's death, but
not after the expiration of the term of the Option. The Option may be exercised
by the recipient's designated beneficiary or personal representative or the
person or persons entitled thereto by will or in accordance with the laws of
descent and distribution, or by the transferee of the Option in accordance with
the provisions of Section VI.A.
2. In the case of any Other Stock Award, any shares of Common Stock or cash
payable shall be determined as of the date of the recipient's death, in
accordance with the terms of the Award Agreement, and the Company shall issue
such shares of Common Stock or pay such cash to the recipient's designated
beneficiary or personal representative or the person or persons entitled thereto
by will or in accordance with the laws of descent and distribution.
Section VI. Other Governing Provisions
A. Transferability
Except as otherwise provided herein, no Award shall be transferable other than
by beneficiary designation, will or the laws of descent and distribution, and
any right granted under an Award may be exercised during the lifetime of the
holder thereof only by Award Recipient or by his/her guardian or legal
representative; provided, however, that an Award recipient may be permitted, in
the sole discretion of the Committee or its delegee, to transfer to a member of
such recipient's immediate family, family trust or family partnership as defined
by the Committee or its delegee, an Option granted pursuant to Section II
hereof, other than an Incentive Stock Option, subject to such terms and
conditions as the Committee or its delegee, in their sole discretion, shall
determine.
B. Rights as a Shareholder
A recipient of an Award shall, unless the terms of the Award Agreement provide
otherwise, have no rights as a shareholder, with respect to any Options or
shares of Common Stock which may be issued in connection with an Award, until
the issuance of a Common Stock certificate for such shares, and no adjustment
other than as stated herein shall be made for dividends or other rights for
which the record date is prior to the issuance of such Common Stock certificate.
In addition, with respect to Restricted Stock Awards, recipients shall have only
such rights as a shareholder as may be set forth in the terms of the Award
Agreement.
C. General Conditions of Awards
No Employee, Director or other person shall have any rights with respect to the
Plan, the shares of Common Stock reserved or in any Award, contingent or
otherwise, until an Award Agreement shall have been delivered to the recipient
and all of the terms, conditions and provisions of the Plan applicable to such
recipient shall have been met.
D. Reservation of Rights of Company
Neither the establishment of the Plan nor the granting of an Award shall confer
upon any Employee any right to continue in the employ of the Company or any
Affiliate or interfere in any way with the right of the Company or any Affiliate
to terminate such employment at any time. No Award shall be deemed to be salary
or compensation for the purpose of computing benefits under any employee
benefit, pension or retirement plans of the Company or any Affiliate, unless the
Committee shall determine otherwise.
E. Acceleration
The Committee, or, with respect to any Awards granted to Directors, the Board,
may, in its sole discretion, accelerate the vesting or date of exercise of any
Awards.
F. Effect of Certain Changes
In the event of any extraordinary dividend, stock split-up, stock dividend,
issuance of targeted stock, recapitalization, warrant or rights issuance, or
combination, exchange or reclassification with respect to the Common Stock or
any other class or series of common stock of the Company, or consolidation,
merger or sale of all, or substantially all, of the assets of the Company, the
Committee or its delegee shall cause such equitable adjustments as it deems
appropriate to be made to the shares reserved under Section I.D of the Plan and
the limits on Awards set forth in Section I.E.3 of the Plan, and the Committee
or Board shall cause such adjustments to be made to the terms of outstanding
Awards to reflect such event and preserve the value of such Awards. In the
event that the Committee or Board determines that any such event has a minimal
effect on the value of Awards, they may elect not to cause any such adjustments
to be made. In all events, the determination of the Committee or Board or their
delegee shall be conclusive. If any such adjustment would result in a
fractional share of Common Stock being issued or awarded under this Plan, such
fractional share shall be disregarded.
G. Withholding of Taxes
The Company shall deduct from any payment, or otherwise collect from the
recipient, any taxes required to be withheld by federal, state or local
governments in connection with any Award. The recipient may elect, subject to
approval by the Committee, to have shares of Common Stock withheld by the
Company in satisfaction of such taxes, or to deliver other shares of Common
Stock owned by the recipient in satisfaction of such taxes. With respect to
Corporate Officers, Directors or other recipients subject to Section 16(b) of
the Exchange Act, the Committee or, with respect to Awards granted to Directors,
the Board, may impose such other conditions on the recipient's election as it
deems necessary or appropriate in order to exempt such withholding from the
penalties set forth in said Section. The number of shares to be withheld or
delivered shall be calculated by reference to the Fair Market Value of the
Common Stock on the date that such taxes are determined.
H. No Warranty of Tax Effect
Except as may be contained in the terms of any Award Agreement, no opinion is
expressed nor warranties made as to the tax effects under federal, foreign,
state or local laws or regulations of any Award granted under the Plan.
I. Amendment of Plan
The Board may, from time to time, amend, suspend or terminate the Plan in whole
or in part, and if terminated, may reinstate any or all of the provisions of the
Plan, except that (i) no amendment, suspension or termination may apply to the
terms of any Award (contingent or otherwise) granted prior to the effective date
of such amendment, suspension or termination, in a manner which would reasonably
be considered to be adverse to the recipient, without the recipient's consent;
(ii) except as provided in Section VI.F., no amendment may be made to increase
the number of shares of Common Stock reserved under Section I.D of the Plan;
(iii) except as provided in Section VI.F., no amendment may be made to increase
the limitations set forth in Section 1.E.3 of the Plan, and (iv) no amendment
may withdraw the authority of the Committee to administer the Plan.
J. Construction of Plan
The place of administration of the Plan shall be in the State of Missouri and
the validity, construction, interpretation, administration and effect of the
Plan and of its rules and regulations, and rights relating to the Plan, shall be
determined solely in accordance with the laws of the State of Missouri, without
giving regard to the conflict of laws provisions thereof.
K. Unfunded Nature of Plan
The Plan, insofar as it provides for cash payments, shall be unfunded, and the
Company shall not be required to segregate any assets which may at any time be
awarded under the Plan. Any liability of the Company to any person with respect
to any Award under the Plan shall be based solely upon any contractual
obligations which may be created by the terms of any Award Agreement entered
into pursuant to the Plan. No such obligation of the Company shall be deemed to
be secured by any pledge of, or other encumbrance on, any property of the
Company.
L. Successors
All obligations of the Company under the Plan, with respect to any Awards
granted hereunder, shall be binding on any successor to the Company, whether the
existence of such successor is the result of a direct or indirect purchase,
merger, consolidation or otherwise, of all or substantially all of the business
and/or assets of the Company.
Section VII. Effective Date and Term
The Plan shall be effective April 1, 2000 and shall continue in effect until
December 31, 2009, when it shall terminate. Upon termination, any balances in
the reserve established under Section I.D shall be cancelled, and no Awards
shall be granted under the Plan thereafter. The Plan shall continue in effect,
however, insofar as is necessary, to complete all of the Company's obligations
under outstanding Awards or to conclude the administration of the Plan.
ENERGIZER HOLDINGS, INC.
------------------------
DEFERRED COMPENSATION PLAN
--------------------------
TABLE OF CONTENTS
ARTICLE PAGE
- ------- ----
ARTICLE I
INTRODUCTION 1
1.1 NAME OF PLAN/PURPOSE. 1
1.2 "TOP HAT" RETIREMENT BENEFIT PLAN. 1
1.3 EFFECTIVE DATE. 1
1.4 ADMINISTRATION. 1
1.5 APPENDICES. 1
ARTICLE II
DEFINITIONS AND CONSTRUCTION 1
2.1 DEFINITIONS. 1
2.2 NUMBER AND GENDER. 5
2.3 HEADINGS. 5
ARTICLE III
PARTICIPATION AND ELIGIBILITY 6
3.1 ELIGIBILITY. 6
3.2 PARTICIPATION. 6
3.3 DURATION OF PARTICIPATION. 6
ARTICLE IV
DEFERRAL AND MATCHING CONTRIBUTIONS 7
4.1 DEFERRALS BY PARTICIPANTS. 7
4.2 EFFECTIVE DATE OF DEFERRED COMPENSATION AGREEMENT. 7
4.3 MODIFICATION OR REVOCATION OF ELECTION OF PARTICIPANT. 7
4.4 MATCHING CONTRIBUTIONS. 8
4.5 MANDATED DEFERRALS. 8
ARTICLE V
VESTING 9
5.1 VESTING IN BASE SALARY DEFERRALS AND BONUS DEFERRALS. 9
5.2 VESTING IN MATCHING CONTRIBUTIONS. 9
5.3 DEFERRAL PERIODS. 9
ARTICLE VI
ACCOUNTS 10
6.1 ESTABLISHMENT OF BOOKKEEPING ACCOUNTS. 10
6.2 SUBACCOUNTS. 10
6.3 INVESTMENT OF ACCOUNTS. 10
6.4 HYPOTHETICAL NATURE OF ACCOUNTS. 11
ARTICLE VII
PAYMENT OF ACCOUNT 12
7.1 TIMING OF DISTRIBUTION OF BENEFITS. 12
7.2 ADJUSTMENT FOR INVESTMENT GAINS AND LOSSES UPON A DISTRIBUTION 12
7.3 FORM OF PAYMENT OR PAYMENTS. 12
7.4 DEATH BENEFITS 13
7.5 DESIGNATION OF BENEFICIARIES. 13
7.6 UNCLAIMED BENEFITS. 13
7.7 WITHDRAWAL. 13
ARTICLE VIII
ADMINISTRATION 14
ARTICLE IX
AMENDMENT AND TERMINATION 15
ARTICLE X
GENERAL PROVISIONS 16
10.1 NON-ALIENATION OF BENEFITS. 16
10.2 CONTRACTUAL RIGHT TO BENEFITS FUNDING. 16
10.3 INDEMNIFICATION AND EXCULPATION. 16
10.4 NO EMPLOYMENT AGREEMENT. 16
10.5 CLAIMS FOR BENEFITS. 17
10.6 SUCCESSOR TO COMPANY. 17
10.7 SEVERABILITY. 17
10.8 ENTIRE PLAN. 17
10.9 PAYEE NOT COMPETENT. 18
10.10 TAX WITHHOLDING. 18
10.11 GOVERNING LAW. 18
<PAGE>
ENERGIZER HOLDINGS, INC.
DEFERRED COMPENSATION PLAN
ARTICLE I
INTRODUCTION
1.1 NAME OF PLAN/PURPOSE.
ENERGIZER HOLDINGS, INC. ("Company") hereby establishes the ENERGIZER
HOLDINGS, INC. DEFERRED COMPENSATION PLAN ("Plan") which Plan is an unfunded
deferred compensation plan for the benefit of certain designated management or
highly compensated employees and Directors of the Company and its Subsidiaries.
This Plan is intended to provide, in part, certain eligible employees and
Directors of the Company and its Subsidiaries the opportunity to defer elements
of their compensation or fees and to receive the benefit of additions to their
deferrals.
1.2 "TOP HAT" RETIREMENT BENEFIT PLAN.
The Plan is intended to be a nonqualified unfunded deferred
compensation plan. The Plan is maintained for Directors and for a select group
of management or highly compensated employees and, therefore, it is intended
that the Plan will be exempt from Parts 2, 3 and 4 of Title I of ERISA. The
Plan is not intended to qualify under Code section 401(a).
1.3 EFFECTIVE DATE.
The Plan is effective as of April 1, 2000.
1.4 ADMINISTRATION.
The Plan shall be administered by the Committee described in Article
VIII.
1.5 APPENDICES.
The Plan may be amplified or modified from time to time by Appendices.
Each Appendix forms a part of the Plan and its provisions shall supersede Plan
provisions as necessary to eliminate any inconsistencies.
<PAGE>
ARTICLE II
DEFINITIONS AND CONSTRUCTION
2.1 DEFINITIONS.
For purposes of the Plan, the following words and phrases, whether or
not capitalized, shall have the respective meanings set forth below, unless the
context clearly requires a different meaning:
(a) "ACCOUNT" means the bookkeeping account maintained on behalf
of each Participant pursuant to Article VI that is credited with Base Salary
Deferrals, Bonus Deferrals, Matching Contributions, and Director Fee Deferrals
pursuant to Article IV, amounts credited to the Ralston Plan Account, and the
earnings and losses on such amounts as determined in accordance with Article VI.
Account also shall include the amounts credited as of March 31, 2000 (including
amounts attributable to services performed on or before March 31, 2000 and not
paid until after such date but that are subject to a deferral election pursuant
to the Ralston Plan) under the Ralston Plan.
(b) "ACQUIRING PERSON" means any person or group of Affiliates or
Associates who is or becomes the beneficial owner, directly or indirectly, of
shares representing 20% or more of the total votes of the outstanding stock
entitled to vote at a meeting of shareholders.
(c) "AFFILIATE" or "ASSOCIATE" shall have the meanings set forth
in Rule 12b-2 of the General Rules and Regulations under the Securities Exchange
Act of 1934, as amended.
(d) "AFFILIATED COMPANY" means any corporation or business
organization during any period during which it is a member of a controlled group
of corporations or trades or businesses within the meaning of Code sections
414(b) and 414(c), which controlled group includes the Company, or it is a
member of an affiliated service group within the meaning of Code section 414(m),
which affiliated service group includes the Company.
(e) "BASE SALARY" means, with respect to an Employee, the annual
cash compensation relating to services performed during any calendar year,
whether or not actually paid in such calendar year or included on the Federal
Income Tax Form W-2 for such calendar year, excluding bonuses, commissions,
overtime, fringe benefits, stock options, relocation expenses, incentive
payments, non-monetary awards, and other fees, automobile and other allowances
paid to a Participant for employment services rendered (whether or not such
allowances are included in the Employee's gross income). Base Salary shall be
calculated before reduction for compensation voluntarily or mandatorily deferred
or contributed by the Participant pursuant to all qualified or non-qualified
plans of the Company and any Subsidiary and shall be calculated to include
amounts not otherwise included in the Participant's gross income under Code
Sections 125, 402(e)(3), 402(h) or 403(b) pursuant to plans established by the
Company; provided however, that all such amounts will be included in
compensation only to the extent that, had there been no such plan, the amount
would have been payable in cash to the Employee.
(f) "BASE SALARY DEFERRAL" means the amount of a Participant's
Base Salary which the Participant elects to have withheld on a pre-tax basis
from his Base Salary and credited to his Account pursuant to Section 4.1.
(g) "BENEFICIAL OWNER" shall mean a person who shall be deemed to
have acquired "beneficial ownership" of, or to "beneficially own," any
securities:
(i) which such person or any of such persons Affiliates or
Associates beneficially owns, directly or indirectly;
(ii) which such person or any of such person's Affiliates or
Associates has (a) the right to acquire (whether such right is exercisable
immediately or only after the passage of time) pursuant to any agreement,
arrangement or understanding (other than customary agreements with and between
underwriters and selling group members with respect to a bona fide public
offering of securities), or upon the exercise of currently exercisable
conversion or exchange rights, warrants or options, or otherwise; provided,
however, that a person shall not be deemed the Beneficial Owner of, or to
beneficially own, securities tendered pursuant to a tender or exchange offer
made by or on behalf of such person or any of such person's Affiliates or
Associates until such tendered securities are accepted for purchase or exchange;
or (b) the right to vote pursuant to any agreement, arrangement or
understanding; provided, however, that a person shall not be deemed the
Beneficial Owner of, or to beneficially own, any security if the agreement,
arrangement or understanding to vote such security (1) arises solely from a
revocable proxy or consent given to such person in response to a public proxy or
consent solicitation made pursuant to, and in accordance with, the applicable
rules and regulations promulgated under the Exchange Act and (2) is not also
then reportable on Schedule 13D under the Exchange Act (or any comparable or
successor report); or
(iii) which are beneficially owned, directly or indirectly,
by any other person with which such person or any of such person's Affiliates or
Associates has any agreement, arrangement or understanding (other than customary
agreements with and between underwriters and selling group members with respect
to a bona fide public offering of securities) for the purpose of acquiring,
holding, voting or disposing of any securities of Company.
Notwithstanding anything in this definition of "Beneficial Owner" to
the contrary, the phrase "then outstanding," when used with reference to a
person's beneficial ownership of securities of Company, shall mean the number of
such securities then issued and outstanding together with the number of such
securities not then actually issued and outstanding which such person would be
deemed to own beneficially hereunder.
(h) "BENEFICIARY" means the person or entity designated by the
Participant to receive benefits which may be payable on or after the
Participant's death in accordance with Section 7.4.
(i) "BOARD" means the Board of Directors of the Company.
(j) "BONUS COMPENSATION" means the amount awarded to a Participant
for a Plan Year under any bonus plan maintained by the Company and/or a
Subsidiary which the Committee permits to be deferred under the Plan.
(k) "BONUS DEFERRAL" means the amount of a Participant's Bonus
Compensation which the Participant elects to have withheld on a pre-tax basis
from his Bonus Compensation and credited to his Account pursuant to Section 4.1.
(l) "CHANGE OF CONTROL" shall mean the time when (a) any Acquiring
person, either individually or together with such person's Affiliates or
Associates, shall have become the Beneficial Owner, director or indirectly, of
more than 20% of the total votes of the outstanding stock of Energizer Holdings,
Inc.; (b) individuals who shall qualify as Continuing Directors shall have
ceased for any reason to constitute at least a majority of the Board; or (c) a
majority of the individuals who shall qualify as Continuing Directors shall
approve a declaration that a Change of Control has occurred.
(m) "CODE" means the Internal Revenue Code of 1986, as amended,
and all valid regulations thereunder.
(n) "COMMITTEE" means the Committee appointed by the President of
the Company which administers the Plan in accordance with Article VIII.
(o) "COMPANY" means Energizer Holdings, Inc. and any successor
thereto.
(p) "CONTINUING DIRECTOR" means any member of the Board, while
such person is a member of such Board, who is not an Affiliate or Associate of
an Acquiring Person or of any such Acquiring Person's Affiliate or Associate and
was a member of such Board prior to the time when such Acquiring Person became
an Acquiring Person, and any successor of a Continuing Director, while such
successor is a member of such Board, who is not an Acquiring Person or an
Affiliate or Associate of an Acquiring Person or a representative or nominee of
an Acquiring Person or of any Affiliate or Associate of such Acquiring Person
and is recommended or elected to succeed the Continuing Director by a majority
of the Continuing Directors.
(q) "DEFERRAL PERIOD" means the period of time for which a
Participant elects to defer receipt of Base Salary Deferrals and Bonus
Deferrals, credited to such Participant's Account for a Plan Year, and the
earnings thereon. A Participant's election of a Deferral Period made with
respect to Bonus Deferrals for a Plan Year (i) may be different from such
election with respect to Salary Deferrals for such Plan Year, and (ii) shall
apply to Matching Contributions made by the Company with respect to such Bonus
Deferrals for such Plan Year.
(r) "DEFERRALS" means (i) with respect to a Participant who is an
Employee, Base Salary Deferrals and/or Bonus Deferrals, and (ii) with respect to
a Participant who is a Director, Director Fee Deferrals.
(s) "DEFERRED COMPENSATION AGREEMENT" means the written agreement
or electronic means by which a Participant elects the amount of Deferrals for a
Plan Year, the Deferral Period, the deemed investment and the form of payment
for the Deferrals and Matching Contributions, credited to such Participant's
Account for a Plan Year, and the earnings thereon. A Participant's election
with respect to the amount of Salary Deferrals and investment and form of
payment of such Salary Deferrals for a Plan Year may be different from such
elections with respect to Bonus Deferrals for such Plan Year. A Participant's
election on a Deferred Compensation Agreement made with respect to a Bonus
Deferral for a Plan Year shall apply to Matching Contributions made by the
Company with respect to such Bonus Deferrals for such Plan Year.
(t) "DIRECTOR" means any member of the Board or the board of
directors of a Subsidiary and who is not an officer or Employee of the Company
or a Subsidiary.
(u) "DIRECTOR FEE DEFERRALS" means the amount of Director Fees
which a Participant elects to have withheld on a pre-tax basis from his Director
Fees and credited to his Account pursuant to Section 4.1.
(v) "DIRECTOR FEES" means the amount of cash paid to a Director,
including but not limited to board of director fees, committee fees, annual
retainer director fees and such other amounts paid to a Director, for services
as a Director of the Company or a Subsidiary.
(w) "DISABILITY" means such physical or mental illness that
prevents the Participant from performing his regular duties for the Company
and/or Subsidiary, as determined by the Committee.
(x) "EFFECTIVE DATE" means April 1, 2000.
(y) "EMPLOYEE" means any common-law employee of the Company or an
Affiliated Company.
(z) "ERISA" means the Employee Retirement Income Security Act of
1974, as amended.
(aa) "MARKET VALUE" means the average of the closing stock price
of the Stock as reported by the New York Stock Exchange - Composite Transactions
during the ten (10) trading days immediately preceding the date in question, or,
if the Stock is not quoted on such composite tape or if such Stock is not listed
on such exchange, on the principal United States securities exchange registered
under the Securities Exchange Act of 1934, as amended, on which the Stock is
listed, or if the Stock is not listed on any such exchange, the average of the
closing bid quotations with respect to a share of the Stock during the ten (10)
days immediately preceding the date in question on the NASDAQ Stock Market
National Market System or any system then in use, or if no such quotations are
available, the fair market value on the date in question of a share of the Stock
as determined by a majority of the Continuing Directors in good faith.
(bb) "MATCHING CONTRIBUTION" means the amount of the contribution
made by the Company and/or a Subsidiary on behalf of a Participant who elects to
make Bonus Deferrals to the Plan for a Plan Year, subject to the provisions of
Section 4.4.
(cc) "PARTICIPANT" means each Employee who has been selected for
participation in the Plan and each Director who has become a Participant
pursuant to Article III.
(dd) "PLAN" means the ENERGIZER HOLDINGS, INC. DEFERRED
COMPENSATION PLAN, as amended from time to time.
(ee) "RALSTON PLAN" means the Ralston Purina Company Deferred
Compensation Plan for Key Employees.
(ff) "RALSTON PLAN ACCOUNT" means the amounts credited on behalf
of a Participant under the Ralston Plan as of March 31, 2000.
(gg) "RETIREMENT" means, with respect to a Participant who is a
Director, the Director's resignation or removal as a Director of the Company and
Subsidiaries following attainment of age 70.
(hh) "PLAN YEAR" means the twelve-consecutive month period
commencing January 1 of each year and ending on December 31, except that the
first Plan Year shall be the period beginning on April 1, 2000 and ending on
December 31, 2000.
(ii) "STOCK" means shares of the Company's common stock, par value
$.01 per share, which consists of shares of a class of common stock designated
as Energizer Common Stock ("ENR Stock") or any such other security outstanding
upon the reclassification or redesignation of the Company's ENR Stock or any
other outstanding class or series of common stock of the Company, including,
without limitation, any stock split-up, stock dividend, creation of tracking
stock, or other distributions of stock in respect of stock, or any reverse stock
split-up, or recapitalization of the Company or any merger or consolidation of
the Company with any Affiliate, or any other transaction, whether or not with or
into or otherwise involving an Acquiring Person.
(jj) "STOCK UNIT" means a stock unit that is equivalent to one
share of Stock.
(kk) "SUBSIDIARY" means any trade or business under common control
with the Company as defined in Code Section 1563(a)(1).
(ll) "TERMINATION FOR CAUSE" means a Participant's termination of
employment with the Company and its Subsidiaries because the Participant
willfully engaged in gross misconduct; provided, however, that a "Termination
for Cause" shall not include a termination attributable to: (i) poor work
performance, bad judgment or negligence on the part of the Participant; or (ii)
an act or omission reasonable believed by the Participant in good faith to have
been in or not opposed to the best interests of his employer and reasonably
believed by the Participant to be lawful.
(mm) "TRUST" means the fund established in consequence of and for
the purpose of the Plan, to be held in trust by the Trustee, from which Trust
benefits under the Plan may be paid.
(nn) "TRUST AGREEMENT" means the Trust under the Energizer
Holdings, Inc. Deferred Compensation Plan made and entered into by the Company
with the Trustee pursuant to the Plan, as said Agreement may be amended from
time to time.
(oo) "TRUSTEE" means any person, persons or corporation designated
by the Company from time to time to hold, invest and disburse, in accordance
with the Plan and Trust Agreement, the assets of the Plan.
(pp) "VALUATION DATE" means the last business day of each calendar
quarter, unless changed by the Committee, and each special valuation date
designated by the Committee.
2.2 NUMBER AND GENDER.
Wherever appropriate herein, words used in the singular shall be
considered to include the plural and words used in the plural shall be
considered to include the singular. The masculine gender, where appearing in
the Plan, shall be deemed to include the feminine gender.
2.3 HEADINGS.
The headings of Articles and Sections herein are included solely for
convenience and do not bear on the interpretation of the text. If there is any
conflict between such headings and the text of the Plan, the text shall control.
As used in the Plan, the terms "Article", "Section" and "Appendix" mean the text
that accompanies the specified Article, Section or Appendix of the Plan.
<PAGE>
ARTICLE III
PARTICIPATION AND ELIGIBILITY
3.1 ELIGIBILITY.
(a) Employees - The Committee shall select who is eligible to
---------
participate in the Plan from among the management and highly compensated
Employees of the Company and its Subsidiaries who are subject to the income tax
laws of the United States. In making its selections hereunder, the Committee
shall take into consideration the nature of the services rendered or to be
rendered to the Company and its Subsidiaries by an Employee, his present and
potential contribution to the success of the Company and its Subsidiaries, and
such other factors as the Committee deems relevant in accomplishing the purposes
of the Plan. The Committee shall notify each Participant of his selection as a
Participant.
(b) Directors - A Director is eligible to participate in the Plan.
---------
3.2 PARTICIPATION.
An Employee or Director shall become a Participant effective as of the
date the Committee determines, which date shall be on or after the date his
Deferred Compensation Agreement becomes effective. Subject to the provisions of
Section 3.3 a Participant shall remain eligible to continue participation in the
Plan for each Plan Year following his initial year of participation in the Plan.
3.3 DURATION OF PARTICIPATION.
(a) Employee - A Participant who is an Employee shall cease to be a
--------
Participant as of the date on which his or her employment with the Company and
all Subsidiaries terminates or is deemed terminated by the Company, the date the
Committee terminates such Participant's participation in the Plan or the date on
which the Plan terminates, whichever date is earliest. Any such Committee
action shall be communicated to such Participant prior to the effective date of
such action.
If the Committee determines in good faith that a Participant no longer
qualifies as a member of a select group of management or highly compensated
employees, as membership in such group is determined in accordance with the
provisions of Section 201(2), 301(a)(3) and 401(a)(1) of ERISA, the Committee
shall have the right, in its sole discretion, to (i) terminate any deferral
election the Participant has made for the remainder of the Plan Year in which
the Participant's membership changes, (ii) prevent the Participant from making
future deferral elections and/or (iii) immediately distribute the Participant's
Account in which he is vested and terminate the Participant's participation in
the Plan.
(b) Director - A Participant who is a Director shall cease to be a
--------
Participant as of the date on which he ceases to be a Director, the date the
Committee terminates such Participant's participation in the Plan or the date on
which the Plan terminates, whichever date is earliest. Any such Committee
action shall be communicated to such Participant prior to the effective date of
such election.
<PAGE>
ARTICLE IV
DEFERRAL AND MATCHING CONTRIBUTIONS
4.1 DEFERRALS BY PARTICIPANTS.
(a) Deferred Elections by Participants - Before the first day of each
------------------------------------
Plan Year (or the remaining portion thereof for an Employee or Director who
commences participation in the Plan other than on the first day of a Plan Year),
a Participant may file with the Committee a Deferred Compensation Agreement
pursuant to which such Participant elects to make Deferrals for such Plan Year.
Any such Participant election shall be subject to any maximum or minimum
percentage or dollar amount limitations and to any other rules prescribed by the
Committee in its sole discretion.
(b) Effect of Termination on Deferral Election - Base Salary Deferrals
-------------------------------------------
will be credited to the Account of each Participant as of the last day of each
calendar month, provided that such Participant is an Employee on the last day of
such calendar month. A Participant whose employment terminates during the
calendar month shall be paid in cash the amount of his Base Salary Deferrals for
such month. Bonus Deferrals will be credited to the Account of each Participant
as soon as administratively feasible after such Bonus Compensation otherwise
would have been paid to the Participant in cash, provided that the Participant
is an Employee as of such date. A Participant whose employment terminates
before his Bonus Compensation would have been paid to him in cash will be paid
his Bonus Deferral in cash. Director Fee Deferrals will be credited to the
Account of each Participant as soon as administratively feasible after such
Director Fees otherwise would have been paid to the Participant in cash,
provided that the Participant is a Director as of such date. A Participant
whose relationship as a Director terminates before his Director Fees would have
been paid to him in cash will be paid his Director Fee Deferrals in cash.
4.2 EFFECTIVE DATE OF DEFERRED COMPENSATION AGREEMENT.
A Participant's initial Deferred Compensation Agreement shall be
effective as of the date the Participant commences participation in the Plan.
Each subsequent Deferred Compensation Agreement shall become effective on the
first day of the Plan Year to which it relates. If a Participant fails to
complete a Deferred Compensation Agreement on or before the date the Participant
commences participation in the Plan or the first day of any Plan Year, the
Participant shall be deemed to have elected not to make Deferrals for such Plan
Year (or remaining portion thereof if the Participant enters the Plan other than
on the first day of a Plan Year).
4.3 MODIFICATION OR REVOCATION OF ELECTION OF PARTICIPANT.
A Participant may not discontinue or change the amount of his
Deferrals during a Plan Year. Under no circumstances may a Participant's
Deferred Compensation Agreement be made, modified or revoked retroactively.
<PAGE>
4.4 MATCHING CONTRIBUTIONS.
For each Plan Year, the Company and/or its Subsidiaries shall make a
Matching Contribution with respect to a Participant's Bonus Deferrals and
Director Fee Deferrals for such Plan Year that are invested in the Stock Unit
fund pursuant to Section 6.3; provided however, that such Bonus Deferrals and
Director Fee Deferrals for such Plan Year must be invested in the Stock Unit
fund as provided in Section 6.3 for a period of not less than twelve (12) months
beginning on the date such Bonus Deferrals and Director Fee Deferrals are
credited to such Participant's Account in order to receive a Matching
Contribution. The amount, if any, of such Matching Contribution for each Plan
Year shall be determined by the Company in its sole discretion.
4.5 MANDATED DEFERRALS.
If the Committee mandates the deferral of any compensation in order to
preserve the deductibility of such compensation, when paid, under Code Section
162(m), such amounts shall remain deferred until such time as the Committee
directs. The Participant shall be entitled to elect the hypothetical investment
of such amounts in accordance with Section 7.3. Such mandated deferrals shall
not be entitled to a Matching Contribution and shall be paid in a lump sum as
soon as practicable after they become deductible by the Company or its
Subsidiaries as determined by the Committee or its delegee.
<PAGE>
ARTICLE V
VESTING
5.1 VESTING IN BASE SALARY DEFERRALS AND BONUS DEFERRALS.
A Participant shall always be 100% vested in the amounts credited to
his Account attributable to his Base Salary Deferrals, Bonus Deferrals and
Director Fee Deferrals, including earnings thereon. A Participant shall also be
100% vested in his Ralston Plan Account and in the amounts credited as of March
31, 2000 (including amounts attributable to services performed on or before
March 31, 2000 and not paid until after such date but that are subject to a
deferral election pursuant to the Ralston Plan) under the Ralston Plan.
5.2 VESTING IN MATCHING CONTRIBUTIONS.
(a) Employees - A Participant who is an Employee shall become 100%
---------
vested in the Matching Contributions and earnings thereon, credited/debited to
his Account for a Plan Year, upon the expiration of thirty-six (36) months
beginning on the date such Matching Contributions are credited to his Account.
Notwithstanding the foregoing, a Participant who is an Employee shall,
become 100% vested in the Matching Contributions and earnings thereon,
credited/debited to his Account upon the Participant's death, disability,
involuntary termination (other than Termination for Cause) or upon a Change of
Control.
(b) Directors - A Participant who is a Director, shall always be 100%
---------
vested in the amounts credited to his Account, including earnings thereon.
5.3 DEFERRAL PERIODS.
(a) Employees - A Participant who is an Employee must specify on the
---------
Deferred Compensation Agreement, the Deferral Period for the Base Salary
Deferrals and the Deferral Period for the Bonus Deferrals for the Plan Year to
which the Deferred Compensation Agreement relates, and earnings thereon, subject
to certain rules as determined by the Committee from time to time. A
Participant shall elect one of the Deferral Period options as follows: (1) a
Deferral Period of at least three (3) years pursuant to which a distribution is
made in January of the fourth (or later) Plan Year following the Plan Year for
which the Base Salary Deferrals, and Bonus Deferrals and Matching Contributions
thereon, were made, and (2) termination of employment with the Company and all
Subsidiaries for any reason.
(b) Directors - A Participant who is a Director may not elect a
---------
Deferral Period with respect to Director Fee Deferrals. Payment of such
Director Fee Deferrals shall be made in accordance with the provisions of
Section 7.1.
<PAGE>
ARTICLE VI
ACCOUNTS
6.1 ESTABLISHMENT OF BOOKKEEPING ACCOUNTS.
A separate bookkeeping account shall be maintained for each
Participant. Such account shall be credited with the Deferrals made by the
Participant pursuant to Section 4.1, the Matching Contributions made by the
Company or a Subsidiary pursuant to Section 4.4, and amounts credited to his
Ralston Plan Account and credited (or charged, as the case may be) with the
hypothetical investment results pursuant to Section 6.3.
6.2 SUBACCOUNTS.
Within each Participant's bookkeeping account, separate subaccounts
may be maintained to the extent necessary for the administration of the Plan.
For example, it may be necessary to maintain separate subaccounts where the
Participant has specified different Deferral Periods, methods of payment or
investment directions with respect to his Deferrals for different Plan Years.
6.3 INVESTMENT OF ACCOUNTS.
A Participant shall elect to invest the amounts credited to his
Account in such measurement funds as are selected by the Committee in its sole
discretion, including but not limited to the Stock Unit measurement fund. The
Committee may change or eliminate such measurement funds from time to time. The
investment of such funds shall be made in accordance with such rules and
procedures established by the Committee.
A Participant's Account shall consist of a cash subaccount and a stock
subaccount. Amounts credited to the cash subaccount shall be invested in
investments other than Stock Units. Amounts credited to the stock subaccount
shall be maintained as Stock Units. A Participant shall elect on his Deferred
Compensation Agreement the portion of his Deferrals for a Plan Year that will be
credited to a cash subaccount and to the stock subaccount. The balance of a
Participant's Account as of any date is the aggregate of the cash subaccount and
the stock subaccount as of such date. The balance of each cash subaccount shall
be expressed in United States dollars. The balance of each stock subaccount
shall be expressed in the numbers of shares of Stock deemed credited to such
subaccount, with fractional shares of Stock calculated to three decimal places.
The number of Stock Units credited to the stock subaccount as of any date shall
be equal to the quotient of the amount credited to the stock subaccount divided
by the Market Value on such date. Upon the occurrence of any stock split-up
dividend, issuance of any tracking stock, combination or reclassification with
respect to any outstanding series or class of Stock, or consolidation, merger or
sale of all or substantially all of the assets of the Company, the number of
Stock Units in each stock subaccount shall, to the extent appropriate, be
adjusted accordingly.
Matching Contributions must be invested in the Stock Unit fund for a
period of not less than thirty-six (36) months beginning on the date such
Matching Contributions are credited to a Participant's Account.
As of each Valuation Date, a Participant's Account shall be adjusted
with earnings and losses to reflect the investment elections made by the
Participant.
6.4 HYPOTHETICAL NATURE OF ACCOUNTS.
The Account established under this Article VI shall be hypothetical in
nature and shall be maintained for bookkeeping purposes only so that earnings
and losses on the Base Salary Deferrals, Bonus Contributions and Matching
Contributions made to the Plan can be credited (or charged, as the case may be).
Neither the Plan nor any of the Accounts (or subaccounts) established hereunder
shall hold any actual funds or assets. The right of any person to receive one
or more payments under the Plan shall be an unsecured claim against the general
assets of the Company. Any liability of the Company to any Participant, former
Participant, or Beneficiary with respect to a right to payment shall be based
solely upon contractual obligations created by the Plan. Neither the Company
and/or any Subsidiary, the Board, nor any other person shall be deemed to be a
trustee of any amounts to be paid under the Plan. Nothing contained in the
Plan, and no action taken pursuant to its provisions, shall create or be
construed to create a trust of any kind, or a fiduciary relationship, between
the Company and/or any Subsidiary and a Participant or any other person.
<PAGE>
ARTICLE VII
PAYMENT OF ACCOUNT
7.1 TIMING OF DISTRIBUTION OF BENEFITS.
(a) Employees - With respect to a Participant who is an Employee,
---------
distribution of Base Salary Deferrals, Bonus Deferrals and Matching
Contributions, shall be made as soon as practicable following the date the
Deferral Period for such Deferrals ends.
(b) Directors - With respect to a Participant who is a Director,
---------
distribution of Director Fee Deferrals shall be made not later than sixty (60)
days following the date the Participant's relationship as a Director terminates.
7.2 ADJUSTMENT FOR INVESTMENT GAINS AND LOSSES UPON A DISTRIBUTION.
Upon a distribution pursuant to this Article VII, the balance of a
Participant's Account shall be determined as of the Valuation Date immediately
preceding the date of the distribution to be made and shall be adjusted for
investment gains and losses which have accrued to the date of distribution but
which have not been credited to his Account.
7.3 FORM OF PAYMENT OR PAYMENTS.
Deferrals and Matching Contributions, made to the Plan for a Plan
Year, shall be distributed to the Participant in accordance with the form of
payment specified as follows:
(a) Lump Sum Payment-A Participant who is an Employee shall be
------------------
paid his benefit in the form of a lump sum payment if the vested amount to be
distributed to such Participant, determined as of the date such amount is to be
distributed, is less than $100,000. A Participant who is a Director shall
receive payment of his Account in a lump sum payment.
(b) Annual Installment Payment-A Participant who is an Employee
----------------------------
may elect, in his Deferred Compensation Agreement, to be paid his benefit in a
series of annual installment payments provided that the vested amount to be
distributed to such Participant, determined as of the date such amount is to be
distributed, is equal to or greater than $100,000. If a Participant does not
elect payment in the form of installment payments or if the vested amount to be
distributed to such Participant determined as of the date such amount is to be
distributed is equal to or greater than $100,000 at the time such payment is to
be made, his benefit shall be paid in the form of a lump sum payment. If a
benefit is to paid in a series of annual installment payments, the annual
installment payments may be made for a period equal to five (5) or ten (10)
years. Annual installments shall commence within 60 days of termination of
employment with the Company and all Subsidiaries provided that the vested amount
to be distributed to such Participant determined as of the date such amount is
to be distributed is equal to or greater than $100,000. Subsequent annual
installment payments shall be paid as soon as administratively feasible after
January l of each year. The amount of each annual installment payment shall be
calculated by multiplying the amount credited to be distributed to such
Participant by a fraction, the numerator of which is one, and the denominator of
which is the remaining number of annual installment payments to be made to the
Participant.
7.4 DEATH BENEFITS
(a) Employees - In the event of the death of a Participant who is an
---------
Employee prior to attainment of age fifty (50) years, the amount credited to the
Participant's Account shall be paid in a lump sum to the Beneficiary. If a
Participant who is an Employee dies at or after attainment of age fifty (50)
years, the amount credited to the Participant's Account shall be paid in
accordance with the applicable form of distribution elected by the Participant;
but if no Beneficiary is designated, then benefits shall be paid in a lump sum
to the Participant's estate or as provided by law. Distribution shall be made
(and, in the case of installment payments, shall commence) no later than sixty
(60) days following the Participant's death.
(b) Directors - In the event of the death of a Participant who is a
---------
Director, the amount credited to the Participant's Account shall be paid in a
lump sum not later than sixty (60) days following the date of the Participant's
death.
7.5 DESIGNATION OF BENEFICIARIES.
A Participant may designate the Beneficiary or Beneficiaries to whom
his benefit under the Plan shall be paid if he dies before he receives complete
payment of such benefit. A Beneficiary designation (i) must be made on a
beneficiary designation form provided by the Committee, (ii) shall be effective
on the date such designation form is actually received by the Committee, and
(iii) shall revoke all prior designations made by the Participant. A
Beneficiary designation form received by the Committee after the date of the
Participant's death shall be null and void. If a Participant has not designated
a Beneficiary, if no designated Beneficiary survives the Participant or if the
Beneficiary designation is legally invalid for any reason, then, the
Participant's Beneficiary shall be the Participant's executor or administrator,
or his heirs at law if there is no administration of such Participant's estate.
7.6 UNCLAIMED BENEFITS.
In the case of a benefit payable on behalf of such Participant, if the
Committee is unable to locate the Participant or Beneficiary to whom such
benefit is payable, such benefit may be forfeited to the Company, upon the
Committee's determination. Notwithstanding the foregoing, if subsequent to any
such forfeiture the Participant or Beneficiary to whom such benefit is payable
makes a valid claim for such benefit, such forfeited benefit shall be paid by
the Company or restored to the Plan by the Company.
7.7 WITHDRAWAL.
A Participant (or, after a Participant's death, his or her
Beneficiary) may elect, at any time, to withdraw all of his Account in
accordance with such rules and procedures prescribed by the Committee. No
partial withdrawals of a Participant's Account may be made. The Participant (or
his or her Beneficiary) shall make this election by giving the Committee advance
written notice of the election in a form determined from time to time by the
Committee. The Participant (or his or her Beneficiary) shall be paid the
withdrawal amount within 60 days of his or her election. The Committee may
impose suspensions of future deferrals or other penalties as a condition to such
withdrawals. The payment of this Withdrawal Amount shall not be subject to the
deduction limitation under Code Section 162(m).
<PAGE>
ARTICLE VIII
ADMINISTRATION
The Plan shall be administered by the Committee. The Committee shall
have all powers necessary or appropriate to enable it to carry out its
administrative duties. Not in limitation, but in application of the foregoing,
the Committee shall have the duty and power to interpret the Plan and determine
all questions that may arise hereunder as to the status and rights of Employees,
Participants, and Beneficiaries. The Committee may exercise the powers hereby
granted in its sole and absolute discretion. No member of the Committee shall
be personally liable for any actions taken by the Committee unless the member's
action involves willful misconduct. The Committee may delegate its
administrative responsibilities to any Employee of the Company provided such
designation is in writing.
<PAGE>
ARTICLE IX
AMENDMENT AND TERMINATION
The power to amend, modify or terminate the Plan in whole or in part
and at any time is reserved to the Committee, except that the co-Chief Executive
Officer of the Company, may make amendments to resolve ambiguities, supply
omissions and cure defects, and may make any amendments deemed necessary or
desirable to comply with federal tax laws or regulations to avoid adverse tax
consequences to Participants or to the Company, and any other amendments deemed
necessary or desirable, which shall be reported to the Committee.
Notwithstanding the foregoing, no amendment or modification which would
reasonably be considered to be adverse to a Participant or Beneficiary may apply
to or affect the terms of any deferral of compensation that was approved prior
to the effective date of such amendment or modification without the consent of
the Participant or Beneficiary affected thereby.
The Board reserves the right to terminate the Plan in whole or in
part, but such termination shall not affect the Deferred Compensation Agreements
then in effect, except that no additional amounts may be deferred by
Participants to the Plan after the date of termination of the Plan.
Upon termination of the Plan, all benefits shall be paid at such time
and in such manner as provided in Article VII.
<PAGE>
ARTICLE X
GENERAL PROVISIONS
10.1 NON-ALIENATION OF BENEFITS.
No right or benefit under the Plan shall be subject to anticipation,
alienation, sale, assignment, pledge, encumbrance, or charge, and any attempt to
anticipate, alienate, sell, assign, pledge, encumber, or change any right or
benefit under this Plan shall be void. No right or benefit hereunder shall in
any manner be liable for or subject to the debts, contracts, liabilities or
torts of the person entitled to such benefits. If the Participant or
Beneficiary becomes bankrupt, or attempts to anticipate, alienate, sell, assign,
pledge, encumber, or change any right hereunder, then such right or benefit
shall, in the discretion of the Committee, cease and terminate, and in such
event, the Committee may hold or apply the same or any part thereof for the
benefit of the Participant or Beneficiary, spouse, children, or other
dependents, or any of them in such manner and in such amounts and proportions as
the Committee may deem proper.
10.2 CONTRACTUAL RIGHT TO BENEFITS FUNDING.
The Plan creates and vests in each Participant a contractual right to
the benefits to which he is entitled hereunder, enforceable by the Participant
against the Company. The benefits to which a Participant is entitled under the
Plan shall be paid from the general assets of the Company or from the Trust that
may be established or maintained to provide such benefits.
If a Trust is established and maintained, amounts deposited with the
Trustee shall be held and disposed of in accordance with the terms of the Trust
Agreement and payments made under the terms of the Trust Agreement shall be in
satisfaction of claims against the Company under the Plan. Nothing in the Plan
or Trust Agreement shall relieve the Company of its liabilities to pay amounts
under the Plan except to the extent that such liabilities are met from the use
of the assets held in Trust.
10.3 INDEMNIFICATION AND EXCULPATION.
The members of the Committee and their agents, and the officers,
directors and employees of the Company and any Subsidiary shall be indemnified
and held harmless by the Company against and from any and all loss, cost,
liability, or expense that may be imposed upon or reasonably incurred by them in
connection with or resulting from any claim, action, suit, or proceeding to
which they may be a party or in which they may be involved by reason of any
action taken or failure to act under this Plan and against and from any and all
amounts paid by them in settlement (with the Company's written approval) or paid
by them in satisfaction of a judgment in any such action, suit, or proceeding.
The foregoing provision shall not be applicable to any person if the loss, cost,
liability, or expense is due to such person's gross negligence or willful
misconduct.
10.4 NO EMPLOYMENT AGREEMENT.
The Plan is not a contract of employment, and participation in the
Plan shall not confer on any Employee the right to be retained in the employ of
the Company and/or any Subsidiary.
10.5 CLAIMS FOR BENEFITS.
A Participant or Beneficiary may claim any benefit to which he or she
is entitled under this Plan by a written notice to the Committee. If a claim is
denied, it must be denied within a reasonable period of time, and be contained
in a written notice stating the following:
(a) The specific reason for the denial.
(b) Specific reference to the Plan provision on which the denial
is based.
(c) Description of additional information necessary for the
claimant to present his claim, if any, and an explanation of why such material
is necessary.
(d) An explanation of the Plan's claims review procedure.
The claimant will have sixty (60) days to request a review of the
denial by the Committee, which will provide a full and fair review. The request
for review must be in writing delivered to the Committee. The claimant may
review pertinent documents, and he may submit issues and comments in writing.
The decision by the Committee with respect to the review must be given within
sixty (60) days after receipt of the request, unless special circumstances
require an extension (such as for a hearing). In no event shall the decision be
delayed beyond one hundred and twenty (120) days after receipt of the request
for review. The decision shall be written in a manner calculated to be
understood by the claimant, and it shall include specific reasons and refer to
specific Plan provisions as to its effect.
10.6 SUCCESSOR TO COMPANY.
The Company shall require any successor or assignee, whether direct or
indirect, by purchase, merger, consolidation or otherwise, to all or
substantially all the business or assets of the Company, expressly and
unconditionally to assume and agree to perform the Company's obligations under
this Plan, in the same manner and to the same extent that the Company would be
required to perform. Accordingly, this Plan and the related Deferred
Compensation Agreements shall be binding upon, and the term "Company" shall
include any successor or assignee to the business or assets of the Company.
10.7 SEVERABILITY.
In the event any provision of the Plan shall be held invalid or
illegal for any reason, any illegality or invalidity shall not affect the
remaining parts of the Plan, but the Plan shall be construed and enforced as if
the illegal or invalid provision had never been inserted, and the Company shall
have the privilege and opportunity to correct and remedy such questions of
illegality or invalidity by amendment as provided in the Plan.
10.8 ENTIRE PLAN.
This document and any amendments contain all the terms and provisions
of the Plan and shall constitute the entire Plan, any other alleged terms or
provisions being of no effect.
10.9 PAYEE NOT COMPETENT.
In the event that the Committee shall find that the Participant is
unable to care for his affairs because of illness or accident, the Committee may
direct that any benefit payment due him, unless claim shall have been made
therefor by a duly appointed legal representative, be paid to his spouse, a
child, a parent or other blood relative, or to a person with whom he resides,
and any such payment so made shall be a complete discharge of the liabilities of
the Plan therefor.
10.10 TAX WITHHOLDING.
The Company shall have the right to deduct from each payment to be
made under the Plan any required withholding taxes.
10.11 GOVERNING LAW.
This Plan shall be construed and governed in accordance with the laws
of the state of Missouri without reference to conflict of law principles.
IN WITNESS WHEREOF, the Company has caused this Plan to be properly
executed on the 30th day of March, 2000.
ENERGIZER HOLDINGS, INC.
BY: Peter J. Conrad
ITS: Vice President, Human Resources
April 1, 2000
Name
Title
Company
Address
Address
Dear ___:
The Energizer Corporation ("Company"), on behalf of itself, its subsidiaries and
its stockholders, and any successor or surviving entity, wishes to encourage
your continued service and dedication in the performance of your duties,
notwithstanding the possibility, threat or occurrence of a Change of Control (as
defined in Subsection I(i)) of the Company (as defined in Subsection I(k)). The
Board of Directors of the Company (the "Board") believes that the prospect of a
pending or threatened Change of Control inevitably creates distractions and
personal risks and uncertainties for its executives, and that it is in the best
interests of Company and its stockholders to minimize such distractions to
certain executives. The Board further believes that it is in the best interests
of the Company to encourage its executives' full attention and dedication to
their duties, both currently and in the event of any threatened or pending
Change of Control.
Accordingly, the Board has determined that appropriate steps should be taken to
reinforce and encourage the continued retention of certain members of the
Company's management, including yourself, and the attention and dedication of
management to their assigned duties without distraction in the face of
potentially disturbing circumstances arising from the possibility of a Change of
Control.
In order to induce you, _________ ("Executive"), to remain in the employ of the
Company and in consideration of your continued service to the Company, the
Company agrees that you shall receive the benefits set forth in this letter
agreement (the "Agreement") in the event that your employment with the Company
is terminated subsequent to a Change of Control in the circumstances described
herein. For purposes of this Agreement, references to employment with the
Company shall include employment with a Subsidiary of the Company (as defined in
Subsection I(w).
I. Definitions.
-----------
The meaning of each defined term that is used in this Agreement is set
forth below.
(a) AAA. The American Arbitration Association.
---
(b) Additional Pay. The meaning of this term is set forth in
---------------
Subsection IV(b).
(c) Agreement. The meaning of this term is set forth in the third
---------
paragraph of this Agreement.
(d) Agreement Payments. The meaning of this term is set forth in
-------------------
Subsection IV(e).
(e) Beneficiaries. The meaning of this term is set forth in Subsection
-------------
VI(b).
(f) Board. The meaning of this term is set forth in the first
-----
paragraph of this Agreement.
(g) Business Combination. The meaning of this term is set forth in
---------------------
Subsection I(i)(iii).
(h) Cause. For purposes of this Agreement, "Cause" shall mean
-----
Executive's willful breach or failure to perform his/her employment duties. For
purposes of this Subsection I(h), no act, or failure to act, on the part of
Executive shall be deemed "willful" unless done, or omitted to be done, by
Executive not in good faith and without reasonable belief that such action or
omission was in the best interest of the Company. Notwithstanding the
foregoing, Executive's employment shall not be deemed to have been terminated
for Cause unless and until the Company delivers to Executive a certificate of a
resolution duly adopted by the affirmative vote of not less than seventy-five
percent (75%) of the entire membership of the Board at a meeting of the Board
called and held for such purpose (after reasonable notice to Executive and an
opportunity for Executive, together with Executive's counsel, to be heard before
the Board), finding that in the good faith opinion of the Board, Executive has
engaged in such willful conduct and specifying the details of such willful
conduct.
(i) Change of Control. For purposes of this Agreement, a "Change of
-------------------
Control" shall be deemed to have occurred if there is a change of control of a
nature that would be required to be reported in response to Item 6(e) of
Schedule 14A of Regulation 14A promulgated under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), whether or not the Company is then
subject to such reporting requirement; provided that, without limitation, such a
Change of Control shall be deemed to have occurred if:
(i) any "person" (as such term is used in Sections 13(d) and
14(d)(2) as currently in effect, of the Exchange Act) is or becomes a
"beneficial owner" (as determined for purposes of Regulation 13D-G, as currently
in effect, of the Exchange Act), directly or indirectly, of securities
representing twenty percent (20%) or more of the total voting power of all of
the Company's then outstanding voting securities. For purposes of this
Agreement, the term "person" shall not include: (A) the Company or any of its
Subsidiaries, (B) a trustee or other fiduciary holding securities under an
employee benefit plan of the Company or any of its Subsidiaries, or (C) an
underwriter temporarily holding securities pursuant to an offering of said
securities;
(ii) during any period of two (2) consecutive calendar years,
individuals who at the beginning of such period constitute the Board and any new
director(s) whose election by the Board or nomination for election by the
Company's stockholders was approved by a vote of at least two-thirds of the
directors then still in office who either were 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;
(iii) the stockholders of the Company approve a merger,
consolidation or sale or other disposition of all or substantially all of the
assets of the Company (a "Business Combination"), in each case, unless following
such Business Combination: (i) all or substantially all of the individuals and
entities who were the "beneficial owners" (as determined for purposes of
Regulation 13D-G, as currently in effect, of the Exchange Act) of the
outstanding voting securities of the Company immediately prior to such Business
Combination beneficially own, directly or indirectly, securities representing
more than fifty percent (50%) of the total voting power of the then outstanding
voting securities of the corporation resulting from such Business Combination or
the parent of such corporation (the "Resulting Corporation"); (ii) no "person"
(as such term is used in Section 13(d) and 14(d)(2), as currently in effect, of
the Exchange Act), other than a trustee or other fiduciary holding securities
under an employee benefit plan of the Company or the Resulting Corporation, is
the "beneficial owner" (as determined for purposes of Regulation 13D-G, as
currently in effect, of the Exchange Act), directly or indirectly, of voting
securities representing twenty percent (20%) or more of the total voting power
of then outstanding voting securities of the Resulting Corporation; and (iii) at
least a majority of the members of the board of directors of the Resulting
Corporation were members of the Board at the time of the execution of the
initial agreement, or at the time of the action of the Board, providing for such
Business Combination;
(iv) the stockholders of the Company approve a plan of complete
liquidation or dissolution of the Company; or
(v) any other event that a simple majority of the Board, in its
sole discretion, shall determine constitutes a Change of Control.
(j) Code. For purposes of this Agreement, "Code" shall mean the
----
Internal Revenue Code of 1986, as amended.
(k) Company. The meaning of this term is set forth in Subsection
-------
VI(a).
(l) Controlled Group. For purposes of this Agreement, "Controlled
-----------------
Group" shall mean the Company and all of the Company's Subsidiaries.
(m) Disability. For purposes of this Agreement, "Disability" shall
----------
mean an illness, injury or similar incapacity which 52 weeks after its
commencement, continues to render Executive unable to perform the material and
substantial duties of Executive's position or any substantially similar
occupation or substantially similar employment for which Executive is qualified
or may reasonably become qualified by training, education or experience. Any
question as to the existence of a Disability upon which Executive and the
Company cannot agree shall be determined by a qualified independent physician
selected by Executive (or, if Executive is unable to make such selection, by any
adult member of Executive's immediate family or Executive's legal
representative), and approved by the Company, such approval not to be
unreasonably withheld. The determination of such physician made in writing to
both the Company and Executive shall be final and conclusive for all purposes of
this Agreement.
(n) Employer. For purposes of this Agreement, "Employer" shall mean
--------
the Company or the Subsidiary, as the case may be, with which Executive has an
employment relationship.
(o) Exchange Act. This term shall have the meaning set forth in
-------------
Subsection I(i)(i).
(p) Executive. This term shall have the meaning set forth in the third
---------
paragraph of this Agreement.
(q) Good Reason. For purposes of this Agreement, "Good Reason" shall
------------
mean the occurrence, without Executive's prior express written consent, of any
of the following circumstances:
(i) The assignment to Executive of any duties inconsistent with
Executive's status or responsibilities as in effect immediately prior to a
Change of Control, including imposition of travel obligations which differ
materially from required business travel immediately prior to the Change of
Control;
(ii) Any diminution in the status or responsibilities of
Executive's position from that which existed immediately prior to the Change of
Control, whether by reason of the Company ceasing to be a public company under
the Exchange Act, becoming a subsidiary of a successor public company, or
otherwise;
(iii) (A) A reduction in Executive's annual base salary as in
effect immediately before the Change of Control; or (B) the failure to pay a
bonus award to which Executive is entitled under any short-term incentive
plan(s) or program(s), any long-term incentive plan(s) or program(s), or any
other incentive compensation plan(s) or program(s) of Company in which Executive
participated immediately prior to the time of the Change of Control;
(iv) A change in the principal place of Executive's employment, as
in effect immediately prior to the Change of Control to a location more than
fifty (50) miles distant from the location of such principal place at such time;
(v) The failure by the Company to offer Executive participation in
incentive compensation or stock or stock option plans on at least a
substantially equivalent basis, both in terms of the nature and amount of
benefits provided and the level of Executive's participation, as is then being
provided by the Company to similarly situated peer executives of the Company;
(vi) (A) Except as required by law, the failure by the Company to
offer Executive benefits on at least a substantially equivalent basis, in the
aggregate, to those then being provided by the Company to similarly situated
peer executives of the Company under the qualified and non-qualified employee
benefit and welfare plans of the Company, including, without limitation, any
pension, deferred compensation, life insurance, medical, dental, health and
accident, disability, retirement or savings plan(s) or program(s) offered by the
Company; (B) the taking of any action by the Company that would, directly or
indirectly, materially reduce or deprive Executive of any other perquisite or
benefit then being offered by the Company to similarly situated peer executives
of the Company (including, without limitation, Company-paid and/or reimbursed
club memberships, financial counseling fees and the like); or (C) the failure by
the Company to treat Executive under the Company's vacation policy, past
practice or special agreement in the same manner and to the same extent as then
being provided by the Company to similarly situated peer executives of the
Company;
(vii) The failure of the Company to obtain a satisfactory written
agreement from any successor prior to consummation of the Change of Control to
assume and agree to perform this Agreement, as contemplated in Subsection VI(a);
or
(viii) Any purported termination by the Company of Executive's
employment that is not effected pursuant to a Notice of Termination satisfying
the requirements of Subsection III(d) or, if applicable, Subsection I(h). For
purposes of this Agreement, no such purported termination shall be effective
except as constituting Good Reason.
Executive's continued employment with the Company or any Subsidiary shall not
constitute a consent to, or a waiver of rights with respect to, any
circumstances constituting Good Reason hereunder. Any good faith determination
of "Good Reason" made by the Executive shall be conclusive for purposes of this
Agreement.
(r) Notice of Termination. The meaning of this term is set forth in
-----------------------
Subsection III(d).
(s) Payments. The meaning of this term is set forth in Subsection IV(e).
--------
(t) Reduced Amount. The meaning of this term is set forth in Subsection
---------------
IV(e).
(u) Resulting Corporation. The meaning of this term is set forth in
----------------------
Subsection I(i)(iii).
(v) Retirement. For purposes of this Agreement, "Retirement" shall
----------
mean Executive's voluntary termination of employment with the Company, other
than for Good Reason, and in accordance with the Company's retirement policy
generally applicable to its employees or in accordance with any prior or
contemporaneous retirement agreement or arrangement between Executive and the
Company.
(w) Subsidiary. For purposes of this Agreement, "Subsidiary" shall
----------
mean any corporation of which fifty percent (50%) or more of the voting stock is
owned, directly or indirectly, by the Company.
(x) Terminate(d) or Termination. The meaning of this term is set forth
---------------------------
in Subsection III(c).
(y) Termination Date. For purposes of this Agreement, "Termination
-----------------
Date" shall mean:
(i) If Executive's employment is terminated for Disability, thirty
(30) calendar days after Notice of Termination is given (provided that Executive
shall not have returned to the full-time performance of his/her duties during
such thirty-day period); and
(ii) If Executive's employment is terminated for Cause or Good
Reason or for any reason other than death or Disability, the date specified in
the Notice of Termination (which in the case of a termination for Cause shall
not be less than thirty (30) calendar days and in the case of a termination for
Good Reason shall not be less than thirty (30) calendar days nor more than sixty
(60) calendar days, respectively, from the date such Notice of Termination is
given).
II. Term of Agreement.
-------------------
(a) General. Upon execution by Executive, this Agreement shall
-------
commence as of April 1, 2000. This Agreement shall continue in effect through
April 1, 2002; provided, however, that commencing on April 1, 2002, and every
third January 1 thereafter, the term of this Agreement shall automatically be
extended for two (2) additional years unless, not later than ninety (90)
calendar days prior to the January 1 on which this Agreement otherwise
automatically would be extended, the Company shall have given notice to
Executive that it does not wish to extend this Agreement; provided further,
however, that if a Change of Control shall have occurred during the original or
any extended term of this Agreement, this Agreement shall continue in effect for
a period of twenty-four (24) months beyond the month in which the Change of
Control occurred. The term of this Agreement automatically shall be extended
for two (2) additional years from the date of any public announcement of an
event that would constitute a Change of Control as defined in this Agreement;
provided, however, that if any such announced event is not consummated within
that two (2) year period, the original renewal term thereafter shall apply.
(b) Disposition of Employer. In the event Executive is employed by a
-------------------------
Subsidiary, the terms of this Agreement shall expire if such Subsidiary is sold
or otherwise disposed of prior to the date on which a Change of Control occurs,
unless Executive continues in employment with the Controlled Group after such
sale or other disposition. If Executive's Employer is sold or disposed of on or
after the date on which a Change of Control occurs, this Agreement shall
continue through its original term or any extended term then in effect.
(c) Deemed Change of Control. If Executive's employment with Employer
-------------------------
is terminated prior to the date on which a Change of Control occurs, and such
termination was at the request of a third party who has taken steps to effect a
Change of Control, or otherwise was in connection with the Change of Control,
then for all purposes of this Agreement, a Change of Control shall be deemed to
have occurred prior to such termination.
(d) Expiration of Agreement. No termination or expiration of this
-------------------------
Agreement shall affect any rights, obligations or liabilities of either party
that shall have accrued on or prior to the date of such termination or
expiration.
III. Benefits Following Change of Control.
----------------------------------------
(a) Accelerated Vesting in All Equity. If a Change of Control shall
-------------------------------------
have occurred, Executive shall be entitled to, immediately upon the date of the
Change of Control, accelerated vesting of all unvested stock options and
restricted stock that have been granted or sold to the executive by the Company
under any restricted terms, such that following said acceleration, all
restrictions as to the sale and ownership of this equity, as imposed by the
company, shall have lapsed.
(b) Prorated Payout of Short Term Bonus. If a Change of Control shall
------------------------------------
have occurred, Executive shall be entitled to, immediately upon the date of the
Change of Control, payment in full of Executive's prorated bonus for the fiscal
year in which the Change of Control occurs. The prorated bonus amount shall be
calculated as Executive's Target Bonus for the fiscal year in which the change
in control occurs divided by 365 and multiplied by the number of calendar days
in said year immediately up to the day on which the Change of Control occurs.
(c) Entitlement to Benefits Upon Termination. If a Change of Control
------------------------------------------
shall have occurred, Executive shall be entitled to, in addition to the benefits
described in Subsections III(a) and (b), the benefits provided in Section IV
hereof upon the subsequent termination of his/her employment with the Company
within two (2) years after the date of the Change of Control unless such
termination is (i) a result of Executive's death or Retirement, (ii) for Cause,
(iii) a result of Executive's Disability, or (iv) by Executive other than for
Good Reason. For purposes of this Agreement, "Termination" shall mean a
termination of Executive's employment that is not as a result of Executive's
death, Retirement or Disability and (x) if by the Company, is not for Cause, or
(y) if by Executive, is for Good Reason.
(d) Notice of Termination. Any purported termination of Executive's
-----------------------
employment by either the Company or Executive shall be communicated by written
Notice of Termination to the other party hereto in accordance with Section VIII.
For purposes of this Agreement, a "Notice of Termination" shall mean a written
notice that indicates the specific provision(s) of this Agreement relied upon
and sets forth in reasonable detail the facts and circumstances claimed to
provide a basis for termination of Executive's employment under the provision(s)
so indicated. If Executive's employment shall be terminated by the Company for
Cause or by Executive for other than Good Reason, the Company shall pay
Executive his/her full base salary through the Termination Date at the salary
level in effect at the time Notice of Termination is given and shall pay any
amounts to be paid to Executive pursuant to any other compensation or stock or
stock option plan(s), program(s) or employment agreement(s) then in effect, and
the Company shall have no further obligations to Executive under this Agreement.
If within thirty (30) calendar days after any Notice of Termination is given,
the party receiving such Notice of Termination notifies the other party that a
dispute exists concerning the grounds for termination, then, notwithstanding the
meaning of "Termination Date" set forth in Subsection I(y), the Termination Date
shall be the date on which the dispute is finally resolved, whether by mutual
written agreement of the parties or by a decision rendered pursuant to Section
XI; provided that the Termination Date shall be extended by a notice of dispute
only if such notice is given in good faith and the party giving such notice
pursues the resolution of such dispute with reasonable diligence.
Notwithstanding the pendency of any such dispute, the Company will continue to
pay Executive his/her full compensation including, without limitation, base
salary, bonus, incentive pay and equity grants, in effect when the notice of the
dispute was given, and continue Executive's participation in all benefits plans
or other perquisites in which Executive was participating, or which Executive
was enjoying, when the Notice of Termination giving rise to the dispute was
given, until the dispute is finally resolved. Amounts paid under this
Subsection III(c) are in addition to and not in lieu of all other amounts due to
Executive under this Agreement and shall not be offset against or reduce any
other amounts due to Executive under this Agreement.
IV. Compensation Upon a Termination.
----------------------------------
Following a Change of Control, upon Executive's Termination, Executive shall be
entitled to the following benefits, provided that such Termination occurs during
the two (2) year period immediately following the date of the Change of Control:
(a) Standard Benefits. The Company shall pay Executive his/her full
------------------
base salary through the Termination Date at the rate in effect at the time the
Notice of Termination is given, no later than the second business day following
the Termination Date, plus all other amounts to which Executive is entitled
under any compensation plan(s) or program(s) of the Company applicable to
Executive at the time such payments are due. Without limitation, amounts
payable pursuant to this Subsection IV(a) shall include, pursuant to the express
terms of any short-term incentive plan(s) in which Executive participates or
otherwise, Executive's annual bonus under such short-term incentive plan,
pro-rated to the Termination Date. If the Termination Date shall fall within
the same short-term incentive period, as set forth by the express terms any of
the short-term incentive plan(s) in which Executive participates or otherwise,
as the Change of Control Date, and Executive has previously received the
pro-rated bonus amount as described in Subsection III(b), then Executive shall
be paid the difference between the pro-rated bonus amount as described here in
Subsection IV(a) and the pro-rated bonus amount described in Subsection III(b).
(b) Additional Benefits. The Company shall pay to Executive as
--------------------
additional pay ("Additional Pay"), the product of two (2) multiplied by the sum
of (x) the greater of (i) Executive's annual base salary in effect immediately
prior to the Termination Date, or (ii) Executive's annual base salary in effect
as of the Change of Control Date, and (y) Executive's annual bonus amount under
any short-term incentive plan(s) or program(s) in which Executive is a
participant as of the Termination Date. The Company shall pay the Additional
Pay to Executive in a lump sum, in cash, not later than the fifteenth calendar
day following the Termination Date. The Company shall maintain for Executive,
all such perquisites and fringe benefits enjoyed by Executive immediately prior
to the Termination Date as are approved in writing by the Company's Chief
Executive Officer for such period as is specified in such writing.
(c) Retirement Plan Benefits. If not already vested, Executive shall
--------------------------
be deemed fully vested as of the Termination Date in any Company retirement
plan(s) or other written agreement(s) between Executive and the Company relating
to pay or other benefits upon retirement in which Executive was a participant,
party or beneficiary immediately prior to the Change of Control, and any
additional plan(s) or agreement(s) in which such Executive became a participant,
party or beneficiary thereafter. In addition to the foregoing, for purposes of
determining the amounts to be paid to Executive under such plan(s) or
agreement(s), the years of service with the Company and the age of Executive
under all such plans and agreements shall be deemed increased by twenty-four
months (24). For purposes of this Subsection IV(c), the term "plan(s)"
includes, without limitation, the Company's qualified pension plan,
non-qualified pension plans, and any companion, successor or amended plan(s),
and the term "agreement(s)" encompasses, without limitation, the terms of any
offer letter(s) leading to Executive's employment with the Company where
Executive was a signatory thereto, any written amendment(s) to the foregoing and
any subsequent agreements on such matters. In the event the terms of the plans
referenced in this Subsection IV(c) do not for any reason coincide with the
provisions of this Subsection IV(c) (e.g., if plan amendments would cause
disqualification of qualified plans), Executive shall be entitled to receive
from the Company under the terms of this Agreement an amount equal to all
amounts Executive would have received, at the time Executive would have received
such amounts, had all such plans continued in existence as in effect on the date
of this Agreement after being amended to coincide with the terms of this
Subsection IV(c).
(d) Health and Other Benefits. Following the Termination Date, the
----------------------------
Company shall continue to provide, for a period of twenty-four months (24),
substantially the same level of health, vision and dental benefits to Executive
and Executive's eligible dependents that the Company would provide to Executive
and Executive's eligible dependents if Executive were first eligible for retiree
health, vision and dental benefits immediately prior to the Change of Control.
The eligibility of Executive's dependents shall be determined by the terms of
any retiree health, vision and dental benefit plan(s) or program(s) in effect
immediately prior to the Change of Control.
(e) Excess Parachute Payment. Anything in this Agreement to the
--------------------------
contrary notwithstanding, in the event that an independent accountant shall
determine that any payment or distribution by the Company to or for the benefit
of Executive (whether paid or payable or distributed or distributable pursuant
to the terms of this Agreement or otherwise) (a "Payment") would be
nondeductible by the Company for Federal income tax purposes because of Code
Section 280G or would constitute an "excess parachute payment" (as defined in
Code Section 280G), then the aggregate present value of amounts payable or
distributable to or for the benefit of Executive pursuant to this Agreement
(such payments or distributions pursuant to this Agreement are hereinafter
referred to as "Agreement Payments") shall be reduced (but not below zero) to
the Reduced Amount. For purposes of this paragraph, the "Reduced Amount" shall
be an amount expressed in present value which maximizes the aggregate present
value of Agreement Payments without causing any Payment to be nondeductible by
the Company because of Code Section 280G or without causing any portion of the
Payment to be subject to the excise tax imposed by Code Section 4999.
If the independent accountant determines that any Payment would be nondeductible
by the Company because of Code Section 280G or that any portion of the Payment
will be subject to the excise tax imposed by Code Section 4999, the Company
shall promptly give Executive notice to that effect and a copy of the detailed
calculation thereof and of the Reduced Amount. Executive may then elect, in
Executive's sole discretion, which and how much of the Agreement Payments shall
be eliminated or reduced (as long as after such election the aggregate present
value of the Agreement Payments equals the Reduced Amount), and shall advise the
Company in writing of such election within ten (10) days of Executive's receipt
of such notice. If no such election is made by Executive within such ten-day
period, the Company may elect which and how much of the Agreement Payments shall
be eliminated or reduced (as long as after such election the aggregate present
value of the Agreement Payments equals the Reduced Amount) and shall notify
Executive promptly of such election. For purposes of this paragraph, present
value shall be determined in accordance with Code Section 280G(d)(4). All
determinations made by the independent accountant under this Section shall be
binding upon the Company and Executive and shall be made within sixty (60) days
of a termination of employment of Executive. As promptly as practicable
following such determination and the elections hereunder, the Company shall pay
to or distribute to or for the benefit of Executive such amounts as are then due
to Executive under this Agreement and shall promptly pay to or distribute for
the benefit of Executive in the future such amounts as become due to Executive
under this Agreement.
As a result of the uncertainty in the application of Code Sections 280G and 4999
at the time of the initial determination by the independent accountant
hereunder, it is possible that Agreement Payments will be made by the Company
which should not have been made ("Overpayment") or that additional Agreement
Payments which have not been made by the Company should have been made
("Underpayment"), in each case, consistent with the calculation of the Reduced
Amount hereunder. In the event that the independent accountant, based upon the
assertion of a deficiency by the Internal Revenue Service against the Company or
Executive, which the independent accountant believes has a high probability of
success, determines that an Overpayment has been made, any such Overpayment
shall be treated for all purposes as a loan to Executive which Executive shall
repay to the Company together with interest at the applicable Federal rate
provided for in Code Section 7872(f)(2)(A); provided, however, that no amount
shall be payable by Executive to the Company if and to the extent such payment
would not reduce the amount which is subject to taxation under Code Section 4999
or if the period of limitations for assessment of tax under Code Section 4999
against Executive shall have expired. In the event that the independent
accountant, based upon controlling precedent, determines that an Underpayment
has occurred, any such Underpayment shall be promptly paid by the Company to or
for the benefit of Executive together with interest at the applicable Federal
rate provided for in Code Section 7872(f)(2)(A).
(f) Legal Fees and Expenses. The Company shall pay to Executive all
--------------------------
legal fees and expenses as and when incurred by Executive in connection with
this Agreement, including all such fees and expenses, if any, incurred in
contesting or disputing any Termination or in seeking to obtain or enforce any
right or benefit provided by this Agreement, regardless of the outcome, unless,
in the case of a legal action brought by or in the name of Executive, a decision
is rendered pursuant to Section XI, or in any other proper legal proceeding,
that such action was not brought by Executive in good faith.
(g) No Mitigation. Executive shall not be required to mitigate the
--------------
amount of any payment provided for in this Section IV by seeking other
employment or otherwise, nor shall the amount of any payment or benefit provided
for in this Section IV be reduced by any compensation earned by Executive as the
result of employment by another employer or by retirement or other benefits
received from whatever source after the Termination Date or otherwise, except as
specifically provided in this Section IV. The Company's obligation to make
payments to Executive provided for in this Agreement and otherwise to perform
its obligations hereunder shall not be affected by any set-off, counterclaim,
recoupment, defense or other claim, right or action that the Company or Employer
may have against Executive or other parties.
V. Death and Disability Benefits.
--------------------------------
In the event of the death or Disability of Executive after a Change of Control,
Executive, or in the case of death, Executive's Beneficiaries (as defined below
in Subsection VI(b)), shall receive the benefits to which Executive or his/her
Beneficiaries are entitled under this Agreement and any and all retirement
plans, pension plans, disability policies and other applicable plans, programs,
policies, agreements or arrangements of the Company.
VI. Successors; Binding Agreement.
-------------------------------
(a) Obligations of Successors. The Company will require any successor
--------------------------
(whether direct or indirect, by purchase, merger, consolidation or otherwise) to
all or substantially all of the business and/or assets of the Company to
expressly assume and agree to perform this Agreement in the same manner and to
the same extent that the Company is required to perform it. Failure of the
Company to obtain such assumption and agreement prior to the effectiveness of
any such succession shall be a breach of this Agreement and shall entitle
Executive to compensation from the Company in the same amount and on the same
terms as Executive would be entitled hereunder if Executive had terminated
employment for Good Reason following a Change of Control, except that for
purposes of implementing the foregoing, the date on which any such succession
becomes effective shall be deemed the Termination Date. As used in this
Agreement, the term "Company" shall mean Company, including any surviving entity
or successor to all or substantially all of its business and/or assets and the
parent of any such surviving entity or successor.
(b) Enforceable by Beneficiaries. This Agreement shall inure to the
------------------------------
benefit of and be enforceable by Executive's personal or legal representatives,
executors, administrators, successors, heirs, distributees, devisees and
legatees (the "Beneficiaries"). In the event of the death of Executive while
any amount would still be payable hereunder if such death had not occurred, all
such amounts, unless otherwise provided herein, shall be paid in accordance with
the terms of this Agreement to Executive's Beneficiaries.
(c) Employment. Except in the event of a Change of Control and,
----------
thereafter, only as specifically set forth in this Agreement, nothing in this
Agreement shall be construed to (i) limit in any way the right of the Company or
a Subsidiary to terminate Executive's employment at any time for any reason or
for no reason; or (ii) be evidence of any agreement or understanding, expressed
or implied, that the Company or a Subsidiary will employ Executive in any
particular position, on any particular terms or at any particular rate of
remuneration.
VII. Confidential Information.
-------------------------
Executive shall hold in fiduciary capacity for the benefit of the Company all
secret or confidential information, knowledge or data relating to the Company,
the Subsidiaries and their respective businesses, which shall have been obtained
during Executive's employment with the Employer and which shall not be public
knowledge (other than by acts by Executive or his/her representatives in
violation of this Agreement). After termination of Executive's employment with
the Company or any Employer within the Controlled Group, Executive shall not,
without prior written consent of the Company or the Employer, communicate or
divulge any such information, knowledge or data to anyone other than the
Company, the Employer or those designated by them. In no event shall an
asserted violation of this Section VII constitute a basis for deferring or
withholding any amounts otherwise payable to Executive under this Agreement.
VIII. Notice.
------
All notices and communications including, without limitation, any Notice of
Termination hereunder, shall be in writing and shall be given by hand delivery
to the other party, by registered or certified mail, return receipt requested,
postage prepaid, or by overnight delivery service, addressed as follows:
If to Executive:
Name
Title
Company
Address
Address
If to the Company:
Energizer Holdings, Inc.
800 Chouteau
St. Louis, MO 63102
Attn: Harry L. Strachan
or to such other address as either party shall have furnished to the other in
writing in accordance herewith. Notice and communications shall be deemed given
and effective when actually received by the addressee.
IX. Miscellaneous.
-------------
No provision of this Agreement may be modified, waived or discharged unless such
waiver, modification or discharge is agreed to in writing and signed by
Executive and the Company's Chief Executive Officer or other authorized officer
designated by the Board or an appropriate committee of the Board. No waiver by
either party hereto at any time of any breach by the other party hereto of, or
compliance with, any conditions or provision of this Agreement to be performed
by such other party shall be deemed a waiver of similar or dissimilar provisions
or conditions at the same or at any prior or subsequent time. No agreements or
representations, oral or otherwise, express or implied, with respect to the
subject matter hereof have been made by either party which are not expressly set
forth in this Agreement. The validity, interpretation, construction and
performance of this Agreement shall be governed by the laws of the State of
Missouri. All references to sections of the Code or the Exchange Act shall be
deemed also to refer to any successor provisions of such sections. Any payments
provided for hereunder shall be paid net of any applicable withholding required
under federal, state or local law. The obligations of the Company under
Sections IV and V shall survive the expiration of the term of this Agreement.
X. Validity.
--------
The invalidity or unenforceability of any provision of this Agreement shall not
affect the validity or enforceability of any other provision of this Agreement,
which shall remain in full force and effect.
XI. Arbitration.
-----------
Executive may agree in writing with the Company (in which case this Article XI
shall have effect but not otherwise) that any dispute that may arise directly or
indirectly in connection with this Agreement, Executive's employment or the
termination of Executive's employment, whether arising in contract, statute,
tort, fraud, misrepresentation, discrimination or other legal theory, shall be
resolved by arbitration in City, State under the applicable rules and procedures
of the AAA. The only legal claims between Executive and the Company or any
Subsidiary that would not be included in this agreement to arbitration are
claims by Executive for workers' compensation or unemployment compensation
benefits, claims for benefits under a Company or Subsidiary benefit plan if the
plan does not provide for arbitration of such disputes, and claims by Executive
that seek judicial relief in the form of specific performance of the right to be
paid until the Termination Date during the pendency of any applicable dispute or
controversy. If this Article XI is in effect, any claim with respect to this
Agreement, Executive's employment or the termination of Executive's employment
must be established by a preponderance of the evidence submitted to an impartial
arbitrator. A single arbitrator engaged in the practice of law shall conduct
any arbitration under the applicable rules and procedures of the AAA. The
arbitrator shall have the authority to order a pre-hearing exchange of
information by the parties including, without limitation, production of
requested documents, and examination by deposition of parties and their
authorized agents. If this Article XI is in effect, the decision of the
arbitrator: (i) shall be final and binding, (ii) shall be rendered within
ninety (90) days after the impanelment of the arbitrator, and (iii) shall be
kept confidential by the parties to such arbitration. The arbitration award may
be enforced in any court of competent jurisdiction. The Federal Arbitration
Act, 9 U.S.C. 1 et seq., not state law, shall govern the arbitrability of all
claims.
If this letter sets forth our agreement on the subject matter hereof, kindly
sign both originals of this letter and return to the Vice President - Law, one
of the fully executed originals of this letter which will then constitute our
Agreement on this subject.
Sincerely,
Energizer Holdings, Inc.
By:___________________________________
Name
Chairman/President/Chief Executive Officer
______________________________________
Employee
Schedule of Recipients
1. Mr. Mulcahy
2. Mr. Mannix
3. Mr. Rose
4. Mr. McClanathan
5. Mr. Klein
6. Mr. Gunawardana
7. Mr. Plana
8. Mr. Hatfield
9. Mr. Tisone
10. Mr. Sanborn
11. Mr. Corbin
12. Mr. Conrad
13. Mr. Strachan
14. Mr. Zimmerman
15. Mr. Fox
16. Mr. Schafale
17. Mr. Grosch
INDEMNIFICATION AGREEMENT
-------------------------
INDEMNIFICATION AGREEMENT (the "Agreement") made this 1st day of
April, 2000, between ENERGIZER HOLDINGS, INC., a Missouri corporation
(the "Company") and _____________ ("Officer").
WHEREAS, Officer is a Corporate Officer of the Company, and in such
capacity is performing a valuable service for Company; and
WHEREAS, the Company's Articles of Incorporation (the "Articles") permit
the indemnification of directors, officers, employees and certain agents of the
Company, and indemnification is also authorized by Section 351.355 of the
Missouri Revised Statutes 1978, as amended to date (the "Indemnification
Statute"); and
WHEREAS, the Articles and the Indemnification Statute permit full
indemnification of officers absent knowingly fraudulent, deliberately dishonest
or willful misconduct; and
WHEREAS, in order to induce Officer to continue to serve as a Corporate
Officer of the Company, Company has determined and agreed to enter into this
contract with Officer;
NOW THEREFORE, in consideration of Officer's continued service as a
Corporate Officer after the date hereof, the Company and Officer agree as
follows:
1. Indemnity of Officer. Company hereby agrees to hold harmless and
----------------------
indemnify Officer to the full extent authorized or permitted by the provisions
of the Indemnification Statute, or by any amendment thereof, or by any other
statutory provision authorizing or permitting such indemnification which is
adopted after the date hereof.
2. Additional Indemnity. Subject to the exclusions set forth in Section
--------------------
3 hereof, Company further agrees to hold harmless and indemnify Officer against
any and all expenses (including attorneys' fees), judgments, fines and amounts
paid in settlement, actually and reasonably incurred by Officer in connection
with any threatened, pending or completed action, claim, suit or proceeding,
whether civil, criminal, administrative or investigative (including an action by
or in the right of the Company) to which Officer is, was or at any time becomes
a party, or is threatened to be made a party, by reason of the fact that Officer
is, was or at any time (whether before or after the date of this Agreement)
becomes a director, officer, employee or agent of the Company, or is or was
serving or at any time serves at the request of the Company as a director,
officer, employee or agent of another corporation, partnership, joint venture,
trust or other enterprise.
<PAGE>
3. Limitations on Additional Indemnity.No indemnity pursuant to Section 2
---------------------------------------
hereof shall be paid by Company:
(a) Except to the extent the aggregate of losses to be indemnified
thereunder exceeds the amount of such losses for which the Officer is
indemnified pursuant to Section 1 hereof or pursuant to any insurance policies
or other comparable policies purchased and maintained by the Company;
(b) In respect to remuneration paid to Officer if it shall be finally
judicially adjudged that such remuneration was in violation of law;
(c) On account of any suit in which a judgment is rendered against
Officer for an accounting of profits made from the purchase or sale by Officer
of securities of the Company pursuant to the provisions of Section 16(b) of the
Securities Exchange Act of 1934, as amended or similar provisions of any state
or local statutory law;
(d) On account of Officer's conduct which is finally judicially
adjudged to have been knowingly fraudulent, deliberately dishonest or willful
misconduct;
(e) If it shall be finally judicially adjudged that such
indemnification is not lawful.
Reference in this Agreement to a matter being "finally judicially adjudged"
shall mean that there shall have been a final decision by a court having
jurisdiction in the matter, all appeals having been denied or not have been
taken and the time therefore to have expired.
4. Continuation of Indemnity. All agreements and obligations of
---------------------------
Company contained herein shall continue during the period Officer is a Corporate
Officer of Company and shall continue thereafter so long as Officer shall be
subject to any possible or threatened, pending or completed action or claim,
suit or proceeding, whether civil, criminal, administrative or investigative, by
reason of the fact that Officer was a Corporate Officer of the Company or was
serving in any other capacity referred to herein.
5. Notification and Defense of Claim. Promptly after receipt by
-------------------------------------
Officer of notice of the commencement of any action, claim, suit or proceeding
against [him] by reason of [his] status as a Corporate Officer of the Company or
any other capacity referenced herein, Officer will notify Company of the
commencement thereof; provided, however, that the omission to so notify Company
will not relieve Company from any liability which it may have to Officer under
this Agreement unless and only to the extent that Company's rights are actually
prejudiced by such failure. With respect to any such action, claim, suit or
proceeding as to which Officer notifies Company of the commencement thereof:
(a) Company will be entitled to participate therein at its own expense;
and,
(b) Except as otherwise provided below, to the extent that it may wish,
Company jointly with any other party will be entitled to assume the defense
thereof, with counsel satisfactory to Officer. After notice from Company to
Officer of its election to so assume the defense thereof, Company will not be
liable to Officer under this Agreement for any legal or other expenses
subsequently incurred by Officer in connection with the defense thereof unless
Officer shall have reasonably concluded that there may be a conflict of interest
between Company and Officer in the conduct of the defense of such action, in
which case, Company shall not be entitled to assume the defense of any action,
claim, suit or proceeding brought by or on behalf of Company;
(c) Company shall not be liable to indemnify Officer under this
Agreement for any amounts paid in settlement of any action or claim effected
without its written consent. Company shall not settle any action or claim in any
manner which would impose any penalty or limitation on Officer without Officer's
written consent. Neither Company nor Officer will unreasonably withhold their
consent to any proposed settlement.
6. Advancement and Repayment of Expenses.
-----------------------------------------
(a) To the extent that the Company assumes the defense of any action,
claim, suit or proceeding against Officer, Officer agrees that [he] will
reimburse Company for all reasonable expenses paid by Company in defending any
such action, claim, suit or proceeding against Officer in the event and only to
the extent that it shall be finally judicially adjudged that Officer is not
entitled to be indemnified by Company for such expenses under the provisions of
the Indemnification Statute, the Articles, this Agreement or otherwise.
(b) To the extent that the Company does not assume the defense of any
action, claim, suit or proceeding against Officer, Company shall advance to
Officer all reasonable expenses, including all reasonable attorneys' fees,
retainers, court costs, transcript costs, fees of experts, witness fees, travel
expenses, duplicating costs, printing and binding costs, telephone charges,
postage, delivery service fees, and all other disbursements or expenses of the
types customarily incurred in connection with defending, preparing to defend or
investigating any civil or criminal action, suit or proceeding, within twenty
days after the receipt by Company of a statement or statements from Officer
requesting such advance or advances, whether prior to or after final disposition
of such action, suit or proceeding. Such statement or statements shall
reasonably evidence the expenses incurred by Officer and shall include or be
preceded or accompanied by an undertaking by or on behalf of Officer to repay
all of such expenses advanced if it shall be finally judicially adjudged that
Officer is not entitled to be indemnified against such expenses. Any advances
and undertakings to repay pursuant to this paragraph shall be unsecured and
interest free.
<PAGE>
7. Enforcement.
-----------
(a) Company expressly confirms and agrees that it has entered into this
Agreement and assumed the obligations imposed on Company hereby in order to
induce Officer to continue to serve as a Corporate Officer of Company, and
acknowledges that Officer is relying upon this Agreement in continuing in such
capacity.
(b) In the event Officer is required to bring any action to enforce
rights or to collect moneys due under this Agreement and is successful in such
action, Company shall reimburse Officer for all of Officer's reasonable fees and
expenses in bringing and pursuing such action.
8. Separability. Each of the provisions of this Agreement is a
------------
separate and distinct agreement and independent of the others, so that if any
provision hereof shall be held to be invalid or unenforceable for any reason,
such invalidity or unenforceability shall not affect the validity or
enforceability of the other provisions hereof.
9. Governing Law; Binding Effect; Amendment and Termination.
--------------------------------------------------------------
(a) This Agreement shall be interpreted and enforced in accordance with
the laws of the State of Missouri.
(b) This Agreement shall be binding upon Officer and upon Company, its
successors and assigns, and shall inure to the benefit of Officer, his or her
heirs, personal representatives and assigns, and to the benefit of Company, its
successors and assigns.
(c) No amendment, modification, termination or cancellation of this
Agreement shall be effective unless signed in writing by both parties hereto.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on and
as of the day and year first above written.
ENERGIZER HOLDINGS, INC.
By:/s/ Harry L. Strachan, III
Harry L. Strachan, III
Vice President and General Counsel
OFFICER
By: /s/ Patrick C. Mannix
<PAGE>
INDEMNIFICATION AGREEMENT
-------------------------
INDEMNIFICATION AGREEMENT (the "Agreement") made this 1st day of
April, 2000, between ENERGIZER HOLDINGS, INC., a Missouri corporation
(the "Company") and ___________ ("Director").
WHEREAS, Director is a member of the Board of Directors of the Company, and
in such capacity is performing a valuable service for Company; and
WHEREAS, the Company's Articles of Incorporation (the "Articles") permit
the indemnification of directors, officers, employees and certain agents of the
Company, and indemnification is also authorized by Section 351.355 of the
Missouri Revised Statutes 1978, as amended to date (the "Indemnification
Statute"); and
WHEREAS, the Articles and the Indemnification Statute permit full
indemnification of officers absent knowingly fraudulent, deliberately dishonest
or willful misconduct; and
WHEREAS, in order to induce Director to continue to serve as a member of
the Board of Directors of the Company, Company has determined and agreed to
enter into this contract with Director;
NOW THEREFORE, in consideration of Director's continued service as a member
of the Board of Directors after the date hereof, the Company and Director agree
as follows:
1. Indemnity of Director. Company hereby agrees to hold harmless and
-----------------------
indemnify Director to the full extent authorized or permitted by the provisions
of the Indemnification Statute, or by any amendment thereof, or by any other
statutory provision authorizing or permitting such indemnification which is
adopted after the date hereof.
2. Additional Indemnity. Subject to the exclusions set forth in Section
--------------------
3 hereof, Company further agrees to hold harmless and indemnify Director against
any and all expenses (including attorneys' fees), judgments, fines and amounts
paid in settlement, actually and reasonably incurred by Director in connection
with any threatened, pending or completed action, claim, suit or proceeding,
whether civil, criminal, administrative or investigative (including an action by
or in the right of the Company) to which Director is, was or at any time becomes
a party, or is threatened to be made a party, by reason of the fact that
Director is, was or at any time (whether before or after the date of this
Agreement) becomes a director, officer, employee or agent of the Company, or is
or was serving or at any time serves at the request of the Company as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise.
<PAGE>
3. Limitations on Additional Indemnity.No indemnity pursuant to Section 2
---------------------------------------
hereof shall be paid by Company:
(a) Except to the extent the aggregate of losses to be indemnified
thereunder exceeds the amount of such losses for which the Director is
indemnified pursuant to Section 1 hereof or pursuant to any insurance policies
or other comparable policies purchased and maintained by the Company;
(b) In respect to remuneration paid to Director if it shall be finally
judicially adjudged that such remuneration was in violation of law;
(c) On account of any suit in which a judgment is rendered against
Officer for an accounting of profits made from the purchase or sale by Director
of securities of the Company pursuant to the provisions of Section 16(b) of the
Securities Exchange Act of 1934, as amended or similar provisions of any state
or local statutory law;
(d) On account of Director's conduct which is finally judicially
adjudged to have been knowingly fraudulent, deliberately dishonest or willful
misconduct;
(e) If it shall be finally judicially adjudged that such
indemnification is not lawful.
Reference in this Agreement to a matter being "finally judicially adjudged"
shall mean that there shall have been a final decision by a court having
jurisdiction in the matter, all appeals having been denied or not have been
taken and the time therefore to have expired.
4. Continuation of Indemnity. All agreements and obligations of
---------------------------
Company contained herein shall continue during the period Director is a member
of the Board of Directors of Company and shall continue thereafter so long as
Director shall be subject to any possible or threatened, pending or completed
action or claim, suit or proceeding, whether civil, criminal, administrative or
investigative, by reason of the fact that Director was a member of the Board of
Directors of the Company or was serving in any other capacity referred to
herein.
5. Notification and Defense of Claim. Promptly after receipt by
-------------------------------------
Director of notice of the commencement of any action, claim, suit or proceeding
against [him] by reason of [his] status as a Director of the Company or any
other capacity referenced herein, Director will notify Company of the
commencement thereof; provided, however, that the omission to so notify Company
will not relieve Company from any liability which it may have to Director under
this Agreement unless and only to the extent that Company's rights are actually
prejudiced by such failure. With respect to any such action, claim, suit or
proceeding as to which Director notifies Company of the commencement thereof:
(a) Company will be entitled to participate therein at its own expense;
and,
(b) Except as otherwise provided below, to the extent that it may wish,
Company jointly with any other party will be entitled to assume the defense
thereof, with counsel satisfactory to Director . After notice from Company to
Director of its election to so assume the defense thereof, Company will not be
liable to Director under this Agreement for any legal or other expenses
subsequently incurred by Director in connection with the defense thereof unless
Director shall have reasonably concluded that there may be a conflict of
interest between Company and Director in the conduct of the defense of such
action, in which case, Company shall not be entitled to assume the defense of
any action, claim, suit or proceeding brought by or on behalf of Company;
(c) Company shall not be liable to indemnify Director under this
Agreement for any amounts paid in settlement of any action or claim effected
without its written consent. Company shall not settle any action or claim in any
manner which would impose any penalty or limitation on Director without
Director's written consent. Neither Company nor Director will unreasonably
withhold their consent to any proposed settlement.
6. Advancement and Repayment of Expenses.
-----------------------------------------
(a) To the extent that the Company assumes the defense of any action,
claim, suit or proceeding against Director, Director agrees that [he] will
reimburse Company for all reasonable expenses paid by Company in defending any
such action, claim, suit or proceeding against Director in the event and only to
the extent that it shall be finally judicially adjudged that Director is not
entitled to be indemnified by Company for such expenses under the provisions of
the Indemnification Statute, the Articles, this Agreement or otherwise.
(b) To the extent that the Company does not assume the defense of any
action, claim, suit or proceeding against Director , Company shall advance to
Director all reasonable expenses, including all reasonable attorneys' fees,
retainers, court costs, transcript costs, fees of experts, witness fees, travel
expenses, duplicating costs, printing and binding costs, telephone charges,
postage, delivery service fees, and all other disbursements or expenses of the
types customarily incurred in connection with defending, preparing to defend or
investigating any civil or criminal action, suit or proceeding, within twenty
days after the receipt by Company of a statement or statements from Director
requesting such advance or advances, whether prior to or after final disposition
of such action, suit or proceeding. Such statement or statements shall
reasonably evidence the expenses incurred by Director and shall include or be
preceded or accompanied by an undertaking by or on behalf of Director to repay
all of such expenses advanced if it shall be finally judicially adjudged that
Director is not entitled to be indemnified against such expenses. Any advances
and undertakings to repay pursuant to this paragraph shall be unsecured and
interest free.
<PAGE>
7. Enforcement.
-----------
(a) Company expressly confirms and agrees that it has entered into this
Agreement and assumed the obligations imposed on Company hereby in order to
induce Director to continue to serve as a member of the Board of Directors of
Company, and acknowledges that Director is relying upon this Agreement in
continuing in such capacity.
(b) In the event Director is required to bring any action to enforce
rights or to collect moneys due under this Agreement and is successful in such
action, Company shall reimburse Director for all of Director's reasonable fees
and expenses in bringing and pursuing such action.
8. Separability. Each of the provisions of this Agreement is a
------------
separate and distinct agreement and independent of the others, so that if any
provision hereof shall be held to be invalid or unenforceable for any reason,
such invalidity or unenforceability shall not affect the validity or
enforceability of the other provisions hereof.
9. Governing Law; Binding Effect; Amendment and Termination.
--------------------------------------------------------------
(a) This Agreement shall be interpreted and enforced in accordance with
the laws of the State of Missouri.
(b) This Agreement shall be binding upon Director and upon Company, its
successors and assigns, and shall inure to the benefit of Director , his or her
heirs, personal representatives and assigns, and to the benefit of Company, its
successors and assigns.
(c) No amendment, modification, termination or cancellation of this
Agreement shall be effective unless signed in writing by both parties hereto.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on and
as of the day and year first above written.
ENERGIZER HOLDINGS, INC.
By: /s/Harry L. Strachan, III
DIRECTOR
By:_____________________________
Schedule of Recipients
1. Mr. Danforth
2. Mr. Garrison
3. Mr. Hoover
4. Mr. Liddy
5. Mr. Micheletto
6. Mr. Mulcahy
7. Mr. Pruzan
8. Mr. Stiritz
ENERGIZER HOLDINGS, INC.
EXECUTIVE SAVINGS INVESTMENT PLAN
I. DEFINITIONS
1.1 "Affiliated Company" means Energizer Holdings, Inc., those domestic
corporations in which Energizer Holdings, Inc. owns directly or indirectly more
than 50% of the voting stock, or any other entity so designed by the Committee.
1.2 "Board" means the Board of Directors of Energizer Holdings, Inc.
1.3 "Code" means the Internal Revenue Code of 1986, as amended.
1.4 "Committee" means the Committee appointed to administer the Plan, its
designee, or any successor to such Committee.
1.5 "Company" means Energizer Holdings, Inc.
1.6 "Compensation" means all or any part of any cash compensation and other
consideration due to an Employee for services rendered or to be rendered to the
Company or an Affiliated Company, as determined by the Committee.
1.7 "Disability" means a finding by the Committee of a Participant's
permanent and total disability.
1.8 "Employee" means a person employed by the Company or an Affiliated
Company and who is one of a select group of management or highly-compensated
employees.
1.9 "Entry Date" means the last day of any payroll period during which or
with respect to which an Employee, meeting the eligibility requirements of
Section 2.2 and 2.3, has his or her deferrals pursuant to the SIP limited by the
deferral limitations of ERISA.
1.10 "ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
1.11 "Participant" means an Employee who is deferring, or an Employee or
former Employee who has deferred, Compensation pursuant to Article III of the
Plan.
1.12 "Plan" means the Energizer Holdings, Inc. Executive Savings Investment
Plan, as amended from time to time.
1.13 "Retirement" means termination of Employment at or after age 55.
1.14 "SIP" means the Energizer Holdings, Inc. Savings Investment Plan, as
amended from time to time.
1.15 "Termination of Employment" means separation from employment with the
Company or an Affiliated Company for reasons other than death of the
Participant; provided, however, that a transfer in employment between the
Company or an Affiliated Company shall not be deemed a Termination of
Employment. For purposes of this Plan, the sale by the Company or an affiliate
of all or substantially all of the outstanding capital stock of the Company or
an Affiliated Company shall be deemed to be a Termination of Employment of
Participants employed by such Company or Affiliated Company.
1.16 "Valuation Date" means December 31 of each Year.
1.17 "Year" means a calendar year, unless otherwise specified.
II. ELIGIBILITY AND PARTICIPATION
2.1 Prior Participants. An Employee who was a Participant in the Ralston
-------------------
Purina Company Executive Savings Plan on March 31, 2000 shall continue his or
her status as a Participant.
2.2 Other Employees. An Employee who is entitled to Compensation shall be
----------------
eligible to elect to participate in the Plan during the period of time in which
the Employee:
(a) (1) is Chairman of the Board, Chief Executive Officer, President,
Vice President, Secretary or Treasurer of the Company; a Vice President of an
administrative or operating division of the Company; a Chairman of the Board,
Chief Executive Officer, President or Corporate Vice President of the Company or
an Affiliated Company, or
(2) is designated by the Chief Executive Officer of the Company as
eligible to participate in the Plan;
and
(b) has elected to defer Compensation as permitted under the terms of the
SIP.
2.3 Initial Enrollment. An Employee may first become a Participant upon an
-------------------
Entry Date if he or she has previously completed and submitted to the Employee
Benefits Committee an enrollment form, supplied by the Committee, by which an
Employee elects to defer a specified percentage of compensation in accordance
with Article III.
2.4 Annual Deferral Elections. A new election to defer compensation must be
-------------------------
submitted in December each Year to the Committee on forms provided by it in
order for a Participant to defer income pursuant to the Plan during the
following Year. Each deferral election is effective for an entire Year, and
cannot be increased or decreased during that period.
2.5 Cessation of Deferrals. A Participant who ceases to meet the
------------------------
eligibility requirements of Section 2.2(a) may no longer defer Compensation
--
pursuant to the Plan effective as of the first payroll period beginning after
such cessation of eligibility. Such Participant shall continue to be a
Participant in the Plan for all other purposes until distribution of his or her
account balance.
III. CONTRIBUTIONS
3.1 Deferrals into the Plan. A Participant whose deferrals into the SIP are
-----------------------
limited during a Year by the deferral limits imposed by ERISA and the Code
may defer a portion of such Participant's Compensation, in excess of that
permitted to be deferred pursuant to the SIP, on a before-tax basis into the
Plan. No after-tax deferrals are permitted under the Plan. If a Participant's
deferrals from a single payment of Compensation must be apportioned between the
SIP and the Plan, the deferral percentage applicable to the initial deferral
under the Plan shall be equal to the deferral percentage then in effect for the
SIP. Subsequent deferrals pursuant to the Plan shall be made at the deferral
percentage elected by the Participant for the Plan for that Year.
3.2 Basic Matched Contributions. Subject to Section 3.1, each Participant
-----------------------------
may defer receipt of a portion of his or her Compensation in any amount from 2%
to 6%, in 1% increments, for each payroll period in a Year beginning with that
payroll period in which the Participant exceeds the deferral limits in the SIP.
Such deferrals into the Plan shall be defined as Basic Matched
Contributions.
3.3 Basic Unmatched Contributions. Subject to Section 3.1, each Participant
-----------------------------
who has elected the maximum Basic Matched Contribution rate of 4% may defer
receipt of a portion of his or her Compensation by an additional 1% to 4%, in 1%
increments, for each payroll period in a calendar year beginning with that
payroll period in which the Participant exceeds the deferral limits in the SIP.
Such deferrals into the Plan shall be defined as Basic Unmatched Contributions.
3.4 Company Matching Contributions. With respect to each payroll period,
--------------------------------
the Company shall contribute on behalf of each Participant an amount equal to
25% of such Participant's Basic Matched Contributions. Such contributions shall
be defined as Company Matching Contributions.
3.5 Participants' Accounts.
-----------------------
(a) The Company shall establish a book reserve account for each Participant.
With respect to each payroll period, as appropriate, the Company shall credit to
a Participant's account his or her Basic Matched Contributions and Basic
Unmatched Contributions, and Company Matching Contributions in accordance with
Section 3.4.
(b) Each Participant's account balance shall be credited, effective as of
December 31 each Year, with annual earnings equal to the rate of earnings net of
expenses for that Year under the Fixed Income Fund of the SIP. Deferrals made
during a Year will be credited at the end of that first Year with a pro rata
share of annual earnings from the time of deferral.
(c) Each Participant shall be furnished annually a statement setting forth
the value of his or her account.
IV. VESTING OF CONTRIBUTIONS
4.1 Vesting of Basic Contributions. Each Participant shall be vested at all
------------------------------
times in amounts attributable to his or her Basic Matched Contributions,
Basic Unmatched Contributions, and any earnings thereon.
4.2 Vesting of Company Matching Contributions. A Participant shall be
---------------------------------------------
vested in the following manner in Company Matching Contributions made to such
Participant's account:
(a) at the rate of 25% for each whole year of employment with the Company as
recognized under the terms of the SIP; or
(b) 100% vested in the event of the occurrence of any one of the following:
(1) attainment of age 65
(2) Retirement
(3) Disability
(4) death
(5) termination of the Plan.
V. DISTRIBUTIONS
5.1 Time of Distribution to Participant. Amounts due to a Participant
---------------------------------------
including, to the extent it can be calculated and paid simultaneously with the
rest of the distribution, interest on such amounts, shall be paid on the 60th
day after such Participant's Retirement or other Termination of Employment. Any
interest accrued on such distribution that cannot be calculated at the time
of the initial distribution shall be paid as promptly thereafter as practicable.
Notwithstanding the foregoing, distributions to Participants found to be
Disabled shall be made on the 60th day following the determination of such
Disability. No distribution to a Participant shall be made upon termination of
the Plan until such Participant's Retirement, Termination of Employment or
Disability.
5.2 Distribution Upon Death. In the event of the Participant's death, all
-------------------------
amounts due to be distributed shall be paid to the Beneficiary designated by the
Participant in writing submitted to the Committee; but if none is
designated, then benefits shall be paid to the Participant's estate or as
provided by law. Changes in designation may be made by filing a written request
with the Committee. Distribution in full shall be paid on the 60th day
following the Participant's death. The Committee reserves the right to review
and approve Beneficiary designations.
5.3 Amount to be Distributed. At the appropriate time of distribution
---------------------------
described in Sections 5.1 or 5.2, the Company shall distribute the value of a
Participant's entire Basic Matched Contributions, Basic Unmatched Contributions
and the vested amount of such Participant's Company Matching Contributions.
Earnings on the vested portion of a Participant's account balance, calculated at
the interest rate applicable to the Valuation Date immediately preceding
the distribution, shall be credited to the Participant's account for the period
between the most recent Valuation Date and the date of distribution of the
principal account balance.
5.4 Form of Distribution. All amounts to be distributed from a
----------------------
Participant's account pursuant to this Article V shall be made in the form of
----
payment elected by the Participant. A Participant may elect to receive the
value of his account in a single lump payment, five annual installments or ten
annual installments. Provided, however, a Participant must have attained age 50
and elected to receive installments at least one year before such
installment payments commence.
5.5 Withdrawals and Loans.
-----------------------
(a) Loans are not permitted under the Plan.
(b) No withdrawals are permitted except that the Committee, in its sole and
absolute discretion, may permit withdrawals by a Participant of any vested
amount from such Participant's accounts if the Committee determines, in its
discretion, that such funds are needed due to serious and immediate financial
hardship from an unforeseeable emergency. Serious and immediate financial
hardship to the Participant must result from a sudden and unexpected illness or
accident of the Participant or a dependent, loss of property due to casualty, or
other similar extraordinary and unforeseeable circumstances arising from events
beyond the control of the Participant. A distribution based upon such financial
hardship cannot exceed the amount necessary to meet such immediate financial
need. In addition, the Committee may impose suspension of a Participant's
deferrals into the Plan or other penalties as a condition of such withdrawals.
VI. FORFEITURES
6.1 Time of Forfeiture. In the event of a Participant's Termination of
--------------------
Employment prior to the attainment of age 65, the unvested, if any, portion of
Company Matching Contributions allocated to such Participant's account, and any
earnings thereon, shall be forfeited as of the date of such Termination of
Employment.
6.2 Disposition of Forfeitures. All forfeitures arising out of the
----------------------------
application of the provisions of Section 6.1 shall be used to reduce Company
Matching Contributions otherwise payable to Participants' accounts under the
Plan.
VII. AMENDMENT AND ADMINISTRATION OF THE PLAN
7.1 Power to Amend. The power to amend, modify or terminate this Plan at
----------------
any time is reserved to the Committee; provided that, no amendment, modification
or termination may apply to or affect the terms of any deferral of
Compensation deferred prior to the effective date of such amendment,
modification or termination, without the consent of the Participant or
Beneficiary affected thereby.
7.2 Administration of the Plan. The Committee shall administer the Plan
-----------------------------
and, in connection therewith, shall have full power to designate types of
Compensation which may be deferred and upon which a Company Matching
Contribution may be calculated; to construe and interpret the Plan; to establish
rules and regulations; to delegate responsibilities to others to assist it
in administering the Plan or performing any responsibilities hereunder; and to
perform all other acts it believes reasonable and proper in connection with the
administration of the Plan.
VIII. MISCELLANEOUS
8.1 Company's Obligations Unfunded. All benefits due a Participant or
--------------------------------
Beneficiary under the Plan are unfunded and unsecured and are payable out of the
general funds of the Company. The Company, in its sole and absolute
discretion, may establish a grantor trust for the payment of benefits and
obligations hereunder, the assets of which shall be at all times subject to the
claims of creditors of the Company as provided for in such trust, provided that
such trust does not alter the characterization of the Plan as an unfunded plan
for purposes of ERISA. Such trust shall make distributions in accordance with
the terms of the Plan.
8.2 No Right to Continued Employment. Neither the establishment of the Plan
--------------------------------
nor the payment of any benefits thereunder nor any action of the Company,
its affiliates, the Board, or the Committee shall be held or construed to confer
upon any person any legal right to be continued in the employ of the Company or
an Affiliated Company.
8.3 Transferability of Benefits. The right to receive payment of benefits
-----------------------------
under this Plan shall not be transferred, assigned or pledged except by
beneficiary designation, will or pursuant to the laws of descent and
distribution.
8.4 Address of Participant or Beneficiary. A Participant shall keep the
-----------------------------------------
Committee apprised of the Participant's current address and that of any
Beneficiary at all times during participation in the Plan. At the death of a
Participant, a Beneficiary who is entitled to receive payment of benefits under
the Plan shall keep the Committee apprised of such Beneficiary's current address
until the entire amount to be distributed has been paid.
8.5 Taxes. Any taxes required to be withheld under applicable federal,
-----
state or local tax laws or regulations may be withheld from any payment due
hereunder.
8.6 Missouri Law to Govern. All questions pertaining to the interpretation,
----------------------
construction, administration, validity and effect of the provisions of the
Plan shall be determined in accordance with the laws of the State of Missouri.
8.7 Headings. Headings of Articles and Sections of the Plan are inserted
--------
for convenience of reference. They constitute no part of the Plan.
IN WITNESS WHEREOF, the Company has caused this Plan to be executed by a
duly authorized officer as of the _____ day of ______________________, 2000.
ENERGIZER HOLDINGS, INC.
By:
Title:
ENERGIZER HOLDINGS, INC.
EXECUTIVE HEALTH PLAN
I . DEFINITIONS
1.1 "Affiliated Company" means Energizer Holdings, Inc., those domestic
corporations in which Energizer Holdings, Inc. owns directly or indirectly more
than 50% of the voting stock, or any other entity so designed by the Committee.
1.2 "Committee" means the Committee appointed to administer the Plan, its
designee, or any successor to such Committee.
1.3 "Company" means Energizer Holdings, Inc.
1.4 "Covered expenses" are expenses incurred for medical, dental, vision
care services and supplies. This includes usual and customary charges in
conjunction with diagnosis, cure, mitigation or treatment of a sickness, injury
or preventative treatment associated with an illness. (A usual and customary
allowance is the fee most frequently charged for a similar service or supply in
a geographic area. The fees are updated on a regular basis to adjust for
changes.)
1.5 "Covered Individual" is an Employee or a dependent of an Employee
covered under this Plan.
1.6 A "dependent" of an Employee is eligible for coverage under this Plan
and is:
(a) A person defined in an Energizer Holdings, Inc. Health Maintenance
Organization ("HMO"), the Energizer Holdings, Inc. Comprehensive Health Plan,
Well-Med Plan, and CBC CIGNA Plan as a dependent of a covered Employee. This
includes the covered Employee's spouse and unmarried children under 19 years of
age. "Children" means the covered Employee's biological children, children who
have been legally adopted by the covered Employee or who have been placed with
the covered Employee for adoption, foster children, or stepchildren living in
the covered Employee's household, dependent upon the covered Employee for
principal support, and
(1) related to the covered Employee by blood or marriage,
(2) under the covered Employee's legal guardianship; or
(3) for whom the covered Employee has have a legal obligation for total or
partial support.
(b) A full-time, unmarried student who is a dependent of a covered Employee
regardless of age, provided the student is enrolled in an accredited educational
institution, and receives primary support from the covered Employee or from a
covered surviving spouse.
(c) A former spouse of a covered Employee provided the divorce decree became
final after April 1, 1977, and the former spouse was covered as a dependent
under this Plan prior to the divorce.
(d) A surviving spouse and dependents of a covered Employee who died on or
after July 21, 1988, and who at the time of death had a minimum of two years of
service with the Company.
1.7 "Employee" means a person employed by the Company or an Affiliated
Company and who is one of a select group of management or highly-compensated
employees.
1.8 "Family Unit" is the covered Employee and covered dependents.
1.9 "Plan" means the Energizer Holdings, Inc. Executive Health Plan.
1.10 "Retired Employee" is a Corporate Officer of the Company who retired
between January 1, 1979, and July 31, 1980, and who at the time of retirement
was not eligible for coverage under the Plan as a retired Employee, or an
Employee covered under this Plan who retired or terminated after age 55 with at
least two years of continuous service, or who was terminated involuntarily after
attaining a combination of age and years of service totaling at least 80, or who
is designated by the Chief Executive Officer of Energizer Holdings, Inc. as
eligible to participate in this Plan as a retiree.
II . ELIGIBILITY
Employees eligible for coverage under this Plan consists of:
(a) Principal Corporate Officers of Energizer Holdings, Inc. or an
Affiliated Company: Chairman of the Board, Chief Executive Officers, President,
any Vice President, Secretary, Treasurer; Chairmen of the Board, Chief Executive
Officers, Presidents and Corporate Vice Presidents of CBC, EBC, PTI and any
other controlled affiliates designated by the Benefits Policy Board;
(b) Vice Presidents of administrative or operating divisions of the
Company or an Affiliated Company; any other person designated by the Chief
Executive Officer of the Company;
(c) if presently employed by the Company or an Affiliated Company,
former Vice Presidents of administrative and operating divisions of the Company
or an Affiliated Company, and former Chairmen of the Board, Chief Executive
Officers, Presidents and Corporate Vice Presidents of a participating Affiliated
Company.
Employees described in (a), (b), or (c) above must participate in an
Energizer Holdings, Inc. HMO, the Energizer Holdings, Inc. Comprehensive Health
Plan or Well-Med Plan or, if a CBC executive, the CIGNA Plan as a prerequisite
for Plan participation.
In addition, individuals employed by a foreign affiliate of the Company or
an Affiliated Company who are not U.S. citizens and who are designated as
participants in this Plan must be covered by the available overseas health
coverage or an Energizer Holdings, Inc. HMO, the Energizer Holdings, Inc.
Comprehensive or Well-Med Plan as a prerequisite for Plan participation.
III . CONTRIBUTIONS
Active Employees are not required to pay contributions for their Plan
coverage or that of their dependents. However, they are required to pay
contributions for an Energizer Holdings, Inc. HMO, the Energizer Holdings, Inc.
Comprehensive, Well-Med and CIGNA coverage.
Retirees must contribute either the rate being charged for high option
retiree coverage under an Energizer Holdings, Inc. HMO, the Energizer Holdings,
Inc. Comprehensive Health Plan High option, the rate for Well-Med, or the CIGNA
retiree coverage if they participate in the Plan but are ineligible to
participate in an Energizer Holdings, Inc. HMO, the Energizer Holdings, Inc.
Comprehensive Health Plan or CIGNA Plan. (Contact the Committee for current
rates.)
The surviving spouse of an executive who dies prior to retirement must pay
premiums equal to those being charged to active Employees participating in an
Energizer Holdings, Inc. HMO, the Energizer Holdings, Inc. Comprehensive Health
Plan, Well-Med Plan, or CIGNA Plan until the date on which the deceased
executive would have been 65 years old. A surviving dependent child who
continues to meet the eligibility requirements for this Plan is also subject to
those same contribution requirements.
IV . EFFECTIVE DATE OF COVERAGE
The coverage of an Employee and his/her eligible dependent(s) will become
effective on the Employee's entry or re-entry date into an eligible class.
V . BENEFITS PAYABLE
The benefits payable under this Plan are the covered expenses incurred for
medical, dental and vision care expenses defined in Section 213(e) of the
Internal Revenue Code of 1986, as amended and in Internal Revenue Service
Regulation 1.213-1 as amended.
Examples of expenses which may be considered covered expenses are expenses
incurred for the following medical, dental or vision care, services and
supplies:
Ambulance Artificial limbs
Chiropodists Chiropractors
Crutches Diagnostic services
Doctors Hospital Care - room and board
Laboratory services Prescription drugs
Nurses - services rendered by a Registered Nurse, Licensed Practical Nurse,
or a Practical Nurse if an RN or LPN is not available (including nurses' room
and board paid by the Employee)
Osteopaths Physicians
Podiatrists Psychiatrists
Special medical equipment Surgeons
Special food or beverages prescribed for the treatment of an illness
Therapy
Eye care X-ray services
Guide dogs for the blind and deaf Dental care
Transportation expenses for medical care Psychologists
Claims for expenses incurred in making a capital expenditure or improvement
to real estate must be approved by the Company in advance of such expenditure.
VI . MAXIMUM BENEFIT FOR AN ACTIVE EMPLOYEE'S FAMILY UNIT
6.1 The maximum calendar-year benefit payable to an active Employee, his/her
spouse and his/her dependents from the Plan is $50,000 for the family unit
as a whole. The maximum calendar-year benefit payable to his/her divorced
spouse and his/her dependents from the Plan is $25,000 for the family unit as a
whole.
6.2 A surviving spouse and/or dependents of an active executive who meet the
criteria under Section (I)(C)(4) will be entitled to coverage limits equal to
those provided in an Energizer Holdings, Inc. HMO, the Energizer Holdings, Inc.
Comprehensive Health Plan, Well-Med Plan, or CIGNA Plan in addition to the
annual maximum coverage limits affected in this Plan.
VII . MAXIMUM BENEFIT FOR A RETIRED EMPLOYEE'S FAMILY UNIT
7.1 The maximum calendar-year benefit payable to a retired Employee and
his/her surviving dependents is $50,000 for the family unit as a whole. This
maximum calendar-year benefit is in addition to the $750,000 lifetime maximum
from the underlying coverage of an Energizer Holdings, Inc. HMO, the Energizer
Holdings, Inc. Comprehensive Health Plan or Well-Med Plan for retirees and the
lifetime maximum for CIGNA retiree coverage. Executives who are eligible for an
Energizer Holdings, Inc. HMO, the Energizer Holdings, Inc. Comprehensive
Health Plan, Well-Med Plan, or CIGNA Plan retiree coverage must participate in
order to receive retiree benefits from the Plan. They must enroll in either the
High option or Well Med option coverage; they cannot enroll for Low Option.
7.2 A retiree who is ineligible for an Energizer Holdings, Inc. HMO, the
Energizer Holdings, Inc. Comprehensive Health Plan, Well-Med Plan or CIGNA Plan
but who participates in this Plan, is eligible for a $1,000,000 lifetime benefit
for all covered medical expenses. However, such a retiree is not eligible for
the $50,000 calendar-year benefit after the $1,000,000 lifetime maximum has been
exhausted. A $25,000 maximum calendar-year benefit will be payable to his/her
divorced spouse(s) or dependent(s) other than a surviving spouse.
7.3 Individuals who retire from a foreign affiliate of the Company or an
Affiliated Company who are not U.S. citizens are not eligible for retiree health
under this Plan.
VIII . EXCEPTIONS
Benefits will not be payable under this Plan for expenses incurred for or
in connection with:
8.1 Medical care, services and supplies for which no charge is made or for
which the covered individual is not, in the absence of this coverage, legally
obligated to pay.
8.2 Medical care, services and supplies which are furnished by a hospital or
facility operated by or at the direction of the U.S. Government or any
authorized agency thereof, or furnished at the expense of such Government or
Agency, or by a doctor employed by such a hospital or facility, unless (1) the
treatment is of an emergency nature, and (2) the insured individual is not
entitled to such treatment without charge by reason of status as a veteran or
otherwise.
8.3 Medical care, services or supplies to the extent that they are paid for,
payable or furnished (1) pursuant to any plan or program administered by a
National Government or Agency thereof or with funds received from taxation or
contributions collected pursuant to legislation by a National Government, or (2)
pursuant to any State Cash Sickness law or laws of a similar character,
including any group insurance policy approved under such a law.
8.4 Blood or blood plasma for which the hospital or other supplier makes a
refund or allowance to or on behalf of the covered individual either as a result
of the operation of a group blood bank or otherwise, but only to the extent of
the refund or allowance.
8.5 Sickness covered by Workers' Compensation law, occupational disease law,
or laws of similar character, or injury arising out of or in the course of any
occupation or employment for compensation, profit or gain.
8.6 Charges resulting from an injury, sickness, or pregnancy for which a
covered individual received any medical care or services within the three month
period immediately before becoming covered under this Plan until the earlier of:
(a) the end of a period of 12 consecutive months during which the covered
individual has not received in connection with such injury, sickness, or
condition any medical, surgical, hospital or nursing services or treatment of
any kind or any drugs or medicine lawfully obtainable only upon prescription of
a doctor; or
(b) the end of a period of 12 consecutive months during which the covered
individual has been continuously covered under this Plan.
The following charges shall not be subject to this exception F:
(1) charges for professional services and supplies related to care and
treatment of teeth or nerves connected to teeth, and
(2) charges incurred by an individual who was covered under an Energizer
Holdings, Inc. HMO, the Energizer Holdings, Inc. Comprehensive Plan or Well-Med
Plan on the date immediately preceding the day his/her Plan coverage became
effective under this Plan, to the extent that the requirements of exception F
have been satisfied under an Energizer Holdings, Inc. HMO, the Energizer
Holdings, Inc. Comprehensive Health Plan or Well-Med Plan.
8.7 Medical care, services and supplies to the extent that they are paid for
or payable under an Energizer Holdings, Inc. HMO, the Energizer Holdings,
Inc. Comprehensive Health Plan, Well-Med Plan, or CIGNA Plan.
8.8 Use of a Christian Science Practitioner.
8.9 Insurance premiums for hospitalization, medical, dental or vision care;
or for pre-paid medical, dental or vision care. Included in this exclusion are
premiums paid for participation in an Energizer Holdings, Inc. HMO, the
Energizer Holdings, Inc. Comprehensive Health Plan, Well-Med Plan, or CIGNA Plan
as either an active Employee or retiree.
8.10 Expenses subject to the "At Risk" and "Under the Influence" copayment
provisions for the Executives who choose the Well-Med Plan.
IX . TERMINATION OF EMPLOYEE COVERAGE
The coverage of each Employee will terminate on the earlier of the
following dates:
9.1 The date the Employee ceases to be eligible for coverage.
9.2 The date of termination of this Plan.
X . COVERAGE OF RETIRED EMPLOYEES
The coverage of each Retired Employee will continue upon payment of the
required premiums after the Employee's termination if he or she is either:
10.1 age 55 with at least two years of service and leaves voluntarily or
involuntarily, or
10.2 has a combination of age and years of service totaling at least 80 and
leaves involuntarily, or
10.3 has CEO approval.
An Employee shall not be eligible for retiree health coverage under this
Plan if he or she terminates from the Company or an Affiliated Company by reason
of a divestiture, spinoff or other disposition of a subsidiary, division or
other business unit.
XI . TERMINATION OF DEPENDENT COVERAGE
The coverage of each dependent of an Employee terminates on the earliest of
the following dates:
11.1 The date the Employee's coverage terminates except as noted in
subsection C below for dependents of a deceased Employee.
11.2 The date a dependent ceases to qualify as eligible as defined in this
Plan; provided that a covered unmarried child who (1) before the date he ceases
to be eligible due to attaining age 19, becomes incapable of self-sustaining
employment by reason of mental or physical handicap, and (2) is dependent upon
the Employee for his principal support and maintenance, will not cease to
qualify solely because of attained age while that dependent remains
incapacitated and dependent provided initial proof of incapacity and dependency
status submitted to the Company or an Affiliated Company at its home office, not
more than 31 days after such dependent would cease to be eligible by reason of
attained age.
11.3 With respect to the coverage of a former spouse of an Employee, or a
surviving spouse, and surviving children of a deceased Employee who at the time
of death had a minimum of two years of service, upon the earliest of the
following: (1) the date a former spouse or surviving spouse remarries or dies,
or (2) the 65th birthday of the former spouse, or (3) the date a former spouse
becomes eligible for government-sponsored medical benefits. If a surviving
spouse dies while a child is covered under this Plan, the child will remain
eligible as long as he or she qualifies as a dependent.
The insurance of a former spouse will not terminate upon termination of
insurance of the Employee if at the time the divorce decree became final the
Employee was age 55 or over and had 20 years or more of service.
11.4 With respect to a dependent who is a full-time, unmarried student, the
earlier of (1) the end of a ninety-day period immediately following the date the
dependent ceases to be enrolled as a student, or (2) the date the dependent
becomes eligible under any other group medical plan or program.
XII . CONTINUATION OF HEALTH COVERAGE
(As required by the Consolidated Omnibus Budget Reconciliation Act of 1985
- - COBRA.) The Plan will allow continued health coverage for the covered
Employee and the Employee's eligible family members, under certain
circumstances.
WHEN DOES THE CONTINUATION PROVISION APPLY?
The continuation provision applies when a covered Employee or an eligible
family member experiences a situation - called a "qualifying event" - which
would normally result in the loss of health coverage under the health plan for
the covered Employee or the covered family member. In such a situation the
covered Employee may elect to continue his/her present coverage for a specified
period. Qualifying events include:
(a) the termination of the covered Employee's employment, either voluntary
or involuntary (unless the covered Employee is discharged for gross misconduct);
(b) a reduction in the covered Employee's work hours.
Also, the Employee's covered family members may continue their present
coverage for a specified period in the event of the Employee's:
(1) death,
(2) termination of employment (for reasons other than the Employee's gross
misconduct) or reduction in work hours,
(3) divorce,
(4) entitlement to Medicare, or
(5) dependent child's ceasing to meet the definition of an eligible
dependent under the health plan.
HOW MUCH DOES CONTINUED COVERAGE COST?
The Employee is required to pay the Plan's full cost of continued coverage
plus a 2% charge to cover the cost of administration. The Employee will be
asked to pay for the coverage in monthly installments and his/her first payment
must begin no later than 45 days after the date that he/she elects continued
coverage. The Committee, St. Louis, can provide the Employee with current cost
information.
CAN THE EMPLOYEE CONTINUE FULL HEALTH COVERAGE?
If the Employee chooses continued coverage the Employee and his/her covered
dependents will be entitled to the same coverage the Employee and his/her
covered dependents had the day prior to the qualifying event, and the Employee
or his/her covered dependents will not be asked to furnish a statement of
health. If the Employee or his/her dependents do not choose continued coverage,
Plan coverage will end for the applicable participant on the day the qualifying
event occurred.
HOW LONG IS COVERAGE CONTINUED?
Coverage may be continued for 18 months after the date of the qualifying
event in the case of termination of employment or reduction of hours, and 29 or
36 months for all other events listed. If a covered family member becomes
entitled to continued coverage because of termination of the Employee's
employment or reduction in the Employee's hours and a covered family member then
experiences another of the events which would entitle such person to continued
coverage, he or she may extend the 18-month continuation period to 36 months
from the date of the event that first made him or her eligible for continued
coverage. At the end of the 18-month or 36-month continuation period, the
Employee will be given the option to enroll in an individual conversion medical
plan provided by General American Life Insurance Company.
Coverage may be terminated earlier than the above dates for an individual:
(a) who becomes covered under another group health plan as an Employee or
otherwise, unless a pre-existing condition is not covered by the new plan;
(b) who becomes eligible for Medicare;
(c) who fails to make a required premium payment; or
(d) whose Company or an Affiliated Company ceases to provide a group health
plan.
The Employee must notify the Committee, St. Louis, upon the occurrence of
events (a) or (b) above.
WHAT IF THE EMPLOYEE BECOME ENTITLED TO MEDICARE?
If the Employee becomes entitled to Medicare, regardless of whether this
results in loss of the Employee's coverage under the Plan, the Employee's spouse
and dependents who are entitled to continued coverage are eligible for a
continuation period of not shorter that 36 months from the date the Employee
becomes entitled to Medicare. This continuation period is measured from the
time the Employee is entitled to Medicare, not from the time his/her spouse and
dependent loses coverage. The total continuation period for the Employee's
spouse and dependents may actually exceed 36 months, depending on when the
Employee becomes entitled to Medicare.
ARE THERE ANY OTHER SITUATIONS THAT WOULD ALLOW FOR EXTENDED COVERAGE?
If the Employee, his/her spouse or dependents lose coverage because of
termination of the Employee's employment or reduction of hours and if the
Employee or a dependent as determined under Title II or XVI of the Social
Security Act to have been disabled at that time, then the disabled person may
extend the continued coverage period for 11 additional months, provided:
A notice of a Social Security determination is given to the Plan
Administrator before the end of the initial 18-month period and within 60 days
after the date of such determination.
The Plan may require payments of up to 150 percent of the applicable cost
for providing the coverage for these 11 additional months.
NOTE: The Plan provides for continued coverage for up to 29 months if a
----
participant becomes disabled, as defined in the Plan.
WHAT MUST I DO TO OBTAIN CONTINUED COVERAGE?
Both the Employee and the Company or the Affiliated Company have
responsibilities when certain events occur which qualify the Employee for
continued coverage.
The Employee or the Employee's eligible family members must notify the
Committee immediately in the event of:
Divorce
Cessation of dependent child coverage
The Committee will notify any eligible family members who are affected by
the event of their right to elect continued coverage.
The Employee or the Employee's eligible family members will be notified of
the right to elect continued coverage within 14 days in the event of:
Termination of employment
Reduction in hours
The Employee's death
The Employee's entitlement to Medicare
The Employee or the Employee's eligible family members will have a 60-day
period during which continued coverage may be elected. The 60-day period begins
on the later of (1) the date the Employee's coverage terminates by reason of the
qualifying event, or (2) the date the Employee or the Employee's eligible family
members were notified of the right to elect continued coverage. Please note:
The Employee is not eligible for continuation of coverage if the Employee
remains covered by another group health plan upon termination of coverage in the
Plan.
ADDITIONAL INFORMATION
If the Employee has any questions or need further information about the
continued coverage provision he/she should contact COBRA Administrator,
Committee, St. Louis, MO 63164.
Also, if the Employee has changed marital status, or if the Employee or
his/her spouse has a change of address, the Committee should be notified.
XIII . EXTENDED MEDICAL BENEFIT ON TERMINATION OF COVERAGE
If an individual is disabled on the date his/her coverage under the Plan is
terminated for any reason, benefits will be payable subject to the applicable
maximum and other provisions and exceptions of the Plan for covered expenses
incurred as a result of the injury or sickness causing such disability provided
that:
13.1 In no event shall benefits be payable for charges for health care,
services or supplies rendered or received more than 24 months after the date
such termination occurs.
13.2 He/she remains continuously disabled from the same cause until the date
the health care, service or supply is rendered or received.
13.3 He/she does not become covered under any other group policy or plan,
including any group basis service or prepayment plan, which entitles him/her to
receive benefits for the injury or sickness causing the disability.
XIV . TAX CONSEQUENCES
Benefits provided under this Plan are not taxable as ordinary income under
current tax laws.
Please note that the tax laws change frequently. The Employee will be
advised if a tax law change has any effect on the Employee's Plan coverage.
XV . MODIFICATION, TERMINATION OF COVERAGE
The Company may amend the provisions or terminate the Plan at any time,
subject to the following restrictions:
15.1 The nature and scope of coverage for any actively employed executive
covered by this Plan will not be reduced or terminated unless coverage is
reduced or terminated for the entire class of covered executives.
15.2 The nature and scope of coverage for retired executives and their
dependents covered by this Plan will not be changed to their detriment unless
mandated by law.
15.3 The Company reserves the right to assign its rights and obligations
under this Plan to a third party.
XVI . FILING A CLAIM
Claim forms for the Plan should be submitted along with itemized bills to
the Committee, St. Louis. The Committee will honor an assignment to the
treating physician, hospital, etc., of all benefits paid through an Energizer
Holdings, Inc. HMO, the Energizer Holdings, Inc. Comprehensive Health Plan,
Well-Med Plan, or CIGNA Plan but all payments made through the Plan will be to
the Employee.
IN WITNESS WHEREOF, the Company has caused this Plan to be executed by a
duly authorized officer as of the _____ day of ______________________, 2000.
ENERGIZER HOLDINGS, INC.
By:
Title:
ENERGIZER HOLDINGS, INC.
EXECUTIVE LONG TERM DISABILITY PLAN
I. DEFINITIONS
1.1 "Affiliated Company" means Energizer Holdings, Inc., those domestic
corporations in which Energizer Holdings, Inc. owns directly or indirectly more
than 50% of the voting stock, or any other entity so designed by the Committee.
1.2 "Benefit Earnings" means the categories of compensation as set forth in
Exhibit A.
1.3 "Board" means the Board of Directors of Energizer Holdings, Inc.
1.4 "Code" means the Internal Revenue Code of 1986, as amended.
1.5 "Committee" means the Committee appointed to administer the Plan, its
designee, or any successor to such Committee.
1.6 "Company" means Energizer Holdings, Inc.
1.7 "Covered Employee" means an Employee who meets the requirements for
coverage under the Plan pursuant to Section 2.1.
1.8 "Disability" means a finding by the Committee of a Participant's
permanent and total disability.
1.9 "Employee" means a person employed by the Company or an Affiliated
Company and who is one of a select group of management or highly-compensated
employees.
1.10 "ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
1.11 "LTD Plan" means the Energizer Holdings, Inc. Long Term Disability
Plan, as amended from time to time.
1.12 "Maximum Benefit Limitation" means the maximum monthly benefit payable
pursuant to the LTD Plan taking into account any applicable reduction amount as
defined in such LTD Plan.
1.13 "Monthly Benefit Earnings" means a Covered Employee's Benefit Earnings
for a calendar year, divided by twelve months or by the number of months for
which such Benefit Earnings were credited if less than twelve.
1.14 "Plan" means the Energizer Holdings, Inc. Executive Long Term
Disability Plan, as amended from time to time.
II. ELIGIBILITY
2.1 Covered Employees. An Employee is eligible for coverage under this Plan
-----------------
if he or she:
(a) (1) is Chairman of the Board, Chief Executive Officer, President,
Vice President, Secretary or Treasurer of the Company or an Affiliated Company;
a Vice President of an administrative or operating division of the Company or an
Affiliated Company; a Chairman of the Board, Chief Executive Officer, President
or Corporate Vice President of the Company or an Affiliated Company or
(2) is designated by the Chief Executive officer of the Company as eligible
to participate in the Plan; and
(b) is enrolled as a participant in the LTD Plan.
2.2 Effective Date of Coverage. An Employee shall be deemed to be a Covered
--------------------------
Employee effective as of the date he or she first meets the requirements of
Section 2.1.
2.3 Termination of Coverage. An Employee ceases to be a Covered Employee on
-----------------------
the earlier of the following dates:
(a) The date the Employee ceases to meet the requirements of Section
2.1(a); or
(b) The date the Employee is no longer enrolled for coverage under the LTD
Plan. In the event the Employee reinstates coverage under the LTD Plan, and
such Employee continues to satisfy the eligibility requirements of Section
2.1(a), coverage under this Plan shall be reinstated simultaneously with
coverage under the LTD Plan.
III. CONTRIBUTIONS
No contributions shall be required of Covered Employees for coverage under
this Plan.
IV. DISABILITY BENEFITS
4.1 Amount and Form of Benefit.
------------------------------
(a) A Covered Employee who is deemed to be disabled pursuant to the terms
and conditions of the LTD Plan shall be entitled to receive a monthly benefit
from the Plan which shall be equal to 66-2/3 percent of the Employee's earnings
for the previous calendar year in excess of $160,000 or the amount specified in
Code section 401(a)(17) as adjusted in accordance with Code section
401(a)(17)(B), for any calendar year.
(b) Benefits shall be payable to a disabled Covered Employee in monthly
installments on the first day of each month as benefits from the LTD Plan are
paid.
4.2 Termination of Benefit. Benefits shall be payable pursuant to this Plan
----------------------
for the period of time benefits are payable pursuant to the LTD Plan.
4.3 Benefit Upon Divestiture of a Business. In the event that the stock or
---------------------------------------
all or substantially all of the assets of the Company or an Affiliated Company
are sold to a purchaser ("Purchaser"), the Company reserves the right to
transfer to such Purchaser its obligations to pay disability benefits with
respect to any disabled Covered Employee who was employed by such Company or
Affiliated Company. Upon the assumption of such obligations by the Purchaser,
the Company shall guarantee the payment of such disability benefits in the event
that the Purchaser fails to pay benefits consistent with the obligations it
has assumed.
V. MISCELLANEOUS
5.1 Obligations Unfunded. All disability benefits due a disabled Covered
---------------------
Employee pursuant to the Plan are unfunded and unsecured and are payable out of
the general funds of the Company. The Company shall make no provision for the
funding or insuring of any benefits payable hereunder.
The Company may, in its sole and absolute discretion, establish a grantor
trust for the payment of benefits hereunder, the assets of which shall be at all
times subject to the claims of creditors of the Company, as provided for in such
trust, provided that such trust does not alter the characterization of the Plan
as an unfunded plan for purposes of ERISA. Such trust shall make distributions
in accordance with the terms of the Plan.
5.2 No Right to Continued Employment. Neither the establishment of the Plan
--------------------------------
nor the payment of any benefits thereunder nor any action of the Company or
an Affiliated Company shall be held or construed to confer upon any person any
legal right to be continued in the employ of the Company or an Affiliated
Company.
5.3 Power to Amend or Terminate. The Board of Directors of the Company and
----------------------------
the Committee are empowered to amend, modify or terminate this Plan at any time.
5.4 Transferability of Benefits. The right to receive payment of disability
---------------------------
benefits under this Plan shall not be transferred, assigned or pledged.
5.5 Anticipation of Benefits. A disabled Covered Employee shall have a
--------------------------
claim upon the Company or an Affiliated Company only to the extent of the
monthly payments, if any, due such Employee up to and including the then current
month, and the Covered Employee shall not have a claim against the Company
or an Affiliated Company for any subsequent monthly payment unless and until
such payments shall become due and payable.
5.6 Taxes. Disability benefits payable under the Plan are taxable to the
-----
Covered Employee. Any taxes required to be withheld under applicable federal,
state or local tax laws or regulations may be withheld from any payment due
hereunder.
5.7 Missouri Law to Govern. Except to the extent preempted by ERISA or
-------------------------
other federal law, all questions pertaining to the interpretation, construction,
administration, validity and effect of the provisions of the Plan shall be
determined in accordance with the laws of the State of Missouri.
5.8 Headings. Headings of Articles and sections of the Plan are inserted
--------
for convenience of reference, and constitute no part of the Plan.
IN WITNESS WHEREOF, the Company has caused this Plan to be executed by a
duly authorized officer as of the _____ day of ______________________, 2000.
ENERGIZER HOLDINGS, INC.
By:
Title:
<PAGE>
ENERGIZER HOLDINGS, INC.
EXECUTIVE LONG TERM DISABILITY PLAN
EXHIBIT A
ENERGIZER HOLDINGS, INC.
FINANCIAL PLANNING PLAN
I. DEFINITIONS
1.1 "Affiliated Company" means Energizer Holdings, Inc., those domestic
corporations in which Energizer Holdings, Inc. owns directly or indirectly more
than 50% of the voting stock, or any other entity so designed by the Committee.
"Board" means the Board of Directors of Energizer Holdings, Inc.
"Committee" means the Committee appointed to administer the Plan, its designee,
or any successor to such Committee.
"Company" means Energizer Holdings, Inc.
"Eligible Employee" means an Employee who meets the requirements for coverage
under Section 2.1 of the Plan.
"Employee" means a person employed by the Company or an Affiliated Company and
who is one of a select group of management or highly-compensated employees.
"Plan" means the Energizer Holdings, Inc. Financial Planning Plan.
1.8 "Plan Year" means the twelve consecutive month period ending on
December 31.
II. ELIGIBILITY
Eligible Employees. The class of Employees eligible for coverage under this
- -------------------
Plan consists of:
(a) Principal Corporate Officers of the Company and/or an Affiliated
Company;
(b) Vice Presidents of the administrative and operating divisions of the
Company and/or an Affiliated Company;
(c) Principal Officers of major affiliates of the Company or an Affiliated
Company; and
(d) non-officer executives authorized by the Committee.
Termination of Participation. An Eligible Employee shall cease participating in
- ----------------------------
the Plan as of the date the Eligible Employee terminates employment with the
Company and all Affiliated Companies. Provided, however, if an Eligible
Employee dies while actively employed, such Eligible Employee shall cease
participating in the Plan as of the one-year anniversary of the Eligible
Employee's death.
III. BENEFITS
Amount of Reimbursement. The Eligible Employee shall select the advisor or
- -------------------------
advisors to perform the services described in Section 3.2. The Company will
reimburse the Eligible Employee in an amount equal to 80% of the expenses
incurred by the Eligible Employee for the services performed in accordance with
Section 3.2. Eligible Employees shall submit requests for reimbursement to the
Committee.
The maximum amount that will be reimbursed for expenses performed in
accordance with Section 3.2 shall be as follows:
First Subsequent Maximum
Plan Year Plan Year Plan Year
Reimbursable Reimbursable Carryforward
Amount Amount Amount
------ ------ ------
Principal
Corporate Officers $8,000 $6,000 $6,000
Vice Presidents of $5,000 $4,000 $4,000
designated divisions
and subsidiaries
The Plan is administered on a Plan Year basis. Any qualifying bill for the
first Plan Year during which the Employee became an Eligible Employee may be
submitted for retroactive reimbursement up to the maximum first Plan Year
reimbursable amount.
The reimbursable amounts for the first two Plan Years can be combined and
paid out at any time during the first two Plan Years of eligibility, allowing
even greater flexibility in initiating a comprehensive individualized program
with potentially high "start-up" costs.
Beginning with the third Plan Year the Employee is an Eligible Employee,
his/her annual reimbursable limit or any portion thereof which might be unused
will be the maximum carryforward amount to be applied the Plan Year only.
If an Eligible Employee dies while an active Employee, the estate of the
Eligible Employee may be reimbursed for expenses incurred for the Covered
Services described below for the one-year period following the Eligible
Employee's death.
3.1 Reimbursable Expenses. An Eligible Employee shall be reimbursed for
----------------------
expenses incurred for the Covered Services described below:
Overall financial planning related to:
- - Investments
- - Cash flow and budgeting
- - Estate
- - Tax
- - Retirement
- - Insurance needs analysis
- - Educational funding
- - Company compensation and benefits
Preparation of legal documents:
- - Wills
- - Trusts
- - Tax Returns
Personal Computer Software Programs for:
- - Tax compliance
- - Cash flow and budgeting
- - Other topics related to overall financial planning or the preparation of
legal documents.
Excluded Services. An Eligible Employee shall not be reimbursed for expenses
- ------------------
incurred for the Excluded Services described below:
Financial service commissions such as broker's fees and mutual fund fees.
Fees related to the Eligible Employee's (or spouse's) "active" financial
interest or legal obligations in any outside business, except to the extent of
direct impact on the executive's tax returns.
Trust fees to banks or other financial institutions.
IV. TAX DEDUCTIBILITY AND WITHHOLDING
Reimbursements made under this Plan are taxable income to the Eligible
Employee and will be handled as such by the Company. Reimbursements are not
used in calculating benefit earnings for Company benefit plans.
V. AMENDMENT AND TERMINATION
The Board and the Committee are each empowered to amend, modify or
terminate this Plan at any time.
IN WITNESS WHEREOF, the Company has caused this Plan to be executed by a
duly authorized officer this _____ day of ______________________, 2000.
ENERGIZER HOLDINGS, INC.
By:
Title:
ENERGIZER HOLDINGS, INC.
EXECUTIVE GROUP PERSONAL EXCESS LIABILITY INSURANCE PLAN
I. DEFINITIONS
1.1 "Affiliated Company" means Energizer Holdings, Inc., those domestic
corporations in which Energizer Holdings, Inc. owns directly or indirectly more
than 50% of the voting stock, or any other entity so designed by the Committee.
1.2 "Board" means the Board of Directors of Energizer Holdings, Inc.
1.3 "Committee" means the Committee appointed to administer the Plan, its
designee, or any successor to such Committee.
1.4 "Company" means Energizer Holdings, Inc.
1.5 "Eligible Employee" means an Employee who meets the requirements for
coverage under the Plan pursuant to Section 3.1.
1.6 "Employee" means a person employed by the Company or an Affiliated
Company and who is one of a select group of management or highly-compensated
employees.
1.7 "Plan" means the Energizer Holdings, Inc. Executive Group Personal
Excess Liability Insurance Plan.
II. ELIGIBILITY
2.1 Eligible Employees. The class of Employees eligible for coverage under
--------------------
this Plan consists of:
(a) Principal Corporate Officers of the Company or an Affiliated
Company, Vice Presidents of the administrative and operating divisions of the
Company or an Affiliated Company,
(b) Chairmen of the Board, Chief Executive Officers, Presidents and
Corporate Vice Presidents of an Affiliated Company which are designated by the
Committee as eligible to participate in this Plan, and
(c) if presently employed by the Company or an Affiliated Company,
former Vice Presidents of administrative and operating divisions of the Company
or Affiliated Company, and former Chairmen of the Board, Chief Executive
Officers, Presidents and Corporate Vice Presidents of a participating Affiliated
Company.
2.2 Termination of Coverage. Services under this Plan will cease when the
--------------------------
Eligible Employee is no longer actively employed by the Company or Affiliated
Company.
III. BENEFITS
The personal excess liability coverage available under the Plan is set
forth in Exhibit A attached hereto.
IV. AMENDMENT AND TERMINATION
The Board and the Committee are each empowered to amend, modify or
terminate this Plan at any time.
IN WITNESS WHEREOF, the Company has caused this Plan to be executed by a
duly authorized officer as of the _____ day of ______________________, 2000.
ENERGIZER HOLDINGS, INC.
By:
Title:
<PAGE>
ENERGIZER HOLDINGS, INC.
EXECUTIVE GROUP PERSONAL EXCESS LIABILITY INSURANCE PLAN
EXHIBIT A
April 1, 2000
PERSONAL & CONFIDENTIAL
- -------------------------
GROUP PERSONAL EXCESS LIABILITY COVERAGE
----------------------------------------
The Company has purchased a Group Personal Excess Liability Insurance Policy
which, as a Corporate Officer or Vice President, provides you excess liability
coverage in the amount of $5,000,000 for liability claims associated with your
homes, vehicles, watercraft, or individuals so long as the covered damages are
in excess of underlying insurance coverage. (Minimums required if you
participate.)
As part of a comprehensive executive benefits plan the Company determined this
coverage was sufficiently important to provide "peace of mind" and allow
continued "job focus" in the event of a mishap and possible distracting personal
litigation.
Personal investments which are common, such as swimming pools, second homes,
boats, and the increased liability risks associated with them combined with the
general litigiousness in this country today support maintenance of the excess
coverage the Company is pleased to provide you. You will have imputed income
for this benefit value but the Company will provide a gross up so it will truly
be a no-cost benefit to you.
Please note enclosed:
1. SPECIMEN POLICY - defining the coverage
2. COVERAGE HIGHLIGHTS
3. UNDERLYING REQUIREMENTS - Coverages you must have with your primary
insurance prior to this "excess" taking effect.
4. Qs & As - Commonly asked questions and answers
5. INDIVIDUAL QUESTIONNAIRE
6. POLICY DOCUMENT
It would be to your advantage to review these materials thoroughly along with
your underlying policy coverages to determine their sufficiency or, in the case
of Personal Excess coverage you may now have - its redundancy.
Please return the questionnaire enclosed to:
The Committee
[Address]
[Address]
St. Louis, MO [Zip Code]
Phone: (314) _________________
Individual questions you may have can be addressed to the Committee at the phone
number above. You will be notified in advance of any significant changes to the
Energizer Group Personal Excess Liability Plan in which you are covered.
Sincerely,
[Name]
Vice President and
Director, Administration
<PAGE>
Group Personal Individual Questionnaire
---------------------------------------
Name: Primary Residence Address:
1. Number of residences owned or leased and occupied by you? ________
2. Number of residences owned and not occupied by you? ________
3. Number of licensed vehicles owned or leased by you, or a member of your
family living in a residence owned or leased by you? ________
4. How many family members are licensed drivers? (Include all dependents
and family members living in residences you own or lease.) ________
How many licensed drivers are under 25 years of age? ________
5. How many recreational vehicles do you own? (Non-licensed for road use,
such as snowmobiles, ATV's, golf carts, tractors) ________
6. How many watercraft do you own?
Under 26 feet or under 50 horsepower ________
26 feet or 50 horsepower or more ________
7. List all motor vehicle violations for all licensed drivers for the past
three years:
8. List all Liability Losses under your homeowners, personal automobile, or
---------
watercraft policies: (Within last three years)
<PAGE>
GROUP
PERSONAL EXCESS
LIABILITY POLICY
COVERAGE SUMMARY
Named and address of Insured
c/o ENERGIZER HOLDINGS, INC. Policy Number __________
[Address]
[Address] Issued by the stock insurance company indicated below, herein
called the Company.
(Per Endorsement)
ST. LOUIS, MISSOURI CHUBB CUSTOM INSURANCE COMPANY
Incorporated under the laws of Delaware, herein called the Company.
Sponsoring Organization and Address
CORPORATE OFFICERS, VICE PRESIDENTS OF THE ADMINISTRATIVE AND OPERATING DIVISION
OF ENERGIZER HOLDINGS, INC. (Per Endorsement) Producer Number 0052600
V. POLICY PERIOD
From: APRIL 1, 2000 To: APRIL 1, 2001
VI. PREMIUM
Amount
VII. LIMIT OF LIABILITY
5,000,000 Each Occurrence
1,000,000 Excess Uninsured Motorists Protection Each Occurrence
VIII. REQUIRED PRIMARY UNDERLYING INSURANCE
Personal Liability (Homeowners) for personal injury and property damage in the
minimum amount of 100,000 each occurrence.
Registered vehicles in the minimum amount of 250,000/500,000 bodily injury and
100,000 property damage; or 300,000 single limit each occurrence. Registered
vehicles include motorcycles and motorhomes.
Unregistered vehicles in the minimum amount of 100,000 bodily injury and
property damage each occurrence.
Watercraft less than 26 feet and 50 engine rated horsepower or less for bodily
injury and property damage in the minimum amount of 100,000 each occurrence.
Watercraft 26 feet or longer or more than 50 engine rated horsepower for bodily
injury and property damage in the minimum amount of 100,000 each occurrence.
Uninsured motorists protection in the minimum amount of 250,000/500,000 bodily
injury or 300,000 single limit occurrence.
FAILURE TO COMPLY WITH THE REQUIRED PRIMARY UNDERLYING INSURANCE WILL RESULT IN
A GAP IN COVERAGE.
<PAGE>
SCHEDULE OF FORMS
Policy Number: ____________________
Insured: c/o ENERGIZER HOLDINGS, INC.
(Per Endorsement)
Policy Period From: APRIL 1, 2000 to APRIL 1, 2001
The following is a schedule of forms issued with the policy at inception:
FORM NAME FORM NUMBER
- ---------- ------------
CONTRACT/POLICY TERMS __________ (__/__)
CCIC - SERVICE OF SUIT __________ (__/__)
MANUSCRIPT __________ (__/__)
MANUSCRIPT __________ (__/__)
MANUSCRIPT __________ (__/__)
<PAGE>
GROUP PERSONAL
EXCESS LIABILITY
POLICY
<PAGE>
GROUP PERSONAL EXCESS LIABILITY POLICY
--------------------------------------
INTRODUCTION
This is your Chubb Group Personal Excess Liability Policy. Together with your
Coverage Summary, it explains your coverages and other conditions of your
insurance in detail.
This policy is a contract between you and us. READ YOUR POLICY CAREFULLY and
keep it in a safe place.
AGREEMENT
We agree to provide the insurance described in this policy in return for the
premium paid by the Sponsoring Organization and your compliance with the policy
conditions.
DEFINITIONS
In this policy, we use words in their plain English meaning. Words with special
meanings are defined in the part of the policy where they are used. The few
defined terms used throughout the policy are defined here:
YOU means the individual who is a member of the Defined Group shown as the Named
Insured in the Coverage Summary.
WE and US mean the insurance company named in the Coverage Summary.
FAMILY MEMBER means your relative who lives with you, or any other person under
25 in your care or your relative's care who lives with you.
SPONSORING ORGANIZATION means the entity, corporation, partnership or sole
proprietorship sponsoring and defining the criteria for qualification as a Named
Insured.
POLICY means your entire Group Personal Excess Liability Policy, including the
Coverage Summary.
COVERAGE SUMMARY means the most recent Coverage Summary we issued to you,
including any subsequent coverage amendments.
OCCURRENCE means a loss or accident to which this insurance applies occurring
within the policy period. Continuous or repeated exposure to substantially the
same general conditions unless excluded is considered to be one occurrence.
BUSINESS means any employment, trade, occupation, profession, or farm operation
including the raising or care of animals.
DEFINED GROUP means those individuals meeting the criteria for qualification as
Named Insured as defined by the Sponsoring Organization and accepted by us.
GROUP PERSONAL EXCESS LIABILITY COVERAGE
This part of your Group Personal Excess Liability Policy provides you with
liability coverage in excess of your underlying insurance anywhere in the world
unless stated otherwise or an exclusion applies.
PAYMENT FOR A LOSS
AMOUNT OF COVERAGE
The amount of coverage for liability is shown in the Coverage Summary. We will
pay on your behalf up to that amount for covered damages from any one
occurrence, regardless of how many claims, homes, vehicles, watercraft, or
people are involved in the occurrence.
Any costs we pay for legal expenses (see Defense coverages) are in addition to
the amount of coverage.
UNDERLYING INSURANCE
We will pay only for covered damages in excess of all underlying insurance
covering those damages, even if the underlying coverage is for more than the
minimum amount.
"Underlying insurance" includes all liability coverage that applies to the
covered damages, except for other insurance purchased in excess of this policy.
- - any person or organization with respect to their legal responsibility for
acts or omissions of you or a family member; or
- - any combination of the above.
"Damages" means the sum that is paid or is payable to satisfy a claim settled by
us or resolved by judicial procedure or by a compromise we agree to in writing.
"Personal injury" means the following injuries, and resulting death:
- - bodily injury;
- - shock, mental anguish, or mental injury;
- - false arrest, false imprisonment, or wrongful detention;
- - wrongful entry or eviction;
- - malicious prosecution or humiliation; and
- - libel, slander, defamation of character, or invasion of privacy.
"Bodily injury" means physical bodily harm, including sickness or disease that
results from it, and required care, loss of services and resulting death.
"Property damage" means physical injury to or destruction of tangible property
and the resulting loss of its use. Tangible property includes the cost of
recreating or replacing stocks, bonds, deeds, mortgages, bank deposits, and
similar instruments, but does not include the value represented by such
instruments.
"Registered vehicle" means any motorized land vehicle not described in
"unregistered vehicle."
"Unregistered vehicle" means: any motorized land vehicle not designed for or
required to be registered for use on public roads; any motorized land vehicle
which is in dead storage at your residence; any motorized land vehicle used
solely on and to service your residence premises; or golf carts.
EXCESS UNINSURED MOTORISTS PROTECTION
This coverage is in effect only if excess uninsured motorists protection is
shown in the Coverage Summary.
We cover damages for bodily injury and property damage a covered person is
legally entitled to receive from the owner or operator of an uninsured motorized
land vehicle. We cover these damages in excess of the underlying insurance or
the Required Primary Underlying Insurance, whichever is greater, if they are
caused by an occurrence during the policy period, unless otherwise stated.
AMOUNT OF COVERAGE. The maximum amount of excess uninsured motorists protection
available for any one occurrence is the excess uninsured motorists protection
amount shown in the Coverage Summary regardless of the number of vehicles
covered by the Required Premium Underlying Insurance. We will not pay more than
this amount in any one occurrence for covered damages regardless of how many
claims, vehicles or people are involved in the occurrence.
This coverage will follow form.
UNINSURED MOTORISTS PROTECTION ARBITRATION
If we and a covered person disagree whether that person is legally entitled to
recover damages from the owner or operator of an uninsured motor vehicle, or do
not agree as to the amount of damages, either party may make a written demand
for arbitration. In this event, each party will select an arbitrator. The two
arbitrators will select a third. If they cannot agree on a third arbitrator
within 45 days, either may request that the arbitration be submitted to the
American Arbitration Association. When the covered person's recovery exceeds
the minimum limit specified in the applicable jurisdiction's financial
responsibility law, each party will pay the expenses it incurs, and bear the
expenses of the third arbitrator equally. Otherwise, we will bear all the
expenses of the arbitration.
Unless both parties agree otherwise, arbitration will take place in the county
and state in which the covered person lives. Local rules of law as to procedure
and evidence will apply. A decision agreed to by two arbitrators will be
binding unless the recovery amount for bodily injury exceeds the minimum limit
specified by the applicable jurisdiction's financial responsibility law. If the
amount exceeds that limit, either party may demand the right to a trial. This
demand must be made within 60 days of the arbitrator's decision. If this demand
is not made, the amount of damages agreed to by the arbitrators will be binding.
WORKERS' COMPENSATION OR DISABILITY. We do not cover any damages a covered
person is legally obligated to provide under any workers' compensation,
disability benefits, unemployment compensation or similar laws. But we do
provide coverage in excess over any other insurance for damages a covered person
is legally obligated to pay for bodily injury to a domestic employee of a
residence covered under the Required Primary Underlying Insurance which are not
compensable under workers' compensation, unless another exclusion applies.
DIRECTOR'S LIABILITY. We do not cover any damages for any covered person's
actions or failure to act as an officer or member of a board of directors of any
corporation or organization. This exclusion does not apply to a not-for-profit
corporation or organization, or to a condominium or cooperative association.
DAMAGE TO COVERED PERSON'S PROPERTY. We do not cover any person for property
damage to property owned by any covered person.
DAMAGE TO PROPERTY IN YOUR CARE. We do not cover any person for property damage
to property rented to, occupied by, used by, or in the care of any covered
person, to the extent that the covered person is required by contract to provide
insurance. But we do cover such damages for loss caused by fire, smoke, or
explosion unless another exclusion applies.
DISCRIMINATION. We do not cover any damages arising out of discrimination due
to age, race, color, sex, creed, national origin, or any other discrimination.
INTENTIONAL ACTS. We do not cover any damages arising out of an act intended by
a covered person to cause personal injury or property damage, even if the injury
or damage is of a different degree or type than actually intended or expected.
An intentional act is one whose consequences could have been foreseen by a
reasonable person. But we do cover such damages if the act was intended to
protect people or property unless another exclusion applies.
MOLESTATION, MISCONDUCT OR ABUSE. We do not cover any damages arising out of
any actual, alleged or threatened:
- - sexual molestation;
- - sexual misconduct or harassment; or
- - abuse.
NONPERMISSIVE USE. We do not cover any person who uses a motorized land vehicle
or watercraft without permission from you or a family member.
BUSINESS PURSUITS. We do not cover any damages arising out of a covered
person's business pursuits, investment or other for-profit activities, for the
account of a covered person or others, or business property except on a follow
form basis.
But we do cover damages arising out of volunteer work for an organized
charitable, religious or community group, an incidental business away from home,
incidental business at home, incidental business property, incidental farming,
or residence premises conditional business liability unless another exclusion
applies. We also cover damages arising out of your ownership, maintenance, or
use of a private passenger motor vehicle in business activities other than
selling, repairing, servicing, storing, parking, testing, or delivering
motorized land vehicles.
"Incidental business away from home" is a self-employed sales activity, or a
self-employed business activity normally undertaken by person under the age of
18 such as newspaper delivery, babysitting, caddying, and lawn care. Either of
these activities must:
- - not yield gross revenues in excess of $5,000 in any year;
- - have no employees subject to worker's compensation or other similar
disability laws;
- - conform to local, state, and federal laws.
"Incidental business at home" is a business activity, other than farming,
conducted on your residence premises which must:
- - not yield gross revenues in excess of $5,000 in any year, except for the
business activity of managing one's own personal investments;
- - have no employees subject to worker's compensation or other similar
disability laws;
- - conform to local, state, and federal laws.
ILLNESS. We do not cover personal injury or property damage resulting from any
illness, sickness or disease transmitted intentionally or unintentionally by a
covered person to anyone, or any consequence resulting from that illness,
sickness or disease. We also do not cover any damages for personal injury
resulting from the fear of contracting any illness, sickness or disease, or any
consequence resulting from the fear of contracting any illness, sickness or
disease.
PARENTAL LIABILITY. We do not cover any damages arising from parental liability
for the acts of a minor using a motorized land vehicle, watercraft 26 feet or
longer or with more than 50 engine rated horsepower, or aircraft. But we do
cover parental liability for the acts of a minor using a motorized land vehicle
or watercraft on a follow form basis for the type of motorized land vehicle or
watercraft involved, unless another exclusion applies.
ENTRUSTMENT. We do not cover any damages arising from the entrustment by any
covered person of a motorized land vehicle, watercraft 26 feet or longer or with
more than 50 engine rated horsepower, or aircraft to any person. But we do
cover entrustment by any covered person of a motorized land vehicle or
watercraft on a follow form basis for the type of motorized land vehicle or
watercraft involved, unless another exclusion applies.
NUCLEAR OR RADIATION HAZARD. We do not cover any damages caused directly or
indirectly by nuclear reaction, radiation, or radioactive contamination,
regardless of how is was caused.
NOTE: MISSING PAGE 8 OF 9 (SEE ORIGINAL)
<PAGE>
LIABILITY CONDITIONS
YOUR DUTIES AFTER A LOSS
In case of an accident or occurrence, the covered person shall perform the
following duties that apply:
NOTIFICATION. You must notify us or your agent or broker as soon as possible.
ASSISTANCE. You must provide us with all available information. This includes
any suit papers or other documents which help us in the event that we defend
you.
COOPERATION. You must cooperate with us fully in any legal defense. This may
include any association by us with the covered person in defense of a claim
reasonably likely to involve us.
APPEALS
If a covered person, or any primary insurer, does not appeal a judgment for
covered damages, we may choose to do so. We will then become responsible for
all expenses, taxable costs, and interest arising out of the appeal. However,
the amount of coverage for damages will not be increased.
SPECIAL CONDITIONS
In the event of conflict with any other conditions of your policy, these
conditions supersede.
LEGAL ACTION AGAINST US
You agree not to bring action against us unless you have first complied with all
conditions of this policy. If you have a loss, you agree not to bring any
action against us until the obligation has been determined by final judgment or
a written agreement by us.
NOTICE OF CANCELLATION AND COVERAGE TERMINATION CONDITIONS
YOUR CANCELLATION. The Sponsoring Organization may cancel this policy by
returning it to us or notifying us in writing at any time subject to the
following:
- - the Sponsoring Organization must notify us in advance of the requested
cancellation date; and
- - the Sponsoring Organization must provide proof of notification to each
member of the Defined Group covered under this policy.
OUR CANCELLATION. At our discretion we may cancel this policy by mailing to the
Sponsoring Organization at the address shown on the Coverage Summary upon ten
(10) days notice for non-payment of premium or thirty (30) days notice in all
other cases.
TERMINATION. Should an individual for any reason no longer qualify as a member
of the Defined Group, coverage will cease sixty (60) days from the date of such
termination, or the policy expiration or cancellation date, whichever comes
first.
REFUND. In the event of cancellation by the Sponsoring Organization or us, we
will refund any unearned premium on the effective date of cancellation, or as
soon as possible afterwards to the Sponsoring Organization. The unearned
premium will be computed short rate for the unexpired term of the policy.
In Witness Whereof, the company issuing this policy has caused this policy to be
signed by its authorized officers, but this policy shall not be valid unless
also signed by a duly authorized representative of the company.
CHUBB CUSTOM INSURANCE COMPANY
President Secretary
<PAGE>
ENDORSEMENT
Policy Period APRIL 1, 2000 to APRIL 1, 2001
Effective Date APRIL 01, 2000
Policy Number ____________________
Insured c/o ENERGIZER HOLDINGS, INC.
(Per Endorsement)
Name of Company CHUBB CUSTOM INSURANCE COMPANY
Date Issued APRIL 1, 2000
UNDER CONDITIONS, THE FOLLOWING CONDITION IS ADDED:
In the event we fail to pay any amount claimed to be due under this
insurance at your request we will submit to the jurisdiction of a court of
competent jurisdiction within the United States of America. Nothing in this
condition constitutes or should be understood to constitute a waiver of our
rights to commence an action in any court of competent jurisdiction in the
United States or to remove an action to a United States District Court or to
seek a transfer of a case to another court as permitted by the laws of the
United States or of any state in the United States.
Service of process in such suit may be made upon President, Chubb Custom
Insurance Company, 15 Mountain View Road, P.O. Box 1615, Warren, NJ 07061-1615,
or his/her nominee.
The above named is authorized and directed to accept service of process on
our behalf in any such suit and/or upon the request to give you a written
undertaking that we will enter a general appearance in the event such a suit
shall be instituted.
SERVICE
OF SUIT CONDITIONS In accordance with any statute of any state, territory or
district of the United States of America, which makes provision therefore, we
designate the Superintendent, Commissioner or Director of Insurance, Secretary
of State or other officer or officers specified for that purpose in the statute
or his or their successor or successors in office, as their true and lawful
attorney upon whom may be served any lawful process in any action, suit or
proceeding instituted by or on your behalf or the behalf of any beneficiary
arising out of this contract of insurance, and hereby designate President, Chubb
Custom Insurance Company or his/her nominee, as the person to whom the said
officer is authorized to mail such process or a true copy thereof.
All Other Terms And Conditions Remain Unchanged.
Authorized Representative
- --------------------------
Date
<PAGE>
GROUP EXCESS LIABILITY POLICY
ENDORSEMENT
Policy Period APRIL 1, 2000 to APRIL 1, 2001
Effective Date APRIL 01, 2000
Policy Number ___________________
Insured c/o ENERGIZER HOLDINGS, INC.
(Per Endorsement)
Name of Company CHUBB CUSTOM INSURANCE COMPANY
Date Issued APRIL 1, 2000
THIS POLICY IS SUBJECT TO THE FOLLOWING ENDORSEMENT
As respects to Uninsured and Underinsured Motorists coverage provided by this
policy, the Limit of Liability set forth on the Coverage Page, Form 10-02-0691
(Ed. 8-96), is limited to $1,000,000. Each Occurrence in Excess of the Required
Primary Underlying limits of $300,000.
It is understood and agreed that this limit is included within, not in addition
to, the policy limit as stated on the Coverage Page, Form 10-02-0691 (Ed. 8-96).
ALL OTHER TERMS AND CONDITIONS REMAIN UNCHANGED.
Authorized Representative
- --------------------------
<PAGE>
GROUP EXCESS LIABILITY POLICY
ENDORSEMENT
Policy Period APRIL 1, 2000 to APRIL 1, 2001
Effective Date APRIL 01, 2000
Policy Number ___________________
Insured c/o ENERGIZER HOLDINGS, INC.
(Per Endorsement)
Name of Company CHUBB CUSTOM INSURANCE COMPANY
Date Issued APRIL 01, 2000
THIS POLICY IS SUBJECT TO THE FOLLOWING ENDORSEMENT
It is hereby agreed that the Named Insured is amended to read:
Corporate Officers, Vice Presidents of the Administrative and Operating Division
of Energizer Holdings, Inc. and the Principle Corporate Officers of any other
controlled affiliate of Energizer Holdings, Inc. when officers are designated as
eligible to participate by the Co-Chief Executive Officers.
ALL OTHER TERMS AND CONDITIONS REMAIN UNCHANGED.
Authorized Representative
- --------------------------
<PAGE>
GROUP EXCESS LIABILITY POLICY
ENDORSEMENT
Policy Period APRIL 01, 2000 to APRIL 1, 2001
Effective Date APRIL 01, 2000
Policy Number ___________________
Insured c/o ENERGIZER HOLDINGS, INC.
(Per Endorsement)
Name of Company CHUBB CUSTOM INSURANCE COMPANY
Date Issued APRIL 1, 2000
THIS POLICY IS SUBJECT TO THE FOLLOWING ENDORSEMENT
The Termination Clause on page 9 of 9 of the Group Personal Excess Liability
contract (form 10-02-0691) is hereby amended to read as follows:
"Termination. Should an individual for any reason no longer qualify as a member
shown on the Schedule of Insureds endorsement, coverage will cease sixty (60)
days from the date of such termination, or the policy expiration or cancellation
date, whichever comes first."
ALL OTHER TERMS AND CONDITIONS REMAIN UNCHANGED.
Authorized Representative
- --------------------------
<PAGE>
GROUP PERSONAL EXCESS LIABILITY
COVERAGE HIGHLIGHTS
- - Worldwide Coverage Territory
- - Defense in addition to the limit
- - $1MM sublimit available for Excess Uninsured Motorists protection
- - Personal injury claims such as mental anguish; libel, slander, and
defamation of character
- - Incidental business pursuits with no employees not yielding revenues in
excess of $5,000
- - Incidental farming which does not produce more than $2,500 in gross annual
revenues
- - Supplemental payments - "all earnings lost by each covered person at our
request, up to $250 a day, to a total of $10,000
- - Termination - coverage will cease sixty (60) days from the date of such
termination, or policy expiration or cancellation date, whichever comes first
<PAGE>
GROUP PERSONAL EXCESS LIABILITY POLICY
The following are some frequently asked questions:
1. WHO IS INCLUDED WITHIN THE GROUP POLICY AS THE NAMED INSURED?
The named insured means the person shown as the named insured on the participant
-------------
list and that person's spouse and any relative related by blood, marriage or
adoption who is a resident of the same household. Any other person under the
age of 25 who is in their care, or a relative's care who lives with them.
2. WHAT IS THE LIMIT OF COVERAGE PROVIDED FOR EACH PARTICIPANT?
Each participant is covered for the limit selected. The limit applies
separately to each individual and is not subject to a policy aggregate. There
may be more than one limit available on the Group policy. For example, coverage
can be purchased for $5,000,000 and $10,000,000. Each participant would be
identified and premium paid for the coverage limit they selected. Defense costs
are outside the policy limit.
3. IS PERSONAL INJURY INCLUDED?
Yes. Personal Injury means: (a) Bodily injury, shock, mental anguish, mental
injury, sickness or disease, including death; (b) Injury because of false arrest
or imprisonment, malicious prosecution, wrongful entry or eviction, humiliation,
libel, slander, defamation of character or invasion of privacy.
4. WHAT IS EXCESS UNINSURED/UNDERINSURED MOTORISTS COVERAGE AND WHY IS IT SO
IMPORTANT?
Should you or a member of your family be involved in an accident with an
uninsured/underinsured driver, this coverage will reimburse you for the damages
you should have been able to collect from the other driver's insurance, i.e.:
loss of income/ future earnings, short term/long term medical expenses, pain and
suffering. Also, this coverage would respond if you or a family member were
injured by an uninsured/ underinsured driver as a pedestrian or in a "hit and
run" occurrence.
5. IS COVERAGE INCLUDED WHILE SERVING AS DIRECTOR OR OFFICER OF A NON-PROFIT
ORGANIZATION?
Yes. Coverage for personal injury or property damage claims arising from
activities as a Director or Officer of a non-profit organization, or to a
condominium or cooperative association.
6. ARE PROFESSIONAL AND BUSINESS ACTIVITIES INCLUDED?
Coverage is provided on a follow form basis (i.e., coverage is included in
primary homeowners, personal automotive policies), subject to the restrictions
set forth in the policy.
7. CAN THE POLICY BE CONVERTED TO A PERSONAL UMBRELLA POLICY IF THE
PARTICIPANT LEAVES THE FIRM (OTHER THAN RETIREMENT REASONS) OR IF THE GROUP
POLICY CEASES TO EXIST?
No. The policy is not convertible. The participant would have to replace
coverage through their personal insurance broker. The policy provides a grace
period for coverage to be terminated after 60 days.
8. CAN I KEEP MY CURRENT UMBRELLA POLICY IN EFFECT IF I PARTICIPATE IN THIS
PROGRAM?
Yes. The Group Umbrella limit would be in addition to your individual limit.
With the high limits and broad coverage available through the Group Personal
Excess Liability Policy, there should be no need to continue a separate Personal
Umbrella unless it is needed to comply with required underlying limits. Should
you decide to keep in place your Personal Umbrella Policy, we suggest that a
copy of your current Umbrella wording be reviewed to determine how it would
respond to a loss.
9. ARE MY CHILDREN WHO ARE AWAY AT COLLEGE COVERED UNDER MY PERSONAL EXCESS
LIABILITY POLICY?
Yes, as long as they maintain that your household is their primary residence
when not at college. Note: if they have their own insurance, their policy
should also be written with the required underlying limits or there will a
self-insured gap.
10. AM I INSURED FOR EXCESS AUTOMOBILE LIABILITY COVERAGE WHEN I RENT A CAR
FOR PERSONAL REASONS OR WHEN I AM ON VACATION ABROAD?
In most states, your primary Automobile policy will apply to rentals in the U.S.
- - check with your insurance agent. If it does not, you need to request the
maximum Automobile Liability limits available from the rental car company. This
would also apply to rentals abroad. A rental is considered a short term of 30
days or less. Anything over that time period would necessitate your purchasing
the required underlying auto limits of $250,000/$500,000 and $100,000 property
damage or $300,000 combined single limit. Note: There is no auto physical
damage (comprehensive or collision) provided by this policy.
11. WHAT ARE THE CONSEQUENCES IF I CAN'T OR DON'T OBTAIN THE REQUIRED
UNINSURED/UNDERINSURED MOTORISTS LIMITS OF $250,000/$500,000 AND $100,000
PROPERTY DAMAGE OR $300,000 COMBINED SINGLE LIMIT?
You will be self-insured (uninsured) for the gap between the
Uninsured/Underinsured Motorists limits you have on your primary auto policy and
the required underlying limits of $250,000/$500,000 and $100,000 property damage
or $300,000 combined single limit.
12. WHAT DO I DO IF I CANNOT GET THE REQUIRED LEVEL OF UNDERLYING COVERAGE
FOR UNINSURED/UNDERINSURED MOTORISTS?
Ask your insurance agent to find an insurance company that can provide the
required coverage. You can also purchase an Excess Liability policy, but make
sure it covers all family members in your household and all of your vehicles; it
must also provide uninsured/underinsured motorist coverage. Not all Excess
Liability policies include this coverage.
13. AM I COVERED FOR MY VACATION HOME THAT IS RENTED OUT?
The policy has a business pursuits exclusion; however, this exclusion does not
apply to a 1, 2, 3, or 4 family dwelling that you rent out as long as it is
insured under a personal comprehensive liability policy with a limit of at least
$100,000.
14. MY NEIGHBOR AND I JOINTLY OWN A VACATION HOME. AM I COVERED?
Yes. For your interests only, as long as the home is insured under a personal
comprehensive liability policy (not a commercial policy) with a limit of at
least $100,000 and you are a named insured on the policy. Your neighbor is not
covered under your policy.
15. MY CHILD, WHO IS A RESIDENT OF MY HOUSEHOLD, HAS A MINIBIKE/MOPED/GOLF
CART THAT IS NOT LICENSED FOR ROAD USE. AM I COVERED?
You should have Comprehensive Personal Liability coverage with a limit of
$100,000 (check your homeowner's policy; it may provide coverage for unlicensed
recreational vehicles).
16. I RACE MY BOAT ON THE WEEKENDS. AM I COVERED?
Yes, if you are racing a sailboat. However, coverage is not provided for any
car, motorcycle, recreational vehicle or other watercraft while practicing for
or taking part in a competitive race.
17. I OWN OR RENT AN AIRCRAFT AND PILOT IT AS A HOBBY. AM I COVERED?
No. Coverage is not provided for the ownership, maintenance, or use of any
aircraft. However, this does not apply to an aircraft chartered with a pilot
and crew by the insured.
ENERGIZER HOLDINGS, INC.
EXECUTIVE RETIREE LIFE PLAN
I. DEFINITIONS
1.1 "Affiliated Company" means Energizer Holdings, Inc., those domestic
corporations in which Energizer Holdings, Inc. owns directly or indirectly more
than 50% of the voting stock, or any other entity so designed by the Committee.
1.2 "Board" means the Board of Directors of Energizer Holdings, Inc.
1.3 "Committee" means the Committee appointed to administer the Plan, its
designee, or any successor to such Committee.
1.4 "Company" means Energizer Holdings, Inc.
1.5 "Employee" means a person employed by the Company or an Affiliated
Company and who is one of a select group of management or highly-compensated
employees.
1.6 "Group Life Insurance Plan" means the Energizer Holdings, Inc. Group
Life Insurance Plan.
1.7 "Plan" means the Energizer Holdings, Inc. Executive Group Personal
Excess Liability Insurance Plan.
ELIGIBILITY
An Employee is eligible for coverage under the Plan if he or she:
(a) is a Principal Corporate Officer of the Company or an Affiliated
Company; Vice President of the administrative or operating division of the
Company or an Affiliated Company; Chairman of the Board, Chief Executive
Officer, President or Corporate Vice President of the Company or an Affiliated
Company which are designated by the Committee as eligible to participate in the
Plan; and
(b) is enrolled as a participant in the Group Life Insurance Plan.
In addition, an Employee must be at least age fifty-five (55) and have
completed at least two years of service with the Company or an Affiliated
Company or have a combined age and years of service total of at least eighty
(80) to be eligible for coverage under the Plan. All such Employees must
terminate employment with the Company or an Affiliated Company on a voluntary
basis.
Individuals employed by a foreign affiliate of the Company or an Affiliated
Company who are not U.S. citizens and, except at the discretion of the Vice
President and Director of Administration, U.S. citizens employed by a foreign
affiliate of the Company or an Affiliated Company, are ineligible for coverage
under this Plan.
BENEFITS
If the Employee is enrolled in the Group Life Insurance Plan, the Company
will provide at Company expense an Executive Retiree Death Benefit equal to 50%
of the Employee's previous full year's benefit earnings at the time he/she
retires. Personal medical information will be required by the insurance company
in order to obtain this additional benefit, no executive will be denied
participation in the Plan.
The benefits payable under this Plan are taxable as ordinary income to the
beneficiary. However, the amount of actual payment will be increased to offset
the approximate tax consequences.
MODIFICATION, TERMINATION OF COVERAGE
The Company may amend the provisions or terminate the Plan at any time,
subject to the following restrictions:
The nature and scope of coverage for any actively employed executive
covered by this Plan will not be reduced or terminated unless coverage is
reduced or terminated for the entire class of covered executives.
The nature and scope of coverage for retired executives covered by this
Plan will not be changed to the detriment of the retired executives unless
mandated by law.
The Company reserves the right to assign its rights and obligations under
this Plan to a third party.
IN WITNESS WHEREOF, the Company has caused this Plan to be executed by a
duly authorized officer as of the _____ day of ______________________, 2000.
ENERGIZER HOLDINGS, INC.
By:
Title:
ENERGIZER HOLDINGS, INC.
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
I. DEFINITIONS
1.1 "Affiliated Company" means Energizer Holdings, Inc., those domestic
corporations in which Energizer Holdings, Inc. owns directly or indirectly more
than 50% of the voting stock, or any other entity so designed by the Committee.
1.2 "Beneficiary" means either a Surviving Spouse (as defined in the
Retirement Plan) or any other person (including a trust) designated pursuant to
the terms of the Retirement Plan to receive benefits under the terms of that
Plan as a result of an Employee's death.
1.3 "Benefit Limitations" means the limitations on benefit accruals
under the Retirement Plan set forth in Section 2.1.
1.4 "Code" means the Internal Revenue Code of 1986, as amended.
1.5 "Committee" means the Committee of the Board of Directors of
Energizer Holdings, Inc., its designee, or any successor to such Committee.
1.6 "Company" means Energizer Holdings, Inc.
1.7 "Compensation" means compensation included for purposes of
computation of benefits pursuant to the Retirement Plan.
1.8 "Employee" means a person employed by any of the Affiliated
Companies who is one of a select group of management or highly-compensated
employees.
1.9 "ERISA" means the Employee Retirement Income Security Act of 1974,
as amended.
1.10 "Plan" means the Energizer Holdings, Inc. Supplemental Executive
Retirement Plan.
1.11 "Retirement" means the effective date on which an Employee or such
Employee's Beneficiary begins to receive benefits pursuant to the Retirement
Plan.
1.12 "Retirement Plan" means the Energizer Holdings, Inc. Retirement
Plan or any successor plan.
1.13 "Section 415 Limitation" means the limitation, imposed by Section
415 of the Code, on the amount of retirement benefits payable from a qualified
retirement plan to a participant in such plan.
1.14 "Supplemental Retirement Benefits" means benefits payable pursuant
to Article III of the Plan.
1.15 "Surviving Spouse" means the spouse of an Employee who dies prior
to Retirement.
II. ELIGIBILITY
2.1 Benefit Limitations. Any Employee described in Section 2.2 shall
--------------------
be eligible to accrue Supplemental Retirement Benefits as described in Article
III in the event that such Employee's retirement benefits accrued pursuant to
the Retirement Plan are limited by the Section 415 Limitation and/or the
Compensation limitations imposed by Section 401(a) of the Code.
2.2 Eligible Employees. The following Employees shall be eligible to
-------------------
accrue Supplemental Retirement Benefits to the extent their benefits accrued
under the Retirement Plan are limited by the Benefit Limitations set forth in
Section 2.1 above:
(a) Principal Corporate Officers of the Company or an Affiliated Company:
Chief Executive Officer, President, any Vice President, Secretary, Treasurer;
(b) Chairmen of the Board, Chief Executive Officers, Presidents and
Corporate Vice Presidents of the Company and any Affiliated Companies designated
by the Chief Executive Officer of the Company;
(c) Vice Presidents of administrative or operating divisions of the Company
or an Affiliated Company;
(d) Any other Employee designated by the Chief Executive Officer of the
Company.
III. SUPPLEMENTAL RETIREMENT BENEFITS
3.1 Amount and Form of Employee's Benefit. Any Employee who meets the
--------------------------------------
eligibility requirements of Article II shall be entitled to receive a
Supplemental Retirement Benefit which shall be equal in value to the additional
benefit which such Employee would have received pursuant to the Retirement Plan
but for the Benefit Limitations.
Notwithstanding the form of benefit selected by the Employee to be paid from the
Retirement Plan, the amounts payable pursuant to this Section 3.1 shall be paid
in the form of a five-year certain annuity if the Employee is unmarried at the
time of commencement of payment, or in the form of a 50% contingent annuitant
benefit if the Employee is married at that time, such optional forms to be
calculated in a manner consistent with administration of the Retirement Plan;
except that an Employee may irrevocably elect, in the year prior to the year in
which such Employee first accrues a benefit under the Plan, to receive benefits
pursuant to this Section in a five-year certain annuity, ten-year certain
annuity, life annuity, 50% contingent annuitant benefit or 100% contingent
annuitant benefit.
In addition, if the Employee is enrolled in the Account Option Benefit as
defined under the Retirement Plan, such Employee may elect to receive his/her
benefit in a single lump-sum payment. Such Employee must elect this form of
payment at least one year prior to the date payments under this Plan begin.
Benefits shall be payable to an Employee in monthly installments on the
first day of each month following Retirement.
3.2 Beneficiaries. In the event of an eligible Employee's death, such
-------------
Employee's Beneficiary shall receive Supplemental Retirement Benefits equal in
amount to the additional monthly benefit which such Beneficiary would have
received from the Retirement Plan but for the Benefit Limitations applicable to
the Employee's accrued benefit.
3.3 Lump Sum Payments. In lieu of monthly installment payments
-------------------
described in Section 3.1 and 3.2, the Committee, at its sole discretion, may
pay, on the sixtieth (60th) day after Retirement or death of an Employee,
Supplemental Retirement Benefits in the form of a single lump-sum distribution
equal in amount to the present value of the right to receive such Supplemental
Retirement Benefits on a monthly basis, but only in the event that such monthly
benefit payment is less than $100. The present value shall be determined using
the discount rate and mortality assumptions utilized in the Retirement Plan to
determine the present value of lump-sum cash distributions permitted by Section
417 of the Code, as such rate may be determined or adjusted from time to time.
IV. ERISA BENEFIT LIMITATION
4.1 Obligations Unfunded. All benefits due an Employee or Beneficiary
---------------------
pursuant to the Plan are unfunded and unsecured and are payable out of the
general funds of the Company. The Company shall make no provision for the
funding or insuring of any benefits payable hereunder. In the event that the
Company shall decide to establish an advance accrual reserve on its books
against the future expense of payments made hereunder, such reserve shall not
under any circumstances be deemed to be an asset of the Plan, nor a source of
payment of any claims under the Plan but at all times shall remain a part of the
general assets of the Company, and shall be subject to the claims of its
creditors.
The Company may, in its sole and absolute discretion, establish a grantor trust
for the payment of benefits hereunder, the assets of which shall be at all times
subject to the claims of creditors of the Company, as provided for in such
trust, provided that such trust does not alter the characterization of the Plan
as an unfunded plan for purposes of ERISA. Such trust shall make distributions
in accordance with the terms of the Plan.
4.2 Excess Benefit Plan. The portion of the Plan relating to
---------------------
Supplemental Retirement Benefits payable on account of the Section 415
Limitations constitutes an excess benefit plan as defined in Section 3(36) of
ERISA.
4.3 No Right to Continued Employment. Neither the establishment of the
--------------------------------
Plan nor the payment of any benefits thereunder nor any action of the Affiliated
Companies shall be held or construed to confer upon any person any legal right
to be continued in the employ of any Affiliated Company.
4.4 Power to Amend or Terminate. The Board of Directors of the
-------------------------------
Company, the Committee and their delegees are each empowered to amend, modify or
terminate this Plan at any time, except that no amendment, modification or
termination may reduce or otherwise detrimentally affect benefits payable under
this Plan to an Employee or his Beneficiary without regard to such amendment
unless the Employee (or Beneficiary, if the Employee is deceased) consents to
such change.
4.5 Benefits Upon Divestiture or Other Disposition of Business. In the
----------------------------------------------------------
event that, as a result of a sale of stock or assets or another transaction by
which all or part of an Affiliated Company ceases to be an affiliate of the
Company, an Employee's employment with an Affiliated Company is terminated or
his employer is no longer an Affiliated Company, the Company reserves the right
to offset, against any Supplemental Retirement Benefits otherwise payable to
such Employee or his Beneficiary, retirement benefits payable to such Employee
or his Beneficiary from any pension or retirement plan of such purchaser, its
affiliate or successor ("Purchaser") after consummation of such sale to the
extent such benefits duplicate the benefits payable under this Plan. The
Company also reserves the right to assign its rights and obligations pursuant to
this Plan and, upon the assumption of such rights and obligations by a third
party, The Company shall guarantee the payment of such transferred obligations
in the event that the assignee fails to pay them.
4.6 Transferability of Benefits. The Employee's right to receive
-----------------------------
payment of benefits under this Plan shall not be transferred, assigned or
pledged except by beneficiary designation, by will or pursuant to the laws of
descent and distribution. A beneficiary designation form shall be effective
only when the form is received by the Company and shall cancel all beneficiary
designation forms of the Employee previously received by the Company.
4.7 Anticipation of Benefits. An Employee shall have a claim upon the
-------------------------
Company only to the extent of the monthly payments, if any, due such Employee up
to and including the then current month, and the Employee shall not have a claim
against the Company for any subsequent monthly payment unless and until such
payments shall become due and payable.
4.8 Taxes. Any taxes required to be withheld under applicable federal,
-----
state or local tax laws or regulations may be withheld from any payment due
hereunder.
4.9 Missouri Law to Govern. Except to the extent preempted by federal
-----------------------
law, all questions pertaining to the interpretation, construction,
administration, validity and effect of the provisions of the Plan shall be
determined in accordance with the laws of the State of Missouri.
4.10 Headings. Headings of Articles and Sections of the Plan are
--------
inserted for convenience of reference, and constitute no part of the Plan.
4.11 Gender. The use of masculine pronouns herein shall be deemed to
------
include both males and females.
IN WITNESS WHEREOF, the Company has caused this Plan to be executed by a
duly authorized officer as of the _____ day of ______________________, 2000.
ENERGIZER HOLDINGS, INC.
By: ____________________________________
Title: ____________________________________
Eveready Battery Company, Inc.
September 17, 1999
[Name]
Dear [Name]:
Due to your critical role in the spin-off process, you will be entitled to a
double bonus payment for the next fiscal year.
As you may know, bonus payments will be made in April and November of next year.
Should you remain on the payroll until January 15, 2001 you will receive an
additional retention bonus equal to the total of those two (2) payments. This
payment will be made no later than February 1, 2001. The January, 2001 payment
is not eligible for any deferred compensation plan.
For example: Bonus target of 45%
Salary of $100,000
Target met in March: Payment $22,500 in April, 2001
Target met in April-October: Payment $22,500 in November, 2000
Additional retention payment on or about January 15, 2001:$45,000
This plan has been limited to a small number of your peers, so please do not
discuss this plan with other associates.
Thank you in advance for making the new Energizer a success. This is one way to
say your efforts will be worthwhile.
/s/ J. Patrick Mulcahy
Schedule of Recipients
1. Mr. Klein
2. Mr. Rose
3. Mr. McClanathan
4. Mr. Conrad
5. Mr. Corbin
6. Mr. Strachan
7. Mr. Mannix
DEBT ASSIGNMENT, ASSUMPTION AND RELEASE AGREEMENT
THIS DEBT ASSIGNMENT, ASSUMPTION AND RELEASE AGREEMENT ("Agreement") is
dated effective as of April 1, 2000, by and among RALSTON PURINA COMPANY, a
Missouri corporation ("Ralston"), ENERGIZER HOLDINGS, INC., a Missouri
corporation ("Energizer") and BANK OF AMERICA, N.A. (the "Bank").
W I T N E S S E T H:
WHEREAS, Ralston is the borrower under that certain letter agreement dated
as of March 30, 2000 by and between Ralston and the Bank (such letter agreement,
as the same may be amended, restated supplemented or otherwise modified from
time to time, the "Bridge Agreement").
WHEREAS, Energizer is a wholly owned subsidiary of Ralston.
WHEREAS, effective April 1, 2000, Ralston will distribute all of the shares
of Energizer's capital stock to Ralston's shareholders, following which all of
Energizer's shares will be held by Ralston's shareholders (the "Spin-Off
Transaction").
WHEREAS, in connection with the consummation of the Spin-Off Transaction,
Ralston desires to assign to Energizer and Energizer desires to assume all of
the indebtedness, obligations and liabilities of Ralston under the Bridge
Agreement.
WHEREAS, the Bank has consented to the assignment by Ralston to Energizer
under and subject to the terms and conditions contained in this Agreement.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by the parties hereto Ralston,
Energizer and the Bank hereby agree as follows:
1. Assignment of Rights. As of the "Effective Date" (as defined in
----------------------
Section 8 below), Ralston hereby assigns all of its rights, duties and
-------
obligations under the Bridge Agreement to Energizer, all on the terms and
------
subject to the conditions set forth in the Bridge Agreement. Each of the
---
parties to this Agreement acknowledges and agrees that from and after the
---
Effective Date, Ralston shall cease to have any rights under the Bridge
---
Agreement as the "Borrower" thereunder and shall cease to be a party to the
---
Bridge Agreement or the other documents, instruments and agreements executed in
-
connection therewith. From and after the Effective Date, all references in the
Bridge Agreement to the "Borrower" shall mean and be a reference to Energizer.
2. Assumption of Obligations. As of the Effective Date, Energizer
---------------------------
hereby assumes, as its direct and primary obligation, all rights, duties and
obligations of Ralston under the Bridge Agreement, including, without limitation
the payment and performance obligations and all other liabilities and
obligations of Ralston under the Bridge Agreement consisting, among other
things, of the obligation to repay all loans made to Ralston prior to the
Effective Date under the Bridge Agreement, to pay interest and fees with respect
to all such liabilities and obligations, and indemnification obligations related
thereto (collectively the "Assumed Obligations") and hereby agrees to make all
payments required under Bridge Agreement as in effect from time to time and to
discharge the Assumed Obligations as they become due or are declared due. Each
of the parties hereto acknowledges that from and after the Effective Date,
Ralston has assigned to Energizer all of the rights of Ralston under the Bridge
Agreement, all on the terms and subject to the conditions set forth in the
Bridge Agreement. From and after the Effective Date, Energizer agrees to
perform and discharge all of the Assumed Obligations, including, without
limitation, performance and observance of all of the covenants and conditions of
the Bridge Agreement to be performed or observed by Ralston thereunder or in
connection therewith, and to be bound in all respects by the terms of the Bridge
Agreement as they relate to Ralston as if Energizer were an original signatory
thereto.
3. Release from Duties. In consideration of the assumption by
---------------------
Energizer, from and after the Effective Date, the Bank confirms that Ralston
shall be discharged from all of its duties and obligations as Borrower under the
Bridge Agreement and the other documents, instruments and agreements entered
into in connection therewith and that from and after the Effective Date, Ralston
shall have no further obligations or liabilities thereunder to the Bank.
4. Ralston Representations and Warranties. To induce Energizer and the
--------------------------------------
Bank to consent to Energizer's assumption of the Assumed Obligations and the
release of Ralston as set forth above, Ralston hereby represents and warrants to
the Bank that, as of the date hereof and as of the Effective Date:
(a) Ralston (i) is a corporation duly organized, validly existing and
in good standing under the laws of the jurisdiction of its organization; (ii) is
duly qualified to do business as a foreign corporation and is in good standing
under the laws of each jurisdiction in which failure to be so qualified and in
good standing will have or is reasonably likely to have a material adverse
effect on the business, condition (financial or otherwise), operations,
performance, properties or prospects of Ralston and its subsidiaries, taken as a
whole, and (iii) has all requisite corporate power and authority to enter into
the transactions contemplated by this Agreement.
(b) Ralston has the requisite corporate power and authority to execute,
deliver and perform its obligations under this Agreement.
(c) Ralston has taken all necessary corporate action to authorize the
execution and delivery of, and the performance of its obligations under, this
Agreement.
(d) This Agreement has been duly executed and delivered and
constitutes the legal, valid and binding obligation of Ralston enforceable
against Ralston in accordance with its terms (except as enforceability may be
limited by bankruptcy, insolvency, or similar laws affecting the enforcement of
creditors' rights generally and by general equitable principles, including
concepts of reasonableness, materiality, good faith and fair dealing and the
possible unavailability of specific performance, injunctive relief or other
equitable remedies (whether enforcement is sought in equity or at law)).
5. Energizer Representations and Warranties. To induce the Bank to
-------------------------------------------
enter into this Agreement and to induce the Bank to consent to Energizer's
assumption of the Assumed Obligations, Energizer hereby represents and warrants
to the Lenders and the Agents that, as of the date hereof and as of the
Effective Date:
(a) Energizer (i) is a corporation duly organized, validly existing and
in good standing under the laws of the jurisdiction of its organization; (ii) is
duly qualified to do business as a foreign corporation and is in good standing
under the laws of each jurisdiction in which failure to be so qualified and in
good standing will have or is reasonably likely to have a Material Adverse
Effect; and (iii) has all requisite corporate power and authority to own,
operate and encumber its property and to conduct its business as presently
conducted and as proposed to be conducted in connection with and following the
consummation of the transactions contemplated by this Agreement.
(b) Energizer has the requisite corporate power and authority to
execute, deliver and perform its obligations under this Agreement, and to
perform its obligations under the Bridge Agreement, and all other agreements,
instruments and documents executed and delivered or to be executed and delivered
by it pursuant hereto or in connection herewith.
(c) Energizer has taken all necessary corporate action to authorize the
execution and delivery of, and the performance of its obligations under, this
Agreement and all other agreements, instruments and documents executed and
delivered by Energizer pursuant hereto or in connection herewith.
(d) This Agreement and all other agreements, instruments or documents
executed and delivered by Energizer pursuant hereto or in connection herewith
have been duly executed and delivered and constitute the legal, valid and
binding obligations of Energizer enforceable against Energizer in accordance
with their terms (except as enforceability may be limited by bankruptcy,
insolvency, or similar laws affecting the enforcement of creditors' rights
generally and by general equitable principles, including concepts of
reasonableness, materiality, good faith and fair dealing and the possible
unavailability of specific performance, injunctive relief or other equitable
remedies (whether enforcement is sought in equity or at law)).
7. Further Assurances. Energizer hereby agrees to take such further
-------------------
action as may be reasonably requested by the Bank to effect the provisions of
this Agreement, including, without limitation, executing a supplement to the
Bridge Agreement and the documents, instruments and agreements executed in
connection therewith pursuant to which Energizer confirms that it has become a
party to the Bridge Agreement and other agreements as the "Borrower" thereunder
as though it was an original party thereto.
8. Effectiveness of this Agreement. Notwithstanding anything herein,
--------------------------------
in the Credit Agreements or any of the other documents, instruments and
agreements executed in connection therewith to the contrary, the assignment,
assumption and release set forth in Sections 1, 2 and 3 above shall not be
---------- - -
effective until each of the following have been satisfied:
This Agreement shall have been executed and delivered by each of the parties
hereto; and
The conditions precedent to the Debt Assumption Agreement (as defined in the
5-Year Credit Agreement) shall have been satisfied.
The date upon which all of the conditions to effectiveness shall have been met
is sometimes referred to herein as the "Effective Date."
9. Section Headings. The Section headings contained in this Agreement
-----------------
are for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
10. CHOICE OF LAW. THE BANK ACCEPTS THIS AGREEMENT AT DALLAS, TEXAS BY
-------------
ACKNOWLEDGING AND AGREEING TO IT THERE. ANY DISPUTE BETWEEN RALSTON, ENERGIZER
AND THE BANK ARISING OUT OF, CONNECTED WITH, RELATED TO, OR INCIDENTAL TO THE
RELATIONSHIP ESTABLISHED BETWEEN THEM IN CONNECTION WITH, THIS AGREEMENT OR ANY
OF THE OTHER LOAN DOCUMENTS, AND WHETHER ARISING IN CONTRACT, TORT, EQUITY, OR
OTHERWISE, SHALL BE RESOLVED IN ACCORDANCE WITH THE INTERNAL LAWS (WITHOUT
REGARD TO THE CONFLICTS OF LAWS PROVISIONS) OF THE STATE OF TEXAS.
11. CONSENT TO JURISDICTION; SERVICE OF PROCESS; JURY TRIAL.
--------------------------------------------------------------
(A) EXCLUSIVE JURISDICTION. EXCEPT AS PROVIDED IN SUBSECTION (B), EACH
----------------------
OF THE PARTIES HERETO AGREES THAT ALL DISPUTES AMONG THEM ARISING OUT OF,
CONNECTED WITH, RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED AMONG
THEM IN CONNECTION WITH, THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS
WHETHER ARISING IN CONTRACT, TORT, EQUITY, OR OTHERWISE, SHALL BE RESOLVED
EXCLUSIVELY BY STATE OR FEDERAL COURTS LOCATED IN DALLAS, TEXAS, BUT THE PARTIES
HERETO ACKNOWLEDGE THAT ANY APPEALS FROM THOSE COURTS MAY HAVE TO BE HEARD BY A
COURT LOCATED OUTSIDE OF DALLAS, TEXAS. EACH OF THE PARTIES HERETO WAIVES IN
ALL DISPUTES BROUGHT PURSUANT TO THIS SUBSECTION (A) ANY OBJECTION THAT IT MAY
HAVE TO THE LOCATION OF THE COURT CONSIDERING THE DISPUTE.
(B) OTHER JURISDICTIONS. RALSTON AND ENERGIZER AGREE THAT THE BANK
--------------------
SHALL HAVE THE RIGHT TO PROCEED AGAINST RALSTON OR ENERGIZER OR ITS PROPERTY IN
A COURT IN ANY LOCATION TO ENABLE SUCH PERSON TO (1) OBTAIN PERSONAL
JURISDICTION OVER RALSTON OR ENERGIZER OR (2) IN ORDER TO ENFORCE A JUDGMENT OR
OTHER COURT ORDER ENTERED IN FAVOR OF SUCH PERSON. EACH OF RALSTON AND
ENERGIZER AGREES THAT IT WILL NOT ASSERT ANY PERMISSIVE COUNTERCLAIMS IN ANY
PROCEEDING BROUGHT BY SUCH PERSON TO REALIZE ON ANY SECURITY FOR THE OBLIGATIONS
OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER IN FAVOR OF SUCH PERSON BUT SHALL
ONLY BE PERMITTED TO BRING ANY SUCH PERMISSIVE COUNTERCLAIM IN A PROCEEDING
BROUGHT PURSUANT TO CLAUSE (A). EACH OF RALSTON AND ENERGIZER WAIVES ANY
OBJECTION THAT IT MAY HAVE TO THE LOCATION OF THE COURT IN WHICH SUCH PERSON HAS
COMMENCED A PROCEEDING DESCRIBED IN THIS SUBSECTION (B).
(C) VENUE. EACH OF RALSTON AND ENERGIZER IRREVOCABLY WAIVES ANY
-----
OBJECTION (INCLUDING, WITHOUT LIMITATION, ANY OBJECTION OF THE LAYING OF VENUE
OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS) WHICH IT MAY NOW OR HEREAFTER
HAVE TO THE BRINGING OF ANY SUCH ACTION OR PROCEEDING WITH RESPECT TO THIS
AGREEMENT OR ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED
IN CONNECTION HEREWITH IN ANY JURISDICTION SET FORTH ABOVE.
(D) WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO IRREVOCABLY
-----------------------
WAIVES ANY RIGHT TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER
SOUNDING IN CONTRACT, TORT, OR OTHERWISE, ARISING OUT OF, CONNECTED WITH,
RELATED TO OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED AMONG THEM IN
CONNECTION WITH THIS AGREEMENT OR ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT
EXECUTED OR DELIVERED IN CONNECTION HEREWITH. EACH OF THE PARTIES HERETO AGREES
AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE
DECIDED BY COURT TRIAL WITHOUT A JURY AND THAT ANY PARTY HERETO MAY FILE AN
ORIGINAL COUNTERPART OR A COPY OF THIS AGREEMENT WITH ANY COURT AS WRITTEN
EVIDENCE OF THE CONSENT OF THE PARTIES HERETO TO THE WAIVER OF THEIR RIGHT TO
TRIAL BY JURY.
(E) ADVICE OF COUNSEL. EACH OF THE PARTIES REPRESENTS TO EACH OTHER
-------------------
PARTY HERETO THAT IT HAS DISCUSSED THIS AGREEMENT AND, SPECIFICALLY, THE
PROVISIONS OF SECTION 11 WITH ITS COUNSEL.
12. Severability. Any provision of this Agreement that is held to be
------------
inoperative, unenforceable, or invalid in any jurisdiction shall, as to that
jurisdiction, be inoperative, unenforceable, or invalid without affecting the
remaining provisions in that jurisdiction or the operation, enforceability, or
validity of that provision in any other jurisdiction, and to this end the
provisions of this Agreement are declared to be severable.
13. Counterparts. This Agreement may be executed in any number of
------------
counterparts, each of which shall be an original, but all of which shall
together constitute one and the same agreement.
14. Definitions. Capitalized terms not otherwise defined herein shall
-----------
have the meanings ascribed to them in the Bridge Agreement.
REMAINDER OF PAGE LEFT INTENTIONALLY BLANK
==========================================
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their proper and duly authorized officer as of
the day and year first set for above.
RALSTON PURINA COMPANY
By: /s/ James R. Elsesser
Name: James R. Elsesser
Title: Chief Financial Officer
ENERGIZER HOLDINGS, INC.
By: /s/ Daniel E. Corbin, Jr.
Name: Daniel E. Corbin, Jr.
Title: Executive Vice President,
Finance and Control
BANK OF AMERICA, N.A.,
By: /s/ Bank Of America, N.A.
Name:
Title:
EXECUTION COPY
364-DAY CREDIT AGREEMENT
Dated as of March 30, 2000
among
RALSTON PURINA COMPANY
as the initial Borrower
prior to the assignment to
and assumption by
ENERGIZER HOLDINGS, INC.
THE INSTITUTIONS FROM TIME TO TIME
PARTIES HERETO AS LENDERS
BANK ONE, NA,
AS ADMINISTRATIVE AGENT
BANK OF AMERICA, N.A.
AS SYNDICATION AGENT
AND
WACHOVIA BANK, N.A.
AS DOCUMENTATION AGENT
BANC ONE CAPITAL MARKETS, INC.,
as Lead Arranger and Sole Bookrunner
SIDLEY & AUSTIN
Bank One Plaza
10 South Dearborn Street
Chicago, Illinois 60603
<PAGE>
364-DAY CREDIT AGREEMENT
This 364-Day Revolving Credit Agreement dated as of March 30, 2000 is
entered into among RALSTON PURINA COMPANY, a Missouri corporation, the
institutions from time to time parties hereto as Lenders, whether by execution
of this Agreement or an Assignment Agreement pursuant to Section 13.3, and BANK
------------
ONE, NA, having its principal office in Chicago, Illinois, in its capacity as
Administrative Agent, BANK OF AMERICA, N.A., as Syndication Agent, and WACHOVIA
BANK, N.A., as Documentation Agent. The parties hereto agree as follows:
ARTICLE I: DEFINITIONS
- ----------- -----------
1.1 Certain Defined Terms. In addition to the terms defined above, the
-----------------------
following terms used in this Agreement shall have the following meanings,
applicable both to the singular and the plural forms of the terms defined.
As used in this Agreement:
"ACCOUNTING CHANGE" is defined in Section 10.9 hereof.
------------------ -------------
"ACQUISITION" means any transaction, or any series of related transactions,
-----------
consummated on or after the date of this Agreement, by which the Borrower or any
of its Subsidiaries (i) acquires any going business or all or substantially all
of the assets of any firm, corporation or division thereof, whether through
purchase of assets, merger or otherwise or (ii) directly or indirectly acquires
(in one transaction or as the most recent transaction in a series of
transactions) at least a majority (in number of votes) of the securities of a
corporation which have ordinary voting power for the election of directors
(other than securities having such power only by reason of the happening of a
contingency) or a majority (by percentage of voting power) of the outstanding
equity interests of another Person.
"ADJUSTMENT DATE" means each date on which the opening pro forma balance sheet
---------------- --- -----
of Energizer and its consolidated Subsidiaries, after giving effect to the
Spin-Off Transactions, is adjusted, which adjustments shall occur simultaneously
with the adjustments made pursuant to the Reorganization Agreement to verify the
calculation of the "Indebtedness" and "Cash Holdings" of Energizer and its
Affiliates thereunder.
"ADMINISTRATIVE AGENT" means Bank One in its capacity as contractual
---------------------
representative for itself and the Lenders pursuant to Article XI hereof and any
---------- ----------
successor Administrative Agent appointed pursuant to Article XI hereof.
-----------
"ADVANCE" means a borrowing hereunder consisting of the aggregate amount of the
-------
several Loans made by the Lenders to the Borrower of the same Type and, in the
case of Eurodollar Rate Advances, for the same Interest Period.
"AFFECTED LENDER" is defined in Section 2.19 hereof.
---------------- -------------
"AFFILIATE" of any Person means any other Person directly or indirectly
---------
controlling, controlled by or under common control with such Person. A Person
-------
shall be deemed to control another Person if the controlling Person is the
"beneficial owner" (as defined in Rule 13d-3 under the Securities Exchange Act
of 1934) of greater than ten percent (10%) or more of any class of voting
securities (or other voting interests) of the controlled Person or possesses,
directly or indirectly, the power to direct or cause the direction of the
management or policies of the controlled Person, whether through ownership of
Capital Stock, by contract or otherwise.
"AGGREGATE REVOLVING LOAN COMMITMENT" means the aggregate of the Revolving Loan
------------------------------------
Commitments of all the Lenders, as may be reduced from time to time pursuant to
the terms hereof. The initial Aggregate Revolving Loan Commitment is Two
Hundred Twenty-Five Million and 00/100 Dollars ($225,000,000.00).
"AGREEMENT" means this 364-Day Credit Agreement, as it may be amended, restated
---------
or otherwise modified and in effect from time to time.
"AGREEMENT ACCOUNTING PRINCIPLES" means generally accepted accounting principles
-------------------------------
as in effect in the United States from time to time, applied in a manner
consistent with that used in preparing the financial statements of Energizer
referred to in Section 6.7 hereof; provided, however, except as provided in
------------ -------- -------
Section 10.9, that with respect to the calculation of financial ratios and other
--------
financial tests required by this Agreement, "Agreement Accounting Principles"
means generally accepted accounting principles as in effect in the United States
as of the date of this Agreement, applied in a manner consistent with that used
in preparing the financial statements of Energizer referred to in Section 6.7
-----------
hereof.
"ALTERNATE BASE RATE" means, for any day, a fluctuating rate of interest per
---------------------
annum equal to the higher of (i) the Prime Rate for such day and (ii) the sum of
--
(a) the Federal Funds Effective Rate for such day and (b) one-half of one
percent (0.5%) per annum.
"APPLICABLE FACILITY FEE PERCENTAGE" means, as at any date of determination, the
----------------------------------
rate per annum then applicable in the determination of the amount payable under
Section 2.14(C)(i) hereof determined in accordance with the provisions of
- -------------------
Section 2.14(D)(ii) hereof.
- --------------------
"APPLICABLE MARGIN" means, as at any date of determination, the rate per annum
------------------
then applicable to Advances of any Type at such time, determined in accordance
with the provisions of Section 2.14(D)(ii) hereof.
--------------------
"ARRANGER" means Banc One Capital Markets, Inc., in its capacity as the lead
--------
arranger and sole bookrunner for the loan transaction evidenced by this
--
Agreement.
--
"ASSIGNMENT AGREEMENT" means an assignment and acceptance agreement entered into
--------------------
in connection with an assignment by a Lender pursuant to Section 13.3 hereof in
------------
substantially the form of Exhibit C.
----------
"ASSET SALE" means, with respect to any Person, the sale, lease, conveyance,
-----------
disposition or other transfer by such Person of any of its assets (including by
--
way of a sale-leaseback transaction, and including the sale or other transfer of
any of the Equity Interests of any Subsidiary of such Person) other than (i) the
sale of Inventory in the ordinary course of business and (ii) the sale or other
disposition of any obsolete manufacturing Equipment disposed of in the ordinary
course of business.
"AUTHORIZED OFFICER" means any of the President, any Vice President (including
-------------------
any Executive Vice President) or the Treasurer of the Borrower, acting singly.
"BANK BOOK" is defined in Section 6.7(A) hereof.
---------- ---------------
"BANK ONE" means Bank One, NA, having its principal office in Chicago, Illinois,
--------
in its individual capacity, and its successors.
"BENEFIT PLAN" means a defined benefit plan as defined in Section 3(35) of ERISA
------------
(other than a Multiemployer Plan or Foreign Pension Plan) in respect of which
Energizer or any other member of the Controlled Group is, or within the
immediately preceding six (6) years was, an "employer" as defined in Section
3(5) of ERISA.
"BORROWER" means (i) for the period from the Closing Date until the consummation
--------
of the Debt Assumption, Ralston and (ii) from and after the consummation of the
Debt Assumption, Energizer, in each case, together with its successors and
assigns, including a debtor-in-possession on behalf of the Borrower.
"BORROWING DATE" means a date on which an Advance is made hereunder.
---------------
"BORROWING/ELECTION NOTICE" is defined in Section 2.7 hereof.
-------------------------- ------------
"BRIDGE FACILITIES" means any temporary bridge financing to be provided in favor
-----------------
of Ralston, all or a portion of which may be assumed by Energizer in connection
with the Spin-Off, which shall be refinanced by Energizer shortly after the
Spin-Off Date with the Receivables Purchase Facility and/or the Senior Notes
and/or cash on hand.
"BUSINESS DAY" means (i) with respect to any borrowing, payment or rate
-------------
selection of Loans bearing interest at the Eurodollar Rate, a day (other than a
-------
Saturday or Sunday) on which banks are open for business in Chicago, Illinois
and on which dealings in Dollars are carried on in the London interbank market
and (ii) for all other purposes a day (other than a Saturday or Sunday) on which
banks are open for business in Chicago, Illinois.
"CAPITAL STOCK" means (i) in the case of a corporation, capital stock, (ii) in
--------------
the case of an association or business entity, any and all shares, interests,
participations, rights or other equivalents (however designated) of corporate
stock, (iii) in the case of a partnership, partnership interests (whether
general or limited) and (iv) any other interest or participation that confers on
a Person the right to receive a share of the profits and losses of, or
distributions of assets of, the issuing Person.
"CAPITALIZED LEASE" of a Person means any lease of property by such Person as
------------------
lessee which would be capitalized on a balance sheet of such Person prepared in
-
accordance with Agreement Accounting Principles.
"CAPITALIZED LEASE OBLIGATIONS" of a Person means the amount of the obligations
------------------------------
of such Person under Capitalized Leases which would be capitalized on a balance
sheet of such Person prepared in accordance with Agreement Accounting
Principles.
"CASH EQUIVALENTS" means (i) marketable direct obligations issued or
-----------------
unconditionally guaranteed by the United States government and backed by the
----------
full faith and credit of the United States government; (ii) domestic and
--
Eurodollar certificates of deposit and time deposits, bankers' acceptances and
--
floating rate certificates of deposit issued by any commercial bank organized
under the laws of the United States, any state thereof, the District of
Columbia, any foreign bank, or its branches or agencies (fully protected against
currency fluctuations for any such deposits with a term of more than ninety (90)
days); (iii) shares of money market, mutual or similar funds having assets in
excess of $100,000,000 and at least 95% of the investments of which are limited
to investment grade securities (i.e., securities rated at least Baa by Moody's
Investors Service, Inc. or at least BBB by Standard & Poor's Ratings Group); and
(iv) commercial paper of United States and foreign banks and bank holding
companies and their subsidiaries and United States and foreign finance,
commercial industrial or utility companies which, at the time of acquisition,
are rated A-1 (or better) by Standard & Poor's Ratings Group or P-1 by Moody's
Investors Service, Inc.; provided that the maturities of such Cash Equivalents
--------
described in the foregoing clauses (i) through (iv) shall not exceed 365 days;
(v) repurchase obligations of any commercial bank organized under the laws of
the United States, any state thereof, the District of Columbia, any foreign
bank, or its branches or agencies having a term not more than thirty (30) days,
with respect to securities issued or fully guaranteed or insured by the United
States government; (vi) securities with maturities of one year or less from the
date of acquisition issued or fully guaranteed by any state, commonwealth,
territory, political subdivision, taxing authority 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
BBB by Standard & Poor's Ratings Group or at least Baa by Moody's Investors
Service, Inc.; (vii) securities with maturities of one year or less from the
date of acquisition backed by standby letters of credit issued by any commercial
bank organized under the laws of the United States, any state thereof or the
District of Columbia (which commercial bank shall have a short-term debt rating
of A-1 (or better) by Standard & Poor's Ratings Group or P-1 by Moody's
Investors Service, Inc.), or by any foreign bank (which foreign bank shall have
a rating of B or better from Thomson BankWatch Global Issuer Rating or, if not
rated by Thomson BankWatch Global Issuer Rating, which foreign bank shall be an
institution acceptable to the Administrative Agent), or its branches or
agencies; or (viii) shares of money market mutual or similar funds at least 95%
of the assets of which are invested in the types of investments satisfying the
requirements of clauses (i) through (vii) of this definition.
"CHANGE" is defined in Section 4.2 hereof.
------ ------------
"CHANGE OF CONTROL" means an event or series of events by which:
-------------------
(i) any "person" or "group" (within the meaning of Sections 13(d) and
14(d)(2) of the Securities Exchange Act of 1934) becomes the "beneficial owner"
(as defined in Rule 13d-3 under the Securities Exchange Act of 1934), directly
or indirectly, of thirty percent (30%) or more of the voting power of the then
outstanding Capital Stock of Energizer entitled to vote generally in the
election of the directors of Energizer (other than Ralston at any time prior to
the consummation of the Spin-Off);
(ii) during any period of 12 consecutive calendar months, the board of
directors of Energizer shall cease to have as a majority of its members
individuals who either:
(a) were directors of Energizer on the first day of such period,
(b) were elected or nominated for election to the board of directors of
Energizer at the recommendation of or other approval by at least a majority of
the directors then still in office at the time of such election or nomination
who were directors of Energizer on the first day of such period, or whose
election or nomination for election was so approved, or
(c) were directors of Energizer on the first Business Day following the
Spin-Off Date;
(iii) other than as a result of a transaction not prohibited under the terms
of this Agreement, Energizer (a) shall cease to own, of record and
beneficially, with sole voting and dispositive power, 100% of the outstanding
shares of Capital Stock of each of the Subsidiary Guarantors or (b) shall cease
to have the power, directly or indirectly, to elect all of the members of the
board of directors of each of the Subsidiary Guarantors; or
(iv) Energizer consolidates with or merges into another corporation or
conveys, transfers or leases all or substantially all of its property to any
Person, or any corporation consolidates with or merges into Energizer, in either
event pursuant to a transaction in which the outstanding Capital Stock of
Energizer is reclassified or changed into or exchanged for cash, securities or
other property.
"CLOSING DATE" means the date of this Agreement.
-------------
"CODE" means the Internal Revenue Code of 1986, as amended, reformed or
----
otherwise modified from time to time.
----
"COMMISSION" means the Securities and Exchange Commission of the United States
----------
of America and any Person succeeding to the functions thereof.
"COMMITMENT TERMINATION DATE" means the earliest of (a) the Revolving Loan
-----------------------------
Termination Date, (b) the date of termination in whole of the Aggregate
----
Revolving Loan Commitment pursuant to Section 2.5 hereof or the Revolving Loan
----
Commitments pursuant to Section 9.1 hereof (other than pursuant to Section
------------ -------
2.2(b)) and (c) if the Spin-Off and Debt Assumption have not occurred prior
-
thereto, April 4, 2000.
"CONSENT DATE" is defined in Section 2.2(a) hereof.
------------- ---------------
"CONSOLIDATED ASSETS" means the total assets of Energizer and its Subsidiaries
--------------------
on a consolidated basis.
"CONSOLIDATED NET WORTH" means, as of any date of determination, the
------------------------
consolidated total stockholders' equity (including capital stock, additional
----------
paid-in capital and retained earnings) of Energizer and its consolidated
--
Subsidiaries determined in accordance with Agreement Accounting Principles.
--
"CONTAMINANT" means any waste, pollutant, hazardous substance, toxic substance,
-----------
hazardous waste, special waste, petroleum or petroleum-derived substance or
waste, asbestos or polychlorinated biphenyls ("PCBS"), and includes but is not
limited to these terms as defined in Environmental, Health or Safety
Requirements of Law.
"CONTINGENT OBLIGATION", as applied to any Person, means any Contractual
----------------------
Obligation, contingent or otherwise, of that Person with respect to any
------
Indebtedness of another or other obligation or liability of another, including,
------
without limitation, any such Indebtedness, obligation or liability of another
directly or indirectly guaranteed, endorsed (otherwise than for collection or
deposit in the ordinary course of business), co-made or discounted or sold with
recourse by that Person, or in respect of which that Person is otherwise
directly or indirectly liable, including Contractual Obligations (contingent or
otherwise) arising through any agreement to purchase, repurchase, or otherwise
acquire such Indebtedness, obligation or liability or any security therefor, or
to provide funds for the payment or discharge thereof (whether in the form of
loans, advances, stock purchases, capital contributions or otherwise), or to
maintain solvency, assets, level of income, or other financial condition, or to
make payment other than for value received. The amount of any Contingent
Obligation shall be equal to the present value of the portion of the obligation
so guaranteed or otherwise supported, in the case of known recurring
obligations, and the maximum reasonably anticipated liability in respect of the
portion of the obligation so guaranteed or otherwise supported assuming such
Person is required to perform thereunder, in all other cases.
"CONTRACTUAL OBLIGATION", as applied to any Person, means any provision of any
-----------------------
equity or debt securities issued by that Person or any indenture, mortgage, deed
of trust, security agreement, pledge agreement, guaranty, contract, undertaking,
agreement or instrument, in any case in writing, to which that Person is a party
or by which it or any of its properties is bound, or to which it or any of its
properties is subject.
"CONTROLLED GROUP" means the group consisting of (i) any corporation which is a
-----------------
member of the same controlled group of corporations (within the meaning of
Section 414(b) of the Code) as Energizer; (ii) a partnership or other trade or
business (whether or not incorporated) which is under common control (within the
meaning of Section 414(c) of the Code) with Energizer; and (iii) a member of the
same affiliated service group (within the meaning of Section 414(m) of the Code)
as Energizer, any corporation described in clause (i) above or any partnership
----------
or trade or business described in clause (ii) above; provided, that after the
----------- --------
Spin-Off Date, such term shall not include Ralston.
"CONVERSION DATE" is defined in Section 2.2(b).
---------------- ---------------
"CONVERTED LOAN TERMINATION DATE" means the date that is 364 days after the
----------------------------------
Conversion Date (or, if such date is not a Business Day, on the immediately
---
preceding Business Day).
---
"CURE LOAN" is defined in Section 9.2(iii) hereof.
---------- -----------------
"CUSTOMARY PERMITTED LIENS" means:
---------------------------
(i) Liens (other than Environmental Liens and Liens in favor of the IRS or
the PBGC or any Plan) with respect to the payment of taxes, assessments or
governmental charges in all cases which are not yet due or (if foreclosure,
distraint, sale or other similar proceedings shall not have been commenced or
any such proceeding after being commenced is stayed) which are being contested
in good faith by appropriate proceedings properly instituted and diligently
conducted and with respect to which adequate reserves or other appropriate
provisions are being maintained as may be required in accordance with Agreement
Accounting Principles;
(ii) statutory Liens of landlords and Liens of suppliers, mechanics,
carriers, materialmen, warehousemen or workmen and other similar Liens imposed
by law created in the ordinary course of business for amounts not yet due or
which are being contested in good faith by appropriate proceedings properly
instituted and diligently conducted and with respect to which adequate reserves
or other appropriate provisions are being maintained as may be required in
accordance with Agreement Accounting Principles;
(iii) Liens (other than Environmental Liens and Liens in favor of the IRS or
the PBGC or any Plan) incurred or deposits made in the ordinary course of
business in connection with workers' compensation, unemployment insurance or
other types of social security benefits or to secure the performance of bids,
tenders, sales, contracts (other than for the repayment of borrowed money),
surety, appeal and performance bonds; provided that (A) all such Liens do not in
--------
the aggregate materially detract from the value of the Borrower's or such
Subsidiary's assets or property taken as a whole or materially impair the use
thereof in the operation of the Borrower's or such Subsidiary's businesses taken
as a whole, and (B) all Liens securing bonds to stay judgments or in connection
with appeals do not secure at any time an aggregate amount exceeding
$30,000,000;
(iv) Liens arising with respect to zoning restrictions, easements, licenses,
reservations, covenants, rights-of-way, utility easements, building restrictions
and other similar charges or encumbrances on the use of real property which do
not in any case materially detract from the value of the property subject
thereto or interfere with the ordinary conduct of the business of the Borrower
or any of its Subsidiaries;
(v) Liens of attachment or judgment with respect to judgments, writs or
warrants of attachment, or similar process against the Borrower or any of its
Subsidiaries which do not constitute a Default under Section 8.1(H) hereof;
--------------
(vi) any interest or title of the lessor in the property subject to any
operating lease entered into by the Borrower or any of its Subsidiaries in the
ordinary course of business; and
(vii) Liens of commercial depository institutions arising in the ordinary
course of business constituting a statutory or common law right of setoff
against amounts on deposit with any such institution.
"DEBT ASSUMPTION" means the assignment and assumption by Energizer of all
----------------
of obligations and liabilities of Ralston hereunder and under the Loan Documents
and the concurrent release of Ralston from such obligations and liabilities,
which shall occur on the Spin-Off Date, pursuant to the Debt Assignment,
Assumption and Release Agreement in the form attached as Exhibit I to this
---------
Agreement (the "DEBT ASSUMPTION AGREEMENT").
"DEBT ASSUMPTION AGREEMENT" is defined in the definition of "Debt Assumption"
---------------------------
above.
-
"DEFAULT" means an event described in Article VIII hereof.
------- -------------
"DISCLOSED LITIGATION" is defined in Section 6.10 hereof.
--------------------- -------------
"DISQUALIFIED STOCK" means any preferred stock and any Capital Stock that, 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
redeemable at the option of the holder thereof, in whole or in part, on or prior
to the date that is 91 days after the Revolving Loan Termination Date.
"DOL" means the United States Department of Labor and any Person succeeding to
---
the functions thereof.
"DOLLAR" and "$" means dollars in the lawful currency of the United States.
------ -
"EBIT" means, for any period, on a consolidated basis for Energizer and its
----
Subsidiaries, the sum of the amounts for such period, without duplication, of
--
(i) Net Income, plus (ii) Interest Expense to the extent deducted in computing
- ----
Net Income, plus (iii) charges against income for foreign, federal, state and
----
local taxes to the extent deducted in computing Net Income, minus (iv)
-----
extraordinary gains to the extent added in computing Net Income, plus (v) other
----
extraordinary non-cash charges to the extent deducted in computing Net Income.
"EBITDA" means, for any period, on a consolidated basis for Energizer and its
------
Subsidiaries, the sum of the amounts for such period, without duplication, of
-
(i) EBIT, plus (ii) depreciation expense to the extent deducted in computing Net
- ----
Income, plus (iii) amortization expense, including, without limitation,
----
amortization of goodwill and other intangible assets, to the extent deducted in
computing Net Income.
"ENERGIZER" means Energizer Holdings, Inc., a Missouri corporation, together
---------
with its permitted successors and assigns, including a debtor-in-possession on
--
behalf of Energizer.
"ENVIRONMENTAL, HEALTH OR SAFETY REQUIREMENTS OF LAW" means all applicable
---------------------------------------------------------
foreign, federal, state and local laws or regulations relating to or addressing
----
pollution or protection of the environment, or protection of worker health or
safety, including, but not limited to, the Comprehensive Environmental Response,
Compensation and Liability Act, 42 U.S.C. 9601 et seq., the Occupational
-- ---
Safety and Health Act of 1970, 29 U.S.C. 651 et seq., and the Resource
-- ---
Conservation and Recovery Act of 1976, 42 U.S.C. 6901 et seq., in each case
-- ---
including any amendments thereto, any successor statutes, and any regulations
promulgated thereunder, and any state or local equivalent thereof.
"ENVIRONMENTAL LIEN" means a lien in favor of any Governmental Authority for (a)
------------------
any liability under Environmental, Health or Safety Requirements of Law, or (b)
damages arising from, or costs incurred by such Governmental Authority in
response to, a Release or threatened Release of a Contaminant into the
environment.
"ENVIRONMENTAL PROPERTY TRANSFER ACT" means any applicable requirement of law
--------------------------------------
that conditions, restricts, prohibits or requires any notification or disclosure
-
triggered by the closure of any property or the transfer, sale or lease of any
property or deed or title for any property for environmental reasons, including,
but not limited to, any so-called "Industrial Site Recovery Act" or "Responsible
Property Transfer Act."
"EQUIPMENT" means all of the Borrower's and its Subsidiaries' present and future
---------
(i) equipment, including, without limitation, machinery, manufacturing,
distribution, selling, data processing and office equipment, assembly systems,
tools, molds, dies, fixtures, appliances, furniture, furnishings, vehicles,
vessels, aircraft, aircraft engines, and trade fixtures, (ii) other tangible
personal property (other than the Borrower's or Subsidiary's Inventory), and
(iii) any and all accessions, parts and appurtenances attached to any of the
foregoing or used in connection therewith, and any substitutions therefor and
replacements, products and proceeds thereof.
"EQUITY INTERESTS" means Capital Stock and all warrants, options or other rights
----------------
to acquire Capital Stock (but excluding any debt security that is convertible
into, or exchangeable for, Capital Stock).
"ERISA" means the Employee Retirement Income Security Act of 1974, as amended
-----
from time to time, including (unless the context otherwise requires) any rules
-
or regulations promulgated thereunder.
"EURODOLLAR BASE RATE" means, with respect to a Eurodollar Rate Advance for the
---------------------
relevant Interest Period, the applicable British Bankers' Association Interest
Settlement Rate for deposits in U.S. dollars appearing on Bloomberg Screen BBAM
as of 11:00 a.m. (London time) two (2) Business Days prior to the first day of
such Interest Period, and having a maturity equal to such Interest Period,
provided that, (i) if Bloomberg Screen BBAM is not available to the
---
Administrative Agent for any reason, the applicable Eurodollar Base Rate for the
---
relevant Interest Period shall instead be the applicable British Bankers'
Association Interest Settlement Rate for deposits in U.S. dollars as reported by
any other generally recognized financial information service mutually acceptable
to the Borrower and the Administrative Agent as of 11:00 a.m. (London time) two
(2) Business Days prior to the first day of such Interest Period, and having a
maturity equal to such Interest Period, and (ii) if no such British Bankers'
Association Interest Settlement Rate is available to the Administrative Agent,
the applicable Eurodollar Base Rate for the relevant Interest Period shall
instead be the rate determined by the Administrative Agent to be the arithmetic
mean (rounded upward, if necessary, to an integral multiple of 1/16th of 1%) of
the rates of interest per annum reported to the Administrative Agent by each
Reference Lender as the rate at which such Reference Lender offers to place
deposits in Dollars with first-class banks in the London interbank market at
approximately 11:00 a.m. (London time) two (2) Business Days prior to the first
day of such Interest Period, in the approximate amount of such Reference
Lender's relevant Eurodollar Rate Loan and having a maturity equal to such
Interest Period. If any Reference Lender fails to provide such quotation to the
Administrative Agent, then the Administrative Agent shall determine the
Eurodollar Base Rate on the basis of the quotations of the remaining Reference
Lender(s).
"EURODOLLAR RATE" means, with respect to a Eurodollar Rate Advance for the
----------------
relevant Interest Period, the sum of (i) the quotient of (a) the Eurodollar Base
----
Rate applicable to such Interest Period, divided by (b) one minus the Reserve
Requirement (expressed as a decimal) applicable to such Interest Period plus
----
(ii) the then Applicable Margin; provided, however, that the foregoing
-------- -------
adjustment for Reserve Requirements shall only be made with respect to that
portion of a Eurodollar Rate Loan made by a Lender which is subject to such
Reserve Requirements.
"EURODOLLAR RATE ADVANCE" means an Advance which bears interest at the
-------------------------
Eurodollar Rate.
--------
"EURODOLLAR RATE LOAN" means a Loan, or portion thereof, which bears interest at
--------------------
the Eurodollar Rate.
"EXCLUDED TAXES" means, in the case of each Lender or applicable Lending
---------------
Installation and the Administrative Agent, taxes imposed on its overall net
------
income, and franchise taxes imposed on it, by (i) the jurisdiction under the
---
laws of which such Lender or the Administrative Agent is incorporated or
--
organized or (ii) the jurisdiction in which the Administrative Agent's or such
--
Lender's principal executive office or such Lender's applicable Lending
Installation is located.
"FACILITY FEE" is defined in Section 2.14(C)(i) hereof.
------------- -------------------
"FEDERAL FUNDS EFFECTIVE RATE" means, for any day, an interest rate per annum
-------------------------------
equal to the weighted average of the rates on overnight Federal funds
-
transactions with members of the Federal Reserve System arranged by Federal
-
funds brokers on such day, as published for such day (or, if such day is not a
-
Business Day, for the immediately preceding Business Day) by the Federal Reserve
Bank of New York, or, if such rate is not so published for any day which is a
Business Day, the average of the quotations at approximately 10:00 a.m. (Chicago
time) on such day on such transactions received by the Administrative Agent from
three Federal funds brokers of recognized standing selected by the
Administrative Agent in its reasonable discretion.
"FINAL ADJUSTMENT DATE" means the last Adjustment Date, which shall occur no
-----------------------
later than July 31, 2000, in accordance with the Reorganization Agreement.
--
"FINANCING FACILITIES" means this Agreement, the 5-Year Credit Agreement, the
---------------------
Bridge Facilities, the Receivables Purchase Facility, the Senior Notes and any
-
other financing facilities entered into or to be entered into in connection with
the Spin-Off, in each case, whether consummated prior to, concurrently with or
following the Spin-Off.
"5-YEAR CREDIT AGREEMENT" means that certain 5-Year Revolving Credit Agreement
-------------------------
of even date herewith among the Borrower, the institutions from time to time
parties thereto as lenders and Bank One, NA, as Administrative Agent, Bank of
America, N.A., as Syndication Agent and Wachovia Bank, N.A., as Documentation
Agent, as the same may be amended, restated, supplemented or otherwise modified
and as in effect from time to time.
"FLOATING RATE ADVANCE" means an Advance which bears interest by reference to
-----------------------
the Alternate Base Rate.
-
"FLOATING RATE LOAN" means a Loan, or portion thereof, which bears interest by
--------------------
reference to the Alternate Base Rate.
"FOREIGN EMPLOYEE BENEFIT PLAN" means any employee benefit plan as defined in
--------------------------------
Section 3(3) of ERISA which is maintained or contributed to for the benefit of
-
the employees of Energizer or any member of the Controlled Group, but which is
not covered by ERISA pursuant to Section 4(b)(4) of ERISA.
"FOREIGN PENSION PLAN" means any employee pension benefit plan (as defined in
----------------------
Section 3(2) of ERISA) which (i) is maintained or contributed to for the benefit
-
of employees of Energizer or any other member of the Controlled Group, (ii) is
not covered by ERISA pursuant to Section 4(b)(4) thereof and (iii) under
applicable local law, is required to be funded through a trust or other funding
vehicle.
"FORM 10" means the Form 10 General Form for the Registration of Securities, as
--------
amended by Amendment No. 1, Amendment No. 2 and Amendment No. 3 thereto, filed
by Energizer (File No. 1-15401) with the Commission in connection with the
Spin-Off, together with all exhibits and appendices thereto.
"GOVERNMENTAL ACTS" is defined in Section 3.10(A) hereof.
------------------ ----------------
"GOVERNMENTAL AUTHORITY" means any nation or government, any federal, state,
-----------------------
local or other political subdivision thereof and any entity exercising
--
executive, legislative, judicial, regulatory or administrative authority or
--
functions of or pertaining to government, including any authority or other
--
quasi-governmental entity established to perform any of such functions.
--
"HEDGING ARRANGEMENTS" is defined in the definition of "Hedging Obligations"
---------------------
below.
--
"HEDGING AGREEMENTS" is defined in Section 7.3(O) hereof.
------------------- ---------------
"HEDGING OBLIGATIONS" of a Person means any and all obligations of such Person,
--------------------
whether absolute or contingent and howsoever and whensoever created, arising,
evidenced or acquired (including all renewals, extensions and modifications
thereof and substitutions therefor), under (i) any and all agreements, devices
or arrangements designed to protect at least one of the parties thereto from the
fluctuations of interest rates, commodity prices, exchange rates or forward
rates applicable to such party's assets, liabilities or exchange transactions,
including, but not limited to, dollar-denominated or cross-currency interest
rate exchange agreements, forward currency exchange agreements, interest rate
cap or collar protection agreements, forward rate currency or interest rate
options, puts and warrants or any similar derivative transactions ("HEDGING
ARRANGEMENTS"), and (ii) any and all cancellations, buy backs, reversals,
terminations or assignments of any of the foregoing.
"HOLDERS OF OBLIGATIONS" means the holders of the Obligations from time to time
-----------------------
and shall include their respective successors, transferees and assigns.
"INDEBTEDNESS" of any Person means, without duplication, such Person's (a)
------------
obligations for borrowed money, (b) obligations representing the deferred
----
purchase price of property or services (other than accounts payable arising in
----
the ordinary course of such Person's business payable on terms customary in the
trade), which purchase price is due more than six (6) months from the date of
incurrence of the obligation in respect thereof, provided that the related
obligations are not interest bearing, (c) obligations, whether or not assumed,
secured by Liens or payable out of the proceeds or production from property or
assets now or hereafter owned or acquired by such Person, (d) obligations which
are evidenced by notes, acceptances or other instruments, (e) Capitalized Lease
Obligations, (f) Contingent Obligations in respect of Indebtedness, (g)
obligations with respect to letters of credit, (h) Off-Balance Sheet
Liabilities, (i) Receivables Facility Attributed Indebtedness and (j)
Disqualified Stock. The amount of Indebtedness of any Person at any date shall
be without duplication (1) the outstanding balance at such date of all
unconditional obligations as described above and the maximum liability of any
such Contingent Obligations at such date and (2) in the case of Indebtedness of
others secured by a Lien to which the property or assets owned or held by such
Person is subject, the lesser of the fair market value at such date of any asset
subject to a Lien securing the Indebtedness of others and the amount of the
Indebtedness secured.
"INDEMNIFIED MATTERS" is defined in Section 10.7(B) hereof.
-------------------- ----------------
"INDEMNITEES" is defined in Section 10.7(B) hereof.
----------- ----------------
"INITIAL FUNDING DATE" means the date on which the initial Revolving Loans are
----------------------
advanced hereunder.
"INSOLVENCY EVENT" is defined in Section 10.14 hereof.
----------------- --------------
"INTERCOMPANY INDEBTEDNESS" is defined in Section 10.14 hereof.
-------------------------- --------------
"INTEREST EXPENSE" means, for any period, the total interest expense of
-----------------
Energizer and its consolidated Subsidiaries, whether paid or accrued, including,
-------
without duplication, Off-Balance Sheet Liabilities (including Receivables
Facility Financing Costs) and the interest component of Capitalized Leases, all
as determined in conformity with Agreement Accounting Principles.
"INTEREST EXPENSE COVERAGE RATIO" is defined in Section 7.4(B) hereof.
---------------------------------- ---------------
"INTEREST PERIOD" means, with respect to a Eurodollar Rate Loan, a period of one
---------------
(1), two (2), three (3) or six (6) months and, to the extent available to all of
the Lenders, nine (9) or twelve (12) months, commencing on a Business Day
selected by the Borrower on which a Eurodollar Rate Advance is made to Borrower
pursuant to this Agreement. Such Interest Period shall end on (but exclude) the
day which corresponds numerically to such date one, two, three, six, nine or
twelve months thereafter; provided, however, that if there is no such
-------- -------
numerically corresponding day in such next, second, third, sixth, ninth or
twelfth succeeding month, such Interest Period shall end on the last Business
Day of such next, second, third, sixth, ninth or twelfth succeeding month. If
an Interest Period would otherwise end on a day which is not a Business Day,
such Interest Period shall end on the next succeeding Business Day, provided,
--------
however, that if said next succeeding Business Day falls in a new calendar
-----
month, such Interest Period shall end on the immediately preceding Business Day.
---
"INVENTORY" shall mean any and all goods, including, without limitation, goods
---------
in transit, wheresoever located, whether now owned or hereafter acquired by the
Borrower or any of its Subsidiaries, which are held for sale or lease, furnished
under any contract of service or held as raw materials, work in process or
supplies, and all materials used or consumed in the business of Borrower or any
of its Subsidiaries, and shall include all right, title and interest of the
Borrower or any of its Subsidiaries in any property the sale or other
disposition of which has given rise to Receivables and which has been returned
to or repossessed or stopped in transit by the Borrower or any of its
Subsidiaries.
"INVESTMENT" means, with respect to any Person, (i) any purchase or other
----------
acquisition by that Person of any Indebtedness, Equity Interests or other
-----
securities, or of a beneficial interest in any Indebtedness, Equity Interests or
-----
other securities, issued by any other Person, (ii) any purchase by that Person
of all or substantially all of the assets of a business conducted by another
Person, and (iii) any loan, advance (other than deposits with financial
institutions available for withdrawal on demand, prepaid expenses, accounts
receivable, advances to employees and similar items made or incurred in the
ordinary course of business) or capital contribution by that Person to any other
Person, including all Indebtedness to such Person arising from a sale of
property by such Person other than in the ordinary course of its business.
"IRS" means the Internal Revenue Service and any Person succeeding to the
---
functions thereof.
---
"LENDERS" means the lending institutions listed on the signature pages of this
-------
Agreement and their respective successors and assigns.
"LENDING INSTALLATION" means, with respect to a Lender or the Administrative
---------------------
Agent, any office, branch, subsidiary or affiliate of such Lender or the
--
Administrative Agent.
--
"LEVERAGE RATIO" is defined in Section 7.4(A) hereof.
--------------- ---------------
"LIEN" means any lien (statutory or other), mortgage, pledge, hypothecation,
----
assignment, deposit arrangement, encumbrance or preference, priority or security
--
agreement or preferential arrangement of any kind or nature whatsoever
(including, without limitation, the interest of a vendor or lessor under any
conditional sale, Capitalized Lease or other title retention agreement).
"LOAN(S)" means, with respect to a Lender, such Lender's portion of any Advance
-------
made pursuant to Section 2.1 hereof, and collectively, all Revolving Loans,
------------
whether made or continued as or converted to Floating Rate Loans or Eurodollar
Rate Loans.
"LOAN ACCOUNT" is defined in Section 2.12(a) hereof.
------------- ----------------
"LOAN DOCUMENTS" means this Agreement, the Subsidiary Guaranty, any promissory
---------------
notes issued pursuant to Section 2.12 and all other documents, instruments and
------------
agreements executed in connection therewith or contemplated thereby, as the same
may be amended, restated or otherwise modified and in effect from time to time.
"LOAN PARTIES" is defined in Section 5.1 hereof.
------------- ------------
"MARGIN STOCK" shall have the meaning ascribed to such term in Regulation U.
-------------
"MATERIAL ADVERSE EFFECT" means a material adverse effect upon (a) the business,
-----------------------
condition (financial or otherwise), operations, performance, properties or
prospects of Energizer and its Subsidiaries, taken as a whole, (b) the ability
of Energizer and its Subsidiaries, taken as a whole, to perform their
obligations under the Loan Documents in any material respect, or (c) the ability
of the Lenders or the Administrative Agent to enforce in any material respect
the Obligations.
"MATERIAL DOMESTIC SUBSIDIARY" means each consolidated Subsidiary (other than
------------------------------
any SPV) of the Borrower (a) incorporated under the laws of any jurisdiction in
-
the United States and (b) the total assets of which exceed, as at the end of any
calendar quarter or, in the case of consummation of a Permitted Acquisition, at
the time of consummation of such Permitted Acquisition (calculated by Energizer
on a pro forma basis taking into account the consummation of such Permitted
--- -----
Acquisition), three percent (3.0%) of the Consolidated Assets of Energizer and
its consolidated Subsidiaries (other than SPVs).
"MATERIAL FOREIGN SUBSIDIARY" means each consolidated Subsidiary (other than any
---------------------------
SPV) of the Borrower (a) incorporated under the laws of any foreign jurisdiction
and (b) the total assets of which exceed, as at the end of any calendar quarter
or, in the case of consummation of a Permitted Acquisition, at the time of
consummation of such Permitted Acquisition (calculated by Energizer on a pro
---
forma basis taking into account the consummation of such Permitted Acquisition),
--
five percent (5.0%) of the Consolidated Assets of Energizer and its consolidated
Subsidiaries (other than SPVs).
"MATERIAL INDEBTEDNESS" means any Indebtedness (other than the Indebtedness
----------------------
hereunder) of a single class with an aggregate outstanding principal amount
---
equal to or greater than $30,000,000.
---
"MATERIAL SUBSIDIARIES" means each of Energizer's Material Domestic Subsidiaries
---------------------
and Material Foreign Subsidiaries.
"MULTIEMPLOYER PLAN" means a "multiemployer plan" as defined in Section
-------------------
4001(a)(3) of ERISA which is, or within the immediately preceding six (6) years
-------
was, contributed to by either Energizer or any member of the Controlled Group.
"NET INCOME" means, for any period, the net earnings (or loss) after taxes of
-----------
Energizer and its Subsidiaries on a consolidated basis for such period taken as
-
a single accounting period determined in conformity with Agreement Accounting
Principles.
"NET WORTH CONDITION" means the requirement that, as of and after the
---------------------
consummation of the Spin-Off Transactions, the Consolidated Net Worth of
---------
Energizer and its Subsidiaries shall not be less than $625,000,000.
------
"NEW SUBSIDIARY" is defined in Section 7.3(F).
--------------- ---------------
"NON-ERISA COMMITMENTS" means
----------------------
(i) each pension, medical, dental, life, accident insurance, disability,
group insurance, sick leave, profit sharing, deferred compensation, bonus, stock
option, stock purchase, retirement, savings, severance, stock ownership,
performance, incentive, hospitalization or other insurance, or other welfare,
benefit or fringe benefit plan, policy, trust, understanding or arrangement of
any kind; and
(ii) each employee collective bargaining agreement and each agreement,
understanding or arrangement of any kind, with or for the benefit of any
present or prior officer, director, employee or consultant (including, without
limitation, each employment, compensation, deferred compensation, severance or
consulting agreement or arrangement and any agreement or arrangement associated
with a change in ownership of the Borrower or any member of the Controlled
Group);
to which Energizer or any member of the Controlled Group is a party or with
respect to which Energizer or any member of the Controlled Group is or will be
required to make any payment other than any Plans.
"NON PRO RATA LOAN" is defined in Section 9.2 hereof.
-------------------- ------------
"NON-U.S. LENDER" is defined in Section 4.5(iv) hereof.
---------------- ----------------
"NOTE PURCHASE AGREEMENT" means any agreement entered into by the Borrower with
------------------------
respect to the Borrower's issuance of senior unsecured notes (the "SENIOR
NOTES"), which shall be pari passu with the Obligations hereunder, on
substantially the terms set forth in the confidential Summary of Proposed Terms
relating to the Senior Notes sent by Banc of America Securities LLC to the
Administrative Agent by e-mail transmission on March 27, 2000, as such Note
Purchase Agreement may be amended, modified or supplemented from time to time in
a manner that is not materially adverse to the interests of the Lenders.
"NOTICE OF ASSIGNMENT" is defined in Section 13.3(B) hereof.
---------------------- ----------------
"NOTICE TO CONVERT" is defined in Section 2.2(b) hereof.
------------------- ---------------
"OBLIGATIONS" means all Loans, advances, debts, liabilities, obligations,
-----------
covenants and duties owing by the Borrower or any of its Subsidiaries to the
-----
Administrative Agent, any Lender, the Arranger, any Affiliate of the
--
Administrative Agent or any Lender, or any Indemnitee, of any kind or nature,
--
present or future, arising under this Agreement or any other Loan Document,
-
whether or not evidenced by any note, guaranty or other instrument, whether or
-
not for the payment of money, whether arising by reason of an extension of
credit, loan, guaranty, indemnification, or in any other manner, whether direct
or indirect (including those acquired by assignment), absolute or contingent,
due or to become due, now existing or hereafter arising and however acquired.
The term includes, without limitation, all interest, charges, expenses, fees,
reasonable attorneys' fees and disbursements, reasonable paralegals' fees (and,
after the occurrence and during the continuance of a Default, all attorney's
fees and disbursements and paralegals' fees, whether or not reasonable), and any
other sum chargeable to the Borrower or any of its Subsidiaries under this
Agreement or any other Loan Document.
"OFF-BALANCE SHEET LIABILITIES" of a Person means, without duplication, (a) any
------------------------------
Receivables Facility Attributed Indebtedness and repurchase obligation or
liability of such Person or any of its Subsidiaries with respect to Receivables
or notes receivable sold by such Person or any of its Subsidiaries (calculated
to include the unrecovered investment of purchasers or transferees of
Receivables or notes receivable or any other obligation of the Borrower or such
transferor to purchasers/transferees of interests in Receivables or notes
receivables or the agent for such purchasers/transferees), (b) any liability
under any sale and leaseback transactions which do not create a liability on the
consolidated balance sheet of such Person, (c) any liability under any financing
lease or so-called "synthetic" lease transaction, or (d) any obligations arising
with respect to any other transaction which is the functional equivalent of or
takes the place of borrowing but which does not constitute a liability on the
consolidated balance sheets of such Person and its Subsidiaries.
"OPENING BALANCE SHEET DELIVERY DATE" means the date within fifteen days
---------------------------------------
following the Final Adjustment Date on which the Administrative Agent receives
------
the opening pro forma balance sheet of Energizer and its consolidated
--- -----
Subsidiaries pursuant to Section 7.1(A)(v).
------------------
"ORIGINATORS" means the Borrower and/or any of its Subsidiaries in their
-----------
respective capacities as parties to any Receivables Purchase Documents, as
------
sellers or transferors of any Receivables and Related Security in connection
----
with a Permitted Receivables Transfer.
--
"OTHER TAXES" is defined in Section 4.5 hereof.
------------ ------------
"PARTICIPANTS" is defined in Section 13.2(A) hereof.
------------ ----------------
"PAYMENT DATE" means the last day of each March, June, September and December.
-------------
"PBGC" means the Pension Benefit Guaranty Corporation, or any successor thereto.
----
"PERMITTED ACQUISITION" is defined in Section 7.3(F) hereof.
---------------------- ---------------
"PERMITTED EXISTING CONTINGENT OBLIGATIONS" means the Contingent Obligations of
------------------------------------------
Energizer and its Subsidiaries identified on Schedule 1.1.3 to this Agreement.
--------------
"PERMITTED EXISTING INVESTMENTS" means the Investments of Energizer and its
--------------------------------
Subsidiaries identified on Schedule 1.1.1 to this Agreement.
--- ---------------
"PERMITTED EXISTING LIENS" means the Liens on assets of Energizer and its
--------------------------
Subsidiaries identified on Schedule 1.1.2 to this Agreement.
----- ---------------
"PERMITTED RECEIVABLES TRANSFER" means (i) a sale or other transfer by an
--------------------------------
Originator to a SPV of Receivables and Related Security for fair market value
-----
and without recourse (except for limited recourse typical of such structured
-
finance transactions), and/or (ii) a sale or other transfer by a SPV to (a)
-
purchasers of or other investors in such Receivables and Related Security or (b)
-
any other Person (including a SPV) in a transaction in which purchasers or other
investors purchase or are otherwise transferred such Receivables and Related
Security, in each case pursuant to and in accordance with the terms of the
Receivables Purchase Documents.
"PERSON" means any individual, corporation, firm, enterprise, partnership,
------
trust, incorporated or unincorporated association, joint venture, joint stock
----
company, limited liability company or other entity of any kind, or any
-
government or political subdivision or any agency, department or instrumentality
-
thereof.
"PLAN" means an employee benefit plan defined in Section 3(3) of ERISA in
----
respect of which Energizer or any member of the Controlled Group is, or within
----
the immediately preceding six (6) years was, an "employer" as defined in Section
3(5) of ERISA.
"PRIME RATE" means a rate per annum equal to the prime rate of interest
-----------
announced from time to time by Bank One or its parent (which is not necessarily
-------
the lowest rate charged to any customer), changing when and as said prime rate
changes.
"PRO RATA SHARE" means, with respect to any Lender, the percentage obtained by
----------------
dividing (A) such Lender's Revolving Loan Commitment at such time (in each case,
as adjusted from time to time in accordance with the provisions of this
Agreement) by (B) the Aggregate Revolving Loan Commitment at such time;
provided, however, from and after the Conversion Date or if all of the Revolving
-------
Loan Commitments are terminated pursuant to the terms of this Agreement, then
"Pro Rata Share" means the percentage obtained by dividing (x) the aggregate
principal balance of such Lender's Loans at such time, by (y) the aggregate
outstanding balance of all Loans at such time.
"PURCHASERS" is defined in Section 13.3(A) hereof.
---------- ----------------
"RALSTON" means Ralston Purina Company, a Missouri corporation, and prior to the
-------
Spin-Off, the owner of all of the outstanding Capital Stock of Energizer,
together with its permitted successors and assigns, including a
debtor-in-possession on behalf of Ralston.
"RECEIVABLE(S)" means and includes all of the Borrower's and its Subsidiaries'
-------------
presently existing and hereafter arising or acquired accounts, accounts
receivable, and all present and future rights of the Borrower and its
Subsidiaries to payment for goods sold or leased or for services rendered
(except those evidenced by instruments or chattel paper), whether or not they
have been earned by performance, and all rights in any merchandise or goods
which any of the same may represent, and all rights, title, security and
guaranties with respect to each of the foregoing, including, without limitation,
any right of stoppage in transit.
"RECEIVABLES AND RELATED SECURITY" means the Receivables and the related
-----------------------------------
security and collections with respect thereto which are sold or transferred by
------
any Originator or SPV in connection with any Permitted Receivables Transfer.
"RECEIVABLES FACILITY ATTRIBUTED INDEBTEDNESS" means the amount of obligations
----------------------------------------------
outstanding under a receivables purchase facility on any date of determination
that would be characterized as principal if such facility were structured as a
secured lending transaction rather than as a purchase.
"RECEIVABLES FACILITY FINANCING COSTS" means such portion of the cash fees,
---------------------------------------
service charges, and other costs, as well as all collections or other amounts
---
retained by purchasers of receivables pursuant to a receivables purchase
-
facility, which are in excess of amounts paid to the Borrower and its
-
consolidated Subsidiaries under any receivables purchase facility for the
-
purchase of receivables pursuant to such facility and are the equivalent of the
-
interest component of the financing if the transaction were characterized as an
on-balance sheet transaction.
"RECEIVABLES PURCHASE DOCUMENTS" means any series of receivables purchase or
--------------------------------
sale agreements generally consistent with terms contained in comparable
--
structured finance transactions pursuant to which an Originator or Originators
--
sell or transfer to SPVs all of their respective right, title and interest in
and to certain Receivables and Related Security for further sale or transfer to
other purchasers of or investors in such assets (and the other documents,
instruments and agreements executed in connection therewith), as any such
agreements may be amended, restated, supplemented or otherwise modified from
time to time, or any replacement or substitution therefor.
"RECEIVABLES PURCHASE FACILITY" means the securitization facility made available
-----------------------------
to Energizer, pursuant to which the Receivables and Related Security of the
Originators are transferred to one or more SPVs, and thereafter to certain
investors, pursuant to the terms and conditions of the Receivables Purchase
Documents.
"REFERENCE LENDERS" means Bank One, Bank of America, N.A. and Wachovia Bank,
------------------
N.A.
--
"REGISTER" is defined in Section 13.3(C) hereof.
-------- ----------------
"REGULATION D" means Regulation D of the Board of Governors of the Federal
-------------
Reserve System as from time to time in effect and any successor thereto or other
----
regulation or official interpretation of said Board of Governors relating to
reserve requirements applicable to member banks of the Federal Reserve System.
"REGULATION T" means Regulation T of the Board of Governors of the Federal
-------------
Reserve System as from time to time in effect and any successor or other
----
regulation or official interpretation of said Board of Governors relating to the
----
extension of credit by and to brokers and dealers of securities for the purpose
of purchasing or carrying margin stock (as defined therein).
"REGULATION U" means Regulation U of the Board of Governors of the Federal
-------------
Reserve System as from time to time in effect and any successor or other
----
regulation or official interpretation of said Board of Governors relating to the
----
extension of credit by banks, non-banks and non-broker lenders for the purpose
of purchasing or carrying Margin Stock applicable to member banks of the Federal
Reserve System.
"REGULATION X" means Regulation X of the Board of Governors of the Federal
-------------
Reserve System as from time to time in effect and any successor or other
----
regulation or official interpretation of said Board of Governors relating to the
----
extension of credit by foreign lenders for the purpose of purchasing or carrying
margin stock (as defined therein).
"RELEASE" means any release, spill, emission, leaking, pumping, injection,
-------
deposit, disposal, discharge, dispersal, leaching or migration into the
----
environment, including the movement of Contaminants through or in the air, soil,
----
surface water or groundwater.
"REORGANIZATION AGREEMENT" means that certain Agreement and Plan of
-------------------------
Reorganization dated as of April 1, 2000, between Ralston and Energizer, as the
-----------
same may be amended, restated, supplemented or otherwise modified from time to
time.
"REPLACEMENT LENDER" is defined in Section 2.19 hereof.
------------------- -------------
"REPORTABLE EVENT" means a reportable event as defined in Section 4043 of ERISA
-----------------
and the regulations issued under such section, with respect to a Plan,
excluding, however, such events as to which the PBGC by regulation waived the
requirement of Section 4043(a) of ERISA that it be notified within thirty (30)
days after such event occurs.
"REQUIRED LENDERS" means Lenders whose Pro Rata Shares, in the aggregate, are
-----------------
greater than fifty percent (50%); provided, however, that, if any Lender shall
-------- -------
have failed to fund its Pro Rata Share of any Revolving Loan requested by the
Borrower, which such Lender is obligated to fund under the terms of this
Agreement and any such failure has not been cured, then for so long as such
failure continues, "REQUIRED LENDERS" means Lenders (excluding all Lenders whose
failure to fund their respective Pro Rata Shares of such Revolving Loans has not
been so cured) whose Pro Rata Shares represent greater than fifty percent (50%)
of the aggregate Pro Rata Shares of such Lenders; provided further, however,
-------- ------- -------
that, from and after the Conversion Date or if the Revolving Loan Commitments
have been terminated pursuant to the terms of this Agreement, "REQUIRED LENDERS"
means Lenders (without regard to such Lenders' performance of their respective
obligations hereunder) whose aggregate ratable shares (stated as a percentage)
of the aggregate outstanding principal balance of all Loans are greater than
fifty percent (50%).
"REQUIREMENTS OF LAW" means, as to any Person, the charter and by-laws or other
--------------------
organizational or governing documents of such Person, and any law, 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 including,
without limitation, the Securities Act of 1933, the Securities Exchange Act of
1934, Regulations T, U and X, ERISA, the Fair Labor Standards Act, the Worker
Adjustment and Retraining Notification Act, Americans with Disabilities Act of
1990, and any certificate of occupancy, zoning ordinance, building,
environmental or land use requirement or permit or environmental, labor,
employment, occupational safety or health law, rule or regulation, including
Environmental, Health or Safety Requirements of Law.
"RESERVE REQUIREMENT" means, with respect to an Interest Period, the maximum
--------------------
aggregate reserve requirement (including all basic, supplemental, marginal and
--
other reserves) which is imposed under Regulation D on "Eurocurrency
liabilities".
"REVOLVING CREDIT AVAILABILITY" means, at any particular time, the amount by
-------------------------------
which the Aggregate Revolving Loan Commitment at such time exceeds the Revolving
--
Credit Obligations outstanding at such time.
"REVOLVING CREDIT OBLIGATIONS" means, at any particular time, the outstanding
------------------------------
principal amount of the Revolving Loans at such time.
-
"REVOLVING LOAN" is defined in Section 2.1 hereof.
--------------- ------------
"REVOLVING LOAN COMMITMENT" means, for each Lender, the obligation of such
---------------------------
Lender to make Revolving Loans not exceeding the amount set forth on Exhibit A
---- ---------
to this Agreement opposite its name thereon under the heading "Revolving Loan
Commitment" or in the Assignment Agreement by which it became a Lender, as such
amount may be modified from time to time pursuant to the terms of this Agreement
or to give effect to any applicable Assignment Agreement.
"REVOLVING LOAN TERMINATION DATE" means March 29, 2001, or any subsequent date
---------------------------------
to which the Revolving Loan Termination Date has been extended pursuant to the
terms of Section 2.2(a).
---------------
"RISK-BASED CAPITAL GUIDELINES" is defined in Section 4.2 hereof.
------------------------------- ------------
"SENIOR MANAGEMENT TEAM" means each Authorized Officer and the Chief Executive
------------------------
Officer of the Borrower.
"SENIOR NOTES" is defined in the definition of "Note Purchase Agreement" above.
-------------
"SOLVENT" means, when used with respect to any Person, that at the time of
-------
determination:
----
(i) the fair value of its assets (both at fair valuation and at present fair
saleable value) is equal to or in excess of the total amount of its
liabilities, including, without limitation, contingent liabilities; and
(ii) it is then able and believes that it will be able to pay its debts as
they mature; and
(iii) it has capital sufficient to carry on its business as conducted and as
proposed to be conducted.
With respect to contingent liabilities (such as litigation and guarantees), such
liabilities shall be computed at the amount which, in light of all the facts and
circumstances existing at the time, represent the amount which can be reasonably
be expected to become an actual or matured liability.
"SPIN-OFF" means the distribution by Ralston to its stockholders in a tax
--------
free transaction of all of the outstanding capital stock of Energizer such that
Energizer will become a separate publicly-held corporation owned directly by the
stockholders of Ralston to whom such distribution is made, in connection with
which there shall have been obtained a letter ruling from the IRS substantially
to the effect that the Spin-Off will be treated as a tax-free distribution by
Ralston under Section 355 of the Code (the "TAX RULING").
"SPIN-OFF DATE" means April 1, 2000.
--------------
"SPIN-OFF TRANSACTIONS" means the series of transactions contemplated by and
----------------------
described in the Form 10, including, but not limited to the Spin-Off.
"SPV" means any special purpose entity established for the purpose of purchasing
receivables in connection with a receivables securitization transaction
permitted under the terms of this Agreement.
"SUBSIDIARY" of a Person means (i) any corporation more than 50% of the
----------
outstanding securities having ordinary voting power of which shall at the time
-------
be owned or controlled, directly or indirectly, by such Person or by one or more
of its Subsidiaries or by such Person and one or more of its Subsidiaries, or
(ii) any partnership, limited liability company, association, joint venture or
similar business organization more than 50% of the ownership interests having
ordinary voting power of which shall at the time be so owned or controlled.
Unless otherwise expressly provided, all references herein to a "Subsidiary"
means a Subsidiary of the Borrower.
"SUBSIDIARY GUARANTORS" means (i) for the period from the Closing Date until the
---------------------
consummation of the Debt Assumption, Energizer and each of its Material Domestic
Subsidiaries; (ii) from and after the consummation of the Debt Assumption, all
of Energizer's Material Domestic Subsidiaries; (iii) all New Subsidiaries which
are Material Domestic Subsidiaries and which have satisfied the provisions of
Section 7.2(K)(a); (iv) all of Energizer's Subsidiaries which become Material
----------------
Domestic Subsidiaries and which have satisfied the provisions of Section
-------
7.2(K)(b); and (v) all other Subsidiaries which become Subsidiary Guarantors in
--
satisfaction of the provisions of Section 7.2(K)(c), in each case with respect
-----------------
to clauses (i) through (v) above, other than the SPVs and together with their
------------ ---
respective successors and assigns.
"SUBSIDIARY GUARANTY" means that certain Guaranty dated as of the Closing Date,
--------------------
executed by the Subsidiary Guarantors in favor of the Administrative Agent, for
the ratable benefit of the Lenders, as it may be amended, modified, supplemented
and/or restated (including to add new Subsidiary Guarantors), and as in effect
from time to time.
"SUPPLEMENT" shall have the meaning set forth in Section 7.2(K).
---------- ---------------
"SUPPLEMENTAL FINANCIAL STATEMENT" is defined in Section 6.7(A) hereof.
---------------------------------- ---------------
"TAX RULING" is defined in the definition of "Spin-Off" above.
-----------
"TAXES" means any and all present or future taxes, duties, levies, imposts,
-----
deductions, charges or withholdings, and any and all liabilities with respect to
---
the foregoing, but excluding Excluded Taxes.
"TERMINATION DATE" means the Commitment Termination Date, or if the Borrower
-----------------
shall have converted the Advances hereunder to a term loan pursuant to Section
-- -------
2.2(b), the Converted Loan Termination Date.
- ------
"TERMINATION EVENT" means (i) a Reportable Event with respect to any Benefit
------------------
Plan; (ii) the withdrawal of Energizer or any member of the Controlled Group
--
from a Benefit Plan during a plan year in which Energizer or such Controlled
--
Group member was a "substantial employer" as defined in Section 4001(a)(2) of
--
ERISA with respect to such plan; (iii) the imposition of an obligation under
-
Section 4041 of ERISA to provide affected parties written notice of intent to
-
terminate a Benefit Plan in a distress termination described in Section 4041(c)
-
of ERISA; (iv) the institution by the PBGC or any foreign governmental authority
of proceedings to terminate or appoint a trustee to administer a Benefit Plan or
Foreign Pension Plan; (v) any event or condition which might constitute grounds
under Section 4042 of ERISA for the termination of, or the appointment of a
trustee to administer, any Benefit Plan; or (vi) the partial or complete
withdrawal of Energizer or any member of the Controlled Group from a
Multiemployer Plan.
"TRANSACTION DOCUMENTS" means the Loan Documents and the documents executed and
----------------------
delivered by Ralston, Energizer or any of their respective Subsidiaries in
connection with the Spin-Off, the Bridge Facilities, the Receivables Purchase
Facility or the Senior Notes, including, without limitation, the Form 10, the
Debt Assumption Agreement, the Receivables Purchase Documents, the Senior Notes,
the Note Purchase Agreement and any documents evidencing the Bridge Facilities.
"TRANSACTIONS" means the Spin-Off Transactions, the Financing Facilities
------------
(including, without limitation, this Agreement and the financing transactions
------
evidenced by the Loan Documents) and the Debt Assumption.
-
"TRANSFEREE" is defined in Section 13.5 hereof.
---------- -------------
"TYPE" means, with respect to any Loan, its nature as a Floating Rate Loan or a
----
Eurodollar Rate Loan.
"UNMATURED DEFAULT" means an event which, but for the lapse of time or the
------------------
giving of notice, or both, would constitute a Default.
----
The foregoing definitions shall be equally applicable to both the singular and
plural forms of the defined terms. Any accounting terms used in this Agreement
which are not specifically defined herein shall have the meanings customarily
given them in accordance with generally accepted accounting principles in
existence as of the date hereof.
1.2 References. Any references to Subsidiaries of Ralston or Energizer
----------
shall not in any way be construed as consent by the Administrative Agent or any
Lender to the establishment, maintenance or acquisition of any Subsidiary,
except as may otherwise be permitted hereunder.
ARTICLE II: THE REVOLVING LOAN FACILITY
- ------------ ------------------------------
2.1 Revolving Loans. (a) Upon the satisfaction of the conditions precedent
----------------
set forth in Sections 5.1 and 5.2, as applicable, from and including the Initial
------------ ---
Funding Date and prior to the earlier of the Conversion Date and the
Commitment Termination Date, each Lender severally and not jointly agrees, on
the terms and conditions set forth in this Agreement, to make revolving loans to
the Borrower from time to time, in Dollars, in an amount not to exceed such
Lender's Pro Rata Share of Revolving Credit Availability at such time (each
individually, a "REVOLVING LOAN" and, collectively, the "REVOLVING LOANS");
provided, however, at no time shall the Revolving Credit Obligations exceed the
---- -------
Aggregate Revolving Loan Commitment. Subject to the terms of this Agreement,
the Borrower may borrow, repay and reborrow Revolving Loans at any time prior to
the earlier of the Conversion Date and the Commitment Termination Date. The
Revolving Loans made on the Initial Funding Date or on or before the third (3rd)
Business Day thereafter shall initially be Floating Rate Loans and thereafter
may be continued as Floating Rate Loans or converted into Eurodollar Rate Loans
in the manner provided in Section 2.9 and subject to the other conditions and
-----------
limitations therein set forth and set forth in this Article II and set forth in
----------
the definition of Interest Period; provided, however, that if the Borrower
-------- -------
delivers a Borrowing/Election Notice, signed by it, together with appropriate
documentation in form and substance satisfactory to the Administrative Agent
indemnifying the Lenders for the amounts described in Section 4.4 on or before
-----------
the third (3rd) Business Day prior to the Initial Funding Date, the Revolving
Loans made on the Initial Funding Date may be Eurodollar Rate Loans. Revolving
Loans made after the third (3rd) Business Day after the Initial Funding Date
shall be, at the option of the Borrower, selected in accordance with Section
-------
2.9, either Floating Rate Loans or Eurodollar Rate Loans. On the Termination
Date, the Borrower shall repay in full the outstanding principal balance of the
Revolving Loans. Each Advance under this Section 2.1 shall consist of Revolving
-----------
Loans made by each Lender ratably in proportion to such Lender's respective Pro
Rata Share.
(b) Borrowing/Election Notice. The Borrower shall deliver to the
--------------------------
Administrative Agent a Borrowing/Election Notice, signed by it, in accordance
with the terms of Section 2.7. The Administrative Agent shall promptly notify
-----------
each Lender of such request.
(c) Making of Revolving Loans. Promptly after receipt of the
----------------------------
Borrowing/Election Notice under Section 2.7 in respect of Revolving Loans, the
------------ -----------
Administrative Agent shall notify each Lender by telex or telecopy, or other
similar form of transmission, of the requested Revolving Loan. Each Lender
shall make available its Revolving Loan in accordance with the terms of Section
-------
2.6. The Administrative Agent will promptly make the funds so received from the
- ---
Lenders available to the Borrower at the Administrative Agent's office in
Chicago, Illinois on the applicable Borrowing Date and shall disburse such
proceeds in accordance with the Borrower's disbursement instructions set forth
in such Borrowing/Election Notice. The failure of any Lender to deposit the
amount described above with the Administrative Agent on the applicable Borrowing
Date shall not relieve any other Lender of its obligations hereunder to make its
Revolving Loan on such Borrowing Date.
2.2 Extension of Revolving Loan Termination Date; Conversion to Term Loan.
-----------------------------------------------------------------------
(a) Extension of Revolving Loan Termination Date. The Aggregate Revolving
--------------------------------------------
Loan Commitment shall expire on the earlier of the Conversion Date and the
Commitment Termination Date. Within the period beginning 59 days and ending 30
days before the then effective Revolving Loan Termination Date, the Borrower may
request in writing that the Revolving Loan Termination Date be extended for an
additional period of 364 days, including the then effective Revolving Loan
Termination Date as one of the days in the calculation of days elapsed. Within
20 days after such request (such 20th day being the "CONSENT DATE"), each Lender
may, in its sole discretion, agree to such extension to a new Revolving Loan
Termination Date not more than 364 days following such Consent Date by giving
written notice of such agreement to the Borrower and the Administrative Agent
(and the failure to provide such notice shall be deemed to be a decision not to
extend). The Revolving Loan Commitment of each Lender that declines to extend
with respect to the Aggregate Revolving Loan Commitment may, at the option of
the Borrower, be replaced in accordance with Section 13.3(A) (but only to the
---------------
extent a replacement Lender is then available), or the Aggregate Revolving Loan
Commitment shall be reduced. All Obligations due to each Lender that declines
to extend its Revolving Loan Commitment under this Section 2.2(a) shall be paid
--------------
in full to the Administrative Agent for the account of each such Lender on the
then effective Revolving Loan Termination Date (without giving effect to any
such requested extension thereto). The Required Lenders and the Borrower must
agree to any extension with respect to the Revolving Loan Termination Date for
any such extension to become effective.
(b) Conversion to Term Loan. From and after the consummation of the Debt
--------------------------
Assumption up until and including the Commitment Termination Date, at the
Borrower's option upon written notice (a "NOTICE TO CONVERT") to the
Administrative Agent (who shall promptly notify each of the Lenders), the
Borrower may convert the then outstanding aggregate principal amount of the
Advances hereunder to a term loan. The Notice to Convert shall expressly state
the date on which such conversion shall occur (such date being the "CONVERSION
DATE") and shall be irrevocable once given and shall constitute a representation
and warranty by the Borrower that the conditions contained in Section 5.2 have
-----------
been satisfied as of the date of such Notice to Convert and as of the Conversion
Date. Upon delivery of such Notice to Convert, (i) the Borrower's option to
request extensions of the Revolving Loan Termination Date under clause (a) above
----------
and to borrow and reborrow Revolving Loans hereunder, shall terminate, (ii) the
Aggregate Revolving Loan Commitment shall be reduced to zero, and (iii) the
outstanding principal balance of all Loans hereunder shall be due and payable on
the Converted Loan Termination Date. All references in this Agreement to
Revolving Loans shall include such Loans as converted hereunder.
2.3 Rate Options for all Advances; Maximum Interest Periods. The Revolving
--------------------------------------------------------
Loans may be Floating Rate Advances or Eurodollar Rate Advances, or a
combination thereof, selected by the Borrower in accordance with Section 2.10.
------------
The Borrower may select, in accordance with Section 2.9, rate options and
-----------
Interest Periods applicable to the Revolving Loans; provided that there shall be
--------
no more than eight (8) Interest Periods in effect with respect to all of
the Loans at any time.
2.4 Optional Payments. The Borrower may from time to time and at any time
------------------
upon at least one (1) Business Day's prior written notice repay or prepay,
without penalty or premium all or any part of outstanding Floating Rate Advances
in an aggregate minimum amount of $10,000,000 and in integral multiples of
$1,000,000 in excess thereof. Eurodollar Rate Advances may be voluntarily repaid
or prepaid prior to the last day of the applicable Interest Period, subject to
the indemnification provisions contained in Section 4.4, provided, that the
----------- --------
Borrower may not so prepay Eurodollar Rate Advances unless it shall have
provided at least three (3) Business Days' prior written notice to the
Administrative Agent of such prepayment and provided, further, that optional
-------- -------
prepayments of Eurodollar Rate Advances made pursuant to Section 2.1 shall be
-----------
for the entire amount of the outstanding Eurodollar Rate Advance.
2.5 Reduction of Revolving Loan Commitments. Prior to the Conversion Date,
----------------------------------------
the Borrower may permanently reduce the Aggregate Revolving Loan Commitment in
whole, or in part ratably among the Lenders, in an aggregate minimum amount of
$25,000,000 and integral multiples of $5,000,000 in excess of that amount
(unless the Aggregate Revolving Loan Commitment is reduced in whole), upon at
least three (3) Business Day's prior written notice to the Administrative Agent,
which notice shall specify the amount of any such reduction; provided, however,
-------- -------
that the amount of the Aggregate Revolving Loan Commitment may not be reduced
below the aggregate principal amount of the outstanding Revolving Credit
Obligations. All accrued Facility Fees shall be payable on the effective date
of any termination of the obligations of the Lenders to make Loans hereunder
(other than a termination of such obligations pursuant to Section 2.2(b)) or any
--------------
reduction of the Aggregate Revolving Loan Commitment on the amount so reduced.
2.6 Method of Borrowing. Not later than 2:00 p.m. (Chicago time) on each
---------------------
Borrowing Date, each Lender shall make available its Revolving Loan, in
immediately available funds, to the Administrative Agent at its address
specified pursuant to Article XIV. The Administrative Agent will promptly make
-----------
the funds so received from the Lenders available to the Borrower at the
Administrative Agent's aforesaid address.
2.7 Method of Selecting Types and Interest Periods for Advances. The
------------------------------------------------------------------
Borrower shall select the Type of Advance and, in the case of each Eurodollar
Rate Advance, the Interest Period applicable to each Advance from time to time.
The Borrower shall give the Administrative Agent irrevocable notice in
substantially the form of Exhibit B hereto (a "BORROWING/ELECTION NOTICE") not
---------
later than 11:00 a.m. (Chicago time) (a) on or before the Borrowing Date of each
Floating Rate Advance and (b) three (3) Business Days before the Borrowing Date
for each Eurodollar Rate Advance specifying: (i) the Borrowing Date (which
shall be a Business Day) of such Advance; (ii) the aggregate amount of such
Advance; (iii) the Type of Advance selected; and (iv) in the case of each
Eurodollar Rate Advance, the Interest Period applicable thereto; provided,
--------
however, that with respect to the borrowing on the Initial Funding Date, such
--
notice shall be delivered in accordance with the terms of Section 2.1(a) and
--------------
shall be accompanied by the documentation specified in such Section. The
Borrower shall select Interest Periods so that, to the best of the Borrower's
knowledge, it will not be necessary to prepay all or any portion of any
Eurodollar Rate Advance prior to the last day of the applicable Interest Period
in order to make mandatory prepayments as required pursuant to the terms hereof.
Each Floating Rate Advance and all Obligations other than Loans shall bear
interest from and including the date of the making of such Advance, in the case
of Floating Rate Advances, and the date such Obligation is due and owing in the
case of such other Obligations, to (but not including) the date of repayment
thereof at the Alternate Base Rate, changing when and as such Alternate Base
Rate changes. Changes in the rate of interest on that portion of the Loans
maintained as Floating Rate Loans will take effect simultaneously with each
change in the Alternate Base Rate. Each Eurodollar Rate Advance shall bear
interest from and including the first day of the Interest Period applicable
thereto to (but not including) the last day of such Interest Period at the
interest rate determined as applicable to such Eurodollar Rate Advance, changing
when and as the Applicable Margin changes. Changes in the rate of interest on
that portion of the Loans maintained as Eurodollar Rate Advances will take
effect simultaneously with each change in the Applicable Margin.
2.8 Minimum Amount of Each Advance. Each Advance shall be in the minimum
---------------------------------
amount of $10,000,000 (and in multiples of $1,000,000 if in excess thereof);
provided, however, that any Floating Rate Advance may be in the amount of the
----- -------
unused Aggregate Revolving Loan Commitment.
2.9 Method of Selecting Types and Interest Periods for Conversion and
------------------------------------------------------------------------
Continuation of Advances.
--------------------
(A) Right to Convert. The Borrower may elect from time to time, subject to
-----------------
the provisions of Section 2.3 and this Section 2.9, to convert all or any part
----------- -----------
of a Loan of any Type into any other Type or Types of Loans; provided that any
--------
conversion of any Eurodollar Rate Advance shall be made on, and only on, the
last day of the Interest Period applicable thereto.
(B) Automatic Conversion and Continuation. Floating Rate Loans shall
----------------------------------------
continue as Floating Rate Loans unless and until such Floating Rate Loans are
repaid or converted into Eurodollar Rate Loans. Eurodollar Rate Loans shall
continue as Eurodollar Rate Loans until the end of the then applicable Interest
Period therefor, at which time such Eurodollar Rate Loans shall be automatically
converted into Floating Rate Loans unless the Borrower shall have repaid such
Loans or given the Administrative Agent a Borrowing/Election Notice in
accordance with Section 2.9(D) requesting that, at the end of such Interest
---------------
Period, such Eurodollar Rate Loans continue as a Eurodollar Rate Loan.
(C) No Conversion Post-Default. Notwithstanding anything to the contrary
----------------------------
contained in Section 2.9(A) or Section 2.9(B), no Loan may be converted into or
-------------- --------------
continued as a Eurodollar Rate Loan (except with the consent of the Required
Lenders) when any Default has occurred and is continuing.
(D) Borrowing/Election Notice. The Borrower shall give the Administrative
--------------------------
Agent an irrevocable Borrowing/Election Notice of each conversion of a Floating
Rate Loan into a Eurodollar Rate Loan or continuation of a Eurodollar Rate Loan
not later than 11:00 a.m. (Chicago time) three (3) Business Days prior to the
date of the requested conversion or continuation, specifying: (i) the requested
date (which shall be a Business Day) of such conversion or continuation; (ii)
the amount and Type of the Loan to be converted or continued; and (iii) the
amount of Eurodollar Rate Loan(s) into which such Loan is to be converted or
continued, and the duration of the Interest Period applicable thereto.
2.10 Default Rate. After the occurrence and during the continuance of a
-------------
Default, the Administrative Agent or the Required Lenders may, at their option,
by notice to the Borrower declare that, (a) the interest rate(s) applicable to
the Obligations (other than Eurodollar Rate Advances) shall be equal to the
Alternate Base Rate, changing as and when the Alternate Base Rate changes, or,
for Eurodollar Rate Advances, the then highest Eurodollar Rate (utilizing the
highest Applicable Margin in effect from time to time), in each case, plus two
----
percent (2.00%) per annum for all Loans and other Obligations, and (b) the
Facility Fees shall be calculated using the highest Applicable Facility Fee
Percentage; provided, that after the occurrence and during the continuance of a
--------
Default under Sections 8.1(F), (G) or (I), the interest rate described in clause
---------------- --- --- ------
(a) above and the Facility Fee described in clause (b) above shall be
--- ----------
applicable without any election or action on the part of the Administrative
Agent or any other Lender.
2.11 Method of Payment. All payments of principal, interest, fees and
-------------------
commissions hereunder shall be made, without setoff, deduction or counterclaim,
in immediately available funds to the Administrative Agent at the Administrative
Agent's address specified pursuant to Article XIV, or at any other Lending
------------
Installation of the Administrative Agent specified in writing by the
Administrative Agent to the Borrower, by 2:00 p.m. (Chicago time) on the date
when due and shall be made ratably among the Lenders (unless such amount is not
to be shared ratably in accordance with the terms hereof). Each payment
delivered to the Administrative Agent for the account of any Lender shall be
delivered promptly by the Administrative Agent to such Lender in the same type
of funds which the Administrative Agent received at its address specified
pursuant to Article XIV or at any Lending Installation specified in a notice
------------
received by the Administrative Agent from such Lender. The Borrower authorizes
the Administrative Agent to charge the account of the Borrower maintained with
Bank One for each payment of principal, interest, fees and commissions as it
becomes due hereunder.
2.12 Evidence of Debt.
------------------
(a) Each Lender shall maintain in accordance with its usual practice an
account or accounts (a "LOAN ACCOUNT") evidencing the indebtedness of the
-------------
Borrower to such Lender owing to such Lender from time to time, including the
amounts of principal and interest payable and paid to such Lender from time to
time hereunder.
(b) The Register maintained by the Administrative Agent pursuant to Section
-------
13.3(C) shall include a control account, and a subsidiary account for each
----
Lender, in which accounts (taken together) shall be recorded (i) the date and
--
the amount of each Loan made hereunder, the Type thereof and the Interest
Period, if any, applicable thereto, (ii) the amount of any principal or interest
due and payable or to become due and payable from the Borrower to each Lender
hereunder, (iii) the effective date and amount of each Assignment Agreement
delivered to and accepted by it and the parties thereto pursuant to Section
-------
13.3, (iv) the amount of any sum received by the Administrative Agent hereunder
for the account of the Lenders and each Lender's share thereof, and (v) all
other appropriate debits and credits as provided in this Agreement, including,
without limitation, all fees, charges, expenses and interest.
(c) The entries made in the Loan Account, the Register and the other accounts
maintained pursuant to subsections (a) or (b) of this Section shall be
---------------- ---
conclusive and binding for all purposes, absent manifest error, unless the
Borrower objects to information contained in the Loan Accounts, the Register or
the other accounts within thirty (30) days of the Borrower's receipt of such
information; provided that the failure of any Lender or the Administrative Agent
--------
to maintain such accounts or any error therein shall not in any manner affect
the obligation of the Borrower to repay the Loans in accordance with the terms
of this Agreement.
(d) Any Lender may request that the Revolving Loans made by it be evidenced by
a promissory note. In such event, the Borrower shall prepare, execute and
deliver to such Lender a promissory note for such Loans payable to the order of
such Lender and in a form approved by the Administrative Agent in its reasonable
discretion and consistent with the terms of this Agreement. Thereafter, the
Loans evidenced by such promissory note and interest thereon shall at all times
(including after assignment pursuant to Section 13.3) be represented by one or
------------
more promissory notes in such form payable to the order of the payee named
therein.
2.13 Telephonic Notices. The Borrower authorizes the Lenders and the
-------------------
Administrative Agent to extend, convert or continue Advances, effect selections
of Types of Advances and to transfer funds based on telephonic notices made by
any person or persons the Administrative Agent or any Lender in good faith
believes to be acting on behalf of the Borrower. The Borrower agrees to deliver
promptly to the Administrative Agent a written confirmation, signed by an
Authorized Officer, if such confirmation is requested by the Administrative
Agent or any Lender, of each telephonic notice. If the written confirmation
differs in any material respect from the action taken by the Administrative
Agent and the Lenders, the records of the Administrative Agent and the Lenders
with respect to such telephonic notice shall govern absent manifest error. In
case of disagreement concerning such notices, if the Administrative Agent has
recorded telephonic Borrowing/Election Notices, such recordings will be made
available to the Borrower upon the Borrower's request therefor.
2.14 Promise to Pay; Interest and Facility Fees; Interest Payment Dates;
-----------------------------------------------------------------------
Interest and Fee Basis; Loan and Control Accounts.
-----------------------------------------------------
(A) Promise to Pay. The Borrower unconditionally promises to pay when due
----------------
the principal amount of each Loan and all other Obligations incurred by it, and
to pay all unpaid interest accrued thereon, in accordance with the terms of this
Agreement and the other Loan Documents.
(B) Interest Payment Dates. Interest accrued on each Floating Rate Loan
------------------------
shall be payable on each Payment Date, commencing with the first such date to
occur after the date hereof and at maturity (whether by acceleration or
otherwise). Interest accrued on each Eurodollar Rate Loan shall be payable on
the last day of its applicable Interest Period, on any date on which the
Eurodollar Rate Loan is prepaid, whether by acceleration or otherwise, and at
maturity. Interest accrued on each Eurodollar Rate Loan having an Interest
Period longer than three months shall also be payable on the last day of each
three-month interval during such Interest Period. Interest accrued on the
principal balance of all other Obligations shall be payable in arrears (i) on
the last day of each calendar quarter, commencing on the first such day
following the incurrence of such Obligation, (ii) upon repayment thereof in full
or in part, and (iii) if not theretofore paid in full, at the time such other
Obligation becomes due and payable (whether by acceleration or otherwise).
(C) Facility Fees and Administrative Agent's Fees. (i) The Borrower shall
----------------------------------------------
pay to the Administrative Agent, for the account of the Lenders in accordance
with their Pro Rata Shares, from and after the Closing Date until the
Termination Date, a facility fee (the "FACILITY FEE") accruing at the per annum
rate of the then Applicable Facility Fee Percentage, on the Aggregate Revolving
Loan Commitment (whether used or unused) (or, from and after the earlier of the
Conversion Date or the Commitment Termination Date, the average daily aggregate
principal amount of all Loans). All such Facility Fees payable under this
clause (C) shall be payable quarterly in arrears on each Payment Date occurring
------
after the Closing Date (with the first such payment being calculated for the
period from the Closing Date and ending on June 30, 2000) and on the Termination
Date.
(ii) Ralston shall pay or shall cause Energizer to pay to the
Administrative Agent for the sole account of the Administrative Agent and the
Arranger (unless otherwise agreed between the Administrative Agent and the
Arranger and any Lender) the fees set forth in the letter agreement among the
Administrative Agent, the Arranger, Ralston and Energizer dated February 16,
2000, payable at the times and in the amounts set forth therein.
(D) Interest and Fee Basis; Applicable Margin and Applicable Facility Fee
------------------------------------------------------------------------
Percentage.
--------
(i) Interest accrued on Eurodollar Rate Advances, Facility Fees and
Floating Rate Advances where the basis for calculation is the Federal Funds
Effective Rate shall be calculated for actual days elapsed on the basis of a
year of 360 days, and interest accrued on Floating Rate Advances where the basis
for calculation is the Prime Rate shall be calculated for actual days elapsed on
the basis of a year of 365, or when appropriate 366, days. Interest shall be
payable for the day an Obligation is incurred but not for the day of any payment
on the amount paid if payment is received prior to 2:00 p.m. (Chicago time) at
the place of payment. If any payment of principal of or interest on a Loan or
any payment of any other Obligations shall become due on a day which is not a
Business Day, such payment shall be made on the next succeeding Business Day
and, in the case of a principal payment, such extension of time shall be
included in computing interest, fees and commissions in connection with such
payment.
(ii) The Applicable Margin and Applicable Facility Fee Percentage shall be
determined from time to time by reference to the table set forth below, on the
basis of the then applicable Leverage Ratio as described in this Section
-------
2.14(D)(ii):
----
APPLICABLE
FACILITY FEE
LEVERAGE RATIO APPLICABLE MARGIN PERCENTAGE
-------------- ----------------- ----------
Level I
<1.0 to 1.0 0.40% 0.10%
- ------------- ----- -----
Level II
1.0 to 1.0 and
<1.5 to 1.0 0.525% 0.10%
- ------------- ------ -----
Level III
1.5 to 1.0 and
<2.0 to 1.0 0.625% 0.125%
------ ------
Level IV
2.0 to 1.0 and
<2.5 to 1.0 0.850% 0.150%
------ ------
Level V
2.5 to 1.0 1.075% 0.175%
- ------------ ------ ------
For purposes of this Section 2.14(D)(ii), the Leverage Ratio shall be calculated
-------------------
as provided in Section 7.4(A). Upon receipt of the financial statements
---------------
delivered pursuant to Section 7.1(A)(i) and (ii), as applicable, the Applicable
----------------- ----
Margin and Applicable Facility Fee Percentage and shall be adjusted, such
adjustment being effective five (5) Business Days following the Administrative
Agent's receipt of such financial statements and the compliance certificate
required to be delivered in connection therewith pursuant to Section
-------
7.1(A)(iii); provided, that if the Borrower shall not have timely delivered its
--------
financial statements in accordance with Section 7.1(A)(i) or (ii), as
------------------ ----
applicable, then commencing on the date upon which such financial statements
should have been delivered and continuing until five (5) Business Days following
the date such financial statements are actually delivered, it shall be assumed
for purposes of determining the Applicable Margin and Applicable Facility Fee
Percentage that the Leverage Ratio was greater than 2.5 to 1.0 and Level V
pricing shall be applicable.
(iii) Notwithstanding anything herein to the contrary, from the Closing
Date to but not including the fifth Business Day following receipt of the
Borrower's financial statements delivered pursuant to Section 7.1(A)(i) for the
-----------------
fiscal quarter ending June 30, 2000, the Applicable Margin and Applicable
Facility Fee Percentage shall be set at the greater of (a) Level III and (b) the
Level determined in accordance with clause (ii) above.
2.15 Notification of Advances, Interest Rates, Prepayments and Aggregate
-----------------------------------------------------------------------
Revolving Loan Commitment Reductions. Promptly after receipt thereof, the
------------------------------------
Administrative Agent will notify each Lender of the contents of each Aggregate
--
Revolving Loan Commitment reduction notice, Borrowing/Election Notice repayment
notice and issuance of Letter of Credit notice received by it hereunder. The
Administrative Agent will notify each Lender of the interest rate applicable to
each Eurodollar Rate Loan promptly upon determination of such interest rate and
will give each Lender prompt notice of each change in the Alternate Base Rate.
2.16 Lending Installations. Each Lender may book its Loans at any Lending
----------------------
Installation selected by such Lender and may change its Lending Installation
from time to time. All terms of this Agreement shall apply to any such Lending
Installation. Subject to the provisions of Section 4.6, each Lender may, by
-----------
written or facsimile notice to the Administrative Agent and the Borrower,
designate a Lending Installation through which Loans will be made by it and for
whose account Loan payments are to be made.
2.17 Non-Receipt of Funds by the Administrative Agent. Unless the Borrower
-------------------------------------------------
or a Lender, as the case may be, notifies the Administrative Agent prior to the
date on which it is scheduled to make payment to the Administrative Agent of (i)
in the case of a Lender, the proceeds of a Loan or (ii) in the case of the
Borrower, a payment of principal, interest or fees to the Administrative Agent
for the account of the Lenders, that it does not intend to make such payment,
the Administrative Agent may assume that such payment has been made. The
Administrative Agent may, but shall not be obligated to, make the amount of such
payment available to the intended recipient in reliance upon such assumption.
If such Lender or the Borrower, as the case may be, has not in fact made such
payment to the Administrative Agent, the recipient of such payment shall, on
demand by the Administrative Agent, repay to the Administrative Agent the amount
so made available together with interest thereon in respect of each day during
the period commencing on the date such amount was so made available by the
Administrative Agent until the date the Administrative Agent recovers such
amount at a rate per annum equal to (i) in the case of payment by a Lender, the
Federal Funds Effective Rate for such day or (ii) in the case of payment by the
Borrower, the interest rate applicable to the relevant Loan.
2.18 Termination Date. This Agreement shall be effective until the
-----------------
Termination Date. Notwithstanding the termination of this Agreement, until all
of the Obligations (other than contingent indemnity obligations) shall have been
fully and indefeasibly paid and satisfied in cash (to the full extent that such
Obligations are payable in cash) and all financing arrangements among the
Borrower and the Lenders shall have been terminated, all of the rights and
remedies under this Agreement and the other Loan Documents shall survive.
2.19 Replacement of Certain Lenders. In the event a Lender ("AFFECTED
---------------------------------
LENDER") shall have: (i) failed to fund its Pro Rata Share of any Advance
requested by the Borrower, which such Lender is obligated to fund under the
terms of this Agreement and which failure has not been cured, (ii) requested
compensation from the Borrower under Sections 4.1, 4.2 or 4.5 to recover Taxes,
------------ --- ---
Other Taxes or other additional costs incurred by such Lender which are not
being incurred generally by the other Lenders, (iii) delivered a notice pursuant
to Section 4.3 claiming that such Lender is unable to extend Eurodollar Rate
------------
Loans to the Borrower for reasons not generally applicable to the other Lenders
or (iv) has invoked Section 10.2, then, in any such case, the Borrower or the
------------
Administrative Agent may make written demand on such Affected Lender (with a
copy to the Administrative Agent in the case of a demand by the Borrower and a
copy to the Borrower in the case of a demand by the Administrative Agent) for
the Affected Lender to assign, and such Affected Lender shall use commercially
reasonable efforts to assign pursuant to one or more duly executed Assignment
Agreements five (5) Business Days after the date of such demand, to one or more
financial institutions that comply with the provisions of Section 13.3 which the
------------
Borrower or the Administrative Agent, as the case may be, shall have engaged for
such purpose ("REPLACEMENT LENDER"), all of such Affected Lender's rights and
obligations under this Agreement and the other Loan Documents (including,
without limitation, its Revolving Loan Commitment and all Loans owing to it) in
accordance with Section 13.3. The Administrative Agent agrees, upon the
-------------
occurrence of such events with respect to an Affected Lender and upon the
written request of the Borrower, to use its reasonable efforts to obtain the
commitments from one or more financial institutions to act as a Replacement
Lender. The Administrative Agent is authorized to execute one or more of such
Assignment Agreements as attorney-in-fact for any Affected Lender failing to
execute and deliver the same within five (5) Business Days after the date of
such demand. Further, with respect to such assignment the Affected Lender shall
have concurrently received, in cash, all amounts due and owing to the Affected
Lender hereunder or under any other Loan Document, including, without
limitation, the aggregate outstanding principal amount of the Loans owed to such
Lender, together with accrued interest thereon through the date of such
assignment, amounts payable under Sections 4.1, 4.2 and 4.5 with respect to such
------------ --- ---
Affected Lender and compensation payable under Section 2.14(C) in the event of
---------------
any replacement of any Affected Lender under clause (ii) or clause (iii) of this
----------- ------------
Section 2.19; provided that upon such Affected Lender's replacement, such
- ------------- --------
Affected Lender shall cease to be a party hereto but shall continue to be
- ------
entitled to the benefits of Sections 4.1, 4.2, 4.4, 4.5 and 10.7, as well as to
- ------ ------------ --- --- --- ----
any fees accrued for its account hereunder and not yet paid, and shall continue
to be obligated under Section 11.8 with respect to losses, obligations,
-------------
liabilities, damages, penalties, actions, judgements, costs, expenses or
disbursements for matters which occurred prior to the date the Affected Lender
is replaced. Upon the replacement of any Affected Lender pursuant to this
Section 2.19, the provisions of Section 9.2 shall continue to apply with respect
------- -----------
to Loans which are then outstanding with respect to which the Affected Lender
failed to fund its Pro Rata Share and which failure has not been cured.
ARTICLE III: [RESERVED]
- ------------- ----------
ARTICLE IV: YIELD PROTECTION; TAXES
- ------------ -------------------------
4.1 Yield Protection. If, on or after the date of this Agreement, the
-----------------
adoption of any law or any governmental or quasi-governmental rule, regulation,
policy, guideline or directive (whether or not having the force of law), or any
change in the interpretation or administration thereof by any governmental or
quasi-governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by any Lender or
applicable Lending Installation with any request or directive (whether or not
having the force of law) of any such authority, central bank or comparable
agency:
(i) subjects any Lender or any applicable Lending Installation to any Taxes,
or changes the basis of taxation of payments (other than with respect to
Excluded Taxes) to any Lender in respect of its Loans, or
(ii) imposes or increases or deems applicable any reserve, assessment,
insurance charge, special deposit or similar requirement against assets of,
deposits with or for the account of, or credit extended by, any Lender or any
applicable Lending Installation (other than reserves and assessments taken into
account in determining the interest rate applicable to Eurodollar Rate
Advances), or
(iii) imposes any other condition the result of which is to increase the
cost to any Lender or any applicable Lending Installation of making, funding or
maintaining its Loans or reduces any amount receivable by any Lender or any
applicable Lending Installation in connection with its Loans, or requires any
Lender or any applicable Lending Installation to make any payment calculated by
reference to the amount of Loans held or interest received by it, by an amount
deemed material by such Lender,
and the result of any of the foregoing is to increase the cost to such Lender or
applicable Lending Installation of making or maintaining its Loans or Revolving
Loan Commitment or to reduce the return received by such Lender or applicable
Lending Installation in connection with such Loans or Revolving Loan Commitment,
then, within fifteen (15) days of demand by such Lender, the Borrower shall pay
such Lender such additional amount or amounts as will compensate such Lender for
such increased cost or reduction in amount received.
Notwithstanding the foregoing provisions of this Section 4.1, if any Lender
-----------
fails to notify the Borrower of any event or circumstance which will entitle
such Lender to compensation pursuant to this Section 4.1 within ninety (90) days
-----------
after such Lender obtains knowledge of such event or circumstance, then such
Lender shall not be entitled to compensation from the Borrower for any amount
arising prior to the date which is ninety (90) days before the date on which
such Lender notifies the Borrower of such event or circumstance.
4.2 Changes in Capital Adequacy Regulations. If a Lender determines the
-------------------------------------------
amount of capital required or expected to be maintained by such Lender, any
Lending Installation of such Lender or any corporation controlling such Lender
is increased as a result of a Change, then, within 15 days of demand by such
Lender, the Borrower shall pay such Lender the amount necessary to compensate
for any shortfall in the rate of return on the portion of such increased capital
which such Lender reasonably determines is attributable to this Agreement,
its Loans or its Revolving Loan Commitment hereunder (after taking into account
such Lender's customary policies as to capital adequacy). "CHANGE" means (i)
any change after the date of this Agreement in the Risk-Based Capital Guidelines
or (ii) any adoption of or change in any other law, governmental or
quasi-governmental rule, regulation, policy, guideline, interpretation, or
directive (whether or not having the force of law) after the date of this
Agreement which affects the amount of capital required or expected to be
maintained by any Lender or any Lending Installation or any corporation
controlling any Lender. "RISK-BASED CAPITAL GUIDELINES" means (i) the
risk-based capital guidelines in effect in the United States on the date of this
Agreement, including transition rules, and (ii) the corresponding capital
regulations promulgated by regulatory authorities outside the United States
implementing the July 1988 report of the Basle Committee on Banking Regulation
and Supervisory Practices Entitled "International Convergence of Capital
Measurements and Capital Standards," including transition rules, and any
amendments to such regulations adopted prior to the date of this Agreement.
4.3 Availability of Types of Advances. If any Lender determines that
-------------------------------------
maintenance of its Eurodollar Rate Loans at a suitable Lending Installation
would violate any applicable law, rule, regulation, or directive, whether or not
having the force of law, or if the Required Lenders determine that (i) deposits
of a type and maturity appropriate to match fund Eurodollar Rate Advances are
not available or (ii) the interest rate applicable to Eurodollar Rate Advances
does not accurately reflect the cost of making or maintaining Eurodollar Rate
Advances, then the Administrative Agent shall suspend the availability of
Eurodollar Rate Advances and require any affected Eurodollar Rate Advances to be
repaid or converted to Floating Rate Advances, subject to the payment of any
funding indemnification amounts required by Section 4.4.
------------
4.4 Funding Indemnification. If any payment of a Eurodollar Rate Advance
------------------------
occurs on a date which is not the last day of the applicable Interest Period,
whether because of acceleration, prepayment or otherwise, or a Eurodollar Rate
Advance is not made on the date specified by the Borrower for any reason other
than default by the Lenders, the Borrower will indemnify each Lender for any
loss or cost incurred by it resulting therefrom (excluding loss of margin),
including, without limitation, any loss or cost in liquidating or employing
deposits acquired to fund or maintain such Eurodollar Rate Advance.
4.5 Taxes. (i) All payments by the Borrower to or for the account of any
-----
Lender or the Administrative Agent hereunder or under any of the other Loan
Documents shall be made free and clear of and without deduction for any and all
Taxes. If the Borrower shall be required by law to deduct any Taxes from or in
respect of any sum payable hereunder to any Lender or the Administrative Agent,
(a) the sum payable shall be increased as necessary so that after making all
required deductions (including deductions applicable to additional sums payable
under this Section 4.5) such Lender or the Administrative Agent (as the case may
-----------
be) receives an amount equal to the sum it would have received had no such
deductions been made, (b) the Borrower shall make such deductions, (c) the
Borrower shall pay the full amount deducted to the relevant authority in
accordance with applicable law and (d) the Borrower shall furnish to the
Administrative Agent the original copy of a receipt evidencing payment thereof
within thirty (30) days after such payment is made. Such Lender or the
Administrative Agent, as the case may be, shall promptly reimburse the Borrower
for such payments to the extent such Lender or the Administrative Agent receives
actual knowledge that it has received any tax credit or other benefit in
connection with such tax payments and that such tax credit or benefit is clearly
attributable to this Agreement.
(ii) In addition, the Borrower hereby agrees to pay any present or future
stamp or documentary taxes and any other excise or property taxes, charges or
similar levies which arise from any payment made hereunder or under any
promissory note issued hereunder or from the execution or delivery of, or
otherwise with respect to, this Agreement or any promissory note issued
hereunder ("OTHER TAXES").
(iii) The Borrower hereby agrees to indemnify the Administrative Agent and each
Lender for the full amount of Taxes or Other Taxes (including, without
limitation, any Taxes or Other Taxes imposed on amounts payable under this
Section 4.5) paid by the Administrative Agent or such Lender and any liability
-------
(including penalties, interest and expenses) arising therefrom or with respect
thereto. Payments due under this indemnification shall be made within thirty
(30) days of the date the Administrative Agent or such Lender makes demand
therefor pursuant to Section 4.6.
------------
(iv) Each Lender that is not incorporated under the laws of the United States
of America or a state thereof (each a "Non-U.S. Lender") agrees that it will,
not less than ten (10) Business Days after the date of this Agreement, deliver
to each of the Borrower and the Administrative Agent a United States Internal
Revenue Form W-8 or W-9, as the case may be, and certify that it is entitled to
an exemption from United States backup withholding tax. Each Non-U.S. Lender
further undertakes to deliver to each of the Borrower and the Administrative
Agent (x) renewals or additional copies of such form (or any successor form) on
or before the date that such form expires or becomes obsolete, and (y) after the
occurrence of any event requiring a change in the most recent forms so delivered
by it, such additional forms or amendments thereto as may be reasonably
requested by the Borrower or the Administrative Agent. All forms or amendments
described in the preceding sentence shall certify that such Lender is entitled
to receive payments under this Agreement without deduction or withholding of any
United States federal income taxes, unless an event (including without
limitation any change in treaty, law or regulation) has occurred prior to the
date on which any such delivery would otherwise be required which renders all
such forms inapplicable or which would prevent such Lender from duly completing
and delivering any such form or amendment with respect to it and such Lender
advises the Borrower and the Administrative Agent that it is not capable of
receiving payments without any deduction or withholding of United States federal
income tax.
(v) For any period during which a Non-U.S. Lender has failed to provide the
Borrower with an appropriate form pursuant to clause (iv), above (unless such
failure is due to a change in treaty, law or regulation, or any change in the
interpretation or administration thereof by any governmental authority,
occurring subsequent to the date on which a form originally was required to be
provided), such Non-U.S. Lender shall not be entitled to indemnification under
this Section 4.5 with respect to Taxes imposed by the United States; provided
------------
that, should a Non-U.S. Lender which is otherwise exempt from or subject to a
reduced rate of withholding tax become subject to Taxes because of its failure
to deliver a form required under clause (iv), above, the Borrower shall take
such steps as such Non-U.S. Lender shall reasonably request (without cost to the
Borrower) to assist such Non-U.S. Lender to recover such Taxes.
(vi) Any Lender that is entitled to an exemption from or reduction of
withholding tax with respect to payments under this Agreement or any promissory
note issued hereunder pursuant to the law of any relevant jurisdiction or any
treaty shall deliver to the Borrower (with a copy to the Administrative Agent),
at the time or times prescribed by applicable law, 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.
(vii) If the U.S. Internal Revenue Service or any other governmental authority
of the United States or any other country or any political subdivision thereof
asserts a claim that the Administrative Agent did not properly withhold tax from
amounts paid to or for the account of any Lender (because the appropriate form
was not delivered or properly completed, because such Lender failed to notify
the Administrative Agent of a change in circumstances which rendered its
exemption from withholding ineffective, or for any other reason other than as a
result of the gross negligence or willful misconduct of the Administrative
Agent), such Lender shall indemnify the Administrative Agent fully for all
amounts paid, directly or indirectly, by the Administrative Agent as tax,
withholding therefor, or otherwise, including penalties and interest, and
including taxes imposed by any jurisdiction on amounts payable to the
Administrative Agent under this subsection, together with all costs and expenses
related thereto (including attorneys fees and time charges of attorneys for the
Administrative Agent, which attorneys may be employees of the Administrative
Agent). The obligations of the Lenders under this Section 4.5(vii) shall
----------------
survive the payment of the Obligations and termination of this Agreement.
4.6 Lender Statements; Survival of Indemnity. To the extent reasonably
--------------------------------------------
possible, each Lender shall designate an alternate Lending Installation with
respect to its Eurodollar Rate Loans to reduce any liability of the Borrower to
such Lender under Sections 4.1, 4.2 and 4.5 or to avoid the unavailability of
------------ --- ---
Eurodollar Rate Advances under Section 4.3, so long as such designation is not,
-----------
in the reasonable judgment of such Lender, disadvantageous to such Lender. Each
Lender shall deliver a written statement of such Lender to the Borrower
(with a copy to the Administrative Agent) as to the amount due, if any, under
Section 4.1, 4.2, 4.4 or 4.5. Such written statement shall set forth in
---------- --- --- ---
reasonable detail the calculations upon which such Lender determined such amount
-----
and shall be final, conclusive and binding on the Borrower in the absence of
manifest error. Determination of amounts payable under such Sections in
connection with a Eurodollar Rate Loan shall be calculated as though each Lender
funded its Eurodollar Rate Loan through the purchase of a deposit of the type
and maturity corresponding to the deposit used as a reference in determining the
Eurodollar Rate applicable to such Loan, whether in fact that is the case or
not, and without regard to loss of margin. Unless otherwise provided herein,
the amount specified in the written statement of any Lender shall be payable on
demand after receipt by the Borrower of such written statement. The obligations
of the Borrower under Sections 4.1, 4.2, 4.4 and 4.5 shall survive payment of
------------ --- --- ---
the Obligations and termination of this Agreement.
ARTICLE V: CONDITIONS PRECEDENT
- ----------- ---------------------
5.1 Initial Advances. The Lenders shall not be required to make the initial
----------------
Loans unless the Borrower has furnished to the Administrative Agent each of
the following, with sufficient copies for the Lenders, all in form and substance
satisfactory to the Administrative Agent and the Lenders:
(1) Copies of the Certificate of Incorporation of Ralston, Energizer and
each of the Subsidiary Guarantors (other than Energizer) (collectively, the
"LOAN PARTIES"), together with all amendments and a certificate of good
standing, both certified by the appropriate governmental officer in its
jurisdiction of incorporation;
(2) Copies, certified by the Secretary or Assistant Secretary of each of the
Loan Parties, of its By-Laws and of its Board of Directors' resolutions (and
resolutions of other bodies, if any are deemed necessary by counsel for any
Lender) authorizing the execution of the Loan Documents entered into by it;
(3) An incumbency certificate, executed by the Secretary or Assistant Secretary
of each of the Loan Parties, which shall identify by name and title and bear the
signature of the officers of the Loan Parties authorized to sign the Loan
Documents and the officers of Ralston and (from and after the consummation of
the Debt Assumption) Energizer authorized to make borrowings hereunder, upon
which certificate the Lenders shall be entitled to rely until informed of any
change in writing by the Borrower; provided, that any officer who will neither
be a signatory to this Agreement nor an individual requesting borrowings
hereunder, shall be permitted to deliver a facsimile of such officer's signature
in satisfaction of this Section 5.1(3);
---------------
(4) Certificates, in form and substance satisfactory to the Administrative
Agent, (a) signed by the Chief Financial Officer of Ralston, stating that on the
Initial Funding Date all the representations in this Agreement made by Ralston
are true and correct and no Default or Unmatured Default has occurred and is
continuing and (b) signed by the Executive Vice President-Finance and Control of
Energizer, stating that on the Initial Funding Date, all of the representations
in this Agreement to be made by Energizer on the Spin-Off Date would be true and
correct if such representations were made by Energizer on the Initial Funding
Date;
(5) The written opinion of the Loan Parties' counsel, addressed to the
Administrative Agent and the Lenders, in substantially the form attached hereto
as Exhibit D and containing assumptions and qualifications acceptable to the
----------
Administrative Agent and the Lenders;
(6) A certificate in form and substance satisfactory to the Administrative
Agent, signed by the chief financial officer or Treasurer of Energizer, stating
that, after taking into consideration all information available at such time,
such officer neither knows nor should know of any information that would prevent
the Net Worth Condition from being satisfied as of the Spin-Off Date, after
giving effect to the Spin-Off Transactions and after all post-closing
adjustments have been made;
(7) Evidence satisfactory to the Administrative Agent that, except as set forth
on Schedule 6.21 of this Agreement, (i) all conditions precedent to the
consummation of the Spin-Off have been satisfied in all material respects, (ii)
the Spin-Off Transactions have been approved by all necessary corporate action
of Ralston's and Energizer's Board of Directors and, if required, shareholders,
and the terms of the Spin-Off Transactions have not been amended, waived or
modified in any material respect from those set forth in the Form 10 without the
approval of the Administrative Agent (such approval not to be unreasonably
withheld); (iii) the Tax Ruling and all necessary regulatory approvals have been
obtained for the consummation of the Spin-Off Transactions; and (iv) the
aggregate amount of all loans and committed Financing Facilities (including this
Agreement and the 5-Year Credit Agreement) available to Energizer upon
consummation of the Spin-Off Transactions equals or exceeds $650,000,000, and
all such commitments are identified on Schedule 6.21(iv) attached hereto;
(8) Evidence satisfactory to the Administrative Agent that there exists no
injunction or temporary restraining order which, in the judgment of the
Administrative Agent, would prohibit the making of the Loans, the consummation
of the Spin-Off Transactions, the consummation of the Debt Assumption and the
other transactions contemplated by the Transaction Documents or any litigation
seeking such an injunction or restraining order;
(9) Written money transfer instructions reasonably requested by the
Administrative Agent, addressed to the Administrative Agent and signed by an
Authorized Officer;
(10) Opinions of value, solvency and other appropriate factual information and
advice in form and substance reasonably satisfactory to it and from the chief
financial officer of Energizer supporting the conclusions that after giving
effect to the Spin-Off Transactions and the Debt Assumption, Energizer and its
Subsidiaries on a consolidated basis are Solvent and will be Solvent subsequent
to incurring the indebtedness contemplated under the Transaction Documents, will
be able to pay its debts and liabilities as they become due and will not be left
with unreasonably small working capital for general corporate purposes;
(11) Evidence satisfactory to the Administrative Agent that Ralston had paid or
has caused Energizer to pay to the Administrative Agent and the Arranger the
fees agreed to in the fee letter dated February 16, 2000, among the
Administrative Agent, the Arranger, Ralston and Energizer; and
(12) Such other documents as the Administrative Agent or any Lender or its
counsel may have reasonably requested, including, without limitation, the
Subsidiary Guaranty, opinions of counsel, an officer's no-default certificate
and each other document reflected on the List of Closing Documents attached as
Exhibit E to this Agreement.
---------
5.2 Each Advance. The Lenders shall not be required to make any Advance
-------------
unless on the applicable Borrowing Date, both before and after taking into
account the proposed borrowing:
(i) There exists no Default or Unmatured Default;
(ii) The representations and warranties contained in Article VI are true and
----------
correct in all material respects as of such Borrowing Date except for changes in
the Schedules to this Agreement reflecting transactions permitted by or not in
violation of this Agreement; and
(iii) The Revolving Credit Obligations do not, and after making such
proposed Advance would not, exceed the Aggregate Revolving Loan Commitment.
Each Borrowing/Election Notice with respect to each such Advance shall
constitute a representation and warranty by the Borrower that the conditions
contained in Sections 5.2(i) and (ii) have been satisfied. Any Lender may
---------------- ----
require a duly completed officer's certificate in substantially the form of
Exhibit F hereto and/or a duly completed compliance certificate in substantially
-----
the form of Exhibit G hereto as a condition to making an Advance.
----------
ARTICLE VI: REPRESENTATIONS AND WARRANTIES
- ------------ --------------------------------
In order to induce the Administrative Agent and the Lenders to enter into
this Agreement and to make the Loans and the other financial accommodations to
Ralston and, after the consummation of the Debt Assumption, Energizer, (a)
Ralston represents and warrants as follows in Section 6.1, 6.2, 6.3, 6.14, 6.18
----------- --- --- ---- ----
and 6.21 to each Lender and the Administrative Agent as of the Closing Date, the
---
Initial Funding Date and the Spin-Off Date, giving effect to the consummation of
the transactions contemplated by the Transaction Documents as of each such date,
(b) Energizer represents and warrants as follows in Sections 6.4 through 6.23
------------ ----
and Section 6.25 to each Lender and the Administrative Agent as of the Spin-Off
------------
Date (immediately following the consummation of the Debt Assumption), giving
effect to the consummation of the transactions contemplated by the Transaction
Documents as of such date, and thereafter on each date as required by Section
-------
5.2 (other than with respect to Section 6.8 which shall only be made by
- ------------
Energizer as of the Spin-Off Date) and (c) Energizer represents and warrants as
-
follows in Section 6.24 to each Lender and the Administrative Agent as a
-------------
condition to the Debt Assumption, on each Adjustment Date and on the Opening
Balance Sheet Delivery Date (in each case, as of the Spin-Off Date, taking into
account the post-closing adjustments made as of such date):
6.1 Organization; Corporate Powers of Ralston. Each of Ralston and
---------------------------------------------
Energizer (i) is a corporation, limited liability company, partnership or other
commercial entity duly organized, validly existing and in good standing under
the laws of the jurisdiction of its organization, (ii) is duly qualified to do
business as a foreign entity and is in good standing under the laws of each
jurisdiction in which failure to be so qualified and in good standing could
reasonably be expected to have a Material Adverse Effect, and (iii) has all
requisite power and authority to own, operate and encumber its property and to
conduct its business as presently conducted and as proposed to be conducted.
6.2 Authority of Ralston.
----------------------
(A) Ralston has the requisite power and authority to execute, deliver and
perform each of the Transaction Documents which are to be executed by it in
connection with the Transactions or which have been executed by it as required
by this Agreement and the other Loan Documents and (ii) to file the Transaction
Documents which must be filed by it in connection with the Transactions or which
have been filed by it as required by this Agreement, the other Loan
Documents or otherwise with any Governmental Authority.
(B) The execution, delivery, performance and filing, as the case may be, of
each of the Transaction Documents which must be executed or filed by Ralston in
connection with the Transactions or which have been executed or filed as
required by this Agreement, the other Loan Documents or otherwise and to which
Ralston is party, and the consummation of the transactions contemplated thereby,
have been duly approved by the respective boards of directors of Ralston and
Energizer and, if necessary, the shareholders of Ralston, and such approvals
have not been rescinded. No other action or proceedings on the part of Ralston
or Energizer are necessary to consummate such transactions.
(C) Each of the Transaction Documents to which Ralston is a party has been
duly executed, delivered or filed, as the case may be, by it and constitutes its
legal, valid and binding obligation, enforceable against it in accordance with
its terms (except as enforceability may be limited by bankruptcy, insolvency, or
similar laws affecting the enforcement of creditors' rights generally and by
general equitable principles, including concepts of reasonableness, materiality,
good faith and fair dealing and the possible unavailability of specific
performance, injunctive relief or other equitable remedies (whether enforcement
is sought by proceedings in equity or at law)), is in full force and effect and
no material term or condition thereof has been amended, modified or waived from
the terms and conditions contained in the Transaction Documents delivered to the
Administrative Agent pursuant to Section 5.1 without the prior written consent
-----------
of the Required Lenders (or all of the Lenders if required by Section 9.3), and
-----------
Ralston has performed and complied with all the material terms, provisions,
agreements and conditions set forth therein and required to be performed or
complied with by Ralston on or before the Initial Funding Date, and no unmatured
default, default or breach of any covenant by any such party exists thereunder.
6.3 No Conflict; Governmental Consents for Ralston. The execution, delivery
----------------------------------------------
and performance of each of the Loan Documents and other Transaction
Documents to which Ralston is a party do not and will not (i) conflict with the
certificate or articles of incorporation or by-laws of Ralston or Energizer,
(ii) with respect to the Transaction Documents other than the Loan Documents,
constitute a tortious interference with any Contractual Obligation of Ralston or
conflict with, result in a breach of or constitute (with or without notice or
lapse of time or both) a default under any Requirement of Law (including,
without limitation, any Environmental Property Transfer Act) or Contractual
Obligation of Ralston, or require termination of any Contractual Obligation,
except such interference, breach, default or termination which individually or
in the aggregate could not reasonably be expected to have a Material Adverse
Effect, (iii) with respect to the Loan Documents, constitute a tortious
interference with any Contractual Obligation of Ralston or conflict with, result
in a breach of or constitute (with or without notice or lapse of time or both) a
default under any Requirement of Law (including, without limitation, any
Environmental Property Transfer Act) or Contractual Obligation of Ralston, or
require termination of any Contractual Obligation, except such interference,
breach or default which individually or in the aggregate could not reasonably be
expected to have a Material Adverse Effect, (iv) result in or require the
creation or imposition of any Lien whatsoever upon any of the property or assets
of Ralston, other than Liens permitted or created by the Loan Documents, or (v)
require any approval of Ralston's or Energizer's Board of Directors or
shareholders, as applicable, except such as have been obtained. Except as set
forth on Schedule 6.3 to this Agreement, the execution, delivery and performance
------------
of each of the Transaction Documents to which Ralston is a party do not and will
not require any registration with, consent or approval of, or notice to, or
other action to, with or by any Governmental Authority, including under any
Environmental Property Transfer Act, except filings, consents or notices which
have been made, obtained or given, or which, if not made, obtained or given,
individually or in the aggregate could not reasonably be expected to have a
Material Adverse Effect.
6.4 Organization; Corporate Powers of Energizer. Energizer and each of its
--------------------------------------------
Subsidiaries (i) is a corporation, limited liability company, partnership or
other commercial entity duly organized, validly existing and in good standing
under the laws of the jurisdiction of its organization, (ii) is duly qualified
to do business as a foreign entity and is in good standing under the laws of
each jurisdiction in which failure to be so qualified and in good standing could
reasonably be expected to have a Material Adverse Effect, and (iii) has all
requisite power and authority to own, operate and encumber its property and to
conduct its business as presently conducted and as proposed to be conducted.
6.5 Authority of Energizer.
------------------------
(A) Energizer and each of its Subsidiaries has the requisite power and
authority to execute, deliver and perform each of the Transaction Documents
which are to be executed by it in connection with the Transactions or which have
been executed by it as required by this Agreement and the other Loan
Documents and (ii) to file the Transaction Documents which must be filed by it
in connection with the Transactions or which have been filed by it as required
by this Agreement, the other Loan Documents or otherwise with any Governmental
Authority.
(B) The execution, delivery, performance and filing, as the case may be, of
each of the Transaction Documents which must be executed or filed by Energizer
or any of its Subsidiaries in connection with the Transactions or which have
been executed or filed as required by this Agreement, the other Loan Documents
or otherwise and to which Energizer or any of its Subsidiaries is party, and the
consummation of the transactions contemplated thereby, have been duly approved
by the respective boards of directors and, if necessary, the shareholders of
Energizer and its Subsidiaries, and such approvals have not been rescinded. No
other action or proceedings on the part of Energizer or its Subsidiaries are
necessary to consummate such transactions.
(C) Each of the Transaction Documents to which Energizer or any of its
Subsidiaries is a party has been duly executed, delivered or filed, as the case
may be, by it and constitutes its legal, valid and binding obligation,
enforceable against it in accordance with its terms (except as enforceability
may be limited by bankruptcy, insolvency, or similar laws affecting the
enforcement of creditors' rights generally and by general equitable principles,
including concepts of reasonableness, materiality, good faith and fair dealing
and the possible unavailability of specific performance, injunctive relief or
other equitable remedies (whether enforcement is sought by proceedings in equity
or at law)), is in full force and effect (other than as a result of expiration
in accordance with its terms) and no material term or condition thereof has been
amended, modified or waived from the terms and conditions contained in the
Transaction Documents delivered to the Administrative Agent pursuant to Section
-------
5.1 without the prior written consent of the Required Lenders (or all of the
- ---
Lenders if required by Section 9.3), and Energizer and its Subsidiaries have,
- --- -----------
and, to the best of Energizer's and its Subsidiaries' knowledge, all other
- --
parties thereto have, performed and complied with all the material terms,
- --
provisions, agreements and conditions set forth therein and required to be
- --
performed or complied with by such parties on or before the Initial Funding Date
- --
or Spin-Off Date, as applicable, and no unmatured default, default or breach of
any covenant by any such party exists thereunder.
6.6 No Conflict; Governmental Consents for Energizer. The execution,
-----------------------------------------------------
delivery and performance of each of the Loan Documents and other Transaction
Documents to which Energizer or any of its Subsidiaries is a party do not and
will not (i) conflict with the certificate or articles of incorporation or
by-laws of Energizer or any such Subsidiary, (ii) with respect to the
Transaction Documents other than the Loan Documents, constitute a tortious
interference with any Contractual Obligation of any Person or conflict with,
result in a breach of or constitute (with or without notice or lapse of time or
both) a default under any Requirement of Law (including, without limitation, any
Environmental Property Transfer Act) or Contractual Obligation of Energizer
or any such Subsidiary, or require termination of any Contractual Obligation,
except such interference, breach, default or termination which individually or
in the aggregate could not reasonably be expected to have a Material Adverse
Effect, (iii) with respect to the Loan Documents, constitute a tortious
interference with any Contractual Obligation of any Person or conflict with,
result in a breach of or constitute (with or without notice or lapse of time or
both) a default under any Requirement of Law (including, without limitation, any
Environmental Property Transfer Act) or Contractual Obligation of Energizer or
any such Subsidiary, or require termination of any Contractual Obligation,
except such interference, breach or default which individually or in the
aggregate could not reasonably be expected to have a Material Adverse Effect,
(iv) result in or require the creation or imposition of any Lien whatsoever upon
any of the property or assets of Energizer or any such Subsidiary, other than
Liens permitted or created by the Loan Documents, or (v) require any approval of
Energizer's or any such Subsidiary's Board of Directors or shareholders except
such as have been obtained. Except as set forth on Schedule 6.6 to this
------------
Agreement, the execution, delivery and performance of each of the Transaction
Documents to which Energizer or any of its Subsidiaries is a party do not and
will not require any registration with, consent or approval of, or notice to, or
other action to, with or by any Governmental Authority, including under any
Environmental Property Transfer Act, except filings, consents or notices which
have been made, obtained or given, or which, if not made, obtained or given,
individually or in the aggregate would not reasonably be expected to have a
Material Adverse Effect.
6.7 Financial Statements.
---------------------
(A) The pro forma historical balance sheet (as updated by the pro forma
--- ----- --- -----
historical balance sheet prepared with respect to Energizer and its Subsidiaries
as of February 29, 2000 (the "SUPPLEMENTAL FINANCIAL STATEMENT")), income
statements and statements of cash flow of Energizer and its Subsidiaries
contained in the Form 10 and the projections and assumptions contained in the
Borrower's Confidential Information Memorandum dated February, 2000 (the "BANK
BOOK") under Appendix A thereof, copies of which are attached hereto as Schedule
---------- --------
6.7 to this Agreement, present on a pro forma basis the financial condition of
- --- --- -----
Energizer and such Subsidiaries as of such date, and reflect on a pro forma
- - --- -----
basis those liabilities reflected in the notes thereto and resulting from
consummation of the Transactions and the other transactions contemplated by this
Agreement, and the payment or accrual of all transaction costs payable on the
Initial Funding Date and the Spin-Off Date with respect to any of the foregoing
and demonstrate that, after giving effect to such transactions, Energizer and
its Subsidiaries can repay their debts and satisfy their other obligations as
and when due, and can comply with the requirements of this Agreement. The
projections and assumptions contained in the Bank Book were prepared in good
faith and represent management's opinion based on the information available to
the Borrower at the time so furnished and, since the preparation thereof and of
the pro forma historical financial statements contained in the Form 10 (as
--- -----
updated by the Supplemental Financial Statement) there has occurred no material
-
adverse change in the business, financial condition, operations, or prospects of
Energizer or any of its Subsidiaries, or Energizer and its Subsidiaries taken as
a whole (it being understood that so long as the representation and warranty
contained in Section 6.24 is true and correct at each time Energizer is required
------------
to make such representation and warranty pursuant to the introduction to this
Article VI, changes from the "Net transactions with RPCO" line item on the pro
--------- ---
forma statement of cash flow will not constitute a material adverse change).
----
(B) Complete and accurate copies of the audited financial statements and
the audit report related thereto prepared with respect to Energizer and its
Subsidiaries as of September 30, 1999 and unaudited financial statements of
prepared with respect to Energizer and its Subsidiaries as of December 31, 1999
have been delivered to the Administrative Agent.
(C) Since the financial statements prepared as of December 31, 1999, the
historical pro forma financial statements contained in the Form 10 (as updated
--- -----
by the Supplemental Financial Statement), and the projections and assumptions
included as Appendix A of the Bank Book, Energizer and its Subsidiaries have
conducted their respective operations (including, without limitation, any
operations and transactions with Ralston, any holder or holders of any of the
Equity Interests of Energizer, or with any Affiliate of Energizer which is not
its Subsidiary) according to their ordinary and usual course of business and
consistent with past practice, as reflected in such financial statements, Form
10 (as updated by the Supplemental Financial Statement) and the Bank Book, as
applicable, in all material respects (it being understood that so long as the
representation and warranty contained in Section 6.24 is true and correct at
------------
each time Energizer is required to make such representation and warranty
pursuant to the introduction to this Article VI, changes from the "Net
-----------
transactions with RPCO" line item on the pro forma statement of cash flow will
--- -----
not constitute a material deviation from past operations).
6.8 No Material Adverse Change. Since each of (a) December 31, 1999
-----------------------------
(determined by reference to the financial statements prepared with respect to
Energizer and its Subsidiaries), (b) the pro forma historical financial
--- -----
statements set forth in the Form 10 (as updated by the Supplemental Financial
Statement, and (c) the projections and assumptions included as Appendix A of the
Bank Book, there has occurred no change in the business, properties,
condition (financial or otherwise), performance, results of operations or
prospects of Energizer, or Energizer and its Subsidiaries taken as a whole or
any other event which has had or would reasonably be expected to have a Material
Adverse Effect (it being understood that so long as the representation and
warranty contained in Section 6.24 is true and correct at each time Energizer is
------------
required to make such representation and warranty pursuant to the introduction
to this Article VI, changes from the "Net transactions with RPCO" line item on
----------
the pro forma statement of cash flow will not constitute an event which has had
--- -----
or would reasonably be expected to have a Material Adverse Effect).
6.9 Taxes.
-----
(A) Tax Examinations. All deficiencies which have been asserted against
-----------------
Energizer or any of Energizer's Subsidiaries as a result of any federal, state,
local or foreign tax examination for each taxable year in respect of which an
examination has been conducted have been fully paid or finally settled or are
being contested in good faith, and no issue has been raised by any taxing
authority in any such examination which, by application of similar principles,
reasonably can be expected to result in assertion by such taxing authority of a
material deficiency for any other year not so examined which has not been
reserved for in Energizer's consolidated financial statements to the extent, if
any, required by Agreement Accounting Principles. Except as permitted pursuant
to Section 7.2(D), neither Energizer nor any of Energizer's Subsidiaries
---------------
anticipates any material tax liability with respect to the years which have not
----
been closed pursuant to applicable law.
(B) Payment of Taxes. All tax returns and reports of Energizer and its
------------------
Subsidiaries required to be filed have been timely filed, and all taxes,
assessments, fees and other governmental charges thereupon and upon their
respective property, assets, income and franchises which are shown in such
returns or reports to be due and payable have been paid except those items which
are being contested in good faith and have been reserved for in accordance with
Agreement Accounting Principles. Energizer has no knowledge of any proposed tax
assessment against Energizer or any of its Subsidiaries that will have or could
reasonably be expected to have a Material Adverse Effect.
6.10 Litigation; Loss Contingencies and Violations. Except as set forth in
----------------------------------------------
Schedule 6.10 (the "DISCLOSED LITIGATION"), there is no action, suit,
- --------------
proceeding, arbitration or, to Energizer's knowledge, investigation before or by
- ----------
any Governmental Authority or private arbitrator pending or, to Energizer's
knowledge, threatened against Energizer, any of its Subsidiaries or any property
of any of them. Neither any of the Disclosed Litigation nor any action, suit,
proceeding, arbitration or investigation which has commenced since the Closing
Date (or the most recent update of the Disclosed Litigation) (i) challenges the
validity or the enforceability of any material provision of the Transaction
Documents or (ii) has or could reasonably be expected to have a Material Adverse
Effect. There is no material loss contingency within the meaning of Agreement
Accounting Principles which has not been reflected in the consolidated financial
statements of Energizer prepared and delivered pursuant to Section 7.1(A) for
--------------
the fiscal period during which such material loss contingency was incurred.
Neither Energizer nor any of its Subsidiaries is (A) in violation of any
applicable Requirements of Law which violation will have or could reasonably be
expected to have a Material Adverse Effect, or (B) subject to or in default with
respect to any final judgment, writ, injunction, restraining order or order of
any nature, decree, rule or regulation of any court or Governmental Authority
which will have or could reasonably be expected to have a Material Adverse
Effect.
6.11 Subsidiaries. Schedule 6.11 to this Agreement (i) contains a
------------ --------------
description of the corporate structure of Energizer, its Subsidiaries and any
other Person in which Energizer or any of its Subsidiaries holds a material
Equity Interest after giving effect to the Spin-Off Transactions; and (ii)
accurately sets forth (A) the correct legal name, the jurisdiction of
incorporation and the jurisdictions in which each of Energizer and the direct
and indirect Subsidiaries of Energizer are qualified to transact business as a
foreign corporation, (B) the authorized, issued and outstanding shares of each
class of Capital Stock of Energizer and each of its Subsidiaries and the owners
of such shares (both as of the consummation of the Spin-Off and on a
fully-diluted basis), and (C) a summary of the direct and indirect partnership,
joint venture, or other Equity Interests, if any, of Energizer and each
Subsidiary of Energizer in any Person that is not a corporation. After the
formation or acquisition of any New Subsidiary permitted under Section 7.3(F),
--------------
if requested by the Administrative Agent, Energizer shall provide a supplement
to Schedule 6.11 to this Agreement reflecting the addition of such New
--------------
Subsidiary. Except as disclosed on Schedule 6.11, none of the issued and
------ --------------
outstanding Capital Stock of Energizer or any of Energizer's Subsidiaries is
---
subject to any vesting, redemption, or repurchase agreement, and there are no
warrants or options outstanding with respect to such Capital Stock. The
outstanding Capital Stock of Energizer and each of its Subsidiaries is duly
authorized, validly issued, fully paid and nonassessable and the stock of
Energizer's Subsidiaries is not Margin Stock.
6.12 ERISA. No Benefit Plan has incurred any material accumulated funding
-----
deficiency (as defined in Sections 302(a)(2) of ERISA and 412(a) of the Code)
whether or not waived. Neither Energizer nor any member of the Controlled Group
has incurred any material liability to the PBGC which remains outstanding other
than the payment of premiums. As of the last day of the most recent prior plan
year, the market value of assets under each Benefit Plan, other than any
Multiemployer Plan, was not by a material amount less than the present value of
benefit liabilities thereunder (determined in accordance with the actuarial
valuation assumptions described therein). Neither Energizer nor any member of
the Controlled Group has (i) failed to make a required contribution or payment
to a Multiemployer Plan of a material amount or (ii) incurred a material
complete or partial withdrawal under Section 4203 or Section 4205 of ERISA from
a Multiemployer Plan. Neither Energizer nor any member of the Controlled Group
has failed to make an installment or any other payment of a material amount
required under Section 412 of the Code on or before the due date for such
installment or other payment. Each Plan, Foreign Employee Benefit Plan and
Non-ERISA Commitment complies in all material respects in form, and has been
administered in all material respects in accordance with its terms and, in
accordance with all applicable laws and regulations, including but not limited
to ERISA and the Code. There have been no and there is no prohibited
transaction described in Sections 406 of ERISA or 4975 of the Code with respect
to any Plan for which a statutory or administrative exemption does not exist
which could reasonably be expected to subject Energizer or any of is
Subsidiaries to material liability. Neither Energizer nor any member of the
Controlled Group has taken or failed to take any action which would constitute
or result in a Termination Event, which action or inaction could reasonably be
expected to subject Energizer or any of its Subsidiaries to material liability.
Neither Energizer nor any member of the Controlled Group is subject to any
material liability under, or has any potential material liability under, Section
4063, 4064, 4069, 4204 or 4212(c) of ERISA. The present value of the aggregate
liabilities to provide all of the accrued benefits under any Foreign Pension
Plan do not exceed the current fair market value of the assets held in trust or
other funding vehicle for such plan by a material amount. With respect to any
Foreign Employee Benefit Plan other than a Foreign Pension Plan, reasonable
reserves have been established in accordance with prudent business practice or
where required by ordinary accounting practices in the jurisdiction in which
such plan is maintained. Neither Ralston nor any other member of its controlled
group (within the meaning of Section 414(b), (c), (m) or (o) of the Code) has
taken or failed to take any action, nor has any event occurred, with respect to
any "employee benefit plan" (as defined in section 3(3) of ERISA) which action,
inaction or event could reasonably be expected to subject Energizer or any of
its Subsidiaries to material liability. For purposes of this Section 6.12,
------------
"material" means any amount, noncompliance or other basis for liability which
could reasonably be expected to subject Energizer or any of its Subsidiaries to
liability, individually or in the aggregate with each other basis for liability
under this Section 6.12, in excess of $25,000,000.
-------------
6.13 Accuracy of Information. The information, exhibits and reports
-------------------------
furnished by or on behalf of Energizer and any of its Subsidiaries to the
Administrative Agent or to any Lender in connection with the negotiation of, or
compliance with, the Loan Documents, the representations and warranties of
Ralston, Energizer and their respective Subsidiaries contained in the Loan
Documents, and all certificates and documents delivered to the Administrative
Agent and the Lenders pursuant to the terms thereof, including, without
limitation the Bank Book and the Form 10 (as updated by the Supplemental
Financial Statement), taken as a whole, do not contain as of the date furnished
any untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements contained herein or therein, in light
of the circumstances under which they were made, not misleading.
6.14 Securities Activities. Neither Ralston, Energizer nor any of its
----------------------
Subsidiaries is engaged in the business of extending credit for the purpose of
purchasing or carrying Margin Stock.
6.15 Material Agreements. Neither Energizer nor any Subsidiary is a party
--------------------
to any Contractual Obligation or subject to any charter or other corporate or
similar restriction which individually or in the aggregate will have or could
reasonably be expected to have a Material Adverse Effect. Neither Energizer nor
any of its Subsidiaries has received notice or has knowledge that (i) it is in
default in the performance, observance or fulfillment of any of the obligations,
covenants or conditions contained in any Contractual Obligation applicable to
it, or (ii) any condition exists which, with the giving of notice or the lapse
of time or both, would constitute a default with respect to any such Contractual
Obligation, in each case, except where such default or defaults, if any,
individually or in the aggregate will not have or could not reasonably be
expected to have a Material Adverse Effect.
6.16 Compliance with Laws. Energizer and its Subsidiaries are in compliance
---------------------
with all Requirements of Law applicable to them and their respective businesses,
in each case where the failure to so comply individually or in the aggregate
could reasonably be expected to have a Material Adverse Effect.
6.17 Assets and Properties. Energizer and each of its Subsidiaries has
-----------------------
legal title to all of its assets and properties (tangible and intangible, real
or personal) owned by it or a valid leasehold interest in all of its leased
assets (except insofar as marketability may be limited by any laws or
regulations of any Governmental Authority affecting such assets), and all such
assets and property are free and clear of all Liens, except Liens permitted
under Section 7.3(C). Substantially all of the assets and properties owned by,
--------------
leased to or used by Energizer and/or each such Subsidiary of Energizer are in
adequate operating condition and repair, ordinary wear and tear excepted.
Neither this Agreement nor any other Transaction Document, nor any transaction
contemplated under any such agreement, will affect any right, title or interest
of Energizer or such Subsidiary in and to any of such assets in a manner that
has or could reasonably be expected to have a Material Adverse Effect.
6.18 Statutory Indebtedness Restrictions. Neither Ralston, Energizer nor
-------------------------------------
any of its Subsidiaries is subject to regulation under the Public Utility
Holding Company Act of 1935, the Federal Power Act, the Interstate Commerce Act,
or the Investment Company Act of 1940, or any other federal or state statute or
regulation which limits its ability to incur indebtedness or its ability to
consummate the transactions contemplated hereby.
6.19 Insurance. The insurance policies and programs in effect with respect
---------
to the respective properties, assets, liabilities and business reflect coverage
that is reasonably consistent with prudent industry practice.
6.20 Labor Matters. No attempt to organize the employees of Energizer, and
--------------
no labor disputes, strikes or walkouts affecting the operations of Energizer or
any of its Subsidiaries, is pending, or, to Energizer's knowledge, threatened,
planned or contemplated, which has or could reasonably be expected to have a
Material Adverse Effect.
6.21 Spin-Off Transactions. Except as set forth in Schedule 6.21 to this
---------------------- -------------
Agreement, (i) (a) all conditions precedent to, and all consents necessary to
permit, the consummation of the Spin-Off Transactions have been satisfied in all
material respects, (b) no additional actions are necessary to consummate the
Spin-Off Transactions other than the passage of time and (c) the Spin-Off will
take effect on April 1, 2000 without any further action on the part of Energizer
or Ralston, (ii) the Spin-Off Transactions have been approved by all necessary
corporate action of Ralston's and Energizer's Board of Directors and, if
required, shareholders, and the terms of the Spin-Off Transactions have not been
amended, waived or modified in any material respect from those set forth in the
Form 10 without the approval of the Administrative Agent and the Required
Lenders (such approval not to be unreasonably withheld); (iii) the Tax Ruling
and all necessary regulatory approvals have been obtained for the consummation
of the Spin-Off Transactions; and (iv) the aggregate amount of all loans and
committed Financing Facilities (including this Agreement and the 5-Year Credit
Agreement) available to Energizer upon consummation of the Spin-Off Transactions
equals or exceeds $650,000,000, and all such commitments are identified on
Schedule 6.21(iv) attached hereto.
-------------
6.22 Environmental Matters. (A) Except as disclosed on Schedule 6.22 to
---------------------- -------------
this Agreement
(i) the operations of Energizer and its Subsidiaries comply in all material
respects with Environmental, Health or Safety Requirements of Law;
(ii) Energizer and its Subsidiaries have all material permits, licenses or
other authorizations required under Environmental, Health or Safety Requirements
of Law and are in material compliance with such permits;
(iii) neither Energizer, any of its Subsidiaries nor any of their respective
present property or operations, or, to Energizer's or any of its Subsidiaries'
knowledge, any of their respective past property or operations, are subject to
or the subject of, any investigation known to Energizer or any of its
Subsidiaries, any judicial or administrative proceeding, order, judgment,
decree, settlement or other agreement respecting: (A) any material violation of
Environmental, Health or Safety Requirements of Law; (B) any material remedial
action; or (C) any material claims or liabilities arising from the Release or
threatened Release of a Contaminant into the environment;
(iv) there is not now, nor to Energizer's or any of its Subsidiaries'
knowledge has there ever been, on or in the property of Energizer or any of its
Subsidiaries any landfill, waste pile, underground storage tanks, aboveground
storage tanks, surface impoundment or hazardous waste storage facility of any
kind, any polychlorinated biphenyls (PCBs) used in hydraulic oils, electric
transformers or other equipment, or any asbestos containing material that would
result in material remediation costs or material penalties to Energizer or any
of its Subsidiaries; and
(v) neither Energizer nor any of its Subsidiaries has any material
Contingent Obligation in connection with any Release or threatened Release of a
Contaminant into the environment.
(B) For purposes of this Section 6.22 "material" means any noncompliance or
------------
other basis for liability which could reasonably be likely to subject Energizer
or any of its Subsidiaries to liability, individually or in the aggregate with
each other basis for liability under this Section 6.22, in excess of
-------------
$25,000,000.
6.23 Solvency. After giving effect to (i) the Loans to be made on the
--------
Initial Funding Date or such other date as Loans requested hereunder are made
and the consummation of the Debt Assumption, (ii) the other transactions
contemplated by this Agreement and the other Transaction Documents, including
consummation of the Spin-Off Transactions, and (iii) the payment and accrual of
all transaction costs with respect to the foregoing, Energizer is, and Energizer
and its Subsidiaries taken as a whole are, Solvent.
6.24 Net Worth Condition. Upon consummation of the Spin-Off Transactions,
---------------------
the Net Worth Condition will be satisfied.
6.25 Benefits. Each of Energizer and its Subsidiaries will benefit from the
--------
financing arrangement established by this Agreement. The Administrative Agent
and the Lenders have stated and Energizer acknowledges that, but for the
agreement by each of the Subsidiary Guarantors to execute and deliver the
Subsidiary Guaranty, the Administrative Agent and the Lenders would not have
made available the credit facilities established hereby on the terms set forth
herein.
ARTICLE VII: COVENANTS
- ------------- ---------
From and after the consummation of the Debt Assumption, Energizer covenants
and agrees that so long as any Revolving Loan Commitments are outstanding and
thereafter until all of the Obligations (other than contingent indemnity
obligations) shall have been fully and indefeasibly paid and satisfied in cash
and all financing arrangements among the Borrower and the Lenders shall have
been terminated, unless the Required Lenders shall otherwise give prior written
consent:
7.1 Reporting. Energizer shall:
---------
(A) Financial Reporting. Furnish to the Administrative Agent (with
--------------------
sufficient copies for each of the Lenders, which the Administrative Agent shall
-
promptly deliver to the Lenders):
(i) Quarterly Reports. As soon as practicable, and in any event within
------------------
forty-five (45) days after the end of each of Energizer's first three fiscal
quarters, the consolidated balance sheet of Energizer and its Subsidiaries as at
the end of such period and the related consolidated statements of income
and cash flows of Energizer 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, certified by the chief financial officer of Energizer on behalf
of Energizer as fairly presenting the consolidated financial position of
Energizer and its Subsidiaries as at the dates indicated and the results of
their operations and cash flows for the periods indicated in accordance with
Agreement Accounting Principles, subject to normal year-end audit adjustments
and the absence of footnotes.
(ii) Annual Reports. As soon as practicable, and in any event within ninety
--------------
(90) days after the end of each fiscal year, (a) the consolidated and
consolidating balance sheet of Energizer and its Subsidiaries as at the end of
such fiscal year and the related consolidated and consolidating statements of
income, stockholders' equity and cash flows of Energizer and its Subsidiaries
for such fiscal year, and in comparative form the corresponding figures for the
previous fiscal year along with consolidating schedules in form and substance
sufficient to calculate the financial covenants set forth in Section 7.4, and
-----------
(b) an audit report on the consolidated financial statements (but not the
consolidating financial statements or schedules) listed in clause (a) hereof of
----------
independent certified public accountants of recognized national standing, which
audit report shall be unqualified and shall state that such financial statements
fairly present the consolidated financial position of Energizer and its
Subsidiaries as at the dates indicated and the results of their operations and
cash flows for the periods indicated in conformity with Agreement Accounting
Principles and that the examination by such accountants in connection with such
consolidated financial statements has been made in accordance with generally
accepted auditing standards.
(iii) Officer's Compliance Certificate. Together with each delivery of any
---------------------------------
financial statement (a) pursuant to clauses (i) and (ii) of this Section 7.1(A),
----------- ---- --------------
an Officer's Certificate from the chief financial officer or Treasurer of
Energizer, substantially in the form of Exhibit F attached hereto and made a
---------
part hereof, stating that (x) the representations and warranties of Energizer
contained in Article VI hereof shall have been true and correct in all material
----------
respects as of the date of such Officer's Certificate and (y) as of the date of
such Officer's Certificate no Default or Unmatured Default exists, or if any
Default or Unmatured Default exists, stating the nature and status thereof and
(b) pursuant to clauses (i) and (ii) of this Section 7.1(A), a compliance
------------ ---- --------------
certificate, substantially in the form of Exhibit G attached hereto and made a
---------
part hereof, signed by Energizer's chief financial officer or Treasurer, setting
forth calculations for the period which demonstrate compliance, when applicable,
with the provisions of Sections 7.3(A) through (R) and Section 7.4, and which
--------------- --- -----------
calculate the Leverage Ratio for purposes of determining the then Applicable
Margin and Applicable Facility Fee Percentage.
(iv) Officer's Net Worth Condition Certificate. On each Adjustment Date
---------------------------------------------
(including the Final Adjustment Date) and on the Opening Balance Sheet Delivery
Date, a certificate in form and substance satisfactory to the Administrative
Agent, signed by the chief financial officer or Treasurer of Energizer, stating
that, after giving effect to the Spin-Off Transactions and after all
post-closing adjustments as of such date have been effected, the Net Worth
Condition was satisfied as of the Spin-Off Date.
(v) Opening Pro Forma Balance Sheet. On the Opening Balance Sheet Delivery
--------------------------------
Date, copies of the pro forma opening consolidated balance sheet of Energizer
--- -----
and its Subsidiaries, after giving effect to the Spin-Off Transactions and
including all post-closing adjustments.
(B) Notice of Default and Adverse Developments. Promptly upon any of the
---------------------------------------------
chief executive officer, chief operating officer, chief financial officer,
treasurer or controller of Energizer obtaining actual knowledge (i) of any
condition or event which constitutes a Default or Unmatured Default, or becoming
aware that any Lender or Administrative Agent has given any written notice
with respect to a claimed Default or Unmatured Default under this Agreement,
(ii) that any Person having the authority to give such a notice has given any
written notice to Energizer or any Subsidiary of Energizer or taken any other
action with respect to a claimed default or event or condition of the type
referred to in Section 8.1(E), or (iii) that any other development, financial or
--------------
otherwise, which could reasonably be expected to have a Material Adverse Effect
has occurred specifying (a) the nature and period of existence of any such
claimed default, Default, Unmatured Default, condition or event, (b) the notice
given or action taken by such Person in connection therewith, and (c) what
action Energizer has taken, is taking and proposes to take with respect thereto.
(C) ERISA Notices. Deliver or cause to be delivered to the Administrative
--------------
Agent and the Lenders, at Energizer's expense, the following information and
notices as soon as reasonably possible, and in any event:
(i) within ten (10) Business Days after any member of the Controlled Group
obtains knowledge that a Termination Event has occurred which could reasonably
be expected to subject Energizer to liability individually or in the aggregate
in excess of $20,000,000, a written statement of the Chief Financial Officer of
Energizer describing such Termination Event and the action, if any, which the
member of the Controlled Group has taken, is taking or proposes to take with
respect thereto, and when known, any action taken or threatened by the IRS, DOL
or PBGC with respect thereto;
(ii) within ten (10) Business Days after the filing of any funding waiver
request with the IRS, a copy of such funding waiver request and thereafter all
communications received by Energizer or a member of the Controlled Group with
respect to such request within ten (10) Business Days such communication is
received; and
(iii) within ten (10) Business Days after Energizer or any member of the
Controlled Group knows or has reason to know that (a) a Multiemployer Plan has
been terminated, (b) the administrator or plan sponsor of a Multiemployer Plan
intends to terminate a Multiemployer Plan, or (c) the PBGC has instituted or
will institute proceedings under Section 4042 of ERISA to terminate a
Multiemployer Plan, a notice describing such matter.
For purposes of this Section 7.1(C), Energizer and any member of the Controlled
--------------
Group shall be deemed to know all facts known by the administrator of any Plan
of which Energizer or any member of the Controlled Group is the plan sponsor.
(D) Other Indebtedness. Deliver to the Administrative Agent (i) a copy of
-------------------
each regular report, notice or communication regarding potential or actual
defaults (including any accompanying officer's certificate) delivered by or on
behalf of Energizer to the holders of funded Material Indebtedness, including
the Senior Notes and the investors parties to the Receivable Purchase Facility
or any Bridge Facilities, pursuant to the terms of the agreements governing such
Indebtedness, such delivery to be made at the same time and by the same
means as such notice or other communication is delivered to such holders, and
(ii) a copy of each notice received by Energizer from the from the holders of
funded Material Indebtedness who are authorized and/or have standing to deliver
such notice pursuant to the terms of such Indebtedness, such delivery to be made
promptly after such notice is received by Energizer.
(E) Other Reports. Deliver or cause to be delivered to the Administrative
--------------
Agent and the Lenders copies of all financial statements, reports and notices,
if any, sent by Energizer to its securities holders or filed with the Commission
by Energizer.
(F) Environmental Notices. As soon as possible and in any event within ten
----------------------
(10) days after receipt by Energizer, a copy of (i) any notice or claim to the
effect that Energizer or any of its Subsidiaries is or may be liable to any
Person as a result of the Release by Energizer, any of its Subsidiaries, or any
other Person of any Contaminant into the environment, and (ii) any notice
alleging any violation of any Environmental, Health or Safety Requirements of
Law by Energizer or any of its Subsidiaries if, in either case, such notice or
claim relates to an event which could reasonably be expected to subject
Energizer and each of its Subsidiaries to liability individually or in the
aggregate in excess of $20,000,000.
(G) Amendments to Financing Facilities. Promptly after the execution
-------------------------------------
thereof, copies of all material amendments to (i) any of the documents
evidencing Indebtedness extended under the Bridge Facilities, (ii) any of the
Receivables Purchase Documents or (iii) the Note Purchase Agreement or the
Senior Notes.
(H) Other Information. Promptly upon receiving a request therefor from the
------------------
Administrative Agent, prepare and deliver to the Administrative Agent and the
Lenders such other information with respect to Energizer, any of its
Subsidiaries, or their respective businesses and assets, including, without
limitation, schedules identifying and describing any Asset Sale (and the use of
the net cash proceeds thereof), as from time to time may be reasonably requested
by the Administrative Agent.
7.2 Affirmative Covenants.
----------------------
(A) Corporate Existence, Etc. Except as permitted pursuant to Section
--------------------------- -------
7.3(H), Energizer shall, and shall cause each of its Subsidiaries to, at all
-
times maintain its existence and preserve and keep, or cause to be preserved and
kept, in full force and effect its rights and franchises material to its
businesses.
(B) Corporate Powers; Conduct of Business. Energizer shall, and shall cause
-------------------------------------
each of its Material Subsidiaries to, qualify and remain qualified to do
business in each jurisdiction in which the nature of its business requires it to
be so qualified and where the failure to be so qualified will have or would
reasonably be expected to have a Material Adverse Effect. Energizer will, and
will cause each Material Subsidiary to, carry on and conduct its business in
substantially the same manner and in substantially the same fields of enterprise
as it is presently conducted unless the failure of Energizer or its Material
Subsidiaries to carry on and conduct its business as so described would not
reasonably be expected to have a Material Adverse Effect.
(C) Compliance with Laws, Etc. Energizer shall, and shall cause its
-----------------------------
Subsidiaries to, (a) comply with all Requirements of Law and all restrictive
covenants affecting such Person or the business, properties, assets or
operations of such Person, and (b) obtain as needed all permits necessary for
its operations and maintain such permits in good standing unless, in either
case, failure to comply or obtain such permits would not reasonably be expected
to have a Material Adverse Effect.
(D) Payment of Taxes and Claims; Tax Consolidation. Energizer shall pay,
-------------------------------------------------
and cause each of its Subsidiaries to pay, (i) all taxes, assessments and other
governmental charges imposed upon it or on any of its properties or assets or in
respect of any of its franchises, business, income or property before any
penalty or interest accrues thereon, and (ii) all claims (including, without
limitation, claims for labor, services, materials and supplies) for sums which
have become due and payable and which by law have or may become a Lien (other
than a Lien permitted by Section 7.3(C)) upon any of Energizer's or such
---------------
Subsidiary's property or assets, prior to the time when any penalty or fine
shall be incurred with respect thereto; provided, however, that no such taxes,
-------- -------
assessments and governmental charges referred to in clause (i) above or claims
----------
referred to in clause (ii) above (and interest, penalties or fines relating
------------
thereto) need be paid if being contested in good faith by appropriate
proceedings diligently instituted and conducted and if such reserve or other
appropriate provision, if any, as shall be required in conformity with Agreement
Accounting Principles shall have been made therefor.
(E) Insurance. Energizer shall maintain for itself and its Subsidiaries, or
---------
shall cause each of its Subsidiaries to maintain in full force and effect,
insurance policies and programs, with such deductibles or self-insurance amounts
as reflect coverage that is reasonably consistent with prudent industry practice
as determined by Energizer.
(F) Inspection of Property; Books and Records; Discussions. Energizer shall
------------------------------------------------------
permit and cause each of Energizer's Subsidiaries to permit, any authorized
representative(s) designated by either the Administrative Agent or any Lender to
visit and inspect any of the properties of Energizer or any of its Subsidiaries,
to examine their respective financial and accounting records and other material
data relating to their respective businesses or the transactions contemplated
hereby (including, without limitation, in connection with environmental
compliance, hazard or liability), and to discuss their affairs, finances and
accounts with their officers and independent certified public accountants, all
upon reasonable notice and at such reasonable times during normal business
hours, as often as may be reasonably requested (provided that an officer of
Energizer or any of its Subsidiaries may, if it so desires, be present at and
participate in any such discussion). Energizer shall keep and maintain, and
cause each of Energizer's Subsidiaries to keep and maintain, in all material
respects, proper books of record and account in which entries in conformity with
Agreement Accounting Principles shall be made of all dealings and transactions
in relation to their respective businesses and activities. If a Default has
occurred and is continuing, Energizer, upon the Administrative Agent's request,
shall turn over copies of any such records to the Administrative Agent or its
representatives.
(G) ERISA Compliance. Energizer shall, and shall cause each of Energizer's
-----------------
Subsidiaries to, establish, maintain and operate all Plans to comply in all
material respects with the provisions of ERISA and shall operate all Plans and
Non-ERISA Commitments to comply in all material respects with the applicable
provisions of the Code, all other applicable laws, and the regulations and
interpretations thereunder and the respective requirements of the governing
documents for such Plans and Non-ERISA Commitments, except for any noncompliance
which, individually or in the aggregate, could not reasonably be expected to
have a Material Adverse Effect.
(H) Maintenance of Property. Energizer shall cause all property necessary
-------------------------
for the conduct of its business or the business of any Subsidiary to be
maintained and kept in good condition, repair and working order and supplied
with all necessary equipment and shall cause to be made all necessary repairs,
renewals, replacements, betterments and improvements thereof, all as in the
judgment of Energizer may be necessary for the conduct of its business;
provided, however, that nothing in this Section 7.2(H) shall prevent Energizer
------- --------------
from discontinuing the operation or maintenance of any of such property if such
discontinuance is, in the judgment of Energizer, desirable in the conduct of its
business or the business of any Subsidiary and not disadvantageous in any
material respect to the Administrative Agent or the Lenders.
(I) Environmental Compliance. (a) Energizer and its Subsidiaries shall
-------------------------
comply with all Environmental, Health or Safety Requirements of Law, except
where noncompliance will not have or is not reasonably likely to subject
Energizer or any of its Subsidiaries, individually or in the aggregate, to
liability in excess of $25,000,000.
(J) Use of Proceeds. (a) Prior to the consummation of the Debt Assumption,
----------------
Ralston shall use the proceeds of the Loans for its working capital needs and
other general corporate purposes of Ralston and its Subsidiaries, and (b) from
and after the consummation of the Debt Assumption, Energizer shall use the
proceeds of any subsequent Loans for the general corporate purposes of Energizer
and its Subsidiaries, including, without limitation, to finance Permitted
Acquisitions.
(K) Addition of Subsidiary Guarantors. (a) New Subsidiaries. Energizer
------------------------------------ ----------------
shall cause each New Subsidiary that is, at any time, a Material Domestic
Subsidiary (other than a SPV) to deliver to the Administrative Agent an executed
Supplement to become a Subsidiary Guarantor under the Subsidiary Guaranty in the
form of Exhibit H attached hereto (a "SUPPLEMENT") and appropriate corporate
----------
resolutions, opinions and other documentation in form and substance reasonably
satisfactory to the Administrative Agent, such Supplement and other
documentation to be delivered to the Administrative Agent as promptly as
possible upon the creation, acquisition of or capitalization thereof or if
otherwise necessary to remain in compliance with Section 7.3(R), but in any
--------------
event within thirty (30) days of such creation, acquisition or capitalization.
(b) Additional Material Domestic Subsidiaries. If any consolidated
--------------------------------------------
Subsidiary of Energizer (other than a New Subsidiary to the extent addressed in
Section 7.2(K)(a) or a SPV) becomes a Material Domestic Subsidiary, Energizer
- ------------------
shall cause any such Material Domestic Subsidiary to deliver to the
- --
Administrative Agent an executed Supplement to become a Subsidiary Guarantor
- --
and appropriate corporate resolutions, opinions and other documentation in form
- --
and substance reasonably satisfactory to the Administrative Agent in connection
therewith, such Supplement and other documentation to be delivered to the
Administrative Agent as promptly as possible but in any event within thirty (30)
days following the date on which such consolidated Subsidiary became a
Material Domestic Subsidiary.
(c) Additional Subsidiary Guarantors. (i) If at any time an Authorized
----------------------------------
Officer of Energizer has actual knowledge that the aggregate assets of all of
Energizer's domestic consolidated Subsidiaries (other than SPVs) which are not
Subsidiary Guarantors exceed ten percent (10%) of Consolidated Assets of
Energizer and its consolidated Subsidiaries (other than the SPVs), as calculated
by Energizer, Energizer shall cause such domestic consolidated Subsidiaries as
are necessary to reduce such aggregate assets to or below ten percent (10%) of
such Consolidated Assets to deliver to the Administrative Agent executed
Supplements to become Subsidiary Guarantors and appropriate corporate
resolutions, opinions and other documentation in form and substance reasonably
satisfactory to the Administrative Agent in connection therewith, such
Supplements and other documentation to be delivered to the Administrative Agent
as promptly as possible but in any event within thirty (30) days following the
initial date on which such aggregate assets exceed ten percent (10%) of such
Consolidated Assets.
(ii) If at any time any domestic Subsidiary of Energizer which is not a
Subsidiary Guarantor guaranties any Indebtedness of Energizer other than the
Indebtedness hereunder or under the 5-Year Credit Agreement, Energizer shall
cause such Subsidiary to deliver to the Administrative Agent an executed
Supplement to become a Subsidiary Guarantor and appropriate corporate
resolutions, opinions and other documentation in form and substance reasonably
satisfactory to the Administrative Agent in connection therewith, such
Supplement and other documentation to be delivered to the Administrative Agent
concurrently with the delivery of the guaranty of such other Indebtedness.
7.3 Negative Covenants.
-------------------
(A) Subsidiary Indebtedness.(A) Subsidiary Indebtedness Energizer shall
------------------------
not permit any of its Subsidiaries directly or indirectly to create, incur,
assume or otherwise become or remain directly or indirectly liable with respect
to any Indebtedness, except:
(i) Indebtedness of the Subsidiaries under the Subsidiary Guaranty;
(ii) Indebtedness in respect of guaranties executed by any Subsidiary
Guarantor with respect to any Indebtedness of Energizer, provided such
--------
Indebtedness is not incurred by Energizer in violation of this Agreement;
(iii) Indebtedness in respect of obligations secured by Customary Permitted
Liens;
(iv) Indebtedness constituting Contingent Obligations permitted by Section
-------
7.3(E);
-----
(v) Indebtedness arising from loans (a) from any Subsidiary to any
wholly-owned Subsidiary or (b) from Energizer to any wholly-owned Subsidiary;
provided, that if any Subsidiary Guarantor is the obligor on such Indebtedness,
------
such Indebtedness shall be expressly subordinate to the payment in full in cash
of the Obligations on terms satisfactory to the Administrative Agent;
(vi) Indebtedness in respect of Hedging Obligations permitted under Section
-------
7.3(O);
- ------
(vii) Indebtedness with respect to surety, appeal and performance bonds
obtained by any of Energizer's Subsidiaries in the ordinary course of business;
(viii) Indebtedness incurred in connection with the Receivables Purchase
Documents, provided, that Receivables Facility Attributed Indebtedness incurred
--------
in connection therewith does not exceed $250,000,000 in the aggregate at any
time; and
(ix) Other Indebtedness in addition to that referred to elsewhere in this
Section 7.3(A) incurred by Energizer's Subsidiaries; provided that no Default or
------------ --------
Unmatured Default shall have occurred and be continuing at the date of such
incurrence or would result therefrom; and provided further that the aggregate
-------- -------
outstanding amount of all Indebtedness incurred by Energizer's Subsidiaries
(other than Indebtedness incurred pursuant to clauses (i), (ii), (v), (vi) and
----------- ---- --- ----
(viii) of this Section 7.3(A)) shall not at any time exceed $250,000,000.
----- --------------
(B) Sales of Assets. Neither Energizer nor any of its Subsidiaries shall
-----------------
sell, assign, transfer, lease, convey or otherwise dispose of any property,
whether now owned or hereafter acquired, or any income or profits therefrom, or
enter into any agreement to do so, except:
(i) sales of Inventory in the ordinary course of business;
(ii) the disposition in the ordinary course of business of Equipment that is
obsolete, excess or no longer used or useful in Energizer's or its Subsidiaries'
businesses;
(iii) any transfer of an interest in Receivables, Receivables Related
Security, accounts or notes receivable on a limited recourse basis under the
Receivables Purchase Documents, provided that such transfer qualifies as a legal
--------
sale and as a sale under Agreement Accounting Principles and that the amount of
Receivables Facility Attributed Indebtedness does not exceed $250,000,000 at any
one time outstanding; and
(iv) sales, assignments, transfers, leases, conveyances or other
dispositions of other assets (other than pursuant to clauses (i), (ii) and (iii)
----------- ---- -----
above) if such transaction (a) is for not less than fair market value, and (b)
when combined with all such other transactions (each such transaction being
valued at book value) during the period from the Closing Date, to the date of
such proposed transaction, represents the disposition of not greater than twenty
percent (20%) of Energizer's Consolidated Assets (such Consolidated Assets being
calculated for the end of the fiscal year immediately preceding that in which
such transaction is proposed to be entered into).
(C) Liens. Neither Energizer nor any of its Subsidiaries shall directly or
-----
indirectly create, incur, assume or permit to exist any Lien on or with respect
to any of their respective property or assets except:
(i) Liens, if any, created by the Loan Documents or otherwise securing the
Obligations, or Liens created by the "Loan Documents" under and as defined in
the 5-Year Credit Agreement or otherwise Securing the "Obligations" (as such
terms are defined in the 5-Year Credit Agreement;
(ii) Customary Permitted Liens;
(iii) Liens arising under the Receivables Purchase Documents; and
(iv) other Liens, including Permitted Existing Liens, (a) securing
Indebtedness of Energizer and/or (b) securing Indebtedness of Energizer's
Subsidiaries as permitted pursuant to Section 7.3(A) and in an aggregate
---------------
outstanding amount not to exceed five percent (5%) of Consolidated Assets at any
time.
In addition, neither Energizer nor any of its Subsidiaries shall become a party
to any agreement, note, indenture or other instrument, or take any other action,
which would prohibit the creation of a Lien on any of its properties or other
assets in favor of the Administrative Agent for the benefit of itself and the
Holders of Obligations, as collateral for the Obligations; provided, that any
--------
agreement, note, indenture or other instrument in connection with purchase money
indebtedness (including Capitalized Leases) may prohibit the creation of a Lien
in favor of the Administrative Agent for the benefit of itself and the Holders
of Obligations on the items of property obtained with the proceeds of such
purchase money indebtedness; provided, further, that (a) the Note Purchase
-------- -------
Agreement in connection with the Senior Notes may prohibit the creation of a
Lien in favor of the Administrative Agent for the benefit of itself and the
Holders of Obligations, as collateral for the Obligations unless the holders of
the Senior Notes shall be provided with an equal and ratable Lien and (b) the
Receivables Purchase Documents may prohibit the creation of a Lien with respect
to all of the assets of the SPV and with respect to the Receivables and Related
Security of any of the Originators in favor of the Administrative Agent for the
benefit of itself and the Holders of Obligations, as collateral for the
Obligations.
(D) Investments. Except to the extent permitted pursuant to paragraph (G)
----------- -------------
below, neither Energizer nor any of its Subsidiaries shall directly or
indirectly make or own any Investment except:
(i) Investments in cash and Cash Equivalents;
(ii) Permitted Existing Investments in an amount not greater than the amount
thereof on the Closing Date;
(iii) Investments in trade receivables or received in connection with the
bankruptcy or reorganization of suppliers and customers and in settlement of
delinquent obligations of, and other disputes with, customers and suppliers
arising in the ordinary course of business;
(iv) Investments consisting of deposit accounts maintained by Energizer and
its Subsidiaries;
(v) Investments consisting of non-cash consideration from a sale,
assignment, transfer, lease, conveyance or other disposition of property
permitted by Section 7.3(B);
---------------
(vi) Investments in any consolidated Subsidiaries (other than joint
ventures);
(vii) Investments in joint ventures and nonconsolidated Subsidiaries in an
aggregate amount not to exceed $50,000,000.
(viii) Investments constituting Permitted Acquisitions;
(ix) Investments constituting Indebtedness permitted by Section 7.3(A) or
--------------
Contingent Obligations permitted by Section 7.3(E);
---------------
(x) Investments in the SPVs (a) required in connection with the Receivables
Purchase Documents and (b) resulting from the transfers permitted by Section
-------
7.3(B)(iii); and
--------
(xi) Investments in addition to those referred to elsewhere in this Section
-------
7.3(D) in an aggregate amount not to exceed $50,000,000.
- ------
(E) Contingent Obligations. None of Energizer's Subsidiaries shall directly
----------------------
or indirectly create or become or be liable with respect to any Contingent
Obligation, except: (i) recourse obligations resulting from endorsement of
negotiable instruments for collection in the ordinary course of business; (ii)
Permitted Existing Contingent Obligations; (iii) obligations, warranties, and
indemnities, not relating to Indebtedness of any Person, which have been or are
undertaken or made in the ordinary course of business and not for the benefit of
or in favor of an Affiliate of Energizer or such Subsidiary; (iv) Contingent
Obligations with respect to surety, appeal and performance bonds obtained by
Energizer or any Subsidiary in the ordinary course of business; (v) Contingent
Obligations of the Subsidiary Guarantors under the Subsidiary Guaranty; (vi)
Contingent Obligations of Subsidiaries which are guarantors under a guaranty of
the Indebtedness evidenced by the Senior Notes and the Note Purchase Agreements;
(vii) Contingent Obligations of Energizer or any of its Subsidiaries arising
under the Receivables Purchase Documents and (viii) Contingent Obligations
incurred in the ordinary course of business by any of Energizer's Subsidiaries
in respect of obligations of any Subsidiary.
(F) Conduct of Business; New Subsidiaries; Acquisitions. Except as
--------------------------------------------------------
expressly provided in clause (c) in the definition of "Permitted Acquisition"
----------
below, neither Energizer nor any of its Subsidiaries shall engage in any
business other than the businesses engaged in by Energizer and its Subsidiaries
on the date of such transaction and any business or activities which are
substantially similar, related or incidental thereto. Energizer may create,
acquire in a Permitted Acquisition or capitalize any Subsidiary (a "NEW
SUBSIDIARY") after the date hereof if (i) no Default or Unmatured Default shall
have occurred and be continuing or would result therefrom; (ii) after such
creation, acquisition or capitalization, all of the representations and
warranties contained herein shall be true and correct; and (iii) after such
creation, acquisition or capitalization Energizer shall be in compliance with
the terms of Sections 7.2(K) and 7.3(R).
---------------- -------
Without in any way limiting the foregoing, Energizer shall not make any
Acquisitions, other than Acquisitions meeting the following requirements or
otherwise approved by the Required Lenders (each such Acquisition constituting a
"PERMITTED ACQUISITION"):
(a) no Default or Unmatured Default shall have occurred and be continuing or
would result from such Acquisition or the incurrence of any Indebtedness in
connection therewith, and all of the representations and warranties contained
herein shall be true and correct on and as of the date such Acquisition with the
same effect as though made on and as of such date;
(b) the purchase is consummated pursuant to a negotiated acquisition
agreement on a non-hostile basis pursuant to an acquisition agreement approved
by the board of directors or other applicable governing body of the Seller prior
to the commencement thereof;
(c) the businesses being acquired shall be consumer product companies or
other businesses that are substantially similar, related or incidental to the
businesses or activities engaged in by Energizer and its Subsidiaries as of the
consummation of the Debt Assumption or such future business or activities
engaged in by Energizer and its Subsidiaries, as well as suppliers to or
distributors of products similar to those of Energizer and its Subsidiaries;
provided, however, that Energizer and its Subsidiaries shall be permitted to
----- -------
acquire businesses that do not satisfy the foregoing criteria in this clause (c)
----------
so long as the aggregate purchase price for all such acquisitions does not
exceed five percent (5%) of Energizer's consolidated tangible net assets (on a
pro forma basis) as of the date of the consummation of such Acquisition; and
(d) prior to each such Acquisition, Energizer shall determine that after
giving effect to such Acquisition and the incurrence of any Indebtedness by
Energizer or any of its Subsidiaries, to the extent permitted by Section 7.3(A),
--------------
in connection therewith, on a pro forma basis using historical audited and
--- -----
reviewed unaudited financial statements obtained from the seller, broken down by
fiscal quarter in Energizer's reasonable judgment, as if the Acquisition and
such incurrence of Indebtedness had occurred on the first day of the
twelve-month period ending on the last day of Energizer's most recently
completed fiscal quarter, Energizer would have been in compliance with the
financial covenants in Section 7.4 and not otherwise in Default.
------------
(G) Transactions with Ralston's Shareholders and Affiliates. Except for (a)
-------------------------------------------------------
the transactions set forth on Schedule 7.3(G), (b) Permitted Receivables
---------------
Transfers and (c) Investments permitted by Section 7.3(D), neither Energizer nor
--------------
any of its Subsidiaries shall directly or indirectly enter into or permit to
exist any transaction (including, without limitation, the purchase, sale, lease
or exchange of any property or the rendering of any service) with Ralston, any
holder or holders of any of the Equity Interests of Energizer, or with any
Affiliate of Energizer which is not its Subsidiary, on terms that are less
favorable to Energizer or any of its Subsidiaries, as applicable, than those
that might be obtained in an arm's length transaction at the time from Persons
who are not such a holder or Affiliate.
(H) Restriction on Fundamental Changes. Neither Energizer nor any of its
-------------------------------------
Subsidiaries shall enter into any merger or consolidation, or liquidate, wind-up
or dissolve (or suffer any liquidation or dissolution), or convey, lease, sell,
transfer or otherwise dispose of, in one transaction or series of transactions,
all or substantially all of Energizer's or any such Subsidiary's business or
property, whether now or hereafter acquired, except (i) transactions permitted
under Sections 7.3(B) or 7.3(F), and (ii) a Subsidiary of Energizer may be
---------------- ------
merged into, liquidated into or consolidated with Energizer (in which case
Energizer shall be the surviving corporation) or any wholly-owned Subsidiary of
Energizer, provided if a Subsidiary Guarantor is merged into, liquidated into or
--------
consolidated with another Subsidiary of Energizer, the surviving Subsidiary
shall also be or shall become a Subsidiary Guarantor.
(I) Sales and Leasebacks. Neither Energizer nor any of its Subsidiaries
----------------------
shall become liable, directly, by assumption or by Contingent Obligation, with
respect to any lease, whether an operating lease or a Capitalized Lease, of any
property (whether real or personal or mixed), (i) which it or one of its
Subsidiaries sold or transferred or is to sell or transfer to any other Person,
or (ii) which it or one of its Subsidiaries intends to use for substantially the
same purposes as any other property which has been or is to be sold or
transferred by it or one of its Subsidiaries to any other Person in connection
with such lease, unless in either case the sale involved is not prohibited under
Section 7.3(B) and the lease involved is not prohibited under Section 7.3(A).
- --------------- --------------
(J) Margin Regulations. Neither Energizer nor any of its Subsidiaries,
-------------------
shall use all or any portion of the proceeds of any credit extended under this
Agreement to purchase or carry Margin Stock.
(K) ERISA. Energizer shall not:
-----
(i) permit to exist any accumulated funding deficiency (as defined in
Sections 302 of ERISA and 412 of the Code), with respect to any Benefit Plan,
whether or not waived;
(ii) terminate, or permit any Controlled Group member to terminate, any
Benefit Plan which would result in liability of Energizer or any Controlled
Group member under Title IV of ERISA;
(iii) fail, or permit any Controlled Group member to fail, to pay any
required installment or any other payment required under Section 412 of the Code
on or before the due date for such installment or other payment; or
(iv) permit any unfunded liabilities with respect to any Foreign Pension
Plan;
except where such transactions, events, circumstances, or failures are not,
individually or in the aggregate, reasonably expected to result in liability
individually or in the aggregate in excess of $25,000,000 or have a Material
Adverse Effect.
(L) Corporate Documents. Neither Energizer nor any of its Subsidiaries
--------------------
shall amend, modify or otherwise change any of the terms or provisions in any of
their respective constituent documents as in effect on the date hereof in
any manner adverse to the interests of the Lenders, without the prior written
consent of the Required Lenders.
(M) Fiscal Year. Neither Energizer nor any of its consolidated Subsidiaries
-----------
shall change its fiscal year for accounting or tax purposes from a twelve-month
period ending September 30 of each year.
(N) Subsidiary Covenants. Energizer will not, and will not permit any
---------------------
Subsidiary to, create or otherwise cause to become effective any consensual
encumbrance or restriction of any kind on the ability of any Subsidiary to pay
dividends or make any other distribution on its stock, redeem or repurchase its
stock, make any other similar payment or distribution, pay any Indebtedness or
other Obligation owed to Energizer or any other Subsidiary, make loans or
advances or other Investments in Energizer or any other Subsidiary, to sell,
transfer or otherwise convey any of its property to Energizer or any other
Subsidiary or merge, consolidate with or liquidate into Energizer or any other
Subsidiary other than pursuant to the Receivables Purchase Documents.
(O) Hedging Obligations. Energizer shall not and shall not permit any of
--------------------
its Subsidiaries to enter into any Hedging Arrangements other than Hedging
Arrangements entered into by Energizer or its Subsidiaries pursuant to which
Energizer or such Subsidiary has hedged its or its Subsidiaries' reasonably
estimated interest rate, foreign currency or commodity exposure and which are of
a non-speculative nature. Such permitted Hedging Arrangements entered into by
Energizer and any Lender or any affiliate of any Lender are sometimes referred
to herein as "HEDGING AGREEMENTS."
(P) Issuance of Disqualified Stock. From and after the Closing Date,
---------------------------------
neither Energizer, nor any of its Subsidiaries shall issue any Disqualified
Stock. All issued and outstanding Disqualified Stock shall be treated as
Indebtedness for borrowed money for all purposes of this Agreement, and the
amount of such deemed Indebtedness shall be the aggregate amount of the
liquidation preference of such Disqualified Stock.
(Q) Non-Guarantor Subsidiaries. Energizer will not at any time permit the
---------------------------
aggregate assets of all of Energizer's domestic consolidated Subsidiaries (other
than the SPVs) which are not Subsidiary Guarantors to exceed ten percent (10%)
of Consolidated Assets of Energizer and its consolidated Subsidiaries (other
than the SPVs). Energizer shall not permit any of its Subsidiaries to guaranty
any Indebtedness of Energizer other than the Indebtedness hereunder or under the
5-Year Agreement unless each such Subsidiary is a Subsidiary Guarantor under the
Subsidiary Guaranty.
(R) Tax Ruling. Notwithstanding anything herein to the contrary, neither
------------
Energizer nor any of its Subsidiaries shall engage in any transaction (i)
described in Section 8.01(b) of the Reorganization Agreement for the time
periods specified therein unless Energizer or such Subsidiary shall have
obtained and/or delivered such documentation as may be required by Section
8.01(a) thereof, or (ii) that would otherwise adversely affect the Tax Ruling.
7.4 Financial Covenants. Energizer shall comply with the following:
--------------------
(A) Maximum Leverage Ratio. Energizer shall not permit the ratio (the
------------------------
"LEVERAGE RATIO") of (i) the sum of (a) all Indebtedness of Energizer and its
Subsidiaries to (ii) EBITDA at any time to be greater than 3.00 to 1.00. The
Leverage Ratio shall be calculated, in each case, determined as of the last day
of each fiscal quarter based upon (a) for Indebtedness, Indebtedness as of the
last day of each such fiscal quarter; and (b) for EBITDA, the actual amount for
the four-quarter period ending on such day, calculated, with respect to
Permitted Acquisitions, on a pro forma basis using unadjusted historical audited
--- -----
and reviewed unaudited financial statements obtained from the seller (with
the EBITDA component thereof broken down by fiscal quarter in Energizer's
reasonable judgment).
(B) Minimum Interest Expense Coverage Ratio. Energizer shall maintain a
-------------------------------------------
ratio (the "INTEREST EXPENSE COVERAGE RATIO") for any applicable period of (a)
EBIT for such period to (b) Interest Expense for such period of greater than
3.00 to 1.00 for each fiscal quarter. The Interest Expense Coverage Ratio shall
be calculated as of the last day of each fiscal quarter for the four-quarter
period ending on such day; provided, that (i) for the fiscal quarter ending June
--------
30, 2000, the Interest Expense Coverage Ratio shall be calculated using EBIT and
Interest Expense for the fiscal quarter ending June 30, 2000, (b) for the fiscal
quarter ending September 30, 2000, the Interest Expense Coverage Ratio shall be
calculated using EBIT and Interest Expense for the two fiscal quarter period
ending September 30, 2000, and (iii) for the fiscal quarter ending December 31,
2000, the Interest Expense Coverage Ratio shall be calculated using such items
for Energizer and its consolidated Subsidiaries for the three fiscal quarter
period ending December 31, 2000.
ARTICLE VIII: DEFAULTS
- -------------- --------
8.1 Defaults. Each of the following occurrences shall constitute a Default
--------
under this Agreement:
(A) Failure to Make Payments When Due. The Borrower shall (i) fail to pay
-----------------------------------
when due any of the Obligations consisting of principal with respect to the
Loans or (ii) shall fail to pay within five (5) Business Days of the date when
due any of the other Obligations under this Agreement or the other Loan
Documents.
(B) Breach of Certain Covenants. The Borrower shall fail duly and
------------------------------
punctually to perform or observe any agreement, covenant or obligation binding
-
on the Borrower or there shall otherwise be a breach of any covenant under:
(i) Sections 7.1 or 7.2 and such failure or breach shall continue unremedied
------------ ---
for thirty (30) days after the earlier to occur of (a) the date on which
written notice from the Administrative Agent or any Lender is received by the
Borrower of such breach and (b) the date on which a member of the Senior
Management Team of the Borrower or any Subsidiary Guarantor had knowledge of the
existence of such breach or should have known of the existence of such breach;
or
(ii) Sections 7.3 or 7.4.
------------- ---
(C) Breach of Representation or Warranty. Any representation or warranty
---------------------------------------
made or deemed made by the Borrower to the Administrative Agent or any Lender
herein or by the Borrower or any of its Subsidiaries in any of the other Loan
Documents or in any statement or certificate at any time given by any such
Person pursuant to any of the Loan Documents shall be false or misleading in any
material respect on the date as of which made (or deemed made).
(D) Other Defaults. The Borrower shall default in the performance of or
---------------
compliance with any term contained in this Agreement (other than as covered by
paragraphs (A) or (B) of this Section 8.1), or the Borrower or any of its
-------------- --- ------------
Subsidiaries shall default in the performance of or compliance with any term
-----
contained in any of the other Loan Documents, and such default shall continue
--
for thirty (30) days after the earlier to occur of (a) the date on which written
-
notice from the Administrative Agent or any Lender is received by the Borrower
of such breach and (b) the date on which a member of the Senior Management Team
of the Borrower or any Subsidiary Guarantor had knowledge of the existence of
such breach or should have known of the existence of such breach.
(E) Default as to Other Indebtedness. The Borrower or any of its
------------------------------------
Subsidiaries shall fail to make any payment when due (whether by scheduled
--
maturity, required prepayment, acceleration, demand or otherwise), beyond any
period of grace provided, with respect to (i) any Indebtedness incurred pursuant
to the 5-Year Credit Agreement or (ii) any other Indebtedness (other than
Indebtedness hereunder) which individually or together with other such
Indebtedness as to which any such failure exists (other than hereunder or under
the 5-Year Credit Agreement) constitutes Material Indebtedness; or any breach,
default or event of default (including any "Amortization Event" or event of like
import in connection with the Receivables Purchase Facility) shall occur, or any
other condition shall exist under any instrument, agreement or indenture
pertaining to any such Indebtedness under the 5-Year Credit Agreement or
Material Indebtedness having such aggregate outstanding principal amount, beyond
any period of grace, if any, provided with respect thereto, if the effect
thereof is to cause an acceleration, mandatory redemption, a requirement that
the Borrower offer to purchase such Indebtedness under the 5-Year Credit
Agreement or Material Indebtedness or other required repurchase of such
Indebtedness under the 5-Year Credit Agreement or Material Indebtedness, or
permit the holder(s) of such Indebtedness under the 5-Year Credit Agreement or
Material Indebtedness to accelerate the maturity of any such Indebtedness under
the 5-Year Credit Agreement or Material Indebtedness or require a redemption or
other repurchase of such Indebtedness under the 5-Year Credit Agreement or
Material Indebtedness; or any such Indebtedness under the 5-Year Credit
Agreement or Material Indebtedness shall be otherwise declared to be due and
payable (by acceleration or otherwise) or required to be prepaid, redeemed or
otherwise repurchased by the Borrower or any of its Subsidiaries (other than by
a regularly scheduled required prepayment) prior to the stated maturity thereof.
(F) Involuntary Bankruptcy; Appointment of Receiver, Etc.
(i) An involuntary case shall be commenced against the Borrower or any of
the Borrower's Material Subsidiaries and the petition shall not be dismissed,
stayed, bonded or discharged within sixty (60) days after commencement of the
case; or a court having jurisdiction in the premises shall enter a decree or
order for relief in respect of the Borrower or any of the Borrower's Material
Subsidiaries in an involuntary case, under any applicable bankruptcy, insolvency
or other similar law now or hereinafter in effect; or any other similar
relief shall be granted under any applicable federal, state, local or foreign
law.
(ii) A decree or order of a court having jurisdiction in the premises for
the appointment of a receiver, liquidator, sequestrator, trustee, custodian or
other officer having similar powers over the Borrower or any of the Borrower's
Material Subsidiaries or over all or a substantial part of the property of the
Borrower or any of the Borrower's Material Subsidiaries shall be entered; or an
interim receiver, trustee or other custodian of the Borrower or any of the
Borrower's Material Subsidiaries or of all or a substantial part of the property
of the Borrower or any of the Borrower's Material Subsidiaries shall be
appointed or a warrant of attachment, execution or similar process against any
substantial part of the property of the Borrower or any of the Borrower's
Material Subsidiaries shall be issued and any such event shall not be stayed,
dismissed, bonded or discharged within sixty (60) days after entry, appointment
or issuance.
(G) Voluntary Bankruptcy; Appointment of Receiver, Etc. The Borrower or any
---------------------------------------------------
of the Borrower's Material Subsidiaries shall (i) commence a voluntary case
under any applicable bankruptcy, insolvency or other similar law now or
hereafter in effect, (ii) consent to the entry of an order for relief in an
involuntary case, or to the conversion of an involuntary case to a voluntary
case, under any such law, (iii) consent to the appointment of or taking
possession by a receiver, trustee or other custodian for all or a substantial
part of its property, (iv) make any assignment for the benefit of creditors, (v)
take any corporate action to authorize any of the foregoing or (vi) is
generally not paying, or admits in writing its inability to pay, its debts as
they become due.
(H) Judgments and Attachments. Any money judgment(s) (other than a money
---------------------------
judgment covered by insurance as to which the insurance company has not
disclaimed or reserved the right to disclaim coverage), writ or warrant of
attachment, or similar process against the Borrower or any of its Subsidiaries
or any of their respective assets involving in any single case or in the
aggregate an amount in excess of $30,000,000 is or are entered and shall remain
undischarged, unvacated, unbonded or unstayed for a period of sixty (60) days or
in any event later than fifteen (15) days prior to the date of any proposed sale
thereunder.
(I) Dissolution. Any order, judgment or decree shall be entered against the
-----------
Borrower decreeing its involuntary dissolution or split up and such order shall
remain undischarged and unstayed for a period in excess of sixty (60) days; or
the Borrower shall otherwise dissolve or cease to exist except as specifically
permitted by this Agreement.
(J) Loan Documents. At any time, for any reason, any Loan Document as a
---------------
whole that materially affects the ability of the Administrative Agent, or any of
the Lenders to enforce the Obligations ceases to be in full force and effect or
the Borrower or any of the Borrower's Subsidiaries party thereto seeks to
repudiate its obligations under any Loan Document.
(K) Termination Event. Any Termination Event occurs which the Required
------------------
Lenders believe is reasonably likely to subject either the Borrower or any of
its Subsidiaries to liability individually or in the aggregate in excess of
$25,000,000.
(L) Waiver of Minimum Funding Standard. If the plan administrator of any
-------------------------------------
Plan applies under Section 412(d) of the Code for a waiver of the minimum
funding standards of Section 412(a) of the Code and the Required Lenders believe
the substantial business hardship upon which the application for the waiver is
based could reasonably be expected to subject either the Borrower or any of its
Subsidiaries to liability individually or in the aggregate in excess of
$25,000,000.
(M) Change of Control. A Change of Control shall occur.
-------------------
(N) Hedging Agreements. Nonpayment by the Borrower of any material
-------------------
obligation under any Hedging Agreement or the breach by the Borrower of any
material term, provision or condition contained in any such Hedging Agreement.
(O) Environmental Matters. The Borrower or any of its Subsidiaries shall be
---------------------
the subject of any proceeding or investigation pertaining to (i) the Release by
the Borrower or any of its Subsidiaries of any Contaminant into the environment,
(ii) the liability of the Borrower or any of its Subsidiaries arising from the
Release by any other Person of any Contaminant into the environment, or (iii)
any violation of any Environmental, Health or Safety Requirements of Law which
by the Borrower or any of its Subsidiaries, which, in any case, has or is
reasonably likely to subject either the Borrower or its Subsidiaries to
liability individually or in the aggregate in excess of $25,000,000.
(P) Subsidiary Guarantor Revocation. Any Subsidiary Guarantor shall
---------------------------------
terminate or revoke any of its obligations under the Subsidiary Guaranty or
breach any of the material terms of such Subsidiary Guaranty.
(Q) Receivables Purchase Document Events. Other than at the request of
---------------------------------------
Energizer, the "Amortization Date" or an event of like import resulting in the
termination of the reinvestment of collections or proceeds of Receivables and
Related Security shall occur under any Receivables Purchase Document.
A Default shall be deemed "continuing" until cured or until waived in
writing in accordance with Section 9.3.
------------
ARTICLE IX: ACCELERATION, DEFAULTING LENDERS; WAIVERS, AMENDMENTS AND
- ------------ --------------------------------------------------------------
REMEDIES
- --------
9.1 Termination of Revolving Loan Commitments; Acceleration. If any Default
-------------------------------------------------------
described in Section 8.1(F), (G) or (I) occurs with respect to the Borrower
-------------- --- ---
and the obligations of the Lenders to make Loans hereunder shall automatically
terminate and the Obligations shall immediately become due and payable without
any election or action on the part of the Administrative Agent or any Lender.
If any other Default occurs, the Required Lenders may terminate or suspend the
obligations of the Lenders to make Loans hereunder or declare the Obligations to
be due and payable, or both, whereupon the Obligations shall become immediately
due and payable, without presentment, demand, protest or notice of any kind, all
of which the Borrower expressly waives.
9.2 Defaulting Lender. In the event that any Lender fails to fund its Pro
------------------
Rata Share of any Advance requested or deemed requested by the Borrower, which
such Lender is obligated to fund under the terms of this Agreement (the funded
portion of such Advance being hereinafter referred to as a "NON PRO RATA LOAN"),
until the earlier of such Lender's cure of such failure and the termination of
the Revolving Loan Commitments, the proceeds of all amounts thereafter repaid to
the Administrative Agent by the Borrower and otherwise required to be applied to
such Lender's share of all other Obligations pursuant to the terms of this
Agreement shall be advanced to the Borrower by the Administrative Agent on
behalf of such Lender to cure, in full or in part, such failure by such Lender,
but shall nevertheless be deemed to have been paid to such Lender in
satisfaction of such other Obligations. Notwithstanding anything in this
Agreement to the contrary:
(i) the foregoing provisions of this Section 9.2 shall apply only with
------------
respect to the proceeds of payments of Obligations and shall not affect the
conversion or continuation of Loans pursuant to Section 2.9;
------------
(ii) any such Lender shall be deemed to have cured its failure to fund its
Pro Rata Share, of any Advance at such time as an amount equal to such Lender's
original Pro Rata Share of the requested principal portion of such Advance is
fully funded to the Borrower, whether made by such Lender itself or by operation
of the terms of this Section 9.2, and whether or not the Non Pro Rata Loan with
-----------
respect thereto has been repaid, converted or continued;
(iii) amounts advanced to the Borrower to cure, in full or in part, any such
Lender's failure to fund its Pro Rata Share of any Advance ("CURE LOANS") shall
bear interest at the rate applicable to Floating Rate Loans in effect from time
to time, and for all other purposes of this Agreement shall be treated as if
they were Floating Rate Loans;
(iv) regardless of whether or not a Default has occurred or is continuing,
and notwithstanding the instructions of the Borrower as to its desired
application, all repayments of principal which, in accordance with the other
terms of this Agreement, would be applied to the outstanding Floating Rate Loans
shall be applied first, ratably to all Floating Rate Loans constituting Non Pro
-----
Rata Loans, second, ratably to Floating Rate Loans other than those constituting
------
Non Pro Rata Loans or Cure Loans and, third, ratably to Floating Rate Loans
-----
constituting Cure Loans;
(v) for so long as and until the earlier of any such Lender's cure of the
failure to fund its Pro Rata Share of any Advance and the termination of the
Revolving Loan Commitments, the term "Required Lenders" for purposes of this
Agreement shall mean Lenders (excluding all Lenders whose failure to fund their
respective Pro Rata Share of such Advance have not been so cured) whose Pro Rata
Shares represent greater than fifty percent (50%) of the aggregate Pro Rata
Shares of such Lenders; and
(vi) for so long as and until any such Lender's failure to fund its Pro Rata
Share of any Advance is cured in accordance with Section 9.2(ii), such Lender
---------------
shall not be entitled to any Facility Fees with respect to its Revolving Loan
Commitment, which Facility Fees shall accrue in favor of the Lenders which have
funded their respective Pro Rata Share of such requested Advance, shall be
allocated among such performing Lenders ratably based upon their relative
Revolving Loan Commitments, and shall be calculated based upon the average
amount by which the aggregate Revolving Loan Commitments of such performing
Lenders exceeds the outstanding principal amount of the Loans owing to such
performing Lenders.
9.3 Amendments. Subject to the provisions of this Article IX, the Required
---------- ----------
Lenders (or the Administrative Agent with the consent in writing of the Required
Lenders) and the Borrower may enter into agreements supplemental hereto for
the purpose of adding or modifying any provisions to the Loan Documents or
changing in any manner the rights of the Lenders or the Borrower hereunder or
waiving any Default hereunder; provided, however, that no such supplemental
-------- -------
agreement shall, without the consent of each Lender (which is not a defaulting
Lender under the provisions of Section 9.2) affected thereby:
------------
(i) Postpone or extend the Revolving Loan Termination Date or any other date
fixed for any payment of principal of, or interest on, the Loans or any
fees or other amounts payable to such Lender (other than (a) as expressly
permitted by the terms of Section 2.2 and (b) any modifications of the
------------
provisions relating to amounts, timing or application of prepayments of the
Loans and other Obligations, which modifications shall require the approval only
of the Required Lenders).
(ii) Reduce the principal amount of any Loans, or reduce the rate or extend
the time of payment of interest or fees thereon (other than (a) as expressly
permitted by Section 2.2, (b) a waiver of the application of the default rate of
-----------
interest pursuant to Section 2.10 hereof and (c) as a result of a change in the
------------
definition of Leverage Ratio or any of the components thereof or the method of
calculation thereof).
(iii) Reduce the percentage specified in the definition of Required Lenders
or any other percentage of Lenders specified to be the applicable percentage in
this Agreement to act on specified matters or amend the definitions of "Required
Lenders" or "Pro Rata Share".
(iv) Increase the amount of the Revolving Loan Commitment of such Lender
hereunder or increase such Lender's Pro Rata Share.
(v) Permit the Borrower to assign its rights under this Agreement, other
than pursuant to the Debt Assumption.
(vi) other than pursuant to a transaction permitted by the terms of this
Agreement, release any guarantor from its obligations under the Subsidiary
Guaranty.
(vii) Amend this Section 9.3.
------------
No amendment of any provision of this Agreement relating to the Administrative
Agent shall be effective without the written consent of the Administrative
Agent. The Administrative Agent may waive payment of the fee required under
Section 13.3(B) without obtaining the consent of any of the Lenders.
-------------
9.4 Preservation of Rights. No delay or omission of the Lenders or the
------------------------
Administrative Agent to exercise any right under the Loan Documents shall impair
such right or be construed to be a waiver of any Default or an acquiescence
therein, and the making of a Loan notwithstanding the existence of a Default or
the inability of the Borrower to satisfy the conditions precedent to such Loan
shall not constitute any waiver or acquiescence. Any single or partial exercise
of any such right shall not preclude other or further exercise thereof or the
exercise of any other right, and no waiver, amendment or other variation of the
terms, conditions or provisions of the Loan Documents whatsoever shall be valid
unless in writing signed by the Lenders required pursuant to Section 9.3, and
-----------
then only to the extent in such writing specifically set forth. All remedies
contained in the Loan Documents or by law afforded shall be cumulative and all
shall be available to the Administrative Agent and the Lenders until all of the
Obligations (other than contingent indemnity obligations) shall have been fully
and indefeasibly paid and satisfied in cash and all financing arrangements among
the Borrower and the Lenders shall have been terminated.
ARTICLE X: GENERAL PROVISIONS
- ----------- -------------------
10.1 Survival of Representations. All representations and warranties of the
---------------------------
Borrower contained in this Agreement shall survive delivery of this
Agreement and the making of the Loans herein contemplated.
10.2 Governmental Regulation. Anything contained in this Agreement to the
------------------------
contrary notwithstanding, no Lender shall be obligated to extend credit to the
Borrower in violation of any limitation or prohibition provided by any
applicable statute or regulation.
10.3 Performance of Obligations. The Borrower agrees that after the
----------------------------
occurrence and during the continuance of a Default, the Administrative Agent
may, but shall have no obligation to, make any payment or perform any act
required of the Borrower under any Loan Document to the extent the
Administrative Agent determines that such action shall be necessary or advisable
in order to protect or preserve the rights of the Lenders hereunder. The
Administrative Agent shall use its reasonable efforts to give the Borrower
notice of any action taken under this Section 10.3 prior to the taking of such
------------
action or promptly thereafter provided the failure to give such notice shall not
affect the Borrower's obligations in respect thereof. The Borrower agrees to
pay the Administrative Agent, upon demand, the principal amount of all funds
advanced by the Administrative Agent under this Section 10.3, together with
------------
interest thereon at the rate from time to time applicable to Floating Rate Loans
from the date of such advance until the outstanding principal balance thereof is
paid in full. If the Borrower fails to make payment in respect of any such
advance under this Section 10.3 within one (1) Business Day after the date the
------------
Borrower receives written demand therefor from the Administrative Agent, the
Administrative Agent shall promptly notify each Lender and each Lender agrees
that it shall thereupon make available to the Administrative Agent, in Dollars
in immediately available funds, the amount equal to such Lender's Pro Rata Share
of such advance. If such funds are not made available to the Administrative
Agent by such Lender within one (1) Business Day after the Administrative
Agent's demand therefor, the Administrative Agent will be entitled to recover
any such amount from such Lender together with interest thereon at the Federal
Funds Effective Rate for each day during the period commencing on the date of
such demand and ending on the date such amount is received. The failure of any
Lender to make available to the Administrative Agent its Pro Rata Share of any
such unreimbursed advance under this Section 10.3 shall neither relieve any
------------
other Lender of its obligation hereunder to make available to the Administrative
Agent such other Lender's Pro Rata Share of such advance on the date such
payment is to be made nor increase the obligation of any other Lender to make
such payment to the Administrative Agent. All outstanding principal of, and
interest on, advances made under this Section 10.3 shall constitute Obligations
------------
subject to the terms of this Agreement until paid in full by the Borrower.
10.4 Headings. Section headings in the Loan Documents are for convenience
--------
of reference only, and shall not govern the interpretation of any of the
provisions of the Loan Documents.
10.5 Entire Agreement. The Loan Documents embody the entire agreement and
-----------------
understanding among the Borrower, the Administrative Agent and the Lenders and
supersede all prior agreements and understandings among the Borrower, the
Administrative Agent and the Lenders relating to the subject matter thereof.
10.6 Several Obligations; Benefits of this Agreement. The respective
----------------------------------------------------
obligations of the Lenders hereunder are several and not joint and no Lender
shall be the partner or agent of any other Lender (except to the extent to which
the Administrative Agent is authorized to act as such). The failure of any
Lender to perform any of its obligations hereunder shall not relieve any other
Lender from any of its obligations hereunder. This Agreement shall not be
construed so as to confer any right or benefit upon any Person other than the
parties to this Agreement and their respective successors and assigns.
10.7 Expenses; Indemnification.
--------------------------
(A) Expenses. The Borrower shall reimburse the Administrative Agent and the
--------
Arranger for any reasonable costs, internal charges and out-of-pocket
expenses (including reasonable attorneys' and paralegals' fees and time charges
of attorneys and paralegals for the Administrative Agent, which attorneys and
paralegals may be employees of the Administrative Agent) paid or incurred by the
Administrative Agent or the Arranger in connection with the preparation,
negotiation, execution, delivery, syndication, review, amendment modification
and, after the occurrence and during the continuance of a Default or an
Unmatured Default, administration of the Loan Documents. The Borrower also
agrees to reimburse the Administrative Agent and the Arranger and the Lenders
for any reasonable costs and out-of-pocket expenses (including reasonable
attorneys' and paralegals' fees and time charges of attorneys and paralegals for
the Administrative Agent and the Arranger and the Lenders, which attorneys and
paralegals may be employees of the Administrative Agent or the Arranger or the
Lenders) paid or incurred by the Administrative Agent or the Arranger or any
Lender in connection with the collection of the Obligations and enforcement of
the Loan Documents; provided, that after the occurrence and during the
--------
continuance of a Default, the Borrower agrees to reimburse the Administrative
Agent, the Arranger and the Lenders for all such costs and out-of-pocket
expenses, whether or not reasonable.
(B) Indemnity. The Borrower further agrees to defend, protect, indemnify,
---------
and hold harmless the Administrative Agent, the Arranger, the Syndication Agent,
the Documentation Agent and each and all of the Lenders and each of their
respective Affiliates, and each of such Administrative Agent's, Syndication
Agent's, Documentation Agent's, Arranger's, Lender's, or Affiliate's respective
officers, directors, trustees, investment advisors, employees, attorneys and
agents (including, without limitation, those retained in connection with the
satisfaction or attempted satisfaction of any of the conditions set forth in
Article V) (collectively, the "INDEMNITEES") from and against any and all
-------
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
---
claims, costs, expenses of any kind or nature whatsoever (including, without
limitation, the fees and disbursements of counsel for such Indemnitees in
connection with any investigative, administrative or judicial proceeding,
whether or not such Indemnitees shall be designated a party thereto), imposed
on, incurred by, or asserted against such Indemnitees in any manner relating to
or arising out of:
(i) this Agreement, the other Loan Documents or any of the Transaction
Documents, or any act, event or transaction related or attendant thereto or to
the Transactions and the making of the Loans hereunder, the management of such
Loans, the use or intended use of the proceeds of the Loans hereunder, or any of
the other transactions contemplated by the Transaction Documents; or
(ii) any liabilities, obligations, responsibilities, losses, damages,
personal injury, death, punitive damages, economic damages, consequential
damages, treble damages, intentional, willful or wanton injury, damage or threat
to the environment, natural resources or public health or welfare, costs and
expenses (including, without limitation, attorney, expert and consulting fees
and costs of investigation, feasibility or remedial action studies), fines,
penalties and monetary sanctions, interest, direct or indirect, known or
unknown, absolute or contingent, past, present or future relating to violation
of any Environmental, Health or Safety Requirements of Law arising from or in
connection with the past, present or future operations of the Borrower, its
Subsidiaries or any of their respective predecessors in interest, or, the past,
present or future environmental, health or safety condition of any respective
property of the Borrower or its Subsidiaries, the presence of
asbestos-containing materials at any respective property of the Borrower or its
Subsidiaries or the Release or threatened Release of any Contaminant into the
environment (collectively, the "INDEMNIFIED MATTERS");
provided, however, the Borrower shall have no obligation to an Indemnitee
- -------- -------
hereunder with respect to Indemnified Matters caused by or resulting from the
- ------
willful misconduct or gross negligence of such Indemnitee with respect to the
- --
Loan Documents, as determined by the final non-appealed judgment of a court of
- --
competent jurisdiction. If the undertaking to indemnify, pay and hold harmless
set forth in the preceding sentence may be unenforceable because it is violative
of any law or public policy, the Borrower shall contribute the maximum portion
which it is permitted to pay and satisfy under applicable law, to the payment
and satisfaction of all Indemnified Matters incurred by the Indemnitees.
Each Indemnitee, with respect to any action against it in respect of which
indemnity may be sought under this Section, shall give written notice of the
commencement of such action to the Borrower within a reasonable time after such
Indemnitee is made a party to such action. Upon receipt of any such notice by
the Borrower, unless such Indemnitee shall be advised by its counsel that there
are or may be legal defenses available to such Indemnitee that are different
from, in addition to, or in conflict with, the defenses available to the
Borrower or any of its Subsidiaries, the Borrower may participate with the
Indemnitee in the defense of such Indemnified Matter, including the employment
of counsel consented to by such Indemnitee (which consent shall not be
unreasonably withheld); provided, however, nothing provided herein shall entitle
-------- -------
(a) the Borrower or any of its Subsidiaries to assume the defense of such
Indemnified Matter or (b) any Indemnitee to effect any settlement in respect of
any indemnified matter without the Borrower's consent, such consent not to be
unreasonably withheld.
(C) Waiver of Certain Claims; Settlement of Claims. The Borrower further
-------------------------------------------------
agrees to assert no claim against any of the Indemnitees on any theory of
liability seeking consequential, special, indirect, exemplary or punitive
damages. No settlement of any claim asserted against or likely to be asserted
against an Indemnitee shall be entered into by the Borrower or any if its
Subsidiaries with respect to any claim, litigation, arbitration or other
proceeding relating to or arising out of the transactions evidenced by this
Agreement, the other Loan Documents or in connection with the Transactions
(whether or not the Administrative Agent or any Lender or any Indemnitee is a
party thereto) unless such settlement releases such Indemnitee from any and all
liability with respect thereto.
(D) Survival of Agreements. The obligations and agreements of the Borrower
-----------------------
under this Section 10.7 shall survive the termination of this Agreement.
-------------
10.8 Numbers of Documents. All statements, notices, closing documents, and
---------------------
requests hereunder shall be furnished to the Administrative Agent with
sufficient counterparts so that the Administrative Agent may furnish one to each
of the Lenders.
10.9 Accounting. Except as provided to the contrary herein, all accounting
----------
terms used herein shall be interpreted and all accounting determinations
hereunder shall be made in accordance with Agreement Accounting Principles. If
any changes in generally accepted accounting principles are hereafter required
or permitted and are adopted by the Borrower or any of its Subsidiaries with the
agreement of its independent certified public accountants and such changes
result in a change in the method of calculation of any of the financial
covenants, tests, restrictions or standards herein or in the related definitions
or terms used therein ("ACCOUNTING CHANGES"), the parties hereto agree, at the
Borrower's request, to enter into negotiations, in good faith, in order to amend
such provisions in a credit neutral manner so as to reflect equitably such
changes with the desired result that the criteria for evaluating the Borrower's
and its Subsidiaries' financial condition shall be the same after such changes
as if such changes had not been made; provided, however, until such provisions
-------- -------
are amended in a manner reasonably satisfactory to the Administrative Agent and
the Required Lenders, no Accounting Change shall be given effect in such
calculations and all financial statements and reports required to be delivered
hereunder shall be prepared in accordance with Agreement Accounting Principles
without taking into account such Accounting Changes. In the event such
amendment is entered into, all references in this Agreement to Agreement
Accounting Principles shall mean generally accepted accounting principles as of
the date of such amendment.
10.10 Severability of Provisions. Any provision in any Loan Document that
----------------------------
is held to be inoperative, unenforceable, or invalid in any jurisdiction shall,
as to that jurisdiction, be inoperative, unenforceable, or invalid without
affecting the remaining provisions in that jurisdiction or the operation,
enforceability, or validity of that provision in any other jurisdiction, and to
this end the provisions of all Loan Documents are declared to be severable.
10.11 Nonliability of Lenders. The relationship between the Borrower and
-------------------------
the Lenders and the Administrative Agent shall be solely that of borrower and
lender. Neither the Administrative Agent nor any Lender shall have any
fiduciary responsibilities to the Borrower. Neither the Administrative Agent
nor any Lender undertakes any responsibility to the Borrower to review or inform
the Borrower of any matter in connection with any phase of the Borrower's
business or operations.
10.12 GOVERNING LAW. THE ADMINISTRATIVE AGENT ACCEPTS THIS AGREEMENT, ON
--------------
BEHALF OF ITSELF AND THE LENDERS, AT CHICAGO, ILLINOIS BY ACKNOWLEDGING AND
AGREEING TO IT THERE. ANY DISPUTE BETWEEN THE BORROWER AND THE ADMINISTRATIVE
AGENT, ANY LENDER OR ANY OTHER HOLDER OF OBLIGATIONS ARISING OUT OF, CONNECTED
WITH, RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED BETWEEN THEM IN
CONNECTION WITH, THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS, AND WHETHER
ARISING IN CONTRACT, TORT, EQUITY, OR OTHERWISE, SHALL BE RESOLVED IN ACCORDANCE
WITH THE INTERNAL LAWS (INCLUDING 735 ILCS 105/5-1 ET SEQ. BUT OTHERWISE WITHOUT
REGARD TO THE CONFLICTS OF LAWS PROVISIONS) OF THE STATE OF ILLINOIS.
10.13 CONSENT TO JURISDICTION; JURY TRIAL.
---------------------------------------
(A) EXCLUSIVE JURISDICTION. EXCEPT AS PROVIDED IN SUBSECTION (B), EACH OF
----------------------- --------------
THE PARTIES HERETO AGREES THAT ALL DISPUTES AMONG THEM ARISING OUT OF, CONNECTED
WITH, RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED AMONG THEM
IN CONNECTION WITH, THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS WHETHER
ARISING IN CONTRACT, TORT, EQUITY, OR OTHERWISE, SHALL BE RESOLVED EXCLUSIVELY
BY STATE OR FEDERAL COURTS LOCATED IN CHICAGO, ILLINOIS, BUT THE PARTIES HERETO
ACKNOWLEDGE THAT ANY APPEALS FROM THOSE COURTS MAY HAVE TO BE HEARD BY A COURT
LOCATED OUTSIDE OF CHICAGO, ILLINOIS. EACH OF THE PARTIES HERETO WAIVES IN ALL
DISPUTES BROUGHT PURSUANT TO THIS SUBSECTION (A) ANY OBJECTION THAT IT MAY HAVE
--------------
TO THE LOCATION OF THE COURT CONSIDERING THE DISPUTE.
(B) OTHER JURISDICTIONS. THE BORROWER AGREES THAT THE ADMINISTRATIVE AGENT,
-------------------
ANY LENDER OR ANY OTHER HOLDER OF OBLIGATIONS SHALL HAVE THE RIGHT TO PROCEED
AGAINST THE BORROWER OR ITS PROPERTY IN A COURT IN ANY LOCATION TO ENABLE SUCH
PERSON TO (1) OBTAIN PERSONAL JURISDICTION OVER THE BORROWER OR (2) IN ORDER TO
ENFORCE A JUDGMENT OR OTHER COURT ORDER ENTERED IN FAVOR OF SUCH PERSON. THE
BORROWER AGREES THAT IT WILL NOT ASSERT ANY PERMISSIVE COUNTERCLAIMS IN ANY
PROCEEDING BROUGHT BY SUCH PERSON TO REALIZE ON ANY SECURITY FOR THE OBLIGATIONS
OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER IN FAVOR OF SUCH PERSON BUT SHALL
ONLY BE PERMITTED TO BRING ANY SUCH PERMISSIVE COUNTERCLAIM IN A PROCEEDING
BROUGHT PURSUANT TO CLAUSE (A). THE BORROWER WAIVES ANY OBJECTION THAT IT MAY
-----------
HAVE TO THE LOCATION OF THE COURT IN WHICH SUCH PERSON HAS COMMENCED A
PROCEEDING DESCRIBED IN THIS SUBSECTION (B).
---------------
(C) VENUE. THE BORROWER IRREVOCABLY WAIVES ANY OBJECTION (INCLUDING,
-----
WITHOUT LIMITATION, ANY OBJECTION OF THE LAYING OF VENUE OR BASED ON THE GROUNDS
OF FORUM NON CONVENIENS) WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF
----- --- ----------
ANY SUCH ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER
INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION HEREWITH
IN ANY JURISDICTION SET FORTH ABOVE.
(D) WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES ANY
--------------------
RIGHT TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER SOUNDING IN
CONTRACT, TORT, OR OTHERWISE, ARISING OUT OF, CONNECTED WITH, RELATED TO OR
INCIDENTAL TO THE RELATIONSHIP ESTABLISHED AMONG THEM IN CONNECTION WITH THIS
AGREEMENT OR ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED
IN CONNECTION HEREWITH. EACH OF THE PARTIES HERETO AGREES AND CONSENTS THAT ANY
SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL
WITHOUT A JURY AND THAT ANY PARTY HERETO MAY FILE AN ORIGINAL COUNTERPART OR A
COPY OF THIS AGREEMENT WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE
PARTIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.
(E) ADVICE OF COUNSEL. EACH OF THE PARTIES REPRESENTS TO EACH OTHER PARTY
-------------------
HERETO THAT IT HAS DISCUSSED THIS AGREEMENT AND, SPECIFICALLY, THE PROVISIONS OF
SECTION 10.7 AND THIS SECTION 10.13, WITH ITS COUNSEL.
- ------------- --------------
10.14 Subordination of Intercompany Indebtedness. The Borrower agrees that
-------------------------------------------
any and all claims of the Borrower against any of its Subsidiaries that is a
Subsidiary Guarantor with respect to any "Intercompany Indebtedness" (as
hereinafter defined), any endorser, obligor or any other guarantor of all or any
part of the Obligations, or against any of its properties shall be
subordinate and subject in right of payment to the prior payment, in full and in
cash, of all Obligations and Hedging Obligations under Hedging Agreements;
provided that, and not in contravention of the foregoing, so long as no Default
---
has occurred and is continuing the Borrower may make loans to and receive
payments in the ordinary course with respect to such Intercompany Indebtedness
from each such Subsidiary Guarantor to the extent permitted by the terms of this
Agreement and the other Loan Documents. Notwithstanding any right of the
Borrower to ask, demand, sue for, take or receive any payment from any
Subsidiary Guarantor, all rights, liens and security interests of the Borrower,
whether now or hereafter arising and howsoever existing, in any assets of any
Subsidiary Guarantor shall be and are subordinated to the rights of the holders
of the Obligations and the Administrative Agent in those assets. The Borrower
shall have no right to possession of any such asset or to foreclose upon any
such asset, whether by judicial action or otherwise, unless and until all of the
Obligations (other than contingent indemnity obligations) and the Hedging
Obligations under Hedging Agreements shall have been fully paid and satisfied
(in cash) and all financing arrangements pursuant to any Loan Document or
Hedging Agreement among the Borrower and the holders of the Obligations (or any
affiliate thereof) have been terminated. If all or any part of the assets of
any Subsidiary Guarantor, or the proceeds thereof, are subject to any
distribution, division or application to the creditors of such Subsidiary
Guarantor, whether partial or complete, voluntary or involuntary, and whether by
reason of liquidation, bankruptcy, arrangement, receivership, assignment for the
benefit of creditors or any other action or proceeding, or if the business of
any such Subsidiary Guarantor is dissolved or if substantially all of the assets
of any such Subsidiary Guarantor are sold, then, and in any such event (such
events being herein referred to as an "INSOLVENCY EVENT"), any payment or
distribution of any kind or character, either in cash, securities or other
property, which shall be payable or deliverable upon or with respect to any
indebtedness of any Subsidiary Guarantor to the Borrower ("INTERCOMPANY
INDEBTEDNESS") shall be paid or delivered directly to the Administrative Agent
for application on any of the Obligations and Hedging Obligations under the
Hedging Agreements, due or to become due, until such Obligations and Hedging
Obligations (other than contingent indemnity obligations) shall have first been
fully paid and satisfied (in cash). Should any payment, distribution, security
or instrument or proceeds thereof be received by the Borrower upon or with
respect to the Intercompany Indebtedness after an Insolvency Event prior to the
satisfaction of all of the Obligations (other than contingent indemnity
obligations) and Hedging Obligations under Hedging Agreements and the
termination of all financing arrangements pursuant to any Loan Document or
Hedging Agreement among the Borrower and the holders of Obligations (and their
affiliates), the Borrower shall receive and hold the same in trust, as trustee,
for the benefit of the holders of the Obligations and such Hedging Obligations
and shall forthwith deliver the same to the Administrative Agent, for the
benefit of such Persons, in precisely the form received (except for the
endorsement or assignment of the Borrower where necessary), for application to
any of the Obligations and such Hedging Obligations, due or not due, and, until
so delivered, the same shall be held in trust by the Borrower as the property of
the holders of the Obligations and such Hedging Obligations. If the Borrower
fails to make any such endorsement or assignment to the Administrative Agent,
the Administrative Agent or any of its officers or employees are irrevocably
authorized to make the same. The Borrower agrees that until the Obligations
(other than the contingent indemnity obligations) and such Hedging Obligations
have been paid in full (in cash) and satisfied and all financing arrangements
pursuant to any Loan Document or Hedging Agreement among the Borrower and the
holders of the Obligations (and their affiliates) have been terminated, the
Borrower will not assign or transfer to any Person (other than the
Administrative Agent) any claim the Borrower has or may have against any
Subsidiary Guarantor.
ARTICLE XI: THE ADMINISTRATIVE AGENT
- ------------ --------------------------
11.1 Appointment; Nature of Relationship. Bank One, NA, having its
---------------------------------------
principal office in Chicago, Illinois is appointed by the Lenders as the
Administrative Agent hereunder and under each other Loan Document, and each of
the Lenders irrevocably authorizes the Administrative Agent to act as the
contractual representative of such Lender with the rights and duties expressly
set forth herein and in the other Loan Documents. The Administrative Agent
agrees to act as such contractual representative upon the express conditions
contained in this Article XI. Notwithstanding the use of the defined term
-----------
"Administrative Agent," it is expressly understood and agreed that the
Administrative Agent shall not have any fiduciary responsibilities to any Holder
of Obligations by reason of this Agreement and that the Administrative
Agent is merely acting as the representative of the Lenders with only those
duties as are expressly set forth in this Agreement and the other Loan
Documents. In its capacity as the Lenders' contractual representative, the
Administrative Agent (i) does not assume any fiduciary duties to any of the
Holders of Obligations, (ii) is a "representative" of the Holders of Obligations
within the meaning of Section 9-105 of the Uniform Commercial Code and (iii) is
acting as an independent contractor, the rights and duties of which are limited
to those expressly set forth in this Agreement and the other Loan Documents.
Each of the Lenders, for itself and on behalf of its affiliates as Holders of
Obligations, agrees to assert no claim against the Administrative Agent on any
agency theory or any other theory of liability for breach of fiduciary duty, all
of which claims each Holder of Obligations waives.
11.2 Powers. The Administrative Agent shall have and may exercise such
------
powers under the Loan Documents as are specifically delegated to the
Administrative Agent by the terms of each thereof, together with such powers as
are reasonably incidental thereto. The Administrative Agent shall have no
implied duties or fiduciary duties to the Lenders, or any obligation to the
Lenders to take any action hereunder or under any of the other Loan Documents
except any action specifically provided by the Loan Documents required to be
taken by the Administrative Agent.
11.3 General Immunity. Neither the Administrative Agent nor any of its
-----------------
directors, officers, agents or employees shall be liable to the Borrower, the
Lenders or any Lender for any action taken or omitted to be taken by it or them
hereunder or under any other Loan Document or in connection herewith or
therewith except to the extent such action or inaction is found in a final
judgment by a court of competent jurisdiction to have arisen solely from the
gross negligence or willful misconduct of such Person.
11.4 No Responsibility for Loans, Creditworthiness, Recitals, Etc. Neither
-------------------------------------------------------------
the Administrative Agent nor any of its directors, officers, agents or employees
shall be responsible for or have any duty to ascertain, inquire into, or verify
(i) any statement, warranty or representation made in connection with any Loan
Document or any borrowing hereunder; (ii) the performance or observance of any
of the covenants or agreements of any obligor under any Loan Document; (iii) the
satisfaction of any condition specified in Article V, except receipt of items
---------
required to be delivered solely to the Administrative Agent; (iv) the existence
or possible existence of any Default or (v) the validity, effectiveness or
genuineness of any Loan Document or any other instrument or writing furnished in
connection therewith. The Administrative Agent shall not be responsible to any
Lender for any recitals, statements, representations or warranties herein or in
any of the other Loan Documents, for the perfection or priority of the Liens on
collateral, if any, or for the execution, effectiveness, genuineness, validity,
legality, enforceability, collectibility, or sufficiency of this Agreement or
any of the other Loan Documents or the transactions contemplated thereby, or for
the financial condition of any guarantor of any or all of the Obligations, the
Borrower or any of its Subsidiaries.
11.5 Action on Instructions of Lenders. The Administrative Agent shall in
-----------------------------------
all cases be fully protected in acting, or in refraining from acting, hereunder
and under any other Loan Document in accordance with written instructions signed
by the Required Lenders (or all of the Lenders in the event that and to the
extent that this Agreement expressly requires such), and such instructions and
any action taken or failure to act pursuant thereto shall be binding on all of
the Lenders and on all owners of Loans and on all Holders of Obligations. The
Administrative Agent shall be fully justified in failing or refusing to take any
action hereunder and under any other Loan Document unless it shall first be
indemnified to its satisfaction by the Lenders pro rata against any and all
liability, cost and expense that it may incur by reason of taking or continuing
to take any such action.
11.6 Employment of Administrative Agents and Counsel. The Administrative
--------------------------------------------------
Agent may execute any of its duties as the Administrative Agent hereunder and
under any other Loan Document by or through employees, agents, and
attorney-in-fact and shall not be answerable to the Lenders, except as to money
or securities received by it or its authorized agents, for the default or
misconduct of any such agents or attorneys-in-fact selected by it with
reasonable care. The Administrative Agent shall be entitled to advice of
counsel concerning the contractual arrangement between the Administrative Agent
and the Lenders and all matters pertaining to the Administrative Agent's duties
hereunder and under any other Loan Document.
11.7 Reliance on Documents; Counsel. The Administrative Agent shall be
---------------------------------
entitled to rely upon any notice, consent, certificate, affidavit, letter,
telegram, statement, paper or document believed by it to be genuine and correct
and to have been signed or sent by the proper person or persons, and, in respect
to legal matters, upon the opinion of counsel selected by the Administrative
Agent, which counsel may be employees of the Administrative Agent.
11.8 The Administrative Agent's Reimbursement and Indemnification. The
-----------------------------------------------------------------
Lenders agree to reimburse and indemnify the Administrative Agent ratably in
proportion to their respective Pro Rata Shares (i) for any amounts not
reimbursed by the Borrower for which the Administrative Agent is entitled to
reimbursement by the Borrower under the Loan Documents, (ii) for any other
expenses incurred by the Administrative Agent on behalf of the Lenders, in
connection with the preparation, execution, delivery, administration and
enforcement of the Loan Documents and (iii) for any liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind and nature whatsoever which may be imposed on,
incurred by or asserted against the Administrative Agent in any way relating to
or arising out of the Loan Documents or any other document delivered in
connection therewith or the transactions contemplated thereby, or the
enforcement of any of the terms thereof or of any such other documents, provided
--------
that no Lender shall be liable for any of the foregoing to the extent any of the
foregoing is found in a final non-appealable judgment by a court of competent
jurisdiction to have arisen solely from the gross negligence or willful
misconduct of the Administrative Agent.
11.9 Rights as a Lender. With respect to its Revolving Loan Commitment and
-------------------
Loans made by it, the Administrative Agent shall have the same rights and powers
hereunder and under any other Loan Document as any Lender and may exercise the
same as though it were not the Administrative Agent, and the term "Lender" or
"Lenders" shall, unless the context otherwise indicates, include the
Administrative Agent in its individual capacity. The Administrative Agent may
accept deposits from, lend money to, and generally engage in any kind of trust,
debt, equity or other transaction, in addition to those contemplated by this
Agreement or any other Loan Document, with the Borrower or any of its
Subsidiaries in which such Person is not prohibited hereby from engaging with
any other Person.
11.10 Lender Credit Decision. Each Lender acknowledges that it has,
------------------------
independently and without reliance upon the Administrative Agent, the Arranger
or any other Lender and based on the financial statements prepared by the
Borrower and such other documents and information as it has deemed appropriate,
made its own credit analysis and decision to enter into this Agreement and the
other Loan Documents. Each Lender also acknowledges that it will, independently
and without reliance upon the Administrative Agent, the Arranger 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 decisions in taking or not taking
action under this Agreement and the other Loan Documents.
11.11 Successor Administrative Agent. The Administrative Agent may resign
--------------------------------
at any time by giving written notice thereof to the Lenders and the Borrower.
Upon any such resignation, the Required Lenders shall have the right to appoint,
on behalf of the Borrower and the Lenders, a successor Administrative Agent. If
no successor Administrative Agent shall have been so appointed by the Required
Lenders and shall have accepted such appointment within thirty days after the
retiring Administrative Agent's giving notice of resignation, then the retiring
Administrative Agent may appoint, on behalf of the Borrower and the Lenders, a
successor Administrative Agent. Notwithstanding anything herein to the
contrary, so long as no Default has occurred and is continuing, each such
successor Administrative Agent shall be subject to approval by the Borrower,
which approval shall not be unreasonably withheld. Such successor
Administrative Agent shall be a commercial bank having capital and retained
earnings of at least $500,000,000. Upon the acceptance of any appointment as
the Administrative Agent hereunder by a successor Administrative Agent, such
successor Administrative Agent shall thereupon succeed to and become vested with
all the rights, powers, privileges and duties of the retiring Administrative
Agent, and the retiring Administrative Agent shall be discharged from its duties
and obligations hereunder and under the other Loan Documents. After any
retiring Administrative Agent's resignation hereunder as Administrative Agent,
the provisions of this Article XI shall continue in effect for its benefit in
----------
respect of any actions taken or omitted to be taken by it while it was acting as
the Administrative Agent hereunder and under the other Loan Documents.
11.12 No Duties Imposed Upon Syndication Agent, Documentation Agent or
-----------------------------------------------------------------
Arranger. None of the Persons identified on the cover page to this Agreement,
- --------
the signature pages to this Agreement or otherwise in this Agreement as a
"Syndication Agent" or "Documentation Agent" or "Arranger" shall have any right,
power, obligation, liability, responsibility or duty under this Agreement other
than if such Person is a Lender, those applicable to all Lenders as such.
Without limiting the foregoing, none of the Persons identified on the cover page
to this Agreement, the signature pages to this Agreement or otherwise in this
Agreement as a "Syndication Agent" or "Documentation Agent" or "Arranger" shall
have or be deemed to have any fiduciary duty to or fiduciary relationship with
any Lender. In addition to the agreement set forth in Section 11.10, each of
-------------
the Lenders acknowledges that it has not relied, and will not rely, on any of
the Persons so identified in deciding to enter into this Agreement or in taking
or not taking action hereunder.
ARTICLE XII: SETOFF; RATABLE PAYMENTS
- ------------- --------------------------
12.1 Setoff. In addition to, and without limitation of, any rights of the
------
Lenders under applicable law, if any Default occurs and is continuing, any
indebtedness from any Lender to the Borrower (including all account balances,
whether provisional or final and whether or not collected or available) may be
offset and applied toward the payment of the Obligations owing to such Lender,
whether or not the Obligations, or any part hereof, shall then be due.
12.2 Ratable Payments. If any Lender, whether by setoff or otherwise, has
-----------------
payment made to it upon its Loans (other than payments received pursuant to
Sections 4.1, 4.2 or 4.4) in a greater proportion than that received by any
--------- --- ---
other Lender, such Lender agrees, promptly upon demand, to purchase a portion of
the Loans held by the other Lenders so that after such purchase each Lender will
hold its ratable proportion of Loans. If any Lender, whether in connection with
setoff or amounts which might be subject to setoff or otherwise, receives
collateral or other protection for its Obligation or such amounts which may be
subject to setoff, such Lender agrees, promptly upon demand, to take such action
necessary such that all Lenders share in the benefits of such collateral ratably
in proportion to the obligations owing to them. In case any such payment is
disturbed by legal process, or otherwise, appropriate further adjustments shall
be made.
12.3 Application of Payments. Subject to the provisions of Section 9.2, the
----------------------- -----------
Administrative Agent shall, unless otherwise specified at the direction of the
Required Lenders which direction shall be consistent with the last sentence of
this Section 12.3, apply all payments and prepayments in respect of any
-------------
Obligations received after the occurrence and during the continuance of a
---
Default or Unmatured Default in the following order:
-
(A) first, to pay interest on and then principal of any portion of the Loans
which the Administrative Agent may have advanced on behalf of any Lender
for which the Administrative Agent has not then been reimbursed by such Lender
or the Borrower;
(B) second, to pay interest on and then principal of any advance made under
Section 10.3 for which the Administrative Agent has not then been paid by the
- -------------
Borrower or reimbursed by the Lenders;
- --
(C) third, to pay Obligations in respect of any fees, expenses,
reimbursements or indemnities then due to the Administrative Agent;
(D) fourth, to pay Obligations in respect of any fees, expenses,
reimbursements or indemnities then due to the Lenders;
(E) fifth, to pay interest due in respect of Loans;
(F) sixth, to the ratable payment or prepayment of principal outstanding on
Loans and Hedging Obligations under Hedging Agreements in such order as the
Administrative Agent may determine in its sole discretion; and
(G) seventh, to the ratable payment of all other Obligations.
Unless otherwise designated (which designation shall only be applicable prior to
the occurrence of a Default) by the Borrower, all principal payments in respect
of Loans shall be applied to the outstanding Revolving Loans first, to repay
outstanding Floating Rate Loans, and then to repay outstanding Eurodollar Rate
----
Loans with those Eurodollar Rate Loans which have earlier expiring Interest
Periods being repaid prior to those which have later expiring Interest Periods.
The order of priority set forth in this Section 12.3 and the related provisions
------------
of this Agreement are set forth solely to determine the rights and priorities of
the Administrative Agent and the Lenders as among themselves. The order of
priority set forth in clauses (D) through (J) of this Section 12.3 may at any
----------- --- ------------
time and from time to time be changed by the Required Lenders without necessity
of notice to or consent of or approval by the Borrower, or any other Person.
The order of priority set forth in clauses (A) through (C) of this Section 12.3
----------- --- ------------
may be changed only with the prior written consent of the Administrative Agent.
12.4 Relations Among Lenders.
-------------------------
(A) Except with respect to the exercise of set-off rights of any Lender in
accordance with Section 12.1, the proceeds of which are applied in accordance
-------------
with this Agreement, and except as set forth in the following sentence, each
Lender agrees that it will not take any action, nor institute any actions or
proceedings, against the Borrower or any other obligor hereunder or with respect
to any Loan Document, without the prior written consent of the Required
Lenders or, as may be provided in this Agreement or the other Loan Documents, at
the direction of the Administrative Agent.
(B) The Lenders are not partners or co-venturers, and no Lender shall be
liable for the acts or omissions of, or (except as otherwise set forth herein in
case of the Administrative Agent) authorized to act for, any other Lender. The
Administrative Agent shall have the exclusive right on behalf of the Lenders, at
the direction of the Required Lenders, to enforce on the payment of the
principal of and interest on any Loan after the date such principal or interest
has become due and payable pursuant to the terms of this Agreement.
12.5 Representations and Covenants Among Lenders. Each Lender represents
----------------------------------------------
and covenants for the benefit of all other Lenders and the Administrative Agent
that such Lender is not satisfying and shall not satisfy any of its obligations
pursuant to this Agreement with any assets considered for any purposes of ERISA
or Section 4975 of the Code to be assets of or on behalf of any "plan" as
defined in section 3(3) of ERISA or section 4975 of the Code, regardless of
whether subject to ERISA or Section 4975 of the Code.
ARTICLE XIII: BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS
- -------------- -----------------------------------------------------
13.1 Successors and Assigns. The terms and provisions of the Loan Documents
----------------------
shall be binding upon and inure to the benefit of the Borrower and the
Lenders and their respective successors and assigns, except that (i) without the
consent of all of the Lenders, (a) Ralston shall not have the right to assign
its rights or obligations under the Loan Documents other than pursuant to the
Debt Assumption and only if the Net Worth Condition and all other conditions to
the Debt Assumption have been satisfied, and (b) Energizer shall not have the
right to assign its rights or obligations under the Loan Documents, and any such
assignment in violation of this Section 13.1(i) shall be null and void, and (ii)
---------------
any assignment by any Lender must be made in compliance with Section 13.3
------------
hereof. Notwithstanding clause (ii) of this Section 13.1 or Section 13.3, (i)
------------ ------------ ------------
any Lender may at any time, without the consent of the Borrower or the
Administrative Agent, assign all or any portion of its rights under this
Agreement to a Federal Reserve Bank and (ii) any Lender which is a fund or
commingled investment vehicle that invests in commercial loans in the ordinary
course of its business may at any time, without the consent of the Borrower or
the Administrative Agent, pledge or assign all or any part of its rights under
this Agreement to a trustee or other representative of holders of obligations
owed or securities issued by such Lender as collateral to secure such
obligations or securities; provided, however, that no such assignment or pledge
-------- -------
shall release the transferor Lender from its obligations hereunder. The
Administrative Agent may treat each Lender as the owner of the Loans made by
such Lender hereunder for all purposes hereof unless and until such Lender
complies with Section 13.3 hereof in the case of an assignment thereof or, in
-------------
the case of any other transfer, a written notice of the transfer is filed with
the Administrative Agent. Any assignee or transferee of a Loan, Revolving Loan
Commitment or any other interest of a lender under the Loan Documents agrees by
acceptance thereof to be bound by all the terms and provisions of the Loan
Documents. Any request, authority or consent of any Person, who at the time of
making such request or giving such authority or consent is the owner of any
Loan, shall be conclusive and binding on any subsequent owner, transferee or
assignee of such Loan.
13.2 Participations.
--------------
(A) Permitted Participants; Effect. Subject to the terms set forth in this
-------------------------------
Section 13.2, any Lender may, in the ordinary course of its business and in
- -------------
accordance with applicable law, at any time sell to one or more banks or other
- ----
entities ("PARTICIPANTS") participating interests in any Loan owing to such
Lender, any Revolving Loan Commitment of such Lender or any other interest of
such Lender under the Loan Documents on a pro rata or non-pro rata basis.
Notice of such participation to the Borrower and the Administrative Agent shall
be required prior to any participation becoming effective with respect to a
Participant which is not a Lender or an Affiliate thereof. In the event of any
such sale by a Lender of participating interests to a Participant, such Lender's
obligations under the Loan Documents shall remain unchanged, such Lender
shall remain solely responsible to the other parties hereto for the performance
of such obligations, such Lender shall remain the owner of all Loans made by it
for all purposes under the Loan Documents, all amounts payable by the Borrower
under this Agreement shall be determined as if such Lender had not sold such
participating interests, 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 the Loan Documents except that, for
purposes of Article IV hereof, the Participants shall be entitled to the same
-----------
rights as if they were Lenders.
(B) Voting Rights. Each Lender shall retain the sole right to approve,
--------------
without the consent of any Participant, any amendment, modification or waiver of
any provision of the Loan Documents other than any amendment, modification or
waiver with respect to any Loan or Revolving Loan Commitment in which such
Participant has an interest which forgives principal, interest or fees or
reduces the interest rate or fees payable pursuant to the terms of this
Agreement with respect to any such Loan or Revolving Loan Commitment, postpones
any date fixed for any regularly-scheduled payment of principal of, or interest
or fees on, any such Loan or Revolving Loan Commitment (other than as expressly
permitted by Section 2.2), releases any Subsidiary Guarantor from its
------------
obligations under the Subsidiary Guaranty, or releases all or substantially all
of the collateral, if any, securing any such Loan.
(C) Benefit of Setoff. The Borrower agrees that each Participant shall be
-------------------
deemed to have the right of setoff provided in Section 12.1 hereof in respect to
------------
its participating interest in amounts owing under the Loan Documents to the same
extent as if the amount of its participating interest were owing directly to it
as a Lender under the Loan Documents, provided that each Lender shall retain the
--------
right of setoff provided in Section 12.1 hereof with respect to the amount of
------------
participating interests sold to each Participant except to the extent such
Participant exercises its right of setoff. The Lenders agree to share with each
Participant, and each Participant, by exercising the right of setoff provided in
Section 12.1 hereof, agrees to share with each Lender, any amount received
- -------------
pursuant to the exercise of its right of setoff, such amounts to be shared in
- -----
accordance with Section 12.2 as if each Participant were a Lender.
- -- -------------
13.3 Assignments.
-----------
(A) Permitted Assignments. Any Lender may, in the ordinary course of its
----------------------
business and in accordance with applicable law, at any time assign to one or
more banks or other entities ("PURCHASERS") all or a portion of its rights and
obligations under this Agreement (including, without limitation, its Revolving
Loan Commitment and all Loans owing to it in accordance with the provisions of
this Section 13.3. Each assignment shall be of a constant, and not a varying,
-------------
ratable percentage of all of the assigning Lender's rights and obligations under
this Agreement. Such assignment shall be substantially in the form of
Exhibit C hereto and shall not be permitted hereunder unless such assignment is
------
either for all of such Lender's rights and obligations under the Loan Documents
or, without the prior written consent of the Administrative Agent and (if no
Default or Unmatured Default has occurred or is continuing) the Borrower,
involves loans and commitments in an aggregate amount of at least $5,000,000
(which minimum amount shall not apply to any assignment between Lenders, or to
an Affiliate of any Lender). Other than with respect to any assignment to
another Lender or an Affiliate or successor entity of such Lender, the consent
of the Administrative Agent, and, prior to the occurrence and continuance of a
Default or Unmatured Default, the Borrower (which consent, in each such case,
shall not be unreasonably withheld) shall be required prior to an assignment
becoming effective.
(B) Effect; Effective Date. Upon (i) delivery to the Administrative Agent
------------------------
of a notice of assignment, substantially in the form attached as Appendix I to
----------
Exhibit C hereto (a "NOTICE OF ASSIGNMENT"), together with any consent required
---------
by Section 13.3(A) hereof, and (ii) payment of a $3,500 fee by the assignee or
----------------
the assignor (as agreed) to the Administrative Agent for processing such
assignment (provided no such fee shall be required in connection with an
assignment by a Lender to an Affiliate or successor entity of such Lender), such
assignment shall become effective on the effective date specified in such Notice
of Assignment. The Notice of Assignment shall contain a representation by the
Purchaser to the effect that none of the consideration used to make the purchase
of the Revolving Loan Commitment or Loans under the applicable Assignment
Agreement constitute for any purpose of ERISA or Section 4975 of the Code assets
of any "plan" as defined in Section 3(3) of ERISA or Section 4975 of the Code
and that the rights and interests of the Purchaser in and under the Loan
Documents will not constitute such "plan assets". On and after the effective
date of such assignment, such Purchaser, if not already a Lender, shall for all
purposes be a Lender party to this Agreement and any other Loan Documents
executed by the Lenders and shall have all the rights and obligations of a
Lender under the Loan Documents, to the same extent as if it were an original
party hereto, and no further consent or action by the Borrower, the Lenders or
the Administrative Agent shall be required to release the transferor Lender with
respect to the percentage of the Aggregate Revolving Loan Commitment and Loans
assigned to such Purchaser. Upon the consummation of any assignment to a
Purchaser pursuant to this Section 13.3(B), the transferor Lender, the
----------------
Administrative Agent and the Borrower shall make appropriate arrangements so
that, to the extent notes have been issued to evidence any of the transferred
Loans, replacement notes are issued to such transferor Lender and new notes or,
as appropriate, replacement notes, are issued to such Purchaser, in each case in
principal amounts reflecting their Revolving Loan Commitment (or from and after
the Conversion Date, the outstanding principal balance of such Lender's Loans),
as adjusted pursuant to such assignment.
(C) The Register. The Administrative Agent shall maintain at its address
-------------
referred to in Section 14.1 a copy of each assignment delivered to and accepted
------------
by it pursuant to this Section 13.3 and a register (the "REGISTER") for the
------------
recordation of the names and addresses of the Lenders and the Revolving Loan
Commitment of and principal amount of the Loans owing to, each Lender from time
to time and whether such Lender is an original Lender or the assignee of another
Lender pursuant to an assignment under this Section 13.3. The entries in the
------------
Register shall be conclusive and binding for all purposes, absent manifest
error, and the Borrower and each of its Subsidiaries, the Administrative Agent
and the Lenders may treat each Person whose name is recorded in the Register as
a Lender hereunder for all purposes of this Agreement. The Register shall be
available for inspection by the Borrower or any Lender at any reasonable time
and from time to time upon reasonable prior notice.
13.4 Confidentiality. Subject to Section 13.5, the Administrative Agent and
--------------- ------------
the Lenders and their respective representatives shall hold all nonpublic
information obtained pursuant to the requirements of this Agreement and
identified as such by the Borrower in accordance with such Person's customary
procedures for handling confidential information of this nature and in
accordance with safe and sound commercial lending or investment practices and in
any event may make disclosure reasonably required by a prospective Transferee in
connection with the contemplated participation or assignment or as required or
requested by any Governmental Authority or any securities exchange or similar
self-regulatory organization or representative thereof or pursuant to a
regulatory examination or legal process, or to any direct or indirect
contractual counterparty in swap agreements or such contractual counterparty's
professional advisor, and shall require any such Transferee to agree (and
require any of its Transferees to agree) to comply with this Section 13.4. In
------------
no event shall the Administrative Agent or any Lender be obligated or required
to return any materials furnished by the Borrower; provided, however, each
-------- -------
prospective Transferee shall be required to agree that if it does not become a
participant or assignee it shall return all materials furnished to it by or on
behalf of the Borrower in connection with this Agreement.
13.5 Dissemination of Information. The Borrower authorizes each Lender to
------------------------------
disclose to any Participant or Purchaser or any other Person acquiring an
interest in the Loan Documents by operation of law (each a "TRANSFEREE") and any
prospective Transferee any and all information in such Lender's possession
concerning the Borrower and its Subsidiaries; provided that prior to any such
--------
disclosure, such prospective Transferee shall agree to preserve in accordance
with Section 13.4 the confidentiality of any confidential information described
------------
therein.
ARTICLE XIV: NOTICES
- ------------- -------
14.1 Giving Notice. Except as otherwise permitted by Section 2.13 with
-------------- ------------
respect to Borrowing/Election Notices, all notices and other communications
provided to any party hereto under this Agreement or any other Loan Documents
shall be in writing or by telex or by facsimile and addressed or delivered to
such party at its address set forth below its signature hereto or at such other
address as may be designated by such party in a notice to the other parties. Any
notice, if mailed and properly addressed with postage prepaid, shall be
deemed given three (3) Business Days after mailed; any notice, if transmitted by
telex or facsimile, shall be deemed given when transmitted (answerback confirmed
in the case of telexes); or, any notice, if transmitted by courier, one (1)
Business Day after deposit with a reputable overnight carrier services, with all
charges paid.
14.2 Change of Address. The Borrower, the Administrative Agent and any
-------------------
Lender may each change the address for service of notice upon it by a notice in
writing to the other parties hereto.
ARTICLE XV: COUNTERPARTS
- ------------ ------------
This Agreement may be executed in any number of counterparts, all of which
taken together shall constitute one agreement, and any of the parties hereto may
execute this Agreement by signing any such counterpart. This Agreement shall be
effective when it has been executed by the Borrower, the Administrative Agent
and the Lenders and each party has notified the Administrative Agent by telex or
telephone, that it has taken such action.
[Remainder of This Page Intentionally Blank]
<PAGE>
IN WITNESS WHEREOF, the Borrower, the Lenders and the Administrative Agent
have executed this Agreement as of the date first above written.
RALSTON PURINA COMPANY, as the Borrower
By: /s/ James R. Elsesser
Name: James R. Elsesser
Title: Chief Financial Officer
Address:
Checkerboard Square
St. Louis, MO 63164
Attention: Chief Financial Officer
Phone: (314) 982-2353
Fax: (314) 982-1092
E-Mail: [email protected]
<PAGE>
BANK ONE, NA (Main Office Chicago), as Administrative Agent, an Issuing
Lender, the Swing Line Bank and as a Lender
By: /s/ BANK ONE, NA
Name:
Title:
Address:
1 Bank One Plaza
Suite IL1-0088
14th Floor
Chicago, Illinois 60670
Attention: William J. Oleferchik
Telephone No.: (312) 732-2947
Facsimile No.: (312) 732-1117
<PAGE>
BANK OF AMERICA, N.A., as Syndication Agent and as a Lender
By:/s/ Suzanne B. Smith
Name: Suzanne B. Smith
Title: Managing Director
Address:
901 Main Street
67th Floor
Dallas, TX 75202-3714
Attention: Suzanne B. Smith
Phone: (214) 209-0280
Fax: (214) 209-0980
E-Mail: [email protected]
<PAGE>
WACHOVIA BANK, N.A., as Documentation Agent and as a Lender
By: /s/ Walter R. Gillikin
Name: Walter R. Gillikin
Title: Senior Vice President
Address:
191 Peachtree Street, MC-GA370
Atlanta, GA 30303
Attention: Walter R. Gillikin
Phone: (404) 332-5747
Fax: (404) 332-6898
E-Mail: [email protected]
<PAGE>
THE NORTHERN TRUST COMPANY,
as a Lender
By: /s/ Lisa M. Taylor
Name: Lisa M. Taylor
Title: Second Vice President
Address:
50 South LaSalle
11th Floor
Chicago, IL 60675
Attention: Lisa Taylor
Phone: (312) 444-4196
Fax: (312) 444-5055
E-Mail: [email protected]
<PAGE>
STANDARD CHARTERED BANK,
as a Lender
By: /s/ Andrew Ng
Name: Andrew Ng
Title: Vice President
By: /s/ Marianne R. Murray
Name: Marianne R. Murray
Title: Senior Vice President
Address:
7 World Trade Center
27th Floor
New York, NY 10048
Attention: Marianne R. Murray
Phone: (212) 667-0505
Fax: (212) 667-0225
E-Mail: [email protected]
<PAGE>
THE BANK OF TOKYO-MITSUBISHI, LTD., CHICAGO BRANCH, as a Lender
By:/s/ Hisashi Miyashiro
Name: Hisashi Miyashiro
Title: Deputy General Manager
Address:
227 West Monroe Street
Suite 2300
Chicago, IL 60606
Attention: Alex Lam
Phone: (312) 696-4662
Fax: (312) 696-4535
E-Mail: [email protected]
<PAGE>
BANK OF NEW YORK, as a Lender
By: /s/ John-Paul Marotta
Name: John-Paul Marotta
Title: Vice President
Address:
One Wall Street
New York, NY 10286
Attention: David Shedd
Phone: (212) 635-8448
Fax: (212) 635-1208
<PAGE>
BANCA COMMERCIALE ITALIANA, CHICAGO BRANCH, as a Lender
By: /s/ Charles Dougherty
Name: Mr. Charles Dougherty
Title: Vice President
By: /s/ Edward Bermant
Name: Mr. Edward Bermant
Title: First Vice President
Deputy Manager
Address:
One William Street
New York, NY 10004
Attention: Mr. Charles Dougherty
Phone: (212) 607-3656
Fax: (212) 809-2124
<PAGE>
BANCA NAZIONALE DEL LAVORO S.P.A.-NEW YORK BRANCH, as a Lender
By: /s/Giulio Giovine
Name: Giulio Giovine
Title: Vice President
By: /s/Leonardo Valentini
Name: Leonardo Valentini
Title: First Vice President
Address:
25 West 51st Street
New York, NY 10019
Attention: Giulio Giovine
Phone: (212) 314-0239
Fax: (212) 765-2978
E-mail: [email protected]
<PAGE>
BANQUE NATIONALE DE PARIS,
as a Lender
By: /s/Arnaud Collin du Bocage
Name: Arnaud Collin du Bocage
Title: Executive Vice President
and General Manager
Address:
209 South LaSalle Street
Chicago, IL 60604
Attention: Ms. Kristin Howatt
Phone: (312) 977-1383
Fax: (312) 977-1380
<PAGE>
DG BANK DEUTSCHE GENOSSENSCHAFTSBANK AG, as a Lender
By:/s/ Dg Bank Deutsche Genossenschaftsbank Ag
Name:
Title:
By:/s/ Dg Bank Deutsche Genossenschaftsbank Ag
Name:
Title:
Address:
609 Fifth Avenue
New York, NY 10017-1021
Attention: Craig Anderson, Vice President
Phone: (212) 745-1583
Fax: (212) 745-1556/1550
<PAGE>
THE DAI-ICHI KANGYO BANK, LTD.,
as a Lender
By:/s/ Nobuyasu Fukatsu
Name: Nobuyasu Fukatsu
Title: General Manager
Address:
10 South Wacker Drive
26th Floor
Chicago, IL 60606
Attention: Brian Riley
Phone: (312) 876-8600
Fax: (312) 876-2011
E-Mail: [email protected]
<PAGE>
MERCANTILE BANK NATIONAL ASSOCIATION, as a Lender
By: /s/ Davif F. Higbee
Name: David F. Higbee
Title: Vice President
Address:
One Mercantile Center
Tram 001/1001/12-3
St. Louis, MO 63101
Attention: David F. Higbee
Phone: (314) 418-1967
Fax: (314) 418-2203
E-Mail: [email protected]
<PAGE>
SANPAOLO IMI S.P.A., as a Lender
By:/s/ Luca Sacchi
Name: Luca Sacchi
Title: Vice President
By:/s/ Carlo Persico
Name: Carlo Persico
Title: Deputy General Manager
Address:
245 Park Avenue
New York, NY 10167
Attention: Luca Sacchi
Phone: (212) 692-3130
Fax: (212) 692-3178
E-Mail: [email protected]
<PAGE>
SUNTRUST BANK, as a Lender
By:/s/ Linda L. Dash
Name: Linda L. Dash
Title: Vice President
Address:
303 Peachtree Street, N.E.
Mail Code 1928, 3rd Floor
Atlanta, GA 30308
Attention: Linda L. Dash
Phone: (404) 658-4923
Fax: (404) 658-4905
<PAGE>
WESTPAC BANKING CORPORATION,
as a Lender
By:/s/ Lewis Love
Name: Lewis Love
Title: Head of Legal & Compliance
Europe & Americas
Address:
575 Fifth Avenue
New York, NY 10017
Attention: Ms. Kate Perry
Phone: (212) 551-1808
Fax: (212) 551-1995
E-Mail: [email protected]
<PAGE>
Effective as of April 1, 2000,
assigned to and assumed pursuant
to the terms of that certain Debt
Assignment, Assumption
and Release Agreement
dated as of April 1, 2000
among Ralston, Energizer and the
Administrative Agent
ENERGIZER HOLDINGS, INC.
/s/ Daniel E. Corbin
Name: Daniel E. Corbin
Title: Executive Vice President - Finance and Control
Address:
Checkerboard Square
800 Chouteau Avenue
St. Louis, MO 63102
Attention: Daniel Corbin
Phone: (314) 982-1801
Fax: (314) 982-1180
E-mail: [email protected]
<PAGE>
<TABLE>
<CAPTION>
EXHIBITS
<S> <C> <C>
EXHIBIT A -- Revolving Loan Commitments (Definitions)
EXHIBIT B -- Form of Borrowing/Election Notice (Section 2.2 and Section 2.7
and Section 2.9)
EXHIBIT C -- Form of Assignment and Acceptance Agreement (Sections 2.19
and 13.3)
EXHIBIT D -- Form of Borrower's Counsel's Opinion (Section 5.1)
EXHIBIT E -- List of Closing Documents (Section 5.1)
EXHIBIT F -- Form of Officer's Certificate (Sections 5.2 and 7.1(A)(iii))
EXHIBIT G -- Form of Compliance Certificate (Sections 5.2 and 7.1(A)(iii))
EXHIBIT H -- Form of Supplement to Subsidiary Guaranty (Definitions)
EXHIBIT I -- Form of Debt Assumption Agreement (Definitions)
</TABLE>
<TABLE>
<CAPTION>
SCHEDULES
<S> <C> <C>
Schedule 1.1.1 -- Permitted Existing Investments (Definitions)
Schedule 1.1.2 -- Permitted Existing Liens (Definitions)
Schedule 1.1.3 -- Permitted Existing Contingent Obligations (Definitions)
Schedule 6.3 -- Ralston Conflicts; Ralston Governmental Consents (Section 6.3)
Schedule 6.6 -- Energizer Conflicts; Energizer Governmental Consents (Section 6.6)
Schedule 6.7 -- Pro Forma Financial Statements (Section 6.7(A))
Schedule 6.10 -- Litigation; Loss Contingencies (Section 6.10)
Schedule 6.11 -- Subsidiaries (Section 6.11)
Schedule 6.21 -- Outstanding Spin-Off Conditions (Section 6.21, Section 5.1(7))
Schedule 6.21(iv) -- Committed Financing Facilities (Section 6.21(iv), Section 5.1(7)(iv))
Schedule 6.22 -- Environmental Matters (Section 6.22)
Schedule 7.3(G) -- Transactions with Ralston's Shareholders and Affiliates (Section 7.3(G))
</TABLE>
<TABLE>
<CAPTION>
<S> <C>
ARTICLE I: DEFINITIONS
1.1 Certain Defined Terms. . . . . . . . . . . . . . . . . . . . . . . . 1
1.2 References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
ARTICLE II: THE REVOLVING LOAN FACILITY
2.1 Revolving Loans. . . . . . . . . . . . . . . . . . . . . . . . . . . 21
2.2 Extension of Revolving Loan Termination Date; Conversion to
Term Loan.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
2.3 Rate Options for all Advances; Maximum Interest Periods. . . . . . . 23
2.4 Optional Payments. . . . . . . . . . . . . . . . . . . . . . . . . . 23
2.5 Reduction of Revolving Loan Commitments. . . . . . . . . . . . . . . 23
2.6 Method of Borrowing. . . . . . . . . . . . . . . . . . . . . . . . . 24
2.7 Method of Selecting Types and Interest Periods for Advances. . . . . 24
2.8 Minimum Amount of Each Advance . . . . . . . . . . . . . . . . . . . 24
2.9 Method of Selecting Types and Interest Periods for
Conversion and Continuation of Advances.. . . . . . . . . . . . . . . . 24
2.10 Default Rate. . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
2.11 Method of Payment . . . . . . . . . . . . . . . . . . . . . . . . . 25
2.12 Evidence of Debt. . . . . . . . . . . . . . . . . . . . . . . . . . 25
2.13 Telephonic Notices. . . . . . . . . . . . . . . . . . . . . . . . . 26
2.14 Promise to Pay; Interest and Facility Fees; Interest Payment Dates;
Interest and Fee Basis; Loan and Control Accounts.. . . . . . . . . . . 26
1.15 Notification of Advances, Interest Rates, Prepayments and
Aggregate Revolving Loan Commitment Reductions. . . . . . . . . . . . . 28
1.16 Lending Installations . . . . . . . . . . . . . . . . . . . . . . . 29
1.17 Non-Receipt of Funds by the Administrative Agent. . . . . . . . . . 29
1.18 Termination Date. . . . . . . . . . . . . . . . . . . . . . . . . . 29
1.19 Replacement of Certain Lenders. . . . . . . . . . . . . . . . . . . 29
ARTICLE III: [RESERVED]
ARTICLE IV: YIELD PROTECTION; TAXES
4.1 Yield Protection . . . . . . . . . . . . . . . . . . . . . . . . . . 30
4.2 Changes in Capital Adequacy Regulations. . . . . . . . . . . . . . . 31
4.3 Availability of Types of Advances. . . . . . . . . . . . . . . . . . 31
4.4 Funding Indemnification. . . . . . . . . . . . . . . . . . . . . . . 32
4.5 Taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
4.6 Lender Statements; Survival of Indemnity . . . . . . . . . . . . . . 33
ARTICLE V: CONDITIONS PRECEDENT
5.1 Initial Advances . . . . . . . . . . . . . . . . . . . . . . . . . . 34
5.2 Each Advance . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
ARTICLE VI: REPRESENTATIONS AND WARRANTIES
6.1 Organization; Corporate Powers of Ralston. . . . . . . . . . . . . . 36
6.2 Authority of Ralston.. . . . . . . . . . . . . . . . . . . . . . . . 36
6.3 No Conflict; Governmental Consents for Ralston . . . . . . . . . . . 37
6.4 Organization; Corporate Powers of Energizer. . . . . . . . . . . . . 38
6.5 Authority of Energizer.. . . . . . . . . . . . . . . . . . . . . . . 38
6.6 No Conflict; Governmental Consents for Energizer . . . . . . . . . . 39
6.7 Financial Statements.. . . . . . . . . . . . . . . . . . . . . . . . 39
6.8 No Material Adverse Change . . . . . . . . . . . . . . . . . . . . . 40
6.9 Taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
6.10 Litigation; Loss Contingencies and Violations . . . . . . . . . . . 41
6.11 Subsidiaries. . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
6.12 ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
6.13 Accuracy of Information . . . . . . . . . . . . . . . . . . . . . . 42
6.14 Securities Activities . . . . . . . . . . . . . . . . . . . . . . . 43
6.15 Material Agreements . . . . . . . . . . . . . . . . . . . . . . . . 43
6.16 Compliance with Laws. . . . . . . . . . . . . . . . . . . . . . . . 43
6.17 Assets and Properties . . . . . . . . . . . . . . . . . . . . . . . 43
6.18 Statutory Indebtedness Restrictions . . . . . . . . . . . . . . . . 43
6.19 Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
6.20 Labor Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
6.21 Spin-Off Transactions . . . . . . . . . . . . . . . . . . . . . . . 44
6.22 Environmental Matters . . . . . . . . . . . . . . . . . . . . . . . 44
6.23 Solvency. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
6.24 Net Worth Condition . . . . . . . . . . . . . . . . . . . . . . . . 45
6.25 Benefits. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
ARTICLE VII: COVENANTS
7.1 Reporting. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
7.2 Affirmative Covenants. . . . . . . . . . . . . . . . . . . . . . . . 48
7.3 Negative Covenants.. . . . . . . . . . . . . . . . . . . . . . . . . 51
7.4 Financial Covenants. . . . . . . . . . . . . . . . . . . . . . . . . 57
ARTICLE VIII: DEFAULTS
8.1 Defaults . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
ARTICLE IX: ACCELERATION, DEFAULTING LENDERS; WAIVERS,
AMENDMENTS AND REMEDIES
9.1 Termination of Revolving Loan Commitments; Acceleration. . . . . . . 61
9.2 Defaulting Lender. . . . . . . . . . . . . . . . . . . . . . . . . . 61
9.3 Amendments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
9.4 Preservation of Rights . . . . . . . . . . . . . . . . . . . . . . . 63
ARTICLE X: GENERAL PROVISIONS
10.1 Survival of Representations . . . . . . . . . . . . . . . . . . . . 63
10.2 Governmental Regulation . . . . . . . . . . . . . . . . . . . . . . 63
10.3 Performance of Obligations. . . . . . . . . . . . . . . . . . . . . 63
10.4 Headings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
10.5 Entire Agreement. . . . . . . . . . . . . . . . . . . . . . . . . . 64
10.6 Several Obligations; Benefits of this Agreement . . . . . . . . . . 64
10.7 Expenses; Indemnification.. . . . . . . . . . . . . . . . . . . . . 64
10.8 Numbers of Documents. . . . . . . . . . . . . . . . . . . . . . . . 66
10.9 Accounting. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
10.10 Severability of Provisions . . . . . . . . . . . . . . . . . . . . 66
10.11 Nonliability of Lenders. . . . . . . . . . . . . . . . . . . . . . 67
10.12 GOVERNING LAW. . . . . . . . . . . . . . . . . . . . . . . . . . . 67
10.13 CONSENT TO JURISDICTION; JURY TRIAL. . . . . . . . . . . . . . . . 67
10.14 Subordination of Intercompany Indebtedness . . . . . . . . . . . . 68
ARTICLE XI: THE ADMINISTRATIVE AGENT
11.1 Appointment; Nature of Relationship . . . . . . . . . . . . . . . . 69
11.2 Powers. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
11.3 General Immunity. . . . . . . . . . . . . . . . . . . . . . . . . . 70
11.4 No Responsibility for Loans, Creditworthiness, Recitals, Etc. . . . 70
11.5 Action on Instructions of Lenders . . . . . . . . . . . . . . . . . 70
11.6 Employment of Administrative Agents and Counsel . . . . . . . . . . 71
11.7 Reliance on Documents; Counsel. . . . . . . . . . . . . . . . . . . 71
11.8 The Administrative Agent's Reimbursement and Indemnification. . . . 71
11.9 Rights as a Lender. . . . . . . . . . . . . . . . . . . . . . . . . 71
11.10 Lender Credit Decision . . . . . . . . . . . . . . . . . . . . . . 71
11.11 Successor Administrative Agent . . . . . . . . . . . . . . . . . . 72
11.12 No Duties Imposed Upon Syndication Agent, Documentation
Agent or Arranger . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
ARTICLE XII: SETOFF; RATABLE PAYMENTS
12.1 Setoff. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
12.2 Ratable Payments. . . . . . . . . . . . . . . . . . . . . . . . . . 72
12.3 Application of Payments . . . . . . . . . . . . . . . . . . . . . . 73
12.4 Relations Among Lenders.. . . . . . . . . . . . . . . . . . . . . . 73
12.5 Representations and Covenants Among Lenders . . . . . . . . . . . . 74
ARTICLE XIII: BENEFIT OF AGREEMENT; ASSIGNMENTS;
PARTICIPATIONS
13.1 Successors and Assigns. . . . . . . . . . . . . . . . . . . . . . . 74
13.2 Participations. . . . . . . . . . . . . . . . . . . . . . . . . . . 74
13.3 Assignments.. . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
13.4 Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . 77
13.5 Dissemination of Information. . . . . . . . . . . . . . . . . . . . 77
ARTICLE XIV: NOTICES
14.1 Giving Notice . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
14.2 Change of Address . . . . . . . . . . . . . . . . . . . . . . . . . 77
ARTICLE XV: COUNTERPARTS
</TABLE>
CHICAGO4 1074507v5 March 31, 2000 (09:18am)
CHICAGO4 1074507v5 March 31, 2000 (09:18am)
EXECUTION COPY
5-YEAR REVOLVING CREDIT AGREEMENT
Dated as of March 30, 2000
among
RALSTON PURINA COMPANY
as the initial Borrower
prior to the assignment to
and assumption by
ENERGIZER HOLDINGS, INC.
THE INSTITUTIONS FROM TIME TO TIME
PARTIES HERETO AS LENDERS
BANK ONE, NA,
AS ADMINISTRATIVE AGENT
BANK OF AMERICA, N.A.
AS SYNDICATION AGENT
AND
WACHOVIA BANK, N.A.,
AS DOCUMENTATION AGENT
BANC ONE CAPITAL MARKETS, INC.,
as Lead Arranger and Sole Bookrunner
SIDLEY & AUSTIN
Bank One Plaza
10 South Dearborn Street
Chicago, Illinois 60603
<PAGE>
5-YEAR REVOLVING CREDIT AGREEMENT
This 5-Year Revolving Credit Agreement dated as of March 30, 2000 is
entered into among RALSTON PURINA COMPANY, a Missouri corporation, the
institutions from time to time parties hereto as Lenders, whether by execution
of this Agreement or an Assignment Agreement pursuant to Section 13.3, and BANK
------------
ONE, NA, having its principal office in Chicago, Illinois, in its capacity as
Administrative Agent, BANK OF AMERICA, N.A., as Syndication Agent, and WACHOVIA
BANK, N.A., as Documentation Agent. The parties hereto agree as follows:
ARTICLE I: DEFINITIONS
- ----------- -----------
1.1 Certain Defined Terms. In addition to the terms defined above, the
-----------------------
following terms used in this Agreement shall have the following meanings,
applicable both to the singular and the plural forms of the terms defined.
As used in this Agreement:
"ACCOUNTING CHANGE" is defined in Section 10.9 hereof.
------------------ -------------
"ACQUISITION" means any transaction, or any series of related transactions,
-----------
consummated on or after the date of this Agreement, by which the Borrower or any
of its Subsidiaries (i) acquires any going business or all or substantially all
of the assets of any firm, corporation or division thereof, whether through
purchase of assets, merger or otherwise or (ii) directly or indirectly acquires
(in one transaction or as the most recent transaction in a series of
transactions) at least a majority (in number of votes) of the securities of a
corporation which have ordinary voting power for the election of directors
(other than securities having such power only by reason of the happening of a
contingency) or a majority (by percentage of voting power) of the outstanding
equity interests of another Person.
"ADJUSTMENT DATE" means each date on which the opening pro forma balance sheet
---------------- --- -----
of Energizer and its consolidated Subsidiaries, after giving effect to the
Spin-Off Transactions, is adjusted, which adjustments shall occur simultaneously
with the adjustments made pursuant to the Reorganization Agreement to verify the
calculation of the "Indebtedness" and "Cash Holdings" of Energizer and its
Affiliates thereunder.
"ADMINISTRATIVE AGENT" means Bank One in its capacity as contractual
---------------------
representative for itself and the Lenders pursuant to Article XI hereof and any
---------- ----------
successor Administrative Agent appointed pursuant to Article XI hereof.
-----------
"ADVANCE" means a borrowing hereunder consisting of the aggregate amount of the
-------
several Loans made by the Lenders to the Borrower of the same Type and, in the
case of Eurodollar Rate Advances, for the same Interest Period.
"AFFECTED LENDER" is defined in Section 2.19 hereof.
---------------- -------------
"AFFILIATE" of any Person means any other Person directly or indirectly
---------
controlling, controlled by or under common control with such Person. A Person
-------
shall be deemed to control another Person if the controlling Person is the
"beneficial owner" (as defined in Rule 13d-3 under the Securities Exchange Act
of 1934) of greater than ten percent (10%) or more of any class of voting
securities (or other voting interests) of the controlled Person or possesses,
directly or indirectly, the power to direct or cause the direction of the
management or policies of the controlled Person, whether through ownership of
Capital Stock, by contract or otherwise.
"AGGREGATE REVOLVING LOAN COMMITMENT" means the aggregate of the Revolving Loan
------------------------------------
Commitments of all the Lenders, as may be reduced from time to time pursuant to
the terms hereof. The initial Aggregate Revolving Loan Commitment is Two
Hundred Twenty-Five Million and 00/100 Dollars ($225,000,000.00).
"AGREEMENT" means this 5-Year Revolving Credit Agreement, as it may be amended,
---------
restated or otherwise modified and in effect from time to time.
"AGREEMENT ACCOUNTING PRINCIPLES" means generally accepted accounting principles
-------------------------------
as in effect in the United States from time to time, applied in a manner
consistent with that used in preparing the financial statements of Energizer
referred to in Section 6.7 hereof; provided, however, except as provided in
------------ -------- -------
Section 10.9, that with respect to the calculation of financial ratios and other
- ------------
financial tests required by this Agreement, "Agreement Accounting Principles"
means generally accepted accounting principles as in effect in the United States
as of the date of this Agreement, applied in a manner consistent with that used
in preparing the financial statements of Energizer referred to in Section 6.7
-----------
hereof.
"ALTERNATE BASE RATE" means, for any day, a fluctuating rate of interest per
---------------------
annum equal to the higher of (i) the Prime Rate for such day and (ii) the sum of
(a) the Federal Funds Effective Rate for such day and (b) one-half of one
percent (0.5%) per annum.
"APPLICABLE FACILITY FEE PERCENTAGE" means, as at any date of determination, the
----------------------------------
rate per annum then applicable in the determination of the amount payable under
Section 2.14(C)(i) hereof determined in accordance with the provisions of
- -------------------
Section 2.14(D)(ii) hereof.
- --------------------
"APPLICABLE MARGIN" means, as at any date of determination, the rate per annum
------------------
then applicable to Advances of any Type at such time, determined in accordance
with the provisions of Section 2.14(D)(ii) hereof.
--------------------
"APPLICABLE L/C FEE PERCENTAGE" means, as at any date of determination, the rate
-----------------------------
per annum then applicable in the determination of the amount payable under
Section 3.8(i) hereof determined in accordance with the provisions of Section
---------- -------
2.14(D)(ii) hereof.
---------
"ARRANGER" means Banc One Capital Markets, Inc., in its capacity as the lead
--------
arranger and sole bookrunner for the loan transaction evidenced by this
Agreement.
"ASSIGNMENT AGREEMENT" means an assignment and acceptance agreement entered into
--------------------
in connection with an assignment by a Lender pursuant to Section 13.3 hereof in
------------
substantially the form of Exhibit D.
----------
"ASSET SALE" means, with respect to any Person, the sale, lease, conveyance,
-----------
disposition or other transfer by such Person of any of its assets (including by
way of a sale-leaseback transaction, and including the sale or other transfer of
any of the Equity Interests of any Subsidiary of such Person) other than (i) the
sale of Inventory in the ordinary course of business and (ii) the sale or other
disposition of any obsolete manufacturing Equipment disposed of in the ordinary
course of business.
"AUTHORIZED OFFICER" means any of the President, any Vice President (including
-------------------
any Executive Vice President) or the Treasurer of the Borrower, acting singly.
"BANK BOOK" is defined in Section 6.7(A) hereof.
---------- ---------------
"BANK ONE" means Bank One, NA, having its principal office in Chicago, Illinois,
--------
in its individual capacity, and its successors.
"BENEFIT PLAN" means a defined benefit plan as defined in Section 3(35) of ERISA
------------
(other than a Multiemployer Plan or Foreign Pension Plan) in respect of which
Energizer or any other member of the Controlled Group is, or within the
immediately preceding six (6) years was, an "employer" as defined in Section
3(5) of ERISA.
"BORROWER" means (i) for the period from the Closing Date until the consummation
--------
of the Debt Assumption, Ralston and (ii) from and after the consummation of the
Debt Assumption, Energizer, in each case, together with its successors and
assigns, including a debtor-in-possession on behalf of the Borrower.
"BORROWING DATE" means a date on which an Advance or Swing Line Loan is made
---------------
hereunder.
"BORROWING/ELECTION NOTICE" is defined in Section 2.7 hereof.
-------------------------- ------------
"BRIDGE FACILITIES" means any temporary bridge financing to be provided in favor
-----------------
of Ralston, all or a portion of which may be assumed by Energizer in connection
with the Spin-Off, which shall be refinanced by Energizer shortly after the
Spin-Off Date with the Receivables Purchase Facility and/or the Senior Notes
and/or cash on hand.
"BUSINESS DAY" means (i) with respect to any borrowing, payment or rate
-------------
selection of Loans bearing interest at the Eurodollar Rate, a day (other than a
-------
Saturday or Sunday) on which banks are open for business in Chicago, Illinois
and on which dealings in Dollars are carried on in the London interbank market
and (ii) for all other purposes a day (other than a Saturday or Sunday) on which
banks are open for business in Chicago, Illinois.
"CAPITAL STOCK" means (i) in the case of a corporation, capital stock, (ii) in
--------------
the case of an association or business entity, any and all shares, interests,
participations, rights or other equivalents (however designated) of corporate
stock, (iii) in the case of a partnership, partnership interests (whether
general or limited) and (iv) any other interest or participation that confers on
a Person the right to receive a share of the profits and losses of, or
distributions of assets of, the issuing Person.
"CAPITALIZED LEASE" of a Person means any lease of property by such Person as
------------------
lessee which would be capitalized on a balance sheet of such Person prepared in
accordance with Agreement Accounting Principles.
"CAPITALIZED LEASE OBLIGATIONS" of a Person means the amount of the obligations
------------------------------
of such Person under Capitalized Leases which would be capitalized on a balance
sheet of such Person prepared in accordance with Agreement Accounting
Principles.
"CASH EQUIVALENTS" means (i) marketable direct obligations issued or
-----------------
unconditionally guaranteed by the United States government and backed by the
full faith and credit of the United States government; (ii) domestic and
Eurodollar certificates of deposit and time deposits, bankers' acceptances and
floating rate certificates of deposit issued by any commercial bank organized
under the laws of the United States, any state thereof, the District of
Columbia, any foreign bank, or its branches or agencies (fully protected against
currency fluctuations for any such deposits with a term of more than ninety (90)
days); (iii) shares of money market, mutual or similar funds having assets in
excess of $100,000,000 and at least 95% of the investments of which are limited
to investment grade securities (i.e., securities rated at least Baa by Moody's
Investors Service, Inc. or at least BBB by Standard & Poor's Ratings Group); and
(iv) commercial paper of United States and foreign banks and bank holding
companies and their subsidiaries and United States and foreign finance,
commercial industrial or utility companies which, at the time of acquisition,
are rated A-1 (or better) by Standard & Poor's Ratings Group or P-1 by Moody's
Investors Service, Inc.; provided that the maturities of such Cash Equivalents
--------
described in the foregoing clauses (i) through (iv) shall not exceed 365 days;
(v) repurchase obligations of any commercial bank organized under the laws of
the United States, any state thereof, the District of Columbia, any foreign
bank, or its branches or agencies having a term not more than thirty (30) days,
with respect to securities issued or fully guaranteed or insured by the United
States government; (vi) securities with maturities of one year or less from the
date of acquisition issued or fully guaranteed by any state, commonwealth,
territory, political subdivision, taxing authority 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
BBB by Standard & Poor's Ratings Group or at least Baa by Moody's Investors
Service, Inc.; (vii) securities with maturities of one year or less from the
date of acquisition backed by standby letters of credit issued by any commercial
bank organized under the laws of the United States, any state thereof or the
District of Columbia (which commercial bank shall have a short-term debt rating
of A-1 (or better) by Standard & Poor's Ratings Group or P-1 by Moody's
Investors Service, Inc.), or by any foreign bank (which foreign bank shall have
a rating of B or better from Thomson BankWatch Global Issuer Rating or, if not
rated by Thomson BankWatch Global Issuer Rating, which foreign bank shall be an
institution acceptable to the Administrative Agent), or its branches or
agencies; or (viii) shares of money market mutual or similar funds at least 95%
of the assets of which are invested in the types of investments satisfying the
requirements of clauses (i) through (vii) of this definition.
"CHANGE" is defined in Section 4.2 hereof.
------ ------------
"CHANGE OF CONTROL" means an event or series of events by which:
-------------------
(i) any "person" or "group" (within the meaning of Sections 13(d) and
14(d)(2) of the Securities Exchange Act of 1934) becomes the "beneficial owner"
(as defined in Rule 13d-3 under the Securities Exchange Act of 1934), directly
or indirectly, of thirty percent (30%) or more of the voting power of the then
outstanding Capital Stock of Energizer entitled to vote generally in the
election of the directors of Energizer (other than Ralston at any time prior to
the consummation of the Spin-Off);
(ii) during any period of 12 consecutive calendar months, the board of
directors of Energizer shall cease to have as a majority of its members
individuals who either:
(a) were directors of Energizer on the first day of such period,
(b) were elected or nominated for election to the board of directors of
Energizer at the recommendation of or other approval by at least a majority of
the directors then still in office at the time of such election or nomination
who were directors of Energizer on the first day of such period, or whose
election or nomination for election was so approved, or
(c) were directors of Energizer on the first Business Day following the
Spin-Off Date;
(iii) other than as a result of a transaction not prohibited under the terms
of this Agreement, Energizer (a) shall cease to own, of record and
beneficially, with sole voting and dispositive power, 100% of the outstanding
shares of Capital Stock of each of the Subsidiary Guarantors or (b) shall cease
to have the power, directly or indirectly, to elect all of the members of the
board of directors of each of the Subsidiary Guarantors; or
(iv) Energizer consolidates with or merges into another corporation or
conveys, transfers or leases all or substantially all of its property to any
Person, or any corporation consolidates with or merges into Energizer, in either
event pursuant to a transaction in which the outstanding Capital Stock of
Energizer is reclassified or changed into or exchanged for cash, securities or
other property.
"CLOSING DATE" means the date of this Agreement.
-------------
"CODE" means the Internal Revenue Code of 1986, as amended, reformed or
----
otherwise modified from time to time.
"COMMISSION" means the Securities and Exchange Commission of the United States
----------
of America and any Person succeeding to the functions thereof.
"CONSOLIDATED ASSETS" means the total assets of Energizer and its Subsidiaries
--------------------
on a consolidated basis.
"CONSOLIDATED NET WORTH" means, as of any date of determination, the
------------------------
consolidated total stockholders' equity (including capital stock, additional
----------
paid-in capital and retained earnings) of Energizer and its consolidated
Subsidiaries determined in accordance with Agreement Accounting Principles.
"CONTAMINANT" means any waste, pollutant, hazardous substance, toxic substance,
-----------
hazardous waste, special waste, petroleum or petroleum-derived substance or
waste, asbestos or polychlorinated biphenyls ("PCBS"), and includes but is not
limited to these terms as defined in Environmental, Health or Safety
Requirements of Law.
"CONTINGENT OBLIGATION", as applied to any Person, means any Contractual
----------------------
Obligation, contingent or otherwise, of that Person with respect to any
Indebtedness of another or other obligation or liability of another, including,
without limitation, any such Indebtedness, obligation or liability of another
directly or indirectly guaranteed, endorsed (otherwise than for collection or
deposit in the ordinary course of business), co-made or discounted or sold with
recourse by that Person, or in respect of which that Person is otherwise
directly or indirectly liable, including Contractual Obligations (contingent or
otherwise) arising through any agreement to purchase, repurchase, or otherwise
acquire such Indebtedness, obligation or liability or any security therefor, or
to provide funds for the payment or discharge thereof (whether in the form of
loans, advances, stock purchases, capital contributions or otherwise), or to
maintain solvency, assets, level of income, or other financial condition, or to
make payment other than for value received. The amount of any Contingent
Obligation shall be equal to the present value of the portion of the obligation
so guaranteed or otherwise supported, in the case of known recurring
obligations, and the maximum reasonably anticipated liability in respect of the
portion of the obligation so guaranteed or otherwise supported assuming such
Person is required to perform thereunder, in all other cases.
"CONTRACTUAL OBLIGATION", as applied to any Person, means any provision of any
-----------------------
equity or debt securities issued by that Person or any indenture, mortgage, deed
of trust, security agreement, pledge agreement, guaranty, contract, undertaking,
agreement or instrument, in any case in writing, to which that Person is a party
or by which it or any of its properties is bound, or to which it or any of its
properties is subject.
"CONTROLLED GROUP" means the group consisting of (i) any corporation which is a
-----------------
member of the same controlled group of corporations (within the meaning of
Section 414(b) of the Code) as Energizer; (ii) a partnership or other trade or
business (whether or not incorporated) which is under common control (within the
meaning of Section 414(c) of the Code) with Energizer; and (iii) a member of the
same affiliated service group (within the meaning of Section 414(m) of the Code)
as Energizer, any corporation described in clause (i) above or any partnership
----------
or trade or business described in clause (ii) above; provided, that after the
----------- --------
Spin-Off Date, such term shall not include Ralston.
"CURE LOAN" is defined in Section 9.2(iii) hereof.
---------- -----------------
"CUSTOMARY PERMITTED LIENS" means:
---------------------------
(i) Liens (other than Environmental Liens and Liens in favor of the IRS or
the PBGC or any Plan) with respect to the payment of taxes, assessments or
governmental charges in all cases which are not yet due or (if foreclosure,
distraint, sale or other similar proceedings shall not have been commenced or
any such proceeding after being commenced is stayed) which are being contested
in good faith by appropriate proceedings properly instituted and diligently
conducted and with respect to which adequate reserves or other appropriate
provisions are being maintained as may be required in accordance with Agreement
Accounting Principles;
(ii) statutory Liens of landlords and Liens of suppliers, mechanics,
carriers, materialmen, warehousemen or workmen and other similar Liens imposed
by law created in the ordinary course of business for amounts not yet due or
which are being contested in good faith by appropriate proceedings properly
instituted and diligently conducted and with respect to which adequate reserves
or other appropriate provisions are being maintained as may be required in
accordance with Agreement Accounting Principles;
(iii) Liens (other than Environmental Liens and Liens in favor of the IRS or
the PBGC or any Plan) incurred or deposits made in the ordinary course of
business in connection with workers' compensation, unemployment insurance or
other types of social security benefits or to secure the performance of bids,
tenders, sales, contracts (other than for the repayment of borrowed money),
surety, appeal and performance bonds; provided that (A) all such Liens do not in
--------
the aggregate materially detract from the value of the Borrower's or such
Subsidiary's assets or property taken as a whole or materially impair the use
thereof in the operation of the Borrower's or such Subsidiary's businesses taken
as a whole, and (B) all Liens securing bonds to stay judgments or in connection
with appeals do not secure at any time an aggregate amount exceeding
$30,000,000;
(iv) Liens arising with respect to zoning restrictions, easements, licenses,
reservations, covenants, rights-of-way, utility easements, building restrictions
and other similar charges or encumbrances on the use of real property which do
not in any case materially detract from the value of the property subject
thereto or interfere with the ordinary conduct of the business of the Borrower
or any of its Subsidiaries;
(v) Liens of attachment or judgment with respect to judgments, writs or
warrants of attachment, or similar process against the Borrower or any of its
Subsidiaries which do not constitute a Default under Section 8.1(H) hereof;
--------------
(vi) any interest or title of the lessor in the property subject to any
operating lease entered into by the Borrower or any of its Subsidiaries in the
ordinary course of business; and
(vii) Liens of commercial depository institutions arising in the ordinary
course of business constituting a statutory or common law right of setoff
against amounts on deposit with any such institution.
"DEBT ASSUMPTION" means the assignment and assumption by Energizer of all
----------------
of obligations and liabilities of Ralston hereunder and under the Loan Documents
and the concurrent release of Ralston from such obligations and liabilities,
which shall occur on the Spin-Off Date, pursuant to the Debt Assignment,
Assumption and Release Agreement in the form attached as Exhibit J to this
---------
Agreement (the "DEBT ASSUMPTION AGREEMENT").
"DEBT ASSUMPTION AGREEMENT" is defined in the definition of "Debt Assumption"
---------------------------
above.
"DEFAULT" means an event described in Article VIII hereof.
------- -------------
"DISCLOSED LITIGATION" is defined in Section 6.10 hereof.
--------------------- -------------
"DISQUALIFIED STOCK" means any preferred stock and any Capital Stock that, 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
redeemable at the option of the holder thereof, in whole or in part, on or prior
to the date that is 91 days after the Revolving Loan Termination Date.
"DOL" means the United States Department of Labor and any Person succeeding to
---
the functions thereof.
"DOLLAR" and "$" means dollars in the lawful currency of the United States.
------ -
"EBIT" means, for any period, on a consolidated basis for Energizer and its
----
Subsidiaries, the sum of the amounts for such period, without duplication, of
(i) Net Income, plus (ii) Interest Expense to the extent deducted in computing
----
Net Income, plus (iii) charges against income for foreign, federal, state and
----
local taxes to the extent deducted in computing Net Income, minus (iv)
-----
extraordinary gains to the extent added in computing Net Income, plus (v) other
----
extraordinary non-cash charges to the extent deducted in computing Net Income.
"EBITDA" means, for any period, on a consolidated basis for Energizer and its
------
Subsidiaries, the sum of the amounts for such period, without duplication, of
(i) EBIT, plus (ii) depreciation expense to the extent deducted in computing Net
----
Income, plus (iii) amortization expense, including, without limitation,
----
amortization of goodwill and other intangible assets, to the extent deducted in
computing Net Income.
"ENERGIZER" means Energizer Holdings, Inc., a Missouri corporation, together
---------
with its permitted successors and assigns, including a debtor-in-possession on
behalf of Energizer.
"ENVIRONMENTAL, HEALTH OR SAFETY REQUIREMENTS OF LAW" means all applicable
---------------------------------------------------------
foreign, federal, state and local laws or regulations relating to or addressing
pollution or protection of the environment, or protection of worker health or
safety, including, but not limited to, the Comprehensive Environmental Response,
Compensation and Liability Act, 42 U.S.C. 9601 et seq., the Occupational
-- ---
Safety and Health Act of 1970, 29 U.S.C. 651 et seq., and the Resource
-- ---
Conservation and Recovery Act of 1976, 42 U.S.C. 6901 et seq., in each case
-- ---
including any amendments thereto, any successor statutes, and any regulations
promulgated thereunder, and any state or local equivalent thereof.
"ENVIRONMENTAL LIEN" means a lien in favor of any Governmental Authority for (a)
------------------
any liability under Environmental, Health or Safety Requirements of Law, or (b)
damages arising from, or costs incurred by such Governmental Authority in
response to, a Release or threatened Release of a Contaminant into the
environment.
"ENVIRONMENTAL PROPERTY TRANSFER ACT" means any applicable requirement of law
--------------------------------------
that conditions, restricts, prohibits or requires any notification or disclosure
triggered by the closure of any property or the transfer, sale or lease of any
property or deed or title for any property for environmental reasons, including,
but not limited to, any so-called "Industrial Site Recovery Act" or "Responsible
Property Transfer Act."
"EQUIPMENT" means all of the Borrower's and its Subsidiaries' present and future
---------
(i) equipment, including, without limitation, machinery, manufacturing,
distribution, selling, data processing and office equipment, assembly systems,
tools, molds, dies, fixtures, appliances, furniture, furnishings, vehicles,
vessels, aircraft, aircraft engines, and trade fixtures, (ii) other tangible
personal property (other than the Borrower's or Subsidiary's Inventory), and
(iii) any and all accessions, parts and appurtenances attached to any of the
foregoing or used in connection therewith, and any substitutions therefor and
replacements, products and proceeds thereof.
"EQUITY INTERESTS" means Capital Stock and all warrants, options or other rights
----------------
to acquire Capital Stock (but excluding any debt security that is convertible
into, or exchangeable for, Capital Stock).
"ERISA" means the Employee Retirement Income Security Act of 1974, as amended
-----
from time to time, including (unless the context otherwise requires) any rules
or regulations promulgated thereunder.
"EURODOLLAR BASE RATE" means, with respect to a Eurodollar Rate Advance for the
---------------------
relevant Interest Period, the applicable British Bankers' Association Interest
Settlement Rate for deposits in U.S. dollars appearing on Bloomberg Screen BBAM
as of 11:00 a.m. (London time) two (2) Business Days prior to the first day of
such Interest Period, and having a maturity equal to such Interest Period,
provided that, (i) if Bloomberg Screen BBAM is not available to the
Administrative Agent for any reason, the applicable Eurodollar Base Rate for the
relevant Interest Period shall instead be the applicable British Bankers'
Association Interest Settlement Rate for deposits in U.S. dollars as reported by
any other generally recognized financial information service mutually acceptable
to the Borrower and the Administrative Agent as of 11:00 a.m. (London time) two
(2) Business Days prior to the first day of such Interest Period, and having a
maturity equal to such Interest Period, and (ii) if no such British Bankers'
Association Interest Settlement Rate is available to the Administrative Agent,
the applicable Eurodollar Base Rate for the relevant Interest Period shall
instead be the rate determined by the Administrative Agent to be the arithmetic
mean (rounded upward, if necessary, to an integral multiple of 1/16th of 1%) of
the rates of interest per annum reported to the Administrative Agent by each
Reference Lender as the rate at which such Reference Lender offers to place
deposits in Dollars with first-class banks in the London interbank market at
approximately 11:00 a.m. (London time) two (2) Business Days prior to the first
day of such Interest Period, in the approximate amount of such Reference
Lender's relevant Eurodollar Rate Loan and having a maturity equal to such
Interest Period. If any Reference Lender fails to provide such quotation to the
Administrative Agent, then the Administrative Agent shall determine the
Eurodollar Base Rate on the basis of the quotations of the remaining Reference
Lender(s).
"EURODOLLAR RATE" means, with respect to a Eurodollar Rate Advance for the
----------------
relevant Interest Period, the sum of (i) the quotient of (a) the Eurodollar Base
----
Rate applicable to such Interest Period, divided by (b) one minus the Reserve
Requirement (expressed as a decimal) applicable to such Interest Period plus
----
(ii) the then Applicable Margin; provided, however, that the foregoing
-------- -------
adjustment for Reserve Requirements shall only be made with respect to that
portion of a Eurodollar Rate Loan made by a Lender which is subject to such
Reserve Requirements.
"EURODOLLAR RATE ADVANCE" means an Advance which bears interest at the
-------------------------
Eurodollar Rate.
--------
"EURODOLLAR RATE LOAN" means a Loan, or portion thereof, which bears interest at
--------------------
the Eurodollar Rate.
"EXCLUDED TAXES" means, in the case of each Lender or applicable Lending
---------------
Installation and the Administrative Agent, taxes imposed on its overall net
income, and franchise taxes imposed on it, by (i) the jurisdiction under the
laws of which such Lender or the Administrative Agent is incorporated or
organized or (ii) the jurisdiction in which the Administrative Agent's or such
Lender's principal executive office or such Lender's applicable Lending
Installation is located.
"FACILITY FEE" is defined in Section 2.14(C)(i) hereof.
------------- -------------------
"FEDERAL FUNDS EFFECTIVE RATE" means, for any day, an interest rate per annum
-------------------------------
equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers on such day, as published for such day (or, if such day is not a
Business Day, for the immediately preceding Business Day) by the Federal Reserve
Bank of New York, or, if such rate is not so published for any day which is a
Business Day, the average of the quotations at approximately 10:00 a.m. (Chicago
time) on such day on such transactions received by the Administrative Agent from
three Federal funds brokers of recognized standing selected by the
Administrative Agent in its reasonable discretion.
"FINAL ADJUSTMENT DATE" means the last Adjustment Date, which shall occur no
-----------------------
later than July 31, 2000, in accordance with the Reorganization Agreement.
"FINANCING FACILITIES" means this Agreement, the 364-Day Credit Agreement, the
---------------------
Bridge Facilities, the Receivables Purchase Facility, the Senior Notes and any
other financing facilities entered into or to be entered into in connection with
the Spin-Off, in each case, whether consummated prior to, concurrently with or
following the Spin-Off.
"FLOATING RATE ADVANCE" means an Advance which bears interest by reference to
-----------------------
the Alternate Base Rate.
"FLOATING RATE LOAN" means a Loan, or portion thereof, which bears interest by
--------------------
reference to the Alternate Base Rate.
"FOREIGN EMPLOYEE BENEFIT PLAN" means any employee benefit plan as defined in
--------------------------------
Section 3(3) of ERISA which is maintained or contributed to for the benefit of
the employees of Energizer or any member of the Controlled Group, but which is
not covered by ERISA pursuant to Section 4(b)(4) of ERISA.
"FOREIGN PENSION PLAN" means any employee pension benefit plan (as defined in
----------------------
Section 3(2) of ERISA) which (i) is maintained or contributed to for the benefit
of employees of Energizer or any other member of the Controlled Group, (ii) is
not covered by ERISA pursuant to Section 4(b)(4) thereof and (iii) under
applicable local law, is required to be funded through a trust or other funding
vehicle.
"FORM 10" means the Form 10 General Form for the Registration of Securities, as
--------
amended by Amendment No. 1, Amendment No. 2 and Amendment No. 3 thereto, filed
by Energizer (File No. 1-15401) with the Commission in connection with the
Spin-Off, together with all exhibits and appendices thereto.
"GOVERNMENTAL ACTS" is defined in Section 3.10(A) hereof.
------------------ ----------------
"GOVERNMENTAL AUTHORITY" means any nation or government, any federal, state,
-----------------------
local or other political subdivision thereof and any entity exercising
executive, legislative, judicial, regulatory or administrative authority or
functions of or pertaining to government, including any authority or other
quasi-governmental entity established to perform any of such functions.
"HEDGING ARRANGEMENTS" is defined in the definition of "Hedging Obligations"
---------------------
below.
"HEDGING AGREEMENTS" is defined in Section 7.3(O) hereof.
------------------- ---------------
"HEDGING OBLIGATIONS" of a Person means any and all obligations of such Person,
--------------------
whether absolute or contingent and howsoever and whensoever created, arising,
evidenced or acquired (including all renewals, extensions and modifications
thereof and substitutions therefor), under (i) any and all agreements, devices
or arrangements designed to protect at least one of the parties thereto from the
fluctuations of interest rates, commodity prices, exchange rates or forward
rates applicable to such party's assets, liabilities or exchange transactions,
including, but not limited to, dollar-denominated or cross-currency interest
rate exchange agreements, forward currency exchange agreements, interest rate
cap or collar protection agreements, forward rate currency or interest rate
options, puts and warrants or any similar derivative transactions ("HEDGING
ARRANGEMENTS"), and (ii) any and all cancellations, buy backs, reversals,
terminations or assignments of any of the foregoing.
"HOLDERS OF OBLIGATIONS" means the holders of the Obligations from time to time
-----------------------
and shall include their respective successors, transferees and assigns.
"INDEBTEDNESS" of any Person means, without duplication, such Person's (a)
------------
obligations for borrowed money, (b) obligations representing the deferred
purchase price of property or services (other than accounts payable arising in
the ordinary course of such Person's business payable on terms customary in the
trade), which purchase price is due more than six (6) months from the date of
incurrence of the obligation in respect thereof, provided that the related
obligations are not interest bearing, (c) obligations, whether or not assumed,
secured by Liens or payable out of the proceeds or production from property or
assets now or hereafter owned or acquired by such Person, (d) obligations which
are evidenced by notes, acceptances or other instruments, (e) Capitalized Lease
Obligations, (f) Contingent Obligations in respect of Indebtedness, (g)
obligations with respect to letters of credit, (h) Off-Balance Sheet
Liabilities, (i) Receivables Facility Attributed Indebtedness and (j)
Disqualified Stock. The amount of Indebtedness of any Person at any date shall
be without duplication (1) the outstanding balance at such date of all
unconditional obligations as described above and the maximum liability of any
such Contingent Obligations at such date and (2) in the case of Indebtedness of
others secured by a Lien to which the property or assets owned or held by such
Person is subject, the lesser of the fair market value at such date of any asset
subject to a Lien securing the Indebtedness of others and the amount of the
Indebtedness secured.
"INDEMNIFIED MATTERS" is defined in Section 10.7(B) hereof.
-------------------- ----------------
"INDEMNITEES" is defined in Section 10.7(B) hereof.
----------- ----------------
"INITIAL FUNDING DATE" means the date on which the initial Revolving Loans are
----------------------
advanced hereunder.
"INSOLVENCY EVENT" is defined in Section 10.14 hereof.
----------------- --------------
"INTERCOMPANY INDEBTEDNESS" is defined in Section 10.14 hereof.
-------------------------- --------------
"INTEREST EXPENSE" means, for any period, the total interest expense of
-----------------
Energizer and its consolidated Subsidiaries, whether paid or accrued, including,
-------
without duplication, Off-Balance Sheet Liabilities (including Receivables
Facility Financing Costs) and the interest component of Capitalized Leases, all
as determined in conformity with Agreement Accounting Principles.
"INTEREST EXPENSE COVERAGE RATIO" is defined in Section 7.4(B) hereof.
---------------------------------- ---------------
"INTEREST PERIOD" means, with respect to a Eurodollar Rate Loan, a period of one
---------------
(1), two (2), three (3) or six (6) months and, to the extent available to all of
the Lenders, nine (9) or twelve (12) months, commencing on a Business Day
selected by the Borrower on which a Eurodollar Rate Advance is made to Borrower
pursuant to this Agreement. Such Interest Period shall end on (but exclude) the
day which corresponds numerically to such date one, two, three, six, nine or
twelve months thereafter; provided, however, that if there is no such
-------- -------
numerically corresponding day in such next, second, third, sixth, ninth or
twelfth succeeding month, such Interest Period shall end on the last Business
Day of such next, second, third, sixth, ninth or twelfth succeeding month. If
an Interest Period would otherwise end on a day which is not a Business Day,
such Interest Period shall end on the next succeeding Business Day, provided,
--------
however, that if said next succeeding Business Day falls in a new calendar
- -------
month, such Interest Period shall end on the immediately preceding Business Day.
"INVENTORY" shall mean any and all goods, including, without limitation, goods
---------
in transit, wheresoever located, whether now owned or hereafter acquired by the
Borrower or any of its Subsidiaries, which are held for sale or lease, furnished
under any contract of service or held as raw materials, work in process or
supplies, and all materials used or consumed in the business of Borrower or any
of its Subsidiaries, and shall include all right, title and interest of the
Borrower or any of its Subsidiaries in any property the sale or other
disposition of which has given rise to Receivables and which has been returned
to or repossessed or stopped in transit by the Borrower or any of its
Subsidiaries.
"INVESTMENT" means, with respect to any Person, (i) any purchase or other
----------
acquisition by that Person of any Indebtedness, Equity Interests or other
securities, or of a beneficial interest in any Indebtedness, Equity Interests or
other securities, issued by any other Person, (ii) any purchase by that Person
of all or substantially all of the assets of a business conducted by another
Person, and (iii) any loan, advance (other than deposits with financial
institutions available for withdrawal on demand, prepaid expenses, accounts
receivable, advances to employees and similar items made or incurred in the
ordinary course of business) or capital contribution by that Person to any other
Person, including all Indebtedness to such Person arising from a sale of
property by such Person other than in the ordinary course of its business.
"IRS" means the Internal Revenue Service and any Person succeeding to the
functions thereof.
"ISSUING BANK(S)" means (i) Bank One in its separate capacity as an issuer of
----------------
Letters of Credit pursuant to Section 3.1 hereunder with respect to each Letter
-----------
of Credit issued by Bank One upon the Borrower's request and (ii) any Lender
(other than Bank One) reasonably acceptable to the Administrative Agent, in such
Lender's separate capacity as an issuer of Letters of Credit pursuant to Section
-------
3.1 hereunder with respect to any and all Letters of Credit issued by such
Lender in its sole discretion upon the Borrower's request. All references
contained in this Agreement and the other Loan Documents to the "Issuing Bank"
shall be deemed to apply equally to each of the institutions referred to in
clauses (i) and (ii) of this definition in their respective capacities as
- ------------ ----
issuers of any and all Letters of Credit issued by each such institution.
"L/C DOCUMENTS" is defined in Section 3.4 hereof.
-------------- ------------
"L/C DRAFT" means a draft drawn on an Issuing Bank pursuant to a Letter of
----------
Credit.
----
"L/C INTEREST" shall have the meaning ascribed to such term in Section 3.6
------------- -----------
hereof.
"L/C OBLIGATIONS" means, without duplication, an amount equal to the sum of (i)
----------------
the aggregate of the amount then available for drawing under each of the Letters
of Credit, (ii) the face amount of all outstanding L/C Drafts corresponding to
the Letters of Credit, which L/C Drafts have been accepted by an Issuing Bank,
(iii) the aggregate outstanding amount of all Reimbursement Obligations at such
time and (iv) the aggregate face amount of all Letters of Credit requested by
the Borrower but not yet issued (unless the request for an unissued Letter of
Credit has been denied).
"LENDERS" means the lending institutions listed on the signature pages of this
-------
Agreement and their respective successors and assigns.
"LENDING INSTALLATION" means, with respect to a Lender or the Administrative
---------------------
Agent, any office, branch, subsidiary or affiliate of such Lender or the
--
Administrative Agent.
--
"LETTER OF CREDIT" means the standby letters of credit to be issued by an
------------------
Issuing Bank pursuant to Section 3.1 hereof.
----- ------------
"LEVERAGE RATIO" is defined in Section 7.4(A) hereof.
--------------- ---------------
"LIEN" means any lien (statutory or other), mortgage, pledge, hypothecation,
----
assignment, deposit arrangement, encumbrance or preference, priority or security
--
agreement or preferential arrangement of any kind or nature whatsoever
(including, without limitation, the interest of a vendor or lessor under any
conditional sale, Capitalized Lease or other title retention agreement).
"LOAN(S)" means, with respect to a Lender, such Lender's portion of any Advance
-------
made pursuant to Section 2.1 hereof, and in the case of the Swing Line Bank, any
-----------
Swing Line Loan made pursuant to Section 2.2 hereof, and collectively, all
-----------
Revolving Loans and Swing Line Loans, whether made or continued as or converted
to Floating Rate Loans or Eurodollar Rate Loans.
"LOAN ACCOUNT" is defined in Section 2.12(a) hereof.
------------- ----------------
"LOAN DOCUMENTS" means this Agreement, the Subsidiary Guaranty, any promissory
---------------
notes issued pursuant to Section 2.12, the L/C Documents and all other
-------------
documents, instruments and agreements executed in connection therewith or
contemplated thereby, as the same may be amended, restated or otherwise modified
and in effect from time to time.
"LOAN PARTIES" is defined in Section 5.1 hereof.
------------- ------------
"MARGIN STOCK" shall have the meaning ascribed to such term in Regulation U.
-------------
"MATERIAL ADVERSE EFFECT" means a material adverse effect upon (a) the business,
-----------------------
condition (financial or otherwise), operations, performance, properties or
prospects of Energizer and its Subsidiaries, taken as a whole, (b) the ability
of Energizer and its Subsidiaries, taken as a whole, to perform their
obligations under the Loan Documents in any material respect, or (c) the ability
of the Lenders, the Issuing Banks or the Administrative Agent to enforce in any
material respect the Obligations.
"MATERIAL DOMESTIC SUBSIDIARY" means each consolidated Subsidiary (other than
------------------------------
any SPV) of the Borrower (a) incorporated under the laws of any jurisdiction in
the United States and (b) the total assets of which exceed, as at the end of any
calendar quarter or, in the case of consummation of a Permitted Acquisition, at
the time of consummation of such Permitted Acquisition (calculated by Energizer
on a pro forma basis taking into account the consummation of such Permitted
--- -----
Acquisition), three percent (3.0%) of the Consolidated Assets of Energizer and
its consolidated Subsidiaries (other than SPVs).
"MATERIAL FOREIGN SUBSIDIARY" means each consolidated Subsidiary (other than any
---------------------------
SPV) of the Borrower (a) incorporated under the laws of any foreign jurisdiction
and (b) the total assets of which exceed, as at the end of any calendar quarter
or, in the case of consummation of a Permitted Acquisition, at the time of
consummation of such Permitted Acquisition (calculated by Energizer on a pro
---
forma basis taking into account the consummation of such Permitted Acquisition),
- -----
five percent (5.0%) of the Consolidated Assets of Energizer and its consolidated
Subsidiaries (other than SPVs).
"MATERIAL INDEBTEDNESS" means any Indebtedness (other than the Indebtedness
----------------------
hereunder) of a single class with an aggregate outstanding principal amount
equal to or greater than $30,000,000.
"MATERIAL SUBSIDIARIES" means each of Energizer's Material Domestic Subsidiaries
---------------------
and Material Foreign Subsidiaries.
"MULTIEMPLOYER PLAN" means a "multiemployer plan" as defined in Section
-------------------
4001(a)(3) of ERISA which is, or within the immediately preceding six (6) years
-------
was, contributed to by either Energizer or any member of the Controlled Group.
"NET INCOME" means, for any period, the net earnings (or loss) after taxes of
-----------
Energizer and its Subsidiaries on a consolidated basis for such period taken as
a single accounting period determined in conformity with Agreement Accounting
Principles.
"NET WORTH CONDITION" means the requirement that, as of and after the
---------------------
consummation of the Spin-Off Transactions, the Consolidated Net Worth of
---------
Energizer and its Subsidiaries shall not be less than $625,000,000.
------
"NEW SUBSIDIARY" is defined in Section 7.3(F).
--------------- ---------------
"NON-ERISA COMMITMENTS" means
----------------------
(i) each pension, medical, dental, life, accident insurance, disability,
group insurance, sick leave, profit sharing, deferred compensation, bonus, stock
option, stock purchase, retirement, savings, severance, stock ownership,
performance, incentive, hospitalization or other insurance, or other welfare,
benefit or fringe benefit plan, policy, trust, understanding or arrangement of
any kind; and
(ii) each employee collective bargaining agreement and each agreement,
understanding or arrangement of any kind, with or for the benefit of any
present or prior officer, director, employee or consultant (including, without
limitation, each employment, compensation, deferred compensation, severance or
consulting agreement or arrangement and any agreement or arrangement associated
with a change in ownership of the Borrower or any member of the Controlled
Group);
to which Energizer or any member of the Controlled Group is a party or with
respect to which Energizer or any member of the Controlled Group is or will be
required to make any payment other than any Plans.
"NON PRO RATA LOAN" is defined in Section 9.2 hereof.
-------------------- ------------
"NON-U.S. LENDER" is defined in Section 4.5(iv) hereof.
---------------- ----------------
"NOTE PURCHASE AGREEMENT" means any agreement entered into by the Borrower with
------------------------
respect to the Borrower's issuance of senior unsecured notes (the "SENIOR
NOTES"), which shall be pari passu with the Obligations hereunder, on
substantially the terms set forth in the confidential Summary of Proposed Terms
relating to the Senior Notes sent by Banc of America Securities LLC to the
Administrative Agent by e-mail transmission on March 27, 2000, as such Note
Purchase Agreement may be amended, modified or supplemented from time to time in
a manner that is not materially adverse to the interests of the Lenders.
"NOTICE OF ASSIGNMENT" is defined in Section 13.3(B) hereof.
---------------------- ----------------
"OBLIGATIONS" means all Loans, L/C Obligations, advances, debts, liabilities,
-----------
obligations, covenants and duties owing by the Borrower or any of its
Subsidiaries to the Administrative Agent, any Lender, the Swing Line Bank, the
Arranger, any Affiliate of the Administrative Agent or any Lender, the Issuing
Banks or any Indemnitee, of any kind or nature, present or future, arising under
this Agreement, the L/C Documents or any other Loan Document, whether or not
evidenced by any note, guaranty or other instrument, whether or not for the
payment of money, whether arising by reason of an extension of credit, loan,
guaranty, indemnification, or in any other manner, whether direct or indirect
(including those acquired by assignment), absolute or contingent, due or to
become due, now existing or hereafter arising and however acquired. The term
includes, without limitation, all interest, charges, expenses, fees, reasonable
attorneys' fees and disbursements, reasonable paralegals' fees (and, after the
occurrence and during the continuance of a Default, all attorney's fees and
disbursements and paralegals' fees, whether or not reasonable), and any other
sum chargeable to the Borrower or any of its Subsidiaries under this Agreement
or any other Loan Document.
"OFF-BALANCE SHEET LIABILITIES" of a Person means, without duplication, (a) any
------------------------------
Receivables Facility Attributed Indebtedness and repurchase obligation or
liability of such Person or any of its Subsidiaries with respect to Receivables
or notes receivable sold by such Person or any of its Subsidiaries (calculated
to include the unrecovered investment of purchasers or transferees of
Receivables or notes receivable or any other obligation of the Borrower or such
transferor to purchasers/transferees of interests in Receivables or notes
receivables or the agent for such purchasers/transferees), (b) any liability
under any sale and leaseback transactions which do not create a liability on the
consolidated balance sheet of such Person, (c) any liability under any financing
lease or so-called "synthetic" lease transaction, or (d) any obligations arising
with respect to any other transaction which is the functional equivalent of or
takes the place of borrowing but which does not constitute a liability on the
consolidated balance sheets of such Person and its Subsidiaries.
"OPENING BALANCE SHEET DELIVERY DATE" means the date within fifteen days
---------------------------------------
following the Final Adjustment Date on which the Administrative Agent receives
the opening pro forma balance sheet of Energizer and its consolidated
--- -----
Subsidiaries pursuant to Section 7.1(A)(v).
------------------
"ORIGINATORS" means the Borrower and/or any of its Subsidiaries in their
-----------
respective capacities as parties to any Receivables Purchase Documents, as
------
sellers or transferors of any Receivables and Related Security in connection
----
with a Permitted Receivables Transfer.
"OTHER TAXES" is defined in Section 4.5 hereof.
------------ ------------
"PARTICIPANTS" is defined in Section 13.2(A) hereof.
------------ ----------------
"PAYMENT DATE" means the last day of each March, June, September and December.
-------------
"PBGC" means the Pension Benefit Guaranty Corporation, or any successor thereto.
----
"PERMITTED ACQUISITION" is defined in Section 7.3(F) hereof.
---------------------- ---------------
"PERMITTED EXISTING CONTINGENT OBLIGATIONS" means the Contingent Obligations of
------------------------------------------
Energizer and its Subsidiaries identified on Schedule 1.1.3 to this Agreement.
--------------
"PERMITTED EXISTING INVESTMENTS" means the Investments of Energizer and its
--------------------------------
Subsidiaries identified on Schedule 1.1.1 to this Agreement.
--- ---------------
"PERMITTED EXISTING LIENS" means the Liens on assets of Energizer and its
--------------------------
Subsidiaries identified on Schedule 1.1.2 to this Agreement.
----- ---------------
"PERMITTED RECEIVABLES TRANSFER" means (i) a sale or other transfer by an
--------------------------------
Originator to a SPV of Receivables and Related Security for fair market value
-----
and without recourse (except for limited recourse typical of such structured
finance transactions), and/or (ii) a sale or other transfer by a SPV to (a)
purchasers of or other investors in such Receivables and Related Security or (b)
any other Person (including a SPV) in a transaction in which purchasers or other
investors purchase or are otherwise transferred such Receivables and Related
Security, in each case pursuant to and in accordance with the terms of the
Receivables Purchase Documents.
"PERSON" means any individual, corporation, firm, enterprise, partnership,
------
trust, incorporated or unincorporated association, joint venture, joint stock
----
company, limited liability company or other entity of any kind, or any
government or political subdivision or any agency, department or instrumentality
thereof.
"PLAN" means an employee benefit plan defined in Section 3(3) of ERISA in
----
respect of which Energizer or any member of the Controlled Group is, or within
the immediately preceding six (6) years was, an "employer" as defined in Section
3(5) of ERISA.
"PRIME RATE" means a rate per annum equal to the prime rate of interest
-----------
announced from time to time by Bank One or its parent (which is not necessarily
the lowest rate charged to any customer), changing when and as said prime rate
changes.
"PRO RATA SHARE" means, with respect to any Lender, the percentage obtained by
----------------
dividing (A) such Lender's Revolving Loan Commitment at such time (in each case,
as adjusted from time to time in accordance with the provisions of this
Agreement) by (B) the Aggregate Revolving Loan Commitment at such time;
provided, however, if all of the Revolving Loan Commitments are terminated
-------
pursuant to the terms of this Agreement, then "Pro Rata Share" means the
percentage obtained by dividing (x) the sum of (A) such Lender's Revolving
Loans, plus (B) such Lender's share of the obligations to purchase
----
participations in Swing Line Loans and Letters of Credit, by (y) the sum of (A)
----
the aggregate outstanding amount of Revolving Loans, plus (B) the aggregate
----
outstanding amount of all Swing Line Loans and Letters of Credit.
"PURCHASERS" is defined in Section 13.3(A) hereof.
---------- ----------------
"RALSTON" means Ralston Purina Company, a Missouri corporation, and prior to the
-------
Spin-Off, the owner of all of the outstanding Capital Stock of Energizer,
together with its permitted successors and assigns, including a
debtor-in-possession on behalf of Ralston.
"RECEIVABLE(S)" means and includes all of the Borrower's and its Subsidiaries'
-------------
presently existing and hereafter arising or acquired accounts, accounts
receivable, and all present and future rights of the Borrower and its
Subsidiaries to payment for goods sold or leased or for services rendered
(except those evidenced by instruments or chattel paper), whether or not they
have been earned by performance, and all rights in any merchandise or goods
which any of the same may represent, and all rights, title, security and
guaranties with respect to each of the foregoing, including, without limitation,
any right of stoppage in transit.
"RECEIVABLES AND RELATED SECURITY" means the Receivables and the related
-----------------------------------
security and collections with respect thereto which are sold or transferred by
any Originator or SPV in connection with any Permitted Receivables Transfer.
"RECEIVABLES FACILITY ATTRIBUTED INDEBTEDNESS" means the amount of obligations
----------------------------------------------
outstanding under a receivables purchase facility on any date of determination
that would be characterized as principal if such facility were structured as a
secured lending transaction rather than as a purchase.
"RECEIVABLES FACILITY FINANCING COSTS" means such portion of the cash fees,
---------------------------------------
service charges, and other costs, as well as all collections or other amounts
retained by purchasers of receivables pursuant to a receivables purchase
facility, which are in excess of amounts paid to the Borrower and its
consolidated Subsidiaries under any receivables purchase facility for the
purchase of receivables pursuant to such facility and are the equivalent of the
interest component of the financing if the transaction were characterized as an
on-balance sheet transaction.
"RECEIVABLES PURCHASE DOCUMENTS" means any series of receivables purchase or
--------------------------------
sale agreements generally consistent with terms contained in comparable
structured finance transactions pursuant to which an Originator or Originators
sell or transfer to SPVs all of their respective right, title and interest in
and to certain Receivables and Related Security for further sale or transfer to
other purchasers of or investors in such assets (and the other documents,
instruments and agreements executed in connection therewith), as any such
agreements may be amended, restated, supplemented or otherwise modified from
time to time, or any replacement or substitution therefor.
"RECEIVABLES PURCHASE FACILITY" means the securitization facility made available
-----------------------------
to Energizer, pursuant to which the Receivables and Related Security of the
Originators are transferred to one or more SPVs, and thereafter to certain
investors, pursuant to the terms and conditions of the Receivables Purchase
Documents.
"REFERENCE LENDERS" means Bank One, Bank of America, N.A. and Wachovia Bank,
------------------
N.A.
"REGISTER" is defined in Section 13.3(C) hereof.
-------- ----------------
"REGULATION D" means Regulation D of the Board of Governors of the Federal
-------------
Reserve System as from time to time in effect and any successor thereto or other
regulation or official interpretation of said Board of Governors relating to
reserve requirements applicable to member banks of the Federal Reserve System.
"REGULATION T" means Regulation T of the Board of Governors of the Federal
-------------
Reserve System as from time to time in effect and any successor or other
regulation or official interpretation of said Board of Governors relating to the
extension of credit by and to brokers and dealers of securities for the purpose
of purchasing or carrying margin stock (as defined therein).
"REGULATION U" means Regulation U of the Board of Governors of the Federal
-------------
Reserve System as from time to time in effect and any successor or other
regulation or official interpretation of said Board of Governors relating to the
extension of credit by banks, non-banks and non-broker lenders for the purpose
of purchasing or carrying Margin Stock applicable to member banks of the Federal
Reserve System.
"REGULATION X" means Regulation X of the Board of Governors of the Federal
-------------
Reserve System as from time to time in effect and any successor or other
regulation or official interpretation of said Board of Governors relating to the
extension of credit by foreign lenders for the purpose of purchasing or carrying
margin stock (as defined therein).
"REIMBURSEMENT OBLIGATION" is defined in Section 3.7 hereof.
------------------------- ------------
"RELEASE" means any release, spill, emission, leaking, pumping, injection,
-------
deposit, disposal, discharge, dispersal, leaching or migration into the
environment, including the movement of Contaminants through or in the air, soil,
surface water or groundwater.
"REORGANIZATION AGREEMENT" means that certain Agreement and Plan of
-------------------------
Reorganization dated as of April 1, 2000, between Ralston and Energizer, as the
same may be amended, restated, supplemented or otherwise modified from time to
time.
"REPLACEMENT LENDER" is defined in Section 2.19 hereof.
------------------- -------------
"REPORTABLE EVENT" means a reportable event as defined in Section 4043 of ERISA
-----------------
and the regulations issued under such section, with respect to a Plan,
excluding, however, such events as to which the PBGC by regulation waived the
requirement of Section 4043(a) of ERISA that it be notified within thirty (30)
days after such event occurs.
"REQUIRED LENDERS" means Lenders whose Pro Rata Shares, in the aggregate, are
-----------------
greater than fifty percent (50%); provided, however, that, if any Lender shall
-------- -------
have failed to fund its Pro Rata Share of (i) any Revolving Loan requested by
the Borrower, (ii) any Revolving Loan required to be made in connection with
reimbursement for any L/C Obligations or (iii) any Swing Line Loan as requested
by the Administrative Agent, which such Lender is obligated to fund under the
terms of this Agreement and any such failure has not been cured, then for so
long as such failure continues, "REQUIRED LENDERS" means Lenders (excluding all
Lenders whose failure to fund their respective Pro Rata Shares of such Revolving
Loans or Swing Line Loans has not been so cured) whose Pro Rata Shares represent
greater than fifty percent (50%) of the aggregate Pro Rata Shares of such
Lenders; provided further, however, that, if the Revolving Loan Commitments have
-------- ------- -------
been terminated pursuant to the terms of this Agreement, "REQUIRED LENDERS"
means Lenders (without regard to such Lenders' performance of their respective
obligations hereunder) whose aggregate ratable shares (stated as a percentage)
of the aggregate outstanding principal balance of all Loans and L/C Obligations
are greater than fifty percent (50%).
"REQUIREMENTS OF LAW" means, as to any Person, the charter and by-laws or other
--------------------
organizational or governing documents of such Person, and any law, 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 including,
without limitation, the Securities Act of 1933, the Securities Exchange Act of
1934, Regulations T, U and X, ERISA, the Fair Labor Standards Act, the Worker
Adjustment and Retraining Notification Act, Americans with Disabilities Act of
1990, and any certificate of occupancy, zoning ordinance, building,
environmental or land use requirement or permit or environmental, labor,
employment, occupational safety or health law, rule or regulation, including
Environmental, Health or Safety Requirements of Law.
"RESERVE REQUIREMENT" means, with respect to an Interest Period, the maximum
--------------------
aggregate reserve requirement (including all basic, supplemental, marginal and
other reserves) which is imposed under Regulation D on "Eurocurrency
liabilities".
"REVOLVING CREDIT AVAILABILITY" means, at any particular time, the amount by
-------------------------------
which the Aggregate Revolving Loan Commitment at such time exceeds the Revolving
Credit Obligations outstanding at such time.
"REVOLVING CREDIT OBLIGATIONS" means, at any particular time, the sum of (i) the
----------------------------
outstanding principal amount of the Revolving Loans at such time, plus (ii) the
----
outstanding principal amount of the Swing Line Loans at such time, plus (iii)
----
the outstanding L/C Obligations at such time.
"REVOLVING LOAN" is defined in Section 2.1 hereof.
--------------- ------------
"REVOLVING LOAN COMMITMENT" means, for each Lender, the obligation of such
---------------------------
Lender to make Revolving Loans and to purchase participations in Letters of
Credit and to participate in Swing Line Loans not exceeding the amount set forth
on Exhibit A to this Agreement opposite its name thereon under the heading
----------
"Revolving Loan Commitment" or in the Assignment Agreement by which it became a
Lender, as such amount may be modified from time to time pursuant to the terms
of this Agreement or to give effect to any applicable Assignment Agreement.
"REVOLVING LOAN TERMINATION DATE" means March 30, 2005.
----------------------------------
"RISK-BASED CAPITAL GUIDELINES" is defined in Section 4.2 hereof.
------------------------------- ------------
"SENIOR MANAGEMENT TEAM" means each Authorized Officer and the Chief Executive
------------------------
Officer of the Borrower.
"SENIOR NOTES" is defined in the definition of "Note Purchase Agreement" above.
-------------
"SOLVENT" means, when used with respect to any Person, that at the time of
-------
determination:
(i) the fair value of its assets (both at fair valuation and at present fair
saleable value) is equal to or in excess of the total amount of its
liabilities, including, without limitation, contingent liabilities; and
(ii) it is then able and believes that it will be able to pay its debts as
they mature; and
(iii) it has capital sufficient to carry on its business as conducted and as
proposed to be conducted.
With respect to contingent liabilities (such as litigation and guarantees), such
liabilities shall be computed at the amount which, in light of all the facts and
circumstances existing at the time, represent the amount which can be reasonably
be expected to become an actual or matured liability.
"SPIN-OFF" means the distribution by Ralston to its stockholders in a tax
--------
free transaction of all of the outstanding capital stock of Energizer such that
Energizer will become a separate publicly-held corporation owned directly by the
stockholders of Ralston to whom such distribution is made, in connection with
which there shall have been obtained a letter ruling from the IRS substantially
to the effect that the Spin-Off will be treated as a tax-free distribution by
Ralston under Section 355 of the Code (the "TAX RULING").
"SPIN-OFF DATE" means April 1, 2000.
--------------
"SPIN-OFF TRANSACTIONS" means the series of transactions contemplated by and
----------------------
described in the Form 10, including, but not limited to the Spin-Off.
"SPV" means any special purpose entity established for the purpose of purchasing
receivables in connection with a receivables securitization transaction
permitted under the terms of this Agreement.
"SUBSIDIARY" of a Person means (i) any corporation more than 50% of the
----------
outstanding securities having ordinary voting power of which shall at the time
-------
be owned or controlled, directly or indirectly, by such Person or by one or more
of its Subsidiaries or by such Person and one or more of its Subsidiaries, or
(ii) any partnership, limited liability company, association, joint venture or
similar business organization more than 50% of the ownership interests having
ordinary voting power of which shall at the time be so owned or controlled.
Unless otherwise expressly provided, all references herein to a "Subsidiary"
means a Subsidiary of the Borrower.
"SUBSIDIARY GUARANTORS" means (i) for the period from the Closing Date until the
---------------------
consummation of the Debt Assumption, Energizer and each of its Material Domestic
Subsidiaries; (ii) from and after the consummation of the Debt Assumption, all
of Energizer's Material Domestic Subsidiaries; (iii) all New Subsidiaries which
are Material Domestic Subsidiaries and which have satisfied the provisions of
Section 7.2(K)(a); (iv) all of Energizer's Subsidiaries which become Material
----------------
Domestic Subsidiaries and which have satisfied the provisions of Section
-------
7.2(K)(b); and (v) all other Subsidiaries which become Subsidiary Guarantors in
--
satisfaction of the provisions of Section 7.2(K)(c), in each case with respect
-----------------
to clauses (i) through (v) above, other than the SPVs and together with their
------------ ---
respective successors and assigns.
"SUBSIDIARY GUARANTY" means that certain Guaranty dated as of the Closing Date,
--------------------
executed by the Subsidiary Guarantors in favor of the Administrative Agent, for
the ratable benefit of the Lenders, the Swing Line Bank and the Issuing Banks,
as it may be amended, modified, supplemented and/or restated (including to add
new Subsidiary Guarantors), and as in effect from time to time.
"SUPPLEMENT" shall have the meaning set forth in Section 7.2(K).
---------- ---------------
"SUPPLEMENTAL FINANCIAL STATEMENT" is defined in Section 6.7(A) hereof.
---------------------------------- ---------------
"SWING LINE BANK" means Bank One pursuant to the terms hereof.
-----------------
"SWING LINE COMMITMENT" means the commitment of the Swing Line Bank, in its
-----------------------
discretion, to make Swing Line Loans up to a maximum principal amount of
$10,000,000 at any one time outstanding.
"SWING LINE LOAN" means a Loan made available to the Borrower by the Swing Line
----------------
Bank pursuant to Section 2.2 hereof.
------------
"TAX RULING" is defined in the definition of "Spin-Off" above.
-----------
"TAXES" means any and all present or future taxes, duties, levies, imposts,
-----
deductions, charges or withholdings, and any and all liabilities with respect to
the foregoing, but excluding Excluded Taxes.
"TERMINATION DATE" means the earliest of (a) the Revolving Loan Termination
-----------------
Date, (b) the date of termination in whole of the Aggregate Revolving Loan
Commitment pursuant to Section 2.5 hereof or the Revolving Loan Commitments
pursuant to Section 9.1 hereof and (c) if the Spin-Off and Debt Assumption have
-----------
not occurred prior thereto, April 4, 2000.
"TERMINATION EVENT" means (i) a Reportable Event with respect to any Benefit
------------------
Plan; (ii) the withdrawal of Energizer or any member of the Controlled Group
from a Benefit Plan during a plan year in which Energizer or such Controlled
Group member was a "substantial employer" as defined in Section 4001(a)(2) of
ERISA with respect to such plan; (iii) the imposition of an obligation under
Section 4041 of ERISA to provide affected parties written notice of intent to
terminate a Benefit Plan in a distress termination described in Section 4041(c)
of ERISA; (iv) the institution by the PBGC or any foreign governmental authority
of proceedings to terminate or appoint a trustee to administer a Benefit Plan or
Foreign Pension Plan; (v) any event or condition which might constitute grounds
under Section 4042 of ERISA for the termination of, or the appointment of a
trustee to administer, any Benefit Plan; or (vi) the partial or complete
withdrawal of Energizer or any member of the Controlled Group from a
Multiemployer Plan.
"364-DAY CREDIT AGREEMENT" means that certain 364-Day Credit Agreement of even
--------------------------
date herewith among the Borrower, the institutions from time to time parties
thereto as lenders and Bank One, NA, as Administrative Agent, Bank of America,
N.A., as Syndication Agent and Wachovia Bank, N.A., as Documentation Agent, as
the same may be amended, restated, supplemented or otherwise modified and as in
effect from time to time.
"TRANSACTION DOCUMENTS" means the Loan Documents and the documents executed and
----------------------
delivered by Ralston, Energizer or any of their respective Subsidiaries in
connection with the Spin-Off, the Bridge Facilities, the Receivables Purchase
Facility or the Senior Notes, including, without limitation, the Form 10, the
Debt Assumption Agreement, the Receivables Purchase Documents, the Senior Notes,
the Note Purchase Agreement and any documents evidencing the Bridge Facilities.
"TRANSACTIONS" means the Spin-Off Transactions, the Financing Facilities
------------
(including, without limitation, this Agreement and the financing transactions
---------
evidenced by the Loan Documents) and the Debt Assumption.
"TRANSFEREE" is defined in Section 13.5 hereof.
---------- -------------
"TYPE" means, with respect to any Loan, its nature as a Floating Rate Loan or a
----
Eurodollar Rate Loan.
"UNMATURED DEFAULT" means an event which, but for the lapse of time or the
------------------
giving of notice, or both, would constitute a Default.
The foregoing definitions shall be equally applicable to both the singular and
plural forms of the defined terms. Any accounting terms used in this Agreement
which are not specifically defined herein shall have the meanings customarily
given them in accordance with generally accepted accounting principles in
existence as of the date hereof.
1.2 References. Any references to Subsidiaries of Ralston or Energizer
----------
shall not in any way be construed as consent by the Administrative Agent or any
Lender to the establishment, maintenance or acquisition of any Subsidiary,
except as may otherwise be permitted hereunder.
ARTICLE II: THE REVOLVING LOAN FACILITY
- ------------ ------------------------------
2.1 Revolving Loans. (a) Upon the satisfaction of the conditions precedent
----------------
set forth in Sections 5.1 and 5.2, as applicable, from and including the Initial
------------ ---
Funding Date and prior to the Termination Date, each Lender severally and
not jointly agrees, on the terms and conditions set forth in this Agreement, to
make revolving loans to the Borrower from time to time, in Dollars, in an amount
not to exceed such Lender's Pro Rata Share of Revolving Credit Availability at
such time (each individually, a "REVOLVING LOAN" and, collectively, the
"REVOLVING LOANS"); provided, however, at no time shall the Revolving Credit
-------- -------
Obligations exceed the Aggregate Revolving Loan Commitment. Subject to the
terms of this Agreement, the Borrower may borrow, repay and reborrow Revolving
Loans at any time prior to the Termination Date. The Revolving Loans made on
the Initial Funding Date or on or before the third (3rd) Business Day thereafter
shall initially be Floating Rate Loans and thereafter may be continued as
Floating Rate Loans or converted into Eurodollar Rate Loans in the manner
provided in Section 2.9 and subject to the other conditions and limitations
------------
therein set forth and set forth in this Article II and set forth in the
-----------
definition of Interest Period; provided, however, that if the Borrower delivers
-------- -------
a Borrowing/Election Notice, signed by it, together with appropriate
documentation in form and substance satisfactory to the Administrative Agent
indemnifying the Lenders for the amounts described in Section 4.4 on or before
-----------
the third (3rd) Business Day prior to the Initial Funding Date, the Revolving
Loans made on the Initial Funding Date may be Eurodollar Rate Loans. Revolving
Loans made after the third (3rd) Business Day after the Initial Funding Date
shall be, at the option of the Borrower, selected in accordance with Section
-------
2.9, either Floating Rate Loans or Eurodollar Rate Loans. On the Termination
Date, the Borrower shall repay in full the outstanding principal balance of the
Revolving Loans. Each Advance under this Section 2.1 shall consist of Revolving
-----------
Loans made by each Lender ratably in proportion to such Lender's respective Pro
Rata Share.
(b) Borrowing/Election Notice. The Borrower shall deliver to the
--------------------------
Administrative Agent a Borrowing/Election Notice, signed by it, in accordance
with the terms of Section 2.7. The Administrative Agent shall promptly notify
-----------
each Lender of such request.
(c) Making of Revolving Loans. Promptly after receipt of the
----------------------------
Borrowing/Election Notice under Section 2.7 in respect of Revolving Loans, the
------------ -----------
Administrative Agent shall notify each Lender by telex or telecopy, or other
similar form of transmission, of the requested Revolving Loan. Each Lender
shall make available its Revolving Loan in accordance with the terms of Section
-------
2.6. The Administrative Agent will promptly make the funds so received from the
Lenders available to the Borrower at the Administrative Agent's office in
Chicago, Illinois on the applicable Borrowing Date and shall disburse such
proceeds in accordance with the Borrower's disbursement instructions set forth
in such Borrowing/Election Notice. The failure of any Lender to deposit the
amount described above with the Administrative Agent on the applicable Borrowing
Date shall not relieve any other Lender of its obligations hereunder to make its
Revolving Loan on such Borrowing Date.
2.2 Swing Line Loans. (A) Amount of Swing Line Loans. Upon the
------------------ ------------------------------
satisfaction of the conditions precedent set forth in Section 5.1 and 5.2, as
----------- ---
applicable, from and including the Initial Funding Date and prior to the
Termination Date, the Swing Line Bank may, in its discretion, on the terms and
conditions set forth in this Agreement, make swing line loans to the Borrower
from time to time, in Dollars, in an amount not to exceed the Swing Line
Commitment (each, individually, a "SWING LINE LOAN" and collectively, the "SWING
LINE LOANS"); provided, however, at no time shall the Revolving Credit
-------- -------
Obligations exceed the Aggregate Revolving Loan Commitment; and provided,
--------
further, that at no time shall the sum of (a) the outstanding amount of the
Swing Line Loans, plus (b) the outstanding amount of Revolving Loans made by the
Swing Line Bank pursuant to Section 2.1, exceed the Swing Line Bank's Revolving
-----------
Loan Commitment at such time. Subject to the terms of this Agreement, the
Borrower may borrow, repay and reborrow Swing Line Loans at any time prior to
the Termination Date.
(B) Borrowing/Election Notice for Swing Line Loans. The Borrower shall
---------------------------------------------------
deliver to the Administrative Agent and the Swing Line Bank a Borrowing/Election
Notice, signed by it, not later than 11:00 a.m. (Chicago time) on the
Borrowing Date of each Swing Line Loan, specifying (i) the applicable Borrowing
Date (which date shall be a Business Day and which may be the same date as the
date the Borrowing/Election Notice is given), and (ii) the aggregate amount of
the requested Swing Line Loan which shall be an amount not less than $1,000,000
and increments of $100,000 in excess thereof. The Swing Line Loans shall at all
times be Floating Rate Loans or shall bear interest at such other rate as shall
be agreed to between the Borrower and the Swing Line Bank at the time of the
making of such Swing Line Loans.
(C) Making of Swing Line Loans. Promptly after receipt of the
------------------------------
Borrowing/Election Notice under Section 2.2(B) in respect of Swing Line Loans,
--------------
the Swing Line Bank may, in its sole discretion make available its Swing Line
Loan, in funds immediately available in Chicago to the Administrative Agent at
its address specified pursuant to Article XIV. The Administrative Agent will
-----------
promptly make the funds so received from the Swing Line Bank available to the
Borrower on the Borrowing Date at the Administrative Agent's aforesaid address.
(D) Repayment of Swing Line Loans. Each Swing Line Loan shall be paid in
--------------------------------
full by the Borrower on or before the fifth (5th) Business Day after the
Borrowing Date for such Swing Line Loan. The Borrower may at any time pay,
without penalty or premium, all outstanding Swing Line Loans or, in a minimum
amount of $1,000,000 and increments of $100,000 in excess thereof, any portion
of the outstanding Swing Line Loans, upon notice to the Administrative Agent and
the Swing Line Bank. In addition, the Administrative Agent (i) may at any time
in its sole discretion with respect to any outstanding Swing Line Loan, or (ii)
shall, in the event the Borrower shall not have otherwise repaid such Loan, on
the fifth (5th) Business Day after the Borrowing Date of any Swing Line Loan,
require each Lender (including the Swing Line Bank) to make a Revolving Loan in
the amount of such Lender's Pro Rata Share of such Swing Line Loan, for the
purpose of repaying such Swing Line Loan. The making of such Revolving Loans by
the Lenders shall discharge the Borrower's obligation under the first sentence
of this Section 2.2(D) and such failure to pay shall not constitute a Default by
--------------
the Borrower. Promptly following receipt of notice pursuant to this Section
-------
2.2(D) from the Administrative Agent, each Lender shall make available its
- ------
required Revolving Loan or Revolving Loans, in funds immediately available in
Chicago to the Administrative Agent at its address specified pursuant to Article
-------
XIV. Revolving Loans made pursuant to this Section 2.2(D) shall initially be
- --- --------------
Floating Rate Loans and thereafter may be continued as Floating Rate Loans or
converted into Eurodollar Rate Loans in the manner provided in Section 2.9 and
-----------
subject to the other conditions and limitations therein set forth and set forth
in this Article II. Unless a Lender shall have notified the Swing Line Bank,
-----------
prior to its making any Swing Line Loan, that any applicable condition precedent
set forth in Sections 5.1 and 5.2, as applicable, had not then been satisfied,
------------ ---
such Lender's obligation to make Revolving Loans pursuant to this Section 2.2(D)
--------------
to repay Swing Line Loans shall be unconditional, continuing, irrevocable and
absolute and shall not be affected by any circumstances, including, without
limitation, (a) any set-off, counterclaim, recoupment, defense or other right
which such Lender may have against the Administrative Agent, the Swing Line Bank
or any other Person, (b) the occurrence or continuance of a Default or Unmatured
Default, (c) any adverse change in the condition (financial or otherwise) of the
Borrower or (d) any other circumstances, happening or event whatsoever. In the
event that any Lender fails to make payment to the Administrative Agent of any
amount due under this Section 2.2(D), the Administrative Agent shall be entitled
--------------
to receive, retain and apply against such obligation the principal and interest
otherwise payable to such Lender hereunder until the Administrative Agent
receives such payment from such Lender or such obligation is otherwise fully
satisfied. In addition to the foregoing, if for any reason any Lender fails to
make payment to the Administrative Agent of any amount due under this Section
-------
2.2(D), such Lender shall be deemed, at the option of the Administrative Agent,
- ------
to have unconditionally and irrevocably purchased from the Swing Line Bank,
without recourse or warranty, an undivided interest and participation in the
applicable Swing Line Loan in the amount of such Revolving Loan, and such
interest and participation may be recovered from such Lender together with
interest thereon at the Federal Funds Effective Rate for each day during the
period commencing on the date of demand and ending on the date such amount is
received. On the Termination Date, the Borrower shall repay in full the
outstanding principal balance of the Swing Line Loans.
2.3 Rate Options for all Advances; Maximum Interest Periods. The Swing Line
-------------------------------------------------------
Loans shall be Floating Rate Loans at all times or shall bear interest at
such other rate as may be agreed to between the Borrower and the Swing Line Bank
at the time of the making of any such Swing Line Loan. The Revolving Loans may
be Floating Rate Advances or Eurodollar Rate Advances, or a combination thereof,
selected by the Borrower in accordance with Section 2.10. The Borrower may
------------
select, in accordance with Section 2.9, rate options and Interest Periods
------------
applicable to the Revolving Loans; provided that there shall be no more than
--------
eight (8) Interest Periods in effect with respect to all of the Loans at any
time.
2.4 Optional Payments. The Borrower may from time to time and at any time
------------------
upon at least one (1) Business Day's prior written notice repay or prepay,
without penalty or premium all or any part of outstanding Floating Rate Advances
in an aggregate minimum amount of $10,000,000 and in integral multiples of
$1,000,000 in excess thereof. Eurodollar Rate Advances may be voluntarily repaid
or prepaid prior to the last day of the applicable Interest Period, subject to
the indemnification provisions contained in Section 4.4, provided, that the
----------- --------
Borrower may not so prepay Eurodollar Rate Advances unless it shall have
provided at least three (3) Business Days' prior written notice to the
Administrative Agent of such prepayment and provided, further, that optional
-------- -------
prepayments of Eurodollar Rate Advances made pursuant to Section 2.1 shall be
-----------
for the entire amount of the outstanding Eurodollar Rate Advance.
2.5 Reduction of Revolving Loan Commitments. The Borrower may permanently
-----------------------------------------
reduce the Aggregate Revolving Loan Commitment in whole, or in part ratably
among the Lenders, in an aggregate minimum amount of $25,000,000 and integral
multiples of $5,000,000 in excess of that amount (unless the Aggregate Revolving
Loan Commitment is reduced in whole), upon at least three (3) Business Day's
prior written notice to the Administrative Agent, which notice shall specify the
amount of any such reduction; provided, however, that the amount of the
-------- -------
Aggregate Revolving Loan Commitment may not be reduced below the aggregate
principal amount of the outstanding Revolving Credit Obligations. All accrued
Facility Fees shall be payable on the effective date of any termination of the
obligations of the Lenders to make Loans hereunder or any reduction of the
Aggregate Revolving Loan Commitment on the amount so reduced.
2.6 Method of Borrowing. Not later than 2:00 p.m. (Chicago time) on each
---------------------
Borrowing Date, each Lender shall make available its Revolving Loan, in
immediately available funds, to the Administrative Agent at its address
specified pursuant to Article XIV. The Administrative Agent will promptly make
-----------
the funds so received from the Lenders available to the Borrower at the
Administrative Agent's aforesaid address.
2.7 Method of Selecting Types and Interest Periods for Advances. The
------------------------------------------------------------------
Borrower shall select the Type of Advance and, in the case of each Eurodollar
Rate Advance, the Interest Period applicable to each Advance from time to time.
The Borrower shall give the Administrative Agent irrevocable notice in
substantially the form of Exhibit B hereto (a "BORROWING/ELECTION NOTICE") not
---------
later than 11:00 a.m. (Chicago time) (a) on or before the Borrowing Date of each
Floating Rate Advance and (b) three (3) Business Days before the Borrowing Date
for each Eurodollar Rate Advance specifying: (i) the Borrowing Date (which
shall be a Business Day) of such Advance; (ii) the aggregate amount of such
Advance; (iii) the Type of Advance selected; and (iv) in the case of each
Eurodollar Rate Advance, the Interest Period applicable thereto; provided,
--------
however, that with respect to the borrowing on the Initial Funding Date, such
- -------
notice shall be delivered in accordance with the terms of Section 2.1(a) and
--------------
shall be accompanied by the documentation specified in such Section. The
Borrower shall select Interest Periods so that, to the best of the Borrower's
knowledge, it will not be necessary to prepay all or any portion of any
Eurodollar Rate Advance prior to the last day of the applicable Interest Period
in order to make mandatory prepayments as required pursuant to the terms hereof.
Each Floating Rate Advance and all Obligations other than Loans shall bear
interest from and including the date of the making of such Advance, in the case
of Floating Rate Advances, and the date such Obligation is due and owing in the
case of such other Obligations, to (but not including) the date of repayment
thereof at the Alternate Base Rate, changing when and as such Alternate Base
Rate changes. Changes in the rate of interest on that portion of the Loans
maintained as Floating Rate Loans will take effect simultaneously with each
change in the Alternate Base Rate. Each Eurodollar Rate Advance shall bear
interest from and including the first day of the Interest Period applicable
thereto to (but not including) the last day of such Interest Period at the
interest rate determined as applicable to such Eurodollar Rate Advance, changing
when and as the Applicable Margin changes. Changes in the rate of interest on
that portion of the Loans maintained as Eurodollar Rate Advances will take
effect simultaneously with each change in the Applicable Margin.
2.8 Minimum Amount of Each Advance. Each Advance (other than an Advance to
-------------------------------
repay Swing Line Loans or a Reimbursement Obligation) shall be in the minimum
amount of $10,000,000 (and in multiples of $1,000,000 if in excess thereof);
provided, however, that any Floating Rate Advance may be in the amount of the
----- -------
unused Aggregate Revolving Loan Commitment.
2.9 Method of Selecting Types and Interest Periods for Conversion and
------------------------------------------------------------------------
Continuation of Advances.
--------------------
(A) Right to Convert. The Borrower may elect from time to time, subject to
-----------------
the provisions of Section 2.3 and this Section 2.9, to convert all or any part
----------- -----------
of a Loan of any Type into any other Type or Types of Loans; provided that any
--------
conversion of any Eurodollar Rate Advance shall be made on, and only on, the
last day of the Interest Period applicable thereto.
(B) Automatic Conversion and Continuation. Floating Rate Loans shall
----------------------------------------
continue as Floating Rate Loans unless and until such Floating Rate Loans are
repaid or converted into Eurodollar Rate Loans. Eurodollar Rate Loans shall
continue as Eurodollar Rate Loans until the end of the then applicable Interest
Period therefor, at which time such Eurodollar Rate Loans shall be automatically
converted into Floating Rate Loans unless the Borrower shall have repaid such
Loans or given the Administrative Agent a Borrowing/Election Notice in
accordance with Section 2.9(D) requesting that, at the end of such Interest
---------------
Period, such Eurodollar Rate Loans continue as a Eurodollar Rate Loan.
(C) No Conversion Post-Default. Notwithstanding anything to the contrary
----------------------------
contained in Section 2.9(A) or Section 2.9(B), no Loan may be converted into or
-------------- --------------
continued as a Eurodollar Rate Loan (except with the consent of the Required
Lenders) when any Default has occurred and is continuing.
(D) Borrowing/Election Notice. The Borrower shall give the Administrative
--------------------------
Agent an irrevocable Borrowing/Election Notice of each conversion of a Floating
Rate Loan into a Eurodollar Rate Loan or continuation of a Eurodollar Rate Loan
not later than 11:00 a.m. (Chicago time) three (3) Business Days prior to the
date of the requested conversion or continuation, specifying: (i) the requested
date (which shall be a Business Day) of such conversion or continuation; (ii)
the amount and Type of the Loan to be converted or continued; and (iii) the
amount of Eurodollar Rate Loan(s) into which such Loan is to be converted or
continued, and the duration of the Interest Period applicable thereto.
2.10 Default Rate. After the occurrence and during the continuance of a
-------------
Default, the Administrative Agent or the Required Lenders may, at their option,
by notice to the Borrower declare that, (a) the interest rate(s) applicable to
the Obligations (other than Eurodollar Rate Advances) shall be equal to the
Alternate Base Rate, changing as and when the Alternate Base Rate changes, or,
for Eurodollar Rate Advances, the then highest Eurodollar Rate (utilizing the
highest Applicable Margin in effect from time to time), in each case, plus two
----
percent (2.00%) per annum for all Loans and other Obligations, (b) the fees
payable under Section 3.8 with respect to Letters of Credit shall be calculated
-----------
using the highest Applicable L/C Fee Percentage plus two percent (2.00%) per
----
annum and (c) the Facility Fees shall be calculated using the highest Applicable
Facility Fee Percentage; provided, that after the occurrence and during the
--------
continuance of a Default under Sections 8.1(F), (G) or (I), the interest rate
---------------- --- ---
described in clause (a) above, the Letter of Credit Fee described in clause (b)
---------- ----------
above and the Facility Fee described in clause (c) above shall be applicable
----------
without any election or action on the part of the Administrative Agent or any
other Lender.
2.11 Method of Payment. All payments of principal, interest, fees,
-------------------
commissions and L/C Obligations hereunder shall be made, without setoff,
deduction or counterclaim, in immediately available funds to the Administrative
Agent at the Administrative Agent's address specified pursuant to Article XIV,
-----------
or at any other Lending Installation of the Administrative Agent specified in
writing by the Administrative Agent to the Borrower, by 2:00 p.m. (Chicago time)
on the date when due and shall be made ratably among the Lenders (unless such
amount is not to be shared ratably in accordance with the terms hereof). Each
payment delivered to the Administrative Agent for the account of any Lender
shall be delivered promptly by the Administrative Agent to such Lender in the
same type of funds which the Administrative Agent received at its address
specified pursuant to Article XIV or at any Lending Installation specified in a
-----------
notice received by the Administrative Agent from such Lender. The Borrower
authorizes the Administrative Agent to charge the account of the Borrower
maintained with Bank One for each payment of principal, interest, fees,
commissions and L/C Obligations as it becomes due hereunder. Each reference to
the Administrative Agent in this Section 2.11 shall also be deemed to refer, and
------------
shall apply equally, to each Issuing Bank, in the case of payments required to
be made by the Borrower to such Issuing Bank pursuant to Article III.
-----------
2.12 Evidence of Debt.
------------------
(a) Each Lender shall maintain in accordance with its usual practice an
account or accounts (a "LOAN ACCOUNT") evidencing the indebtedness of the
-------------
Borrower to such Lender owing to such Lender from time to time, including the
amounts of principal and interest payable and paid to such Lender from time to
time hereunder.
(b) The Register maintained by the Administrative Agent pursuant to Section
-------
13.3(C) shall include a control account, and a subsidiary account for each
- -------
Lender, in which accounts (taken together) shall be recorded (i) the date and
the amount of each Loan made hereunder, the Type thereof and the Interest
Period, if any, applicable thereto, (ii) the amount of any principal or interest
due and payable or to become due and payable from the Borrower to each Lender
hereunder, (iii) the effective date and amount of each Assignment Agreement
delivered to and accepted by it and the parties thereto pursuant to Section
-------
13.3, (iv) the amount of any sum received by the Administrative Agent hereunder
for the account of the Lenders and each Lender's share thereof, and (v) all
other appropriate debits and credits as provided in this Agreement, including,
without limitation, all fees, charges, expenses and interest.
(c) The entries made in the Loan Account, the Register and the other accounts
maintained pursuant to subsections (a) or (b) of this Section shall be
---------------- ---
conclusive and binding for all purposes, absent manifest error, unless the
Borrower objects to information contained in the Loan Accounts, the Register or
the other accounts within thirty (30) days of the Borrower's receipt of such
information; provided that the failure of any Lender or the Administrative Agent
--------
to maintain such accounts or any error therein shall not in any manner affect
the obligation of the Borrower to repay the Loans in accordance with the terms
of this Agreement.
(d) Any Lender may request that the Revolving Loans made by it be evidenced by
a promissory note. In such event, the Borrower shall prepare, execute and
deliver to such Lender a promissory note for such Loans payable to the order of
such Lender and in a form approved by the Administrative Agent in its reasonable
discretion and consistent with the terms of this Agreement. Thereafter, the
Loans evidenced by such promissory note and interest thereon shall at all times
(including after assignment pursuant to Section 13.3) be represented by one or
------------
more promissory notes in such form payable to the order of the payee named
therein.
2.13 Telephonic Notices. The Borrower authorizes the Lenders and the
-------------------
Administrative Agent to extend, convert or continue Advances, effect selections
of Types of Advances and to transfer funds based on telephonic notices made by
any person or persons the Administrative Agent or any Lender in good faith
believes to be acting on behalf of the Borrower. The Borrower agrees to deliver
promptly to the Administrative Agent a written confirmation, signed by an
Authorized Officer, if such confirmation is requested by the Administrative
Agent or any Lender, of each telephonic notice. If the written confirmation
differs in any material respect from the action taken by the Administrative
Agent and the Lenders, the records of the Administrative Agent and the Lenders
with respect to such telephonic notice shall govern absent manifest error. In
case of disagreement concerning such notices, if the Administrative Agent has
recorded telephonic Borrowing/Election Notices, such recordings will be made
available to the Borrower upon the Borrower's request therefor.
2.14 Promise to Pay; Interest and Facility Fees; Interest Payment Dates;
-----------------------------------------------------------------------
Interest and Fee Basis; Loan and Control Accounts.
- --------------------------------------------------------
(A) Promise to Pay. The Borrower unconditionally promises to pay when due
----------------
the principal amount of each Loan and all other Obligations incurred by it, and
to pay all unpaid interest accrued thereon, in accordance with the terms of this
Agreement and the other Loan Documents.
(B) Interest Payment Dates. Interest accrued on each Floating Rate Loan
------------------------
shall be payable on each Payment Date, commencing with the first such date to
occur after the date hereof and at maturity (whether by acceleration or
otherwise). Interest accrued on each Eurodollar Rate Loan shall be payable on
the last day of its applicable Interest Period, on any date on which the
Eurodollar Rate Loan is prepaid, whether by acceleration or otherwise, and at
maturity. Interest accrued on each Eurodollar Rate Loan having an Interest
Period longer than three months shall also be payable on the last day of each
three-month interval during such Interest Period. Interest accrued on the
principal balance of all other Obligations shall be payable in arrears (i) on
the last day of each calendar quarter, commencing on the first such day
following the incurrence of such Obligation, (ii) upon repayment thereof in full
or in part, and (iii) if not theretofore paid in full, at the time such other
Obligation becomes due and payable (whether by acceleration or otherwise).
(C) Facility Fees and Administrative Agent's Fees. (i) The Borrower shall
----------------------------------------------
pay to the Administrative Agent, for the account of the Lenders in accordance
with their Pro Rata Shares, from and after the Closing Date until the
Termination Date, a facility fee (the "FACILITY FEE") accruing at the per annum
rate of the then Applicable Facility Fee Percentage, on the Aggregate Revolving
Loan Commitment (whether used or unused). All such Facility Fees payable under
this clause (C) shall be payable quarterly in arrears on each Payment Date
-----------
occurring after the Closing Date (with the first such payment being calculated
for the period from the Closing Date and ending on June 30, 2000), and on the
Termination Date.
(ii) Ralston shall pay or shall cause Energizer to pay to the
Administrative Agent for the sole account of the Administrative Agent and the
Arranger (unless otherwise agreed between the Administrative Agent and the
Arranger and any Lender) the fees set forth in the letter agreement among the
Administrative Agent, the Arranger, Ralston and Energizer dated February 16,
2000, payable at the times and in the amounts set forth therein.
(D) Interest and Fee Basis; Applicable Margin, Applicable Facility Fee
------------------------------------------------------------------------
Percentage and Applicable L/C Fee Percentage.
--------------------------------------------
(i) Interest accrued on Eurodollar Rate Advances, fees payable with
respect to Letters of Credit, Facility Fees, and Floating Rate Advances and
Swing Line Loans where the basis for calculation is the Federal Funds Effective
Rate shall be calculated for actual days elapsed on the basis of a year of 360
days, and interest accrued on Floating Rate Advances and Swing Line Loans where
the basis for calculation is the Prime Rate shall be calculated for actual days
elapsed on the basis of a year of 365, or when appropriate 366, days. Interest
shall be payable for the day an Obligation is incurred but not for the day of
any payment on the amount paid if payment is received prior to 2:00 p.m.
(Chicago time) at the place of payment. If any payment of principal of or
interest on a Loan or any payment of any other Obligations shall become due on a
day which is not a Business Day, such payment shall be made on the next
succeeding Business Day and, in the case of a principal payment, such extension
of time shall be included in computing interest, fees and commissions in
connection with such payment.
(ii) The Applicable Margin, Applicable Facility Fee Percentage and Applicable
L/C Fee Percentage shall be determined from time to time by reference to the
table set forth below, on the basis of the then applicable Leverage Ratio as
described in this Section 2.14(D)(ii):
--------------------
<TABLE>
<CAPTION>
APPLICABLE FEES
----------------
LEVERAGE RATIO APPLICABLE
APPLICABLE L/C FEE FACILITY FEE
APPLICABLE MARGIN PERCENTAGE PERCENTAGE
------------------ ----------- -----------
<S> <C> <C> <C>
LEVEL I
<1.0 to 1.0 0.375% 0.375% 0.125%
- -------------- ------------------ ----------- -----------
LEVEL II
1.0 to 1.0 and
<1.5 to 1.0 0.50% 0.50% 0.125%
------------------ ----------- -----------
LEVEL III
1.5 to 1.0 and
<2.0 to 1.0 0.60% 0.60% 0.15%
------------------ ----------- -----------
LEVEL IV
2.0 to 1.0 and
<2.5 to 1.0 0.825% 0.825% 0.175%
------------------ ----------- -----------
LEVEL V
2.5 to 1.0 1.05% 1.05% 0.20%
- -------------- ------------------ ----------- -----------
</TABLE>
For purposes of this Section 2.14(D)(ii), the Leverage Ratio shall be calculated
-------------------
as provided in Section 7.4(A). Upon receipt of the financial statements
---------------
delivered pursuant to Section 7.1(A)(i) and (ii), as applicable, the Applicable
----------------- ----
Margin, Applicable Facility Fee Percentage and Applicable L/C Fee Percentage
shall be adjusted, such adjustment being effective five (5) Business Days
following the Administrative Agent's receipt of such financial statements and
the compliance certificate required to be delivered in connection therewith
pursuant to Section 7.1(A)(iii); provided, that if the Borrower shall not have
------------------- --------
timely delivered its financial statements in accordance with Section 7.1(A)(i)
-----------------
or (ii), as applicable, then commencing on the date upon which such financial
----
statements should have been delivered and continuing until five (5) Business
Days following the date such financial statements are actually delivered, it
shall be assumed for purposes of determining the Applicable Margin, Applicable
Facility Fee Percentage and Applicable L/C Fee Percentage that the Leverage
Ratio was greater than 2.5 to 1.0 and Level V pricing shall be applicable.
(iii) Notwithstanding anything herein to the contrary, from the Closing
Date to but not including the fifth Business Day following receipt of the
Borrower's financial statements delivered pursuant to Section 7.1(A)(i) for the
-----------------
fiscal quarter ending June 30, 2000, the Applicable Margin, Applicable Facility
Fee Percentage and Applicable L/C Fee Percentage shall be set at the greater of
(a) Level III and (b) the Level determined in accordance with clause (ii) above.
2.15 Notification of Advances, Interest Rates, Prepayments and Aggregate
-----------------------------------------------------------------------
Revolving Loan Commitment Reductions. Promptly after receipt thereof, the
------------------------------------
Administrative Agent will notify each Lender of the contents of each Aggregate
Revolving Loan Commitment reduction notice, Borrowing/Election Notice repayment
notice and issuance of Letter of Credit notice received by it hereunder. The
Administrative Agent will notify each Lender of the interest rate applicable to
each Eurodollar Rate Loan promptly upon determination of such interest rate and
will give each Lender prompt notice of each change in the Alternate Base Rate.
2.16 Lending Installations. Each Lender may book its Loans or Letters of
----------------------
Credit at any Lending Installation selected by such Lender and may change its
Lending Installation from time to time. All terms of this Agreement shall apply
to any such Lending Installation. Subject to the provisions of Section 4.6,
-----------
each Lender may, by written or facsimile notice to the Administrative Agent and
the Borrower, designate a Lending Installation through which Loans will be made
by it and for whose account Loan payments and/or payments of L/C Obligations are
to be made.
2.17 Non-Receipt of Funds by the Administrative Agent. Unless the Borrower
-------------------------------------------------
or a Lender, as the case may be, notifies the Administrative Agent prior to the
date on which it is scheduled to make payment to the Administrative Agent of (i)
in the case of a Lender, the proceeds of a Loan or (ii) in the case of the
Borrower, a payment of principal, interest or fees to the Administrative Agent
for the account of the Lenders, that it does not intend to make such payment,
the Administrative Agent may assume that such payment has been made. The
Administrative Agent may, but shall not be obligated to, make the amount of such
payment available to the intended recipient in reliance upon such assumption.
If such Lender or the Borrower, as the case may be, has not in fact made such
payment to the Administrative Agent, the recipient of such payment shall, on
demand by the Administrative Agent, repay to the Administrative Agent the amount
so made available together with interest thereon in respect of each day during
the period commencing on the date such amount was so made available by the
Administrative Agent until the date the Administrative Agent recovers such
amount at a rate per annum equal to (i) in the case of payment by a Lender, the
Federal Funds Effective Rate for such day or (ii) in the case of payment by the
Borrower, the interest rate applicable to the relevant Loan.
2.18 Termination Date. This Agreement shall be effective until the
-----------------
Termination Date. Notwithstanding the termination of this Agreement, until all
of the Obligations (other than contingent indemnity obligations) shall have been
fully and indefeasibly paid and satisfied in cash (to the full extent that such
Obligations are payable in cash), all financing arrangements among the Borrower
and the Lenders shall have been terminated and all of the Letters of Credit
shall have expired, been canceled or terminated, all of the rights and remedies
under this Agreement and the other Loan Documents shall survive.
2.19 Replacement of Certain Lenders. In the event a Lender ("AFFECTED
---------------------------------
LENDER") shall have: (i) failed to fund its Pro Rata Share of any Advance
requested by the Borrower, or to fund a Revolving Loan in order to repay Swing
Line Loans or Reimbursement Obligations, which such Lender is obligated to fund
under the terms of this Agreement and which failure has not been cured, (ii)
requested compensation from the Borrower under Sections 4.1, 4.2 or 4.5 to
------------ --- ---
recover Taxes, Other Taxes or other additional costs incurred by such Lender
which are not being incurred generally by the other Lenders, (iii) delivered a
notice pursuant to Section 4.3 claiming that such Lender is unable to extend
------------
Eurodollar Rate Loans to the Borrower for reasons not generally applicable to
the other Lenders or (iv) has invoked Section 10.2, then, in any such case, the
------------
Borrower or the Administrative Agent may make written demand on such Affected
Lender (with a copy to the Administrative Agent in the case of a demand by the
Borrower and a copy to the Borrower in the case of a demand by the
Administrative Agent) for the Affected Lender to assign, and such Affected
Lender shall use commercially reasonable efforts to assign pursuant to one or
more duly executed Assignment Agreements five (5) Business Days after the date
of such demand, to one or more financial institutions that comply with the
provisions of Section 13.3 which the Borrower or the Administrative Agent, as
-------------
the case may be, shall have engaged for such purpose ("REPLACEMENT LENDER"), all
of such Affected Lender's rights and obligations under this Agreement and the
other Loan Documents (including, without limitation, its Revolving Loan
Commitment, all Loans owing to it, all of its participation interests in
existing Letters of Credit, and its obligation to participate in additional
Letters of Credit and Swing Line Loans hereunder) in accordance with Section
-------
13.3. The Administrative Agent agrees, upon the occurrence of such events with
- ----
respect to an Affected Lender and upon the written request of the Borrower, to
use its reasonable efforts to obtain the commitments from one or more financial
institutions to act as a Replacement Lender. The Administrative Agent is
authorized to execute one or more of such Assignment Agreements as
attorney-in-fact for any Affected Lender failing to execute and deliver the same
within five (5) Business Days after the date of such demand. Further, with
respect to such assignment the Affected Lender shall have concurrently received,
in cash, all amounts due and owing to the Affected Lender hereunder or under any
other Loan Document, including, without limitation, the aggregate outstanding
principal amount of the Loans owed to such Lender, together with accrued
interest thereon through the date of such assignment, amounts payable under
Sections 4.1, 4.2 and 4.5 with respect to such Affected Lender and compensation
--------- --- ---
payable under Section 2.14(C) in the event of any replacement of any Affected
----------------
Lender under clause (ii) or clause (iii) of this Section 2.19; provided that
------------ ------------ ------------ --------
upon such Affected Lender's replacement, such Affected Lender shall cease to be
a party hereto but shall continue to be entitled to the benefits of Sections
--------
4.1, 4.2, 4.4, 4.5 and 10.7, as well as to any fees accrued for its account
--- --- --- ----
hereunder and not yet paid, and shall continue to be obligated under Section
-------
11.8 with respect to losses, obligations, liabilities, damages, penalties,
- ----
actions, judgments, costs, expenses or disbursements for matters which occurred
-
prior to the date the Affected Lender is replaced. Upon the replacement of any
Affected Lender pursuant to this Section 2.19, the provisions of Section 9.2
------------ -----------
shall continue to apply with respect to Loans which are then outstanding with
respect to which the Affected Lender failed to fund its Pro Rata Share and which
failure has not been cured.
ARTICLE III: THE LETTER OF CREDIT FACILITY
- ------------- ---------------------------------
3.1 Obligation to Issue Letters of Credit. Subject to the terms and
------------------------------------------
conditions of this Agreement and in reliance upon the representations,
warranties and covenants of the Borrower herein set forth, each Issuing Bank
hereby agrees to issue for the account of the Borrower through such Issuing
Bank's branches as it and the Borrower may jointly agree, one or more standby
Letters of Credit denominated in Dollars in accordance with this Article III,
-----------
from time to time during the period, commencing on the Initial Funding Date and
ending on the fifth Business Day prior to the Revolving Loan Termination Date.
3.2 [Reserved].
----------
3.3 Types and Amounts. No Issuing Bank shall have any obligation to and no
------------------
Issuing Bank shall:
(i) issue (or amend) any Letter of Credit if on the date of issuance (or
amendment), before or after giving effect to the Letter of Credit requested
hereunder, (a) the Revolving Credit Obligations at such time would exceed the
Aggregate Revolving Loan Commitment at such time, or (b) the aggregate
outstanding amount of the L/C Obligations would exceed $10,000,000; or
(ii) issue (or amend) any Letter of Credit which has an expiration date
later than the date which is the earlier of (a) one (1) year after the date of
issuance thereof or (b) five (5) Business Days immediately preceding the
Revolving Loan Termination Date; provided that any Letter of Credit with a
--------
one-year tenor may provide for the renewal thereof for additional one-year
periods (which shall in no event extend beyond the date referred to in clause
------
(b) above).
- ---
3.4 Conditions. In addition to being subject to the satisfaction of the
----------
conditions contained in Sections 5.1 and 5.2, the obligation of any Issuing Bank
------------ ---
to issue any Letter of Credit is subject to the satisfaction in full of the
following conditions:
(i) the Borrower shall have delivered to such Issuing Bank (with copies
delivered simultaneously to the Administrative Agent) at such times and in such
manner as such Issuing Bank may reasonably prescribe, a request for issuance of
such Letter of Credit in substantially the form of Exhibit C hereto, duly
---------
executed applications for such Letter of Credit, and such other documents,
instructions and agreements as may be required pursuant to the terms thereof
(all such applications, documents, instructions, and agreements being referred
to herein as the "L/C DOCUMENTS"), and the proposed Letter of Credit shall be
reasonably satisfactory to such Issuing Bank as to form and content; and
(ii) as of the date of issuance no order, judgment or decree of any court,
arbitrator or Governmental Authority shall purport by its terms to enjoin or
restrain such Issuing Bank from issuing such Letter of Credit and no law, rule
or regulation applicable to such Issuing Bank and no request or directive
(whether or not having the force of law) from a Governmental Authority with
jurisdiction over such Issuing Bank shall prohibit or request that such Issuing
Bank refrain from the issuance of Letters of Credit generally or the issuance of
that Letter of Credit.
3.5 Procedure for Issuance of Letters of Credit. (a) Subject to the terms
--------------------------------------------
and conditions of this Article III and provided that the applicable conditions
-----------
set forth in Sections 5.1 and 5.2 hereof have been satisfied, the applicable
------------- ---
Issuing Bank shall, on the requested date, issue a Letter of Credit on behalf of
the Borrower in accordance with such Issuing Bank's usual and customary
business practices and, in this connection, such Issuing Bank may assume that
the applicable conditions set forth in Section 5.2 hereof have been satisfied
-----------
unless it shall have received notice to the contrary from the Administrative
Agent or a Lender or has knowledge that the applicable conditions have not been
met.
(b) Immediately upon such issuance, the applicable Issuing Bank shall give
the Administrative Agent written or telex notice, or telephonic notice confirmed
promptly thereafter in writing, of the issuance of a Letter of Credit, provided,
--------
however, that the failure to provide such notice shall not result in any
- -------
liability on the part of such Issuing Bank.
(c) The applicable Issuing Bank shall not extend (including as a result of any
evergreen provision) or amend any Letter of Credit unless the requirements of
this Section 3.5 are met as though a new Letter of Credit was being requested
------------
and issued.
3.6 Letter of Credit Participation. Immediately upon the issuance of each
--------------------------------
Letter of Credit hereunder, each Lender with a Pro Rata Share shall be deemed to
have automatically, irrevocably and unconditionally purchased and received
from each Issuing Bank an undivided interest and participation in and to each
Letter of Credit, the obligations of the Borrower in respect thereof, and the
liability of the applicable Issuing Bank thereunder (collectively, an "L/C
INTEREST") in an amount equal to the amount available for drawing under such
Letter of Credit multiplied by such Lender's Pro Rata Share. If the Borrower
fails at any time to repay a Reimbursement Obligation pursuant to Section 3.7,
-----------
promptly following receipt of notice from the Administrative Agent or the
applicable Issuing Bank, each Lender shall make payment to the Administrative
Agent, for the account of the applicable Issuing Bank, in immediately available
funds in an amount equal to such Lender's Pro Rata Share of the amount of any
unreimbursed payment of an L/C Draft or other draw under a Letter of Credit.
The obligation of each Lender to reimburse the applicable Issuing Bank under
this Section 3.6 shall be unconditional, continuing, irrevocable and absolute.
------------
In the event that any Lender fails to make payment to the Administrative Agent
of any amount due under this Section 3.6, the Administrative Agent shall be
-----------
entitled to receive, retain and apply against such obligation the principal and
interest otherwise payable to such Lender hereunder until the Administrative
Agent receives such payment from such Lender or such obligation is otherwise
fully satisfied; provided, however, that nothing contained in this sentence
-------- -------
shall relieve such Lender of its obligation to reimburse the applicable Issuing
Bank for such amount in accordance with this Section 3.6.
------------
3.7 Reimbursement Obligation. The Borrower agrees unconditionally,
-------------------------
irrevocably and absolutely to pay immediately to the Administrative Agent, for
the account of the Lenders, the amount of each advance drawn under or pursuant
to a Letter of Credit or an L/C Draft related thereto (such obligation of the
Borrower to reimburse the Administrative Agent for an advance made under a
Letter of Credit or L/C Draft being hereinafter referred to as a "REIMBURSEMENT
OBLIGATION" with respect to such Letter of Credit or L/C Draft), each such
reimbursement to be made by the Borrower no later than the Business Day on which
the applicable Issuing Bank makes payment of each such L/C Draft or, in the case
of any other draw on a Letter of Credit, the date specified in the demand of the
applicable Issuing Bank. If the Borrower at any time fails to repay a
Reimbursement Obligation pursuant to this Section 3.7, such failure shall not
-----------
constitute a Default if the Revolving Credit Obligations do not, and after
making Revolving Loans in repayment of such Reimbursement Obligation would not,
exceed the Aggregate Revolving Loan Commitments and the conditions set forth in
Sections 5.2(i) and (ii) have been satisfied, and the Borrower shall be deemed
- ---------------- ----
to have elected to borrow Revolving Loans from the Lenders, as of the date of
the advance giving rise to the Reimbursement Obligation, equal in amount to the
amount of the unpaid Reimbursement Obligation. Such Revolving Loans shall be
made as of the date of the payment giving rise to such Reimbursement Obligation,
automatically, without notice and without any requirement to satisfy the
conditions precedent otherwise applicable to an Advance of Revolving Loans.
Such Revolving Loans shall constitute a Floating Rate Advance, the proceeds of
which Advance shall be used to repay such Reimbursement Obligation. If, for any
reason, the Borrower fails to repay a Reimbursement Obligation on the day such
Reimbursement Obligation arises and, for any reason, the Lenders are unable to
make or have no obligation to make Revolving Loans, then such Reimbursement
Obligation shall bear interest from and after such day, until paid in full, at
the interest rate applicable to a Floating Rate Advance.
3.8 Letter of Credit Fees. The Borrower agrees to pay:
------------------------
(i) quarterly, in arrears, to the Administrative Agent for the ratable
benefit of the Lenders, except as set forth in Section 9.2, a letter of credit
-----------
fee at a rate per annum equal to the Applicable L/C Fee Percentage on the
average daily outstanding face amount available for drawing under all standby
Letters of Credit;
(ii) quarterly, in arrears, to the applicable Issuing Bank, a letter of
credit fronting fee in an amount or at a rate per annum to be negotiated by the
Borrower and the applicable Issuing Bank at the time of issuance of each standby
Letter of Credit on the average daily outstanding face amount available for
drawing under all Letters of Credit issued by such Issuing Bank; and
(iii) to the applicable Issuing Bank, all customary fees and other issuance,
amendment, cancellation, document examination, negotiation, transfer and
presentment expenses and related charges in connection with the issuance,
amendment, cancellation, presentation of L/C Drafts, negotiation, transfer and
the like customarily charged by such Issuing Bank with respect to standby
Letters of Credit, payable at the time of invoice of such amounts.
3.9 Issuing Bank Reporting Requirements. Upon the request of any Lender,
-------------------------------------
each Issuing Bank shall furnish to such Lender copies of any Letter of Credit
and any application for or reimbursement agreement with respect to a Letter of
Credit to which such Issuing Bank is party.
3.10 Indemnification; Exoneration. (A) In addition to amounts payable as
-----------------------------
elsewhere provided in this Article III, the Borrower hereby agrees to protect,
-----------
indemnify, pay and save harmless the Administrative Agent, each Issuing Bank and
each Lender from and against any and all liabilities and costs which the
Administrative Agent, such Issuing Bank or such Lender may incur or be subject
to as a consequence, direct or indirect, of (i) the issuance of any Letter of
Credit other than, in the case of such Issuing Bank, as a result of its gross
negligence or willful misconduct, as determined by the final judgment of a court
of competent jurisdiction, or (ii) the failure of such Issuing Bank to honor a
drawing under a Letter of Credit as a result of any act or omission, whether
rightful or wrongful, of any present or future de jure or de facto Governmental
------- --------
Authority (all such acts or omissions herein called "GOVERNMENTAL ACTS").
(B) As among the Borrower, the Lenders, the Administrative Agent and each
Issuing Bank, the Borrower assumes all risks of the acts and omissions of, or
misuse of such Letter of Credit by, the beneficiary of any Letters of Credit.
In furtherance and not in limitation of the foregoing, subject to the provisions
of the Letter of Credit applications and Letter of Credit reimbursement
agreements executed by the Borrower at the time of request for any Letter of
Credit, neither the Administrative Agent, any Issuing Bank nor any Lender shall
be responsible (in the absence of gross negligence or willful misconduct in
connection therewith, as determined by the final judgment of a court of
competent jurisdiction): (i) for the form, validity, sufficiency, accuracy,
genuineness or legal effect of any document submitted by any party in connection
with the application for and issuance of the Letters of Credit, even if it
should in fact prove to be in any or all respects invalid, insufficient,
inaccurate, fraudulent or forged; (ii) for the validity or sufficiency of any
instrument transferring or assigning or purporting to transfer or assign a
Letter of Credit or the rights or benefits thereunder or proceeds thereof, in
whole or in part, which may prove to be invalid or ineffective for any reason;
(iii) for failure of the beneficiary of a Letter of Credit to comply duly with
conditions required in order to draw upon such Letter of Credit; (iv) for
errors, omissions, interruptions or delays in transmission or delivery of any
messages, by mail, cable, telegraph, telex, or other similar form of
teletransmission or otherwise; (v) for errors in interpretation of technical
trade terms; (vi) for any loss or delay in the transmission or otherwise of any
document required in order to make a drawing under any Letter of Credit or of
the proceeds thereof; (vii) for the misapplication by the beneficiary of a
Letter of Credit of the proceeds of any drawing under such Letter of Credit; and
(viii) for any consequences arising from causes beyond the control of the
Administrative Agent, the Issuing Banks and the Lenders, including, without
limitation, any Governmental Acts. None of the above shall affect, impair, or
prevent the vesting of any Issuing Bank's rights or powers under this Section
-------
3.10.
- ----
(C) In furtherance and extension and not in limitation of the specific
provisions hereinabove set forth, any action taken or omitted by any Issuing
Bank under or in connection with the Letters of Credit or any related
certificates shall not, in the absence of gross negligence or willful
misconduct, as determined by the final judgment of a court of competent
jurisdiction, put such Issuing Bank, the Administrative Agent or any Lender
under any resulting liability to the Borrower or relieve the Borrower of any of
its obligations hereunder to any such Person.
(D) Without prejudice to the survival of any other agreement of the Borrower
hereunder, the agreements and obligations of the Borrower contained in this
Section 3.10 shall survive the payment in full of principal and interest
- -------------
hereunder, the termination of the Letters of Credit and the termination of this
Agreement.
3.11 Cash Collateral. Notwithstanding anything to the contrary herein or in
---------------
any application for a Letter of Credit, after the occurrence and during the
continuance of a Default, the Borrower shall, upon the Administrative Agent's
demand, deliver to the Administrative Agent for the benefit of the Lenders and
the Issuing Banks, cash, or other collateral of a type satisfactory to the
Required Lenders, having a value, as determined by such Lenders, equal to the
aggregate outstanding L/C Obligations. In addition, but without duplication of
amounts deposited pursuant to the foregoing sentence, if the Revolving Credit
Availability is at any time less than the amount of contingent L/C Obligations
outstanding at any time, the Borrower shall deposit cash collateral with the
Administrative Agent in an amount equal to the amount by which such L/C
Obligations exceed such Revolving Credit Availability. Any such collateral
shall be held by the Administrative Agent in a separate account appropriately
designated as a cash collateral account in relation to this Agreement and the
Letters of Credit and retained by the Administrative Agent for the benefit of
the Lenders and the Issuing Banks as collateral security for the Borrower's
obligations in respect of this Agreement and each of the Letters of Credit and
L/C Drafts. Such amounts shall be applied to reimburse the Issuing Banks for
drawings or payments under or pursuant to Letters of Credit or L/C Drafts, or if
no such reimbursement is required, to payment of such of the other Obligations
as the Administrative Agent shall determine. If no Default shall be continuing,
amounts remaining in any cash collateral account established pursuant to this
Section 3.11 which are not to be applied to reimburse the Issuing Banks for
-----------
amounts actually paid or to be paid by the Issuing Banks in respect of a Letter
of Credit or L/C Draft, shall be returned promptly to the Borrower (after
deduction of the Administrative Agent's reasonable out-of-pocket expenses
incurred in connection with such cash collateral account) as the Letters of
Credit expire.
ARTICLE IV: YIELD PROTECTION; TAXES
- ------------ -------------------------
4.1 Yield Protection. If, on or after the date of this Agreement, the
-----------------
adoption of any law or any governmental or quasi-governmental rule, regulation,
policy, guideline or directive (whether or not having the force of law), or any
change in the interpretation or administration thereof by any governmental or
quasi-governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by any Lender or
applicable Lending Installation with any request or directive (whether or not
having the force of law) of any such authority, central bank or comparable
agency:
(i) subjects any Lender or any applicable Lending Installation to any Taxes,
or changes the basis of taxation of payments (other than with respect to
Excluded Taxes) to any Lender in respect of its Loans or L/C Interests, or
(ii) imposes or increases or deems applicable any reserve, assessment,
insurance charge, special deposit or similar requirement against assets of,
deposits with or for the account of, or credit extended by, any Lender or any
applicable Lending Installation (other than reserves and assessments taken into
account in determining the interest rate applicable to Eurodollar Rate
Advances), or
(iii) imposes any other condition the result of which is to increase the
cost to any Lender or any applicable Lending Installation of making, funding or
maintaining its Loans or L/C Interests or reduces any amount receivable by any
Lender or any applicable Lending Installation in connection with its Loans or
L/C Interests, or requires any Lender or any applicable Lending Installation to
make any payment calculated by reference to the amount of Loans or L/C Interests
held or interest received by it, by an amount deemed material by such Lender,
and the result of any of the foregoing is to increase the cost to such Lender or
applicable Lending Installation of making or maintaining its Loans, L/C
Interests or Revolving Loan Commitment or to reduce the return received by such
Lender or applicable Lending Installation in connection with such Loans, L/C
Interests or Revolving Loan Commitment, then, within fifteen (15) days of demand
by such Lender, the Borrower shall pay such Lender such additional amount or
amounts as will compensate such Lender for such increased cost or reduction in
amount received.
Notwithstanding the foregoing provisions of this Section 4.1, if any Lender
-----------
fails to notify the Borrower of any event or circumstance which will entitle
such Lender to compensation pursuant to this Section 4.1 within ninety (90) days
-----------
after such Lender obtains knowledge of such event or circumstance, then such
Lender shall not be entitled to compensation from the Borrower for any amount
arising prior to the date which is ninety (90) days before the date on which
such Lender notifies the Borrower of such event or circumstance.
4.2 Changes in Capital Adequacy Regulations. If a Lender determines the
-------------------------------------------
amount of capital required or expected to be maintained by such Lender, any
Lending Installation of such Lender or any corporation controlling such Lender
is increased as a result of a Change, then, within 15 days of demand by such
Lender, the Borrower shall pay such Lender the amount necessary to compensate
for any shortfall in the rate of return on the portion of such increased capital
which such Lender reasonably determines is attributable to this Agreement,
its Loans, L/C Interests or its Revolving Loan Commitment hereunder (after
taking into account such Lender's customary policies as to capital adequacy).
"CHANGE" means (i) any change after the date of this Agreement in the Risk-Based
Capital Guidelines or (ii) any adoption of or change in any other law,
governmental or quasi-governmental rule, regulation, policy, guideline,
interpretation, or directive (whether or not having the force of law) after the
date of this Agreement which affects the amount of capital required or expected
to be maintained by any Lender or any Lending Installation or any corporation
controlling any Lender. "RISK-BASED CAPITAL GUIDELINES" means (i) the
risk-based capital guidelines in effect in the United States on the date of this
Agreement, including transition rules, and (ii) the corresponding capital
regulations promulgated by regulatory authorities outside the United States
implementing the July 1988 report of the Basle Committee on Banking Regulation
and Supervisory Practices Entitled "International Convergence of Capital
Measurements and Capital Standards," including transition rules, and any
amendments to such regulations adopted prior to the date of this Agreement.
4.3 Availability of Types of Advances. If any Lender determines that
-------------------------------------
maintenance of its Eurodollar Rate Loans at a suitable Lending Installation
would violate any applicable law, rule, regulation, or directive, whether or not
having the force of law, or if the Required Lenders determine that (i) deposits
of a type and maturity appropriate to match fund Eurodollar Rate Advances are
not available or (ii) the interest rate applicable to Eurodollar Rate Advances
does not accurately reflect the cost of making or maintaining Eurodollar Rate
Advances, then the Administrative Agent shall suspend the availability of
Eurodollar Rate Advances and require any affected Eurodollar Rate Advances to be
repaid or converted to Floating Rate Advances, subject to the payment of any
funding indemnification amounts required by Section 4.4.
------------
4.4 Funding Indemnification. If any payment of a Eurodollar Rate Advance
------------------------
occurs on a date which is not the last day of the applicable Interest Period,
whether because of acceleration, prepayment or otherwise, or a Eurodollar Rate
Advance is not made on the date specified by the Borrower for any reason other
than default by the Lenders, the Borrower will indemnify each Lender for any
loss or cost incurred by it resulting therefrom (excluding loss of margin),
including, without limitation, any loss or cost in liquidating or employing
deposits acquired to fund or maintain such Eurodollar Rate Advance.
4.5 Taxes. (i) All payments by the Borrower to or for the account of any
-----
Lender or the Administrative Agent hereunder or under any of the other Loan
Documents shall be made free and clear of and without deduction for any and all
Taxes. If the Borrower shall be required by law to deduct any Taxes from or in
respect of any sum payable hereunder to any Lender, any Issuing Bank or the
Administrative Agent, (a) the sum payable shall be increased as necessary so
that after making all required deductions (including deductions applicable to
additional sums payable under this Section 4.5) such Lender, such Issuing Bank
-----------
or the Administrative Agent (as the case may be) receives an amount equal to the
sum it would have received had no such deductions been made, (b) the Borrower
shall make such deductions, (c) the Borrower shall pay the full amount deducted
to the relevant authority in accordance with applicable law and (d) the Borrower
shall furnish to the Administrative Agent the original copy of a receipt
evidencing payment thereof within thirty (30) days after such payment is made.
Such Lender, such Issuing Bank or the Administrative Agent, as the case may be,
shall promptly reimburse the Borrower for such payments to the extent such
Lender, such Issuing Bank or the Administrative Agent receives actual knowledge
that it has received any tax credit or other benefit in connection with such tax
payments and that such tax credit or benefit is clearly attributable to this
Agreement.
(ii) In addition, the Borrower hereby agrees to pay any present or future
stamp or documentary taxes and any other excise or property taxes, charges or
similar levies which arise from any payment made hereunder or under any
promissory note issued hereunder or from the execution or delivery of, or
otherwise with respect to, this Agreement or any promissory note issued
hereunder ("OTHER TAXES").
(iii) The Borrower hereby agrees to indemnify the Administrative Agent and each
Lender for the full amount of Taxes or Other Taxes (including, without
limitation, any Taxes or Other Taxes imposed on amounts payable under this
Section 4.5) paid by the Administrative Agent or such Lender and any liability
- ------------
(including penalties, interest and expenses) arising therefrom or with respect
thereto. Payments due under this indemnification shall be made within thirty
(30) days of the date the Administrative Agent or such Lender makes demand
therefor pursuant to Section 4.6.
------------
(iv) Each Lender that is not incorporated under the laws of the United States
of America or a state thereof (each a "Non-U.S. Lender") agrees that it will,
not less than ten (10) Business Days after the date of this Agreement, deliver
to each of the Borrower and the Administrative Agent a United States Internal
Revenue Form W-8 or W-9, as the case may be, and certify that it is entitled to
an exemption from United States backup withholding tax. Each Non-U.S. Lender
further undertakes to deliver to each of the Borrower and the Administrative
Agent (x) renewals or additional copies of such form (or any successor form) on
or before the date that such form expires or becomes obsolete, and (y) after the
occurrence of any event requiring a change in the most recent forms so delivered
by it, such additional forms or amendments thereto as may be reasonably
requested by the Borrower or the Administrative Agent. All forms or amendments
described in the preceding sentence shall certify that such Lender is entitled
to receive payments under this Agreement without deduction or withholding of any
United States federal income taxes, unless an event (including without
limitation any change in treaty, law or regulation) has occurred prior to the
date on which any such delivery would otherwise be required which renders all
such forms inapplicable or which would prevent such
<PAGE>
Lender from duly completing and delivering any such form or amendment with
respect to it and such Lender advises the Borrower and the Administrative Agent
that it is not capable of receiving payments without any deduction or
withholding of United States federal income tax.
(v) For any period during which a Non-U.S. Lender has failed to provide
the Borrower with an appropriate form pursuant to clause (iv), above (unless
such failure is due to a change in treaty, law or regulation, or any change in
the interpretation or administration thereof by any governmental authority,
occurring subsequent to the date on which a form originally was required to be
provided), such Non-U.S. Lender shall not be entitled to indemnification under
this Section 4.5 with respect to Taxes imposed by the United States; provided
------------
that, should a Non-U.S. Lender which is otherwise exempt from or subject to a
reduced rate of withholding tax become subject to Taxes because of its failure
to deliver a form required under clause (iv), above, the Borrower shall take
such steps as such Non-U.S. Lender shall reasonably request (without cost to the
Borrower) to assist such Non-U.S. Lender to recover such Taxes.
(vi) Any Lender that is entitled to an exemption from or reduction of
withholding tax with respect to payments under this Agreement or any promissory
note issued hereunder pursuant to the law of any relevant jurisdiction or any
treaty shall deliver to the Borrower (with a copy to the Administrative Agent),
at the time or times prescribed by applicable law, 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.
(vii) If the U.S. Internal Revenue Service or any other governmental authority
of the United States or any other country or any political subdivision thereof
asserts a claim that the Administrative Agent did not properly withhold tax from
amounts paid to or for the account of any Lender (because the appropriate form
was not delivered or properly completed, because such Lender failed to notify
the Administrative Agent of a change in circumstances which rendered its
exemption from withholding ineffective, or for any other reason other than as a
result of the gross negligence or willful misconduct of the Administrative
Agent), such Lender shall indemnify the Administrative Agent fully for all
amounts paid, directly or indirectly, by the Administrative Agent as tax,
withholding therefor, or otherwise, including penalties and interest, and
including taxes imposed by any jurisdiction on amounts payable to the
Administrative Agent under this subsection, together with all costs and expenses
related thereto (including attorneys fees and time charges of attorneys for the
Administrative Agent, which attorneys may be employees of the Administrative
Agent). The obligations of the Lenders under this Section 4.5(vii) shall
----------------
survive the payment of the Obligations, the termination of the Letters of Credit
and termination of this Agreement.
4.6 Lender Statements; Survival of Indemnity. To the extent reasonably
--------------------------------------------
possible, each Lender shall designate an alternate Lending Installation with
respect to its Eurodollar Rate Loans to reduce any liability of the Borrower to
such Lender under Sections 4.1, 4.2 and 4.5 or to avoid the unavailability of
------------ --- ---
Eurodollar Rate Advances under Section 4.3, so long as such designation is not,
-----------
in the reasonable judgment of such Lender, disadvantageous to such Lender. Each
Lender shall deliver a written statement of such Lender to the Borrower
(with a copy to the Administrative Agent) as to the amount due, if any, under
Section 4.1, 4.2, 4.4 or 4.5. Such written statement shall set forth in
- ------------ --- --- ---
reasonable detail the calculations upon which such Lender determined such amount
and shall be final, conclusive and binding on the Borrower in the absence of
manifest error. Determination of amounts payable under such Sections in
connection with a Eurodollar Rate Loan shall be calculated as though each Lender
funded its Eurodollar Rate Loan through the purchase of a deposit of the type
and maturity corresponding to the deposit used as a reference in determining the
Eurodollar Rate applicable to such Loan, whether in fact that is the case or
not, and without regard to loss of margin. Unless otherwise provided herein,
the amount specified in the written statement of any Lender shall be payable on
demand after receipt by the Borrower of such written statement. The obligations
of the Borrower under Sections 4.1, 4.2, 4.4 and 4.5 shall survive payment of
------------ --- --- ---
the Obligations, termination of the Letters of Credit and termination of this
Agreement.
ARTICLE V: CONDITIONS PRECEDENT
- ----------- ---------------------
5.1 Initial Advances and Letters of Credit. The Lenders shall not be
-------------------------------------------
required to make the initial Loans or issue any Letters of Credit unless the
Borrower has furnished to the Administrative Agent each of the following, with
sufficient copies for the Lenders, all in form and substance satisfactory to the
Administrative Agent and the Lenders:
(1) Copies of the Certificate of Incorporation of Ralston, Energizer and
each of the Subsidiary Guarantors (other than Energizer) (collectively, the
"LOAN PARTIES"), together with all amendments and a certificate of good
standing, both certified by the appropriate governmental officer in its
jurisdiction of incorporation;
(2) Copies, certified by the Secretary or Assistant Secretary of each of the
Loan Parties, of its By-Laws and of its Board of Directors' resolutions (and
resolutions of other bodies, if any are deemed necessary by counsel for any
Lender) authorizing the execution of the Loan Documents entered into by it;
(3) An incumbency certificate, executed by the Secretary or Assistant Secretary
of each of the Loan Parties, which shall identify by name and title and bear the
signature of the officers of the Loan Parties authorized to sign the Loan
Documents and the officers of Ralston and (from and after the consummation of
the Debt Assumption) Energizer authorized to make borrowings hereunder, upon
which certificate the Lenders shall be entitled to rely until informed of any
change in writing by the Borrower; provided, that any officer who will neither
be a signatory to this Agreement nor an individual requesting borrowings
hereunder, shall be permitted to deliver a facsimile of such officer's signature
in satisfaction of this Section 5.1(3);
---------------
(4) Certificates, in form and substance satisfactory to the Administrative
Agent, (a) signed by the Chief Financial Officer of Ralston, stating that on the
Initial Funding Date all the representations in this Agreement made by Ralston
are true and correct and no Default or Unmatured Default has occurred and is
continuing and (b) signed by the Executive Vice President-Finance and Control of
Energizer, stating that on the Initial Funding Date, all of the representations
in this Agreement to be made by Energizer on the Spin-Off Date would be true and
correct if such representations were made by Energizer on the Initial Funding
Date;
(5) The written opinion of the Loan Parties' counsel, addressed to the
Administrative Agent and the Lenders, in substantially the form attached hereto
as Exhibit E and containing assumptions and qualifications acceptable to the
----------
Administrative Agent and the Lenders;
(6) A certificate in form and substance satisfactory to the Administrative
Agent, signed by the chief financial officer or Treasurer of Energizer, stating
that, after taking into consideration all information available at such time,
such officer neither knows nor should know of any information that would prevent
the Net Worth Condition from being satisfied as of the Spin-Off Date, after
giving effect to the Spin-Off Transactions and after all post-closing
adjustments have been made;
(7) Evidence satisfactory to the Administrative Agent that, except as set forth
on Schedule 6.21 of this Agreement, (i) all conditions precedent to the
consummation of the Spin-Off have been satisfied in all material respects, (ii)
the Spin-Off Transactions have been approved by all necessary corporate action
of Ralston's and Energizer's Board of Directors and, if required, shareholders,
and the terms of the Spin-Off Transactions have not been amended, waived or
modified in any material respect from those set forth in the Form 10 without the
approval of the Administrative Agent (such approval not to be unreasonably
withheld); (iii) the Tax Ruling and all necessary regulatory approvals have been
obtained for the consummation of the Spin-Off Transactions; and (iv) the
aggregate amount of all loans and committed Financing Facilities (including this
Agreement and the 364-Day Credit Agreement) available to Energizer upon
consummation of the Spin-Off Transactions equals or exceeds $650,000,000, and
all such commitments are identified on Schedule 6.21(iv) attached hereto;
(8) Evidence satisfactory to the Administrative Agent that there exists no
injunction or temporary restraining order which, in the judgment of the
Administrative Agent, would prohibit the making of the Loans, the consummation
of the Spin-Off Transactions, the consummation of the Debt Assumption and the
other transactions contemplated by the Transaction Documents or any litigation
seeking such an injunction or restraining order;
(9) Written money transfer instructions reasonably requested by the
Administrative Agent, addressed to the Administrative Agent and signed by an
Authorized Officer;
(10) Opinions of value, solvency and other appropriate factual information and
advice in form and substance reasonably satisfactory to it and from the chief
financial officer of Energizer supporting the conclusions that after giving
effect to the Spin-Off Transactions and the Debt Assumption, Energizer and its
Subsidiaries on a consolidated basis are Solvent and will be Solvent subsequent
to incurring the indebtedness contemplated under the Transaction Documents, will
be able to pay its debts and liabilities as they become due and will not be left
with unreasonably small working capital for general corporate purposes;
(11) Evidence satisfactory to the Administrative Agent that Ralston had paid or
has caused Energizer to pay to the Administrative Agent and the Arranger the
fees agreed to in the fee letter dated February 16, 2000, among the
Administrative Agent, the Arranger, Ralston and Energizer; and
(12) Such other documents as the Administrative Agent or any Lender or its
counsel may have reasonably requested, including, without limitation, the
Subsidiary Guaranty, opinions of counsel, an officer's no-default certificate
and each other document reflected on the List of Closing Documents attached as
Exhibit F to this Agreement.
---------
5.2 Each Advance and Letter of Credit. The Lenders shall not be required to
---------------------------------
make any Advance, or issue any Letter of Credit, unless on the applicable
Borrowing Date, or in the case of a Letter of Credit, the date on which the
Letter of Credit is to be issued, both before and after taking into account the
proposed borrowing or Letter of Credit:
(i) There exists no Default or Unmatured Default;
(ii) The representations and warranties contained in Article VI are true and
----------
correct in all material respects as of such Borrowing Date except for changes in
the Schedules to this Agreement reflecting transactions permitted by or not in
violation of this Agreement; and
(iii) The Revolving Credit Obligations do not, and after making such
proposed Advance or issuing such Letter of Credit would not, exceed the
Aggregate Revolving Loan Commitment.
Each Borrowing/Election Notice with respect to each such Advance and the
letter of credit application with respect to each Letter of Credit shall
constitute a representation and warranty by the Borrower that the conditions
contained in Sections 5.2(i) and (ii) have been satisfied. Any Lender may
---------------- ----
require a duly completed officer's certificate in substantially the form of
Exhibit G hereto and/or a duly completed compliance certificate in substantially
- ---------
the form of Exhibit H hereto as a condition to making an Advance.
----------
ARTICLE VI: REPRESENTATIONS AND WARRANTIES
- ------------ --------------------------------
In order to induce the Administrative Agent and the Lenders to enter into
this Agreement and to make the Loans and the other financial accommodations to
Ralston and, after the consummation of the Debt Assumption, Energizer, and to
issue the Letters of Credit described herein, (a) Ralston represents and
warrants as follows in Section 6.1, 6.2, 6.3, 6.14, 6.18 and 6.21 to each Lender
----------- --- --- ---- ---- ---
and the Administrative Agent as of the Closing Date, the Initial Funding Date
and the Spin-Off Date, giving effect to the consummation of the transactions
contemplated by the Transaction Documents as of each such date, (b) Energizer
represents and warrants as follows in Sections 6.4 through 6.23 and Section 6.25
------------ ---- ------------
to each Lender and the Administrative Agent as of the Spin-Off Date (immediately
following the consummation of the Debt Assumption), giving effect to the
consummation of the transactions contemplated by the Transaction Documents as of
such date, and thereafter on each date as required by Section 5.2 (other than
-----------
with respect to Section 6.8 which shall only be made by Energizer as of the
------------
Spin-Off Date) and (c) Energizer represents and warrants as follows in Section
-------
6.24 to each Lender and the Administrative Agent as a condition to the Debt
Assumption, on each Adjustment Date and on the Opening Balance Sheet Delivery
Date (in each case, as of the Spin-Off Date, taking into account the
post-closing adjustments made as of such date):
6.1 Organization; Corporate Powers of Ralston. Each of Ralston and
---------------------------------------------
Energizer (i) is a corporation, limited liability company, partnership or other
commercial entity duly organized, validly existing and in good standing under
the laws of the jurisdiction of its organization, (ii) is duly qualified to do
business as a foreign entity and is in good standing under the laws of each
jurisdiction in which failure to be so qualified and in good standing could
reasonably be expected to have a Material Adverse Effect, and (iii) has all
requisite power and authority to own, operate and encumber its property and to
conduct its business as presently conducted and as proposed to be conducted.
6.2 Authority of Ralston.
----------------------
(A) Ralston has the requisite power and authority to execute, deliver and
perform each of the Transaction Documents which are to be executed by it in
connection with the Transactions or which have been executed by it as required
by this Agreement and the other Loan Documents and (ii) to file the Transaction
Documents which must be filed by it in connection with the Transactions or which
have been filed by it as required by this Agreement, the other Loan
Documents or otherwise with any Governmental Authority.
(B) The execution, delivery, performance and filing, as the case may be, of
each of the Transaction Documents which must be executed or filed by Ralston in
connection with the Transactions or which have been executed or filed as
required by this Agreement, the other Loan Documents or otherwise and to which
Ralston is party, and the consummation of the transactions contemplated thereby,
have been duly approved by the respective boards of directors of Ralston and
Energizer and, if necessary, the shareholders of Ralston, and such approvals
have not been rescinded. No other action or proceedings on the part of Ralston
or Energizer are necessary to consummate such transactions.
(C) Each of the Transaction Documents to which Ralston is a party has been
duly executed, delivered or filed, as the case may be, by it and constitutes its
legal, valid and binding obligation, enforceable against it in accordance with
its terms (except as enforceability may be limited by bankruptcy, insolvency, or
similar laws affecting the enforcement of creditors' rights generally and by
general equitable principles, including concepts of reasonableness, materiality,
good faith and fair dealing and the possible unavailability of specific
performance, injunctive relief or other equitable remedies (whether enforcement
is sought by proceedings in equity or at law)), is in full force and effect and
no material term or condition thereof has been amended, modified or waived from
the terms and conditions contained in the Transaction Documents delivered to the
Administrative Agent pursuant to Section 5.1 without the prior written consent
-----------
of the Required Lenders (or all of the Lenders if required by Section 9.3), and
-----------
Ralston has performed and complied with all the material terms, provisions,
agreements and conditions set forth therein and required to be performed or
complied with by Ralston on or before the Initial Funding Date, and no unmatured
default, default or breach of any covenant by any such party exists thereunder.
6.3 No Conflict; Governmental Consents for Ralston. The execution, delivery
----------------------------------------------
and performance of each of the Loan Documents and other Transaction
Documents to which Ralston is a party do not and will not (i) conflict with the
certificate or articles of incorporation or by-laws of Ralston or Energizer,
(ii) with respect to the Transaction Documents other than the Loan Documents,
constitute a tortious interference with any Contractual Obligation of Ralston or
conflict with, result in a breach of or constitute (with or without notice or
lapse of time or both) a default under any Requirement of Law (including,
without limitation, any Environmental Property Transfer Act) or Contractual
Obligation of Ralston, or require termination of any Contractual Obligation,
except such interference, breach, default or termination which individually or
in the aggregate could not reasonably be expected to have a Material Adverse
Effect, (iii) with respect to the Loan Documents, constitute a tortious
interference with any Contractual Obligation of Ralston or conflict with, result
in a breach of or constitute (with or without notice or lapse of time or both) a
default under any Requirement of Law (including, without limitation, any
Environmental Property Transfer Act) or Contractual Obligation of Ralston, or
require termination of any Contractual Obligation, except such interference,
breach or default which individually or in the aggregate could not reasonably be
expected to have a Material Adverse Effect, (iv) result in or require the
creation or imposition of any Lien whatsoever upon any of the property or assets
of Ralston, other than Liens permitted or created by the Loan Documents, or (v)
require any approval of Ralston's or Energizer's Board of Directors or
shareholders, as applicable, except such as have been obtained. Except as set
forth on Schedule 6.3 to this Agreement, the execution, delivery and performance
------------
of each of the Transaction Documents to which Ralston is a party do not and will
not require any registration with, consent or approval of, or notice to, or
other action to, with or by any Governmental Authority, including under any
Environmental Property Transfer Act, except filings, consents or notices which
have been made, obtained or given, or which, if not made, obtained or given,
individually or in the aggregate could not reasonably be expected to have a
Material Adverse Effect.
6.4 Organization; Corporate Powers of Energizer. Energizer and each of its
--------------------------------------------
Subsidiaries (i) is a corporation, limited liability company, partnership or
other commercial entity duly organized, validly existing and in good standing
under the laws of the jurisdiction of its organization, (ii) is duly qualified
to do business as a foreign entity and is in good standing under the laws of
each jurisdiction in which failure to be so qualified and in good standing could
reasonably be expected to have a Material Adverse Effect, and (iii) has all
requisite power and authority to own, operate and encumber its property and to
conduct its business as presently conducted and as proposed to be conducted.
6.5 Authority of Energizer.
------------------------
(A) Energizer and each of its Subsidiaries has the requisite power and
authority to execute, deliver and perform each of the Transaction Documents
which are to be executed by it in connection with the Transactions or which have
been executed by it as required by this Agreement and the other Loan
Documents and (ii) to file the Transaction Documents which must be filed by it
in connection with the Transactions or which have been filed by it as required
by this Agreement, the other Loan Documents or otherwise with any Governmental
Authority.
(B) The execution, delivery, performance and filing, as the case may be, of
each of the Transaction Documents which must be executed or filed by Energizer
or any of its Subsidiaries in connection with the Transactions or which have
been executed or filed as required by this Agreement, the other Loan Documents
or otherwise and to which Energizer or any of its Subsidiaries is party, and the
consummation of the transactions contemplated thereby, have been duly approved
by the respective boards of directors and, if necessary, the shareholders of
Energizer and its Subsidiaries, and such approvals have not been rescinded. No
other action or proceedings on the part of Energizer or its Subsidiaries are
necessary to consummate such transactions.
(C) Each of the Transaction Documents to which Energizer or any of its
Subsidiaries is a party has been duly executed, delivered or filed, as the case
may be, by it and constitutes its legal, valid and binding obligation,
enforceable against it in accordance with its terms (except as enforceability
may be limited by bankruptcy, insolvency, or similar laws affecting the
enforcement of creditors' rights generally and by general equitable principles,
including concepts of reasonableness, materiality, good faith and fair dealing
and the possible unavailability of specific performance, injunctive relief or
other equitable remedies (whether enforcement is sought by proceedings in equity
or at law)), is in full force and effect (other than as a result of expiration
in accordance with its terms) and no material term or condition thereof has been
amended, modified or waived from the terms and conditions contained in the
Transaction Documents delivered to the Administrative Agent pursuant to Section
-------
5.1 without the prior written consent of the Required Lenders (or all of the
Lenders if required by Section 9.3), and Energizer and its Subsidiaries have,
-----------
and, to the best of Energizer's and its Subsidiaries' knowledge, all other
parties thereto have, performed and complied with all the material terms,
provisions, agreements and conditions set forth therein and required to be
performed or complied with by such parties on or before the Initial Funding Date
or Spin-Off Date, as applicable, and no unmatured default, default or breach of
any covenant by any such party exists thereunder.
6.6 No Conflict; Governmental Consents for Energizer. The execution,
-----------------------------------------------------
delivery and performance of each of the Loan Documents and other Transaction
Documents to which Energizer or any of its Subsidiaries is a party do not and
will not (i) conflict with the certificate or articles of incorporation or
by-laws of Energizer or any such Subsidiary, (ii) with respect to the
Transaction Documents other than the Loan Documents, constitute a tortious
interference with any Contractual Obligation of any Person or conflict with,
result in a breach of or constitute (with or without notice or lapse of time or
both) a default under any Requirement of Law (including, without limitation, any
Environmental Property Transfer Act) or Contractual Obligation of Energizer
or any such Subsidiary, or require termination of any Contractual Obligation,
except such interference, breach, default or termination which individually or
in the aggregate could not reasonably be expected to have a Material Adverse
Effect, (iii) with respect to the Loan Documents, constitute a tortious
interference with any Contractual Obligation of any Person or conflict with,
result in a breach of or constitute (with or without notice or lapse of time or
both) a default under any Requirement of Law (including, without limitation, any
Environmental Property Transfer Act) or Contractual Obligation of Energizer or
any such Subsidiary, or require termination of any Contractual Obligation,
except such interference, breach or default which individually or in the
aggregate could not reasonably be expected to have a Material Adverse Effect,
(iv) result in or require the creation or imposition of any Lien whatsoever upon
any of the property or assets of Energizer or any such Subsidiary, other than
Liens permitted or created by the Loan Documents, or (v) require any approval of
Energizer's or any such Subsidiary's Board of Directors or shareholders except
such as have been obtained. Except as set forth on Schedule 6.6 to this
------------
Agreement, the execution, delivery and performance of each of the Transaction
Documents to which Energizer or any of its Subsidiaries is a party do not and
will not require any registration with, consent or approval of, or notice to, or
other action to, with or by any Governmental Authority, including under any
Environmental Property Transfer Act, except filings, consents or notices which
have been made, obtained or given, or which, if not made, obtained or given,
individually or in the aggregate would not reasonably be expected to have a
Material Adverse Effect.
6.7 Financial Statements.
---------------------
(A) The pro forma historical balance sheet (as updated by the pro forma
--- ----- --- -----
historical balance sheet prepared with respect to Energizer and its Subsidiaries
as of February 29, 2000 (the "SUPPLEMENTAL FINANCIAL STATEMENT")), income
statements and statements of cash flow of Energizer and its Subsidiaries
contained in the Form 10 and the projections and assumptions contained in the
Borrower's Confidential Information Memorandum dated February, 2000 (the "BANK
BOOK") under Appendix A thereof, copies of which are attached hereto as Schedule
---------- --------
6.7 to this Agreement, present on a pro forma basis the financial condition of
- --- --- -----
Energizer and such Subsidiaries as of such date, and reflect on a pro forma
--- -----
basis those liabilities reflected in the notes thereto and resulting from
consummation of the Transactions and the other transactions contemplated by this
Agreement, and the payment or accrual of all transaction costs payable on the
Initial Funding Date and the Spin-Off Date with respect to any of the foregoing
and demonstrate that, after giving effect to such transactions, Energizer and
its Subsidiaries can repay their debts and satisfy their other obligations as
and when due, and can comply with the requirements of this Agreement. The
projections and assumptions contained in the Bank Book were prepared in good
faith and represent management's opinion based on the information available to
the Borrower at the time so furnished and, since the preparation thereof and of
the pro forma historical financial statements contained in the Form 10 (as
--- -----
updated by the Supplemental Financial Statement) there has occurred no material
adverse change in the business, financial condition, operations, or prospects of
Energizer or any of its Subsidiaries, or Energizer and its Subsidiaries taken as
a whole (it being understood that so long as the representation and warranty
contained in Section 6.24 is true and correct at each time Energizer is required
------------
to make such representation and warranty pursuant to the introduction to this
Article VI, changes from the "Net transactions with RPCO" line item on the pro
--------- ---
forma statement of cash flow will not constitute a material adverse change).
(B) Complete and accurate copies of the audited financial statements and
the audit report related thereto prepared with respect to Energizer and its
Subsidiaries as of September 30, 1999 and unaudited financial statements of
prepared with respect to Energizer and its Subsidiaries as of December 31, 1999
have been delivered to the Administrative Agent.
(C) Since the financial statements prepared as of December 31, 1999, the
historical pro forma financial statements contained in the Form 10 (as updated
--- -----
by the Supplemental Financial Statement), and the projections and assumptions
included as Appendix A of the Bank Book, Energizer and its Subsidiaries have
conducted their respective operations (including, without limitation, any
operations and transactions with Ralston, any holder or holders of any of the
Equity Interests of Energizer, or with any Affiliate of Energizer which is not
its Subsidiary) according to their ordinary and usual course of business and
consistent with past practice, as reflected in such financial statements, Form
10 (as updated by the Supplemental Financial Statement) and the Bank Book, as
applicable, in all material respects (it being understood that so long as the
representation and warranty contained in Section 6.24 is true and correct at
------------
each time Energizer is required to make such representation and warranty
pursuant to the introduction to this Article VI, changes from the "Net
-----------
transactions with RPCO" line item on the pro forma statement of cash flow will
--- -----
not constitute a material deviation from past operations).
6.8 No Material Adverse Change. Since each of (a) December 31, 1999
-----------------------------
(determined by reference to the financial statements prepared with respect to
Energizer and its Subsidiaries), (b) the pro forma historical financial
--- -----
statements set forth in the Form 10 (as updated by the Supplemental Financial
Statement), and (c) the projections and assumptions included as Appendix A of
the Bank Book, there has occurred no change in the business, properties,
condition (financial or otherwise), performance, results of operations or
prospects of Energizer, or Energizer and its Subsidiaries taken as a whole or
any other event which has had or would reasonably be expected to have a Material
Adverse Effect (it being understood that so long as the representation and
warranty contained in Section 6.24 is true and correct at each time Energizer is
------------
required to make such representation and warranty pursuant to the introduction
to this Article VI, changes from the "Net transactions with RPCO" line item on
----------
the pro forma statement of cash flow will not constitute an event which has had
--- -----
or would reasonably be expected to have a Material Adverse Effect).
6.9 Taxes.
-----
(A) Tax Examinations. All deficiencies which have been asserted against
-----------------
Energizer or any of Energizer's Subsidiaries as a result of any federal, state,
local or foreign tax examination for each taxable year in respect of which an
examination has been conducted have been fully paid or finally settled or are
being contested in good faith, and no issue has been raised by any taxing
authority in any such examination which, by application of similar principles,
reasonably can be expected to result in assertion by such taxing authority of a
material deficiency for any other year not so examined which has not been
reserved for in Energizer's consolidated financial statements to the extent, if
any, required by Agreement Accounting Principles. Except as permitted pursuant
to Section 7.2(D), neither Energizer nor any of Energizer's Subsidiaries
---------------
anticipates any material tax liability with respect to the years which have not
been closed pursuant to applicable law.
(B) Payment of Taxes. All tax returns and reports of Energizer and its
------------------
Subsidiaries required to be filed have been timely filed, and all taxes,
assessments, fees and other governmental charges thereupon and upon their
respective property, assets, income and franchises which are shown in such
returns or reports to be due and payable have been paid except those items which
are being contested in good faith and have been reserved for in accordance with
Agreement Accounting Principles. Energizer has no knowledge of any proposed tax
assessment against Energizer or any of its Subsidiaries that will have or could
reasonably be expected to have a Material Adverse Effect.
6.10 Litigation; Loss Contingencies and Violations. Except as set forth in
----------------------------------------------
Schedule 6.10 (the "DISCLOSED LITIGATION"), there is no action, suit,
- --------------
proceeding, arbitration or, to Energizer's knowledge, investigation before or by
- ----------
any Governmental Authority or private arbitrator pending or, to Energizer's
knowledge, threatened against Energizer, any of its Subsidiaries or any property
of any of them. Neither any of the Disclosed Litigation nor any action, suit,
proceeding, arbitration or investigation which has commenced since the Closing
Date (or the most recent update of the Disclosed Litigation) (i) challenges the
validity or the enforceability of any material provision of the Transaction
Documents or (ii) has or could reasonably be expected to have a Material Adverse
Effect. There is no material loss contingency within the meaning of Agreement
Accounting Principles which has not been reflected in the consolidated financial
statements of Energizer prepared and delivered pursuant to Section 7.1(A) for
--------------
the fiscal period during which such material loss contingency was incurred.
Neither Energizer nor any of its Subsidiaries is (A) in violation of any
applicable Requirements of Law which violation will have or could reasonably be
expected to have a Material Adverse Effect, or (B) subject to or in default with
respect to any final judgment, writ, injunction, restraining order or order of
any nature, decree, rule or regulation of any court or Governmental Authority
which will have or could reasonably be expected to have a Material Adverse
Effect.
6.11 Subsidiaries. Schedule 6.11 to this Agreement (i) contains a
------------ --------------
description of the corporate structure of Energizer, its Subsidiaries and any
other Person in which Energizer or any of its Subsidiaries holds a material
Equity Interest after giving effect to the Spin-Off Transactions; and (ii)
accurately sets forth (A) the correct legal name, the jurisdiction of
incorporation and the jurisdictions in which each of Energizer and the direct
and indirect Subsidiaries of Energizer are qualified to transact business as a
foreign corporation, (B) the authorized, issued and outstanding shares of each
class of Capital Stock of Energizer and each of its Subsidiaries and the owners
of such shares (both as of the consummation of the Spin-Off and on a
fully-diluted basis), and (C) a summary of the direct and indirect partnership,
joint venture, or other Equity Interests, if any, of Energizer and each
Subsidiary of Energizer in any Person that is not a corporation. After the
formation or acquisition of any New Subsidiary permitted under Section 7.3(F),
--------------
if requested by the Administrative Agent, Energizer shall provide a supplement
to Schedule 6.11 to this Agreement reflecting the addition of such New
--------------
Subsidiary. Except as disclosed on Schedule 6.11, none of the issued and
- --------- --------------
outstanding Capital Stock of Energizer or any of Energizer's Subsidiaries is
subject to any vesting, redemption, or repurchase agreement, and there are no
warrants or options outstanding with respect to such Capital Stock. The
outstanding Capital Stock of Energizer and each of its Subsidiaries is duly
authorized, validly issued, fully paid and nonassessable and the stock of
Energizer's Subsidiaries is not Margin Stock.
6.12 ERISA. No Benefit Plan has incurred any material accumulated funding
-----
deficiency (as defined in Sections 302(a)(2) of ERISA and 412(a) of the Code)
whether or not waived. Neither Energizer nor any member of the Controlled Group
has incurred any material liability to the PBGC which remains outstanding other
than the payment of premiums. As of the last day of the most recent prior plan
year, the market value of assets under each Benefit Plan, other than any
Multiemployer Plan, was not by a material amount less than the present value of
benefit liabilities thereunder (determined in accordance with the actuarial
valuation assumptions described therein). Neither Energizer nor any member of
the Controlled Group has (i) failed to make a required contribution or payment
to a Multiemployer Plan of a material amount or (ii) incurred a material
complete or partial withdrawal under Section 4203 or Section 4205 of ERISA from
a Multiemployer Plan. Neither Energizer nor any member of the Controlled Group
has failed to make an installment or any other payment of a material amount
required under Section 412 of the Code on or before the due date for such
installment or other payment. Each Plan, Foreign Employee Benefit Plan and
Non-ERISA Commitment complies in all material respects in form, and has been
administered in all material respects in accordance with its terms and, in
accordance with all applicable laws and regulations, including but not limited
to ERISA and the Code. There have been no and there is no prohibited
transaction described in Sections 406 of ERISA or 4975 of the Code with respect
to any Plan for which a statutory or administrative exemption does not exist
which could reasonably be expected to subject Energizer or any of is
Subsidiaries to material liability. Neither Energizer nor any member of the
Controlled Group has taken or failed to take any action which would constitute
or result in a Termination Event, which action or inaction could reasonably be
expected to subject Energizer or any of its Subsidiaries to material liability.
Neither Energizer nor any member of the Controlled Group is subject to any
material liability under, or has any potential material liability under, Section
4063, 4064, 4069, 4204 or 4212(c) of ERISA. The present value of the aggregate
liabilities to provide all of the accrued benefits under any Foreign Pension
Plan do not exceed the current fair market value of the assets held in trust or
other funding vehicle for such plan by a material amount. With respect to any
Foreign Employee Benefit Plan other than a Foreign Pension Plan, reasonable
reserves have been established in accordance with prudent business practice or
where required by ordinary accounting practices in the jurisdiction in which
such plan is maintained. Neither Ralston nor any other member of its controlled
group (within the meaning of Section 414(b), (c), (m) or (o) of the Code) has
taken or failed to take any action, nor has any event occurred, with respect to
any "employee benefit plan" (as defined in section 3(3) of ERISA) which action,
inaction or event could reasonably be expected to subject Energizer or any of
its Subsidiaries to material liability. For purposes of this Section 6.12,
------------
"material" means any amount, noncompliance or other basis for liability which
could reasonably be expected to subject Energizer or any of its Subsidiaries to
liability, individually or in the aggregate with each other basis for liability
under this Section 6.12, in excess of $25,000,000.
-------------
6.13 Accuracy of Information. The information, exhibits and reports
-------------------------
furnished by or on behalf of Energizer and any of its Subsidiaries to the
Administrative Agent or to any Lender in connection with the negotiation of, or
compliance with, the Loan Documents, the representations and warranties of
Ralston, Energizer and their respective Subsidiaries contained in the Loan
Documents, and all certificates and documents delivered to the Administrative
Agent and the Lenders pursuant to the terms thereof, including, without
limitation the Bank Book and the Form 10 (as updated by the Supplemental
Financial Statement), taken as a whole, do not contain as of the date furnished
any untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements contained herein or therein, in light
of the circumstances under which they were made, not misleading.
6.14 Securities Activities. Neither Ralston, Energizer nor any of its
----------------------
Subsidiaries is engaged in the business of extending credit for the purpose of
purchasing or carrying Margin Stock.
6.15 Material Agreements. Neither Energizer nor any Subsidiary is a party
--------------------
to any Contractual Obligation or subject to any charter or other corporate or
similar restriction which individually or in the aggregate will have or could
reasonably be expected to have a Material Adverse Effect. Neither Energizer nor
any of its Subsidiaries has received notice or has knowledge that (i) it is in
default in the performance, observance or fulfillment of any of the obligations,
covenants or conditions contained in any Contractual Obligation applicable to
it, or (ii) any condition exists which, with the giving of notice or the lapse
of time or both, would constitute a default with respect to any such Contractual
Obligation, in each case, except where such default or defaults, if any,
individually or in the aggregate will not have or could not reasonably be
expected to have a Material Adverse Effect.
6.16 Compliance with Laws. Energizer and its Subsidiaries are in compliance
---------------------
with all Requirements of Law applicable to them and their respective businesses,
in each case where the failure to so comply individually or in the aggregate
could reasonably be expected to have a Material Adverse Effect.
6.17 Assets and Properties. Energizer and each of its Subsidiaries has
-----------------------
legal title to all of its assets and properties (tangible and intangible, real
or personal) owned by it or a valid leasehold interest in all of its leased
assets (except insofar as marketability may be limited by any laws or
regulations of any Governmental Authority affecting such assets), and all such
assets and property are free and clear of all Liens, except Liens permitted
under Section 7.3(C). Substantially all of the assets and properties owned by,
--------------
leased to or used by Energizer and/or each such Subsidiary of Energizer are in
adequate operating condition and repair, ordinary wear and tear excepted.
Neither this Agreement nor any other Transaction Document, nor any transaction
contemplated under any such agreement, will affect any right, title or interest
of Energizer or such Subsidiary in and to any of such assets in a manner that
has or could reasonably be expected to have a Material Adverse Effect.
6.18 Statutory Indebtedness Restrictions. Neither Ralston, Energizer nor
-------------------------------------
any of its Subsidiaries is subject to regulation under the Public Utility
Holding Company Act of 1935, the Federal Power Act, the Interstate Commerce Act,
or the Investment Company Act of 1940, or any other federal or state statute or
regulation which limits its ability to incur indebtedness or its ability to
consummate the transactions contemplated hereby.
6.19 Insurance. The insurance policies and programs in effect with respect
---------
to the respective properties, assets, liabilities and business reflect coverage
that is reasonably consistent with prudent industry practice.
6.20 Labor Matters. No attempt to organize the employees of Energizer, and
--------------
no labor disputes, strikes or walkouts affecting the operations of Energizer or
any of its Subsidiaries, is pending, or, to Energizer's knowledge, threatened,
planned or contemplated, which has or could reasonably be expected to have a
Material Adverse Effect.
6.21 Spin-Off Transactions. Except as set forth in Schedule 6.21 to this
---------------------- -------------
Agreement, (i) (a) all conditions precedent to, and all consents necessary to
permit, the consummation of the Spin-Off Transactions have been satisfied in all
material respects, (b) no additional actions are necessary to consummate the
Spin-Off Transactions other than the passage of time and (c) the Spin-Off will
take effect on April 1, 2000 without any further action on the part of Energizer
or Ralston, (ii) the Spin-Off Transactions have been approved by all necessary
corporate action of Ralston's and Energizer's Board of Directors and, if
required, shareholders, and the terms of the Spin-Off Transactions have not been
amended, waived or modified in any material respect from those set forth in the
Form 10 without the approval of the Administrative Agent and the Required
Lenders (such approval not to be unreasonably withheld); (iii) the Tax Ruling
and all necessary regulatory approvals have been obtained for the consummation
of the Spin-Off Transactions; and (iv) the aggregate amount of all loans and
committed Financing Facilities (including this Agreement and the 364-Day Credit
Agreement) available to Energizer upon consummation of the Spin-Off Transactions
equals or exceeds $650,000,000, and all such commitments are identified on
Schedule 6.21(iv) attached hereto.
- ------------------
6.22 Environmental Matters. (A) Except as disclosed on Schedule 6.22 to
---------------------- -------------
this Agreement
(i) the operations of Energizer and its Subsidiaries comply in all material
respects with Environmental, Health or Safety Requirements of Law;
(ii) Energizer and its Subsidiaries have all material permits, licenses or
other authorizations required under Environmental, Health or Safety Requirements
of Law and are in material compliance with such permits;
(iii) neither Energizer, any of its Subsidiaries nor any of their respective
present property or operations, or, to Energizer's or any of its Subsidiaries'
knowledge, any of their respective past property or operations, are subject to
or the subject of, any investigation known to Energizer or any of its
Subsidiaries, any judicial or administrative proceeding, order, judgment,
decree, settlement or other agreement respecting: (A) any material violation of
Environmental, Health or Safety Requirements of Law; (B) any material remedial
action; or (C) any material claims or liabilities arising from the Release or
threatened Release of a Contaminant into the environment;
(iv) there is not now, nor to Energizer's or any of its Subsidiaries'
knowledge has there ever been, on or in the property of Energizer or any of its
Subsidiaries any landfill, waste pile, underground storage tanks, aboveground
storage tanks, surface impoundment or hazardous waste storage facility of any
kind, any polychlorinated biphenyls (PCBs) used in hydraulic oils, electric
transformers or other equipment, or any asbestos containing material that would
result in material remediation costs or material penalties to Energizer or any
of its Subsidiaries; and
(v) neither Energizer nor any of its Subsidiaries has any material
Contingent Obligation in connection with any Release or threatened Release of a
Contaminant into the environment.
(B) For purposes of this Section 6.22 "material" means any noncompliance or
------------
other basis for liability which could reasonably be likely to subject Energizer
or any of its Subsidiaries to liability, individually or in the aggregate with
each other basis for liability under this Section 6.22, in excess of
-------------
$25,000,000.
6.23 Solvency. After giving effect to (i) the Loans to be made on the
--------
Initial Funding Date or such other date as Loans requested hereunder are made
and the consummation of the Debt Assumption, (ii) the other transactions
contemplated by this Agreement and the other Transaction Documents, including
consummation of the Spin-Off Transactions, and (iii) the payment and accrual of
all transaction costs with respect to the foregoing, Energizer is, and Energizer
and its Subsidiaries taken as a whole are, Solvent.
6.24 Net Worth Condition. Upon consummation of the Spin-Off Transactions,
---------------------
the Net Worth Condition will be satisfied.
6.25 Benefits. Each of Energizer and its Subsidiaries will benefit from the
--------
financing arrangement established by this Agreement. The Administrative Agent
and the Lenders have stated and Energizer acknowledges that, but for the
agreement by each of the Subsidiary Guarantors to execute and deliver the
Subsidiary Guaranty, the Administrative Agent and the Lenders would not have
made available the credit facilities established hereby on the terms set forth
herein.
ARTICLE VII: COVENANTS
- ------------- ---------
From and after the consummation of the Debt Assumption, Energizer covenants
and agrees that so long as any Revolving Loan Commitments are outstanding and
thereafter until all of the Obligations (other than contingent indemnity
obligations) shall have been fully and indefeasibly paid and satisfied in cash,
all financing arrangements among the Borrower and the Lenders shall have been
terminated and all of the Letters of Credit shall have expired, been canceled or
terminated, unless the Required Lenders shall otherwise give prior written
consent:
7.1 Reporting. Energizer shall:
---------
(A) Financial Reporting. Furnish to the Administrative Agent (with
--------------------
sufficient copies for each of the Lenders, which the Administrative Agent shall
promptly deliver to the Lenders):
(i) Quarterly Reports. As soon as practicable, and in any event within
------------------
forty-five (45) days after the end of each of Energizer's first three fiscal
quarters, the consolidated balance sheet of Energizer and its Subsidiaries as at
the end of such period and the related consolidated statements of income
and cash flows of Energizer 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, certified by the chief financial officer of Energizer on behalf
of Energizer as fairly presenting the consolidated financial position of
Energizer and its Subsidiaries as at the dates indicated and the results of
their operations and cash flows for the periods indicated in accordance with
Agreement Accounting Principles, subject to normal year-end audit adjustments
and the absence of footnotes.
(ii) Annual Reports. As soon as practicable, and in any event within ninety
--------------
(90) days after the end of each fiscal year, (a) the consolidated and
consolidating balance sheet of Energizer and its Subsidiaries as at the end of
such fiscal year and the related consolidated and consolidating statements of
income, stockholders' equity and cash flows of Energizer and its Subsidiaries
for such fiscal year, and in comparative form the corresponding figures for the
previous fiscal year along with consolidating schedules in form and substance
sufficient to calculate the financial covenants set forth in Section 7.4, and
-----------
(b) an audit report on the consolidated financial statements (but not the
consolidating financial statements or schedules) listed in clause (a) hereof of
----------
independent certified public accountants of recognized national standing, which
audit report shall be unqualified and shall state that such financial statements
fairly present the consolidated financial position of Energizer and its
Subsidiaries as at the dates indicated and the results of their operations and
cash flows for the periods indicated in conformity with Agreement Accounting
Principles and that the examination by such accountants in connection with such
consolidated financial statements has been made in accordance with generally
accepted auditing standards.
(iii) Officer's Compliance Certificate. Together with each delivery of any
---------------------------------
financial statement (a) pursuant to clauses (i) and (ii) of this Section 7.1(A),
----------- ---- --------------
an Officer's Certificate from the chief financial officer or Treasurer of
Energizer, substantially in the form of Exhibit G attached hereto and made a
---------
part hereof, stating that (x) the representations and warranties of Energizer
contained in Article VI hereof shall have been true and correct in all material
----------
respects as of the date of such Officer's Certificate and (y) as of the date of
such Officer's Certificate no Default or Unmatured Default exists, or if any
Default or Unmatured Default exists, stating the nature and status thereof and
(b) pursuant to clauses (i) and (ii) of this Section 7.1(A), a compliance
------------ ---- --------------
certificate, substantially in the form of Exhibit H attached hereto and made a
---------
part hereof, signed by Energizer's chief financial officer or Treasurer, setting
forth calculations for the period which demonstrate compliance, when applicable,
with the provisions of Sections 7.3(A) through (R) and Section 7.4, and which
--------------- --- -----------
calculate the Leverage Ratio for purposes of determining the then Applicable
Margin, Applicable Facility Fee Percentage and Applicable L/C Fee Percentage.
(iv) Officer's Net Worth Condition Certificate. On each Adjustment Date
---------------------------------------------
(including the Final Adjustment Date) and on the Opening Balance Sheet Delivery
Date, a certificate in form and substance satisfactory to the Administrative
Agent, signed by the chief financial officer or Treasurer of Energizer, stating
that, after giving effect to the Spin-Off Transactions and after all
post-closing adjustments as of such date have been effected, the Net Worth
Condition was satisfied as of the Spin-Off Date.
(v) Opening Pro Forma Balance Sheet. On the Opening Balance Sheet Delivery
--------------------------------
Date, copies of the pro forma opening consolidated balance sheet of Energizer
--- -----
and its Subsidiaries, after giving effect to the Spin-Off Transactions and
including all post-closing adjustments.
(B) Notice of Default and Adverse Developments. Promptly upon any of the
---------------------------------------------
chief executive officer, chief operating officer, chief financial officer,
treasurer or controller of Energizer obtaining actual knowledge (i) of any
condition or event which constitutes a Default or Unmatured Default, or becoming
aware that any Lender or Administrative Agent has given any written notice
with respect to a claimed Default or Unmatured Default under this Agreement,
(ii) that any Person having the authority to give such a notice has given any
written notice to Energizer or any Subsidiary of Energizer or taken any other
action with respect to a claimed default or event or condition of the type
referred to in Section 8.1(E), or (iii) that any other development, financial or
--------------
otherwise, which could reasonably be expected to have a Material Adverse Effect
has occurred specifying (a) the nature and period of existence of any such
claimed default, Default, Unmatured Default, condition or event, (b) the notice
given or action taken by such Person in connection therewith, and (c) what
action Energizer has taken, is taking and proposes to take with respect thereto.
(C) ERISA Notices. Deliver or cause to be delivered to the Administrative
--------------
Agent and the Lenders, at Energizer's expense, the following information and
notices as soon as reasonably possible, and in any event:
(i) within ten (10) Business Days after any member of the Controlled Group
obtains knowledge that a Termination Event has occurred which could reasonably
be expected to subject Energizer to liability individually or in the aggregate
in excess of $20,000,000, a written statement of the Chief Financial Officer of
Energizer describing such Termination Event and the action, if any, which the
member of the Controlled Group has taken, is taking or proposes to take with
respect thereto, and when known, any action taken or threatened by the IRS, DOL
or PBGC with respect thereto;
(ii) within ten (10) Business Days after the filing of any funding waiver
request with the IRS, a copy of such funding waiver request and thereafter all
communications received by Energizer or a member of the Controlled Group with
respect to such request within ten (10) Business Days such communication is
received; and
(iii) within ten (10) Business Days after Energizer or any member of the
Controlled Group knows or has reason to know that (a) a Multiemployer Plan has
been terminated, (b) the administrator or plan sponsor of a Multiemployer Plan
intends to terminate a Multiemployer Plan, or (c) the PBGC has instituted or
will institute proceedings under Section 4042 of ERISA to terminate a
Multiemployer Plan, a notice describing such matter.
For purposes of this Section 7.1(C), Energizer and any member of the Controlled
--------------
Group shall be deemed to know all facts known by the administrator of any Plan
of which Energizer or any member of the Controlled Group is the plan sponsor.
(D) Other Indebtedness. Deliver to the Administrative Agent (i) a copy of
-------------------
each regular report, notice or communication regarding potential or actual
defaults (including any accompanying officer's certificate) delivered by or on
behalf of Energizer to the holders of funded Material Indebtedness, including
the Senior Notes and the investors parties to the Receivable Purchase Facility
or any Bridge Facilities, pursuant to the terms of the agreements governing such
Indebtedness, such delivery to be made at the same time and by the same
means as such notice or other communication is delivered to such holders, and
(ii) a copy of each notice received by Energizer from the from the holders of
funded Material Indebtedness who are authorized and/or have standing to deliver
such notice pursuant to the terms of such Indebtedness, such delivery to be made
promptly after such notice is received by Energizer.
(E) Other Reports. Deliver or cause to be delivered to the Administrative
--------------
Agent and the Lenders copies of all financial statements, reports and notices,
if any, sent by Energizer to its securities holders or filed with the Commission
by Energizer.
(F) Environmental Notices. As soon as possible and in any event within ten
----------------------
(10) days after receipt by Energizer, a copy of (i) any notice or claim to the
effect that Energizer or any of its Subsidiaries is or may be liable to any
Person as a result of the Release by Energizer, any of its Subsidiaries, or any
other Person of any Contaminant into the environment, and (ii) any notice
alleging any violation of any Environmental, Health or Safety Requirements of
Law by Energizer or any of its Subsidiaries if, in either case, such notice or
claim relates to an event which could reasonably be expected to subject
Energizer and each of its Subsidiaries to liability individually or in the
aggregate in excess of $20,000,000.
(G) Amendments to Financing Facilities. Promptly after the execution
-------------------------------------
thereof, copies of all material amendments to (i) any of the documents
evidencing Indebtedness extended under the Bridge Facilities, (ii) any of the
Receivables Purchase Documents or (iii) the Note Purchase Agreement or the
Senior Notes.
(H) Other Information. Promptly upon receiving a request therefor from the
------------------
Administrative Agent, prepare and deliver to the Administrative Agent and the
Lenders such other information with respect to Energizer, any of its
Subsidiaries, or their respective businesses and assets, including, without
limitation, schedules identifying and describing any Asset Sale (and the use of
the net cash proceeds thereof), as from time to time may be reasonably requested
by the Administrative Agent.
7.2 Affirmative Covenants.
----------------------
(A) Corporate Existence, Etc. Except as permitted pursuant to Section
--------------------------- -------
7.3(H), Energizer shall, and shall cause each of its Subsidiaries to, at all
times maintain its existence and preserve and keep, or cause to be preserved and
kept, in full force and effect its rights and franchises material to its
businesses.
(B) Corporate Powers; Conduct of Business. Energizer shall, and shall cause
-------------------------------------
each of its Material Subsidiaries to, qualify and remain qualified to do
business in each jurisdiction in which the nature of its business requires it to
be so qualified and where the failure to be so qualified will have or would
reasonably be expected to have a Material Adverse Effect. Energizer will, and
will cause each Material Subsidiary to, carry on and conduct its business in
substantially the same manner and in substantially the same fields of enterprise
as it is presently conducted unless the failure of Energizer or its Material
Subsidiaries to carry on and conduct its business as so described would not
reasonably be expected to have a Material Adverse Effect.
(C) Compliance with Laws, Etc. Energizer shall, and shall cause its
-----------------------------
Subsidiaries to, (a) comply with all Requirements of Law and all restrictive
covenants affecting such Person or the business, properties, assets or
operations of such Person, and (b) obtain as needed all permits necessary for
its operations and maintain such permits in good standing unless, in either
case, failure to comply or obtain such permits would not reasonably be expected
to have a Material Adverse Effect.
(D) Payment of Taxes and Claims; Tax Consolidation. Energizer shall pay,
-------------------------------------------------
and cause each of its Subsidiaries to pay, (i) all taxes, assessments and other
governmental charges imposed upon it or on any of its properties or assets or in
respect of any of its franchises, business, income or property before any
penalty or interest accrues thereon, and (ii) all claims (including, without
limitation, claims for labor, services, materials and supplies) for sums which
have become due and payable and which by law have or may become a Lien (other
than a Lien permitted by Section 7.3(C)) upon any of Energizer's or such
---------------
Subsidiary's property or assets, prior to the time when any penalty or fine
shall be incurred with respect thereto; provided, however, that no such taxes,
-------- -------
assessments and governmental charges referred to in clause (i) above or claims
----------
referred to in clause (ii) above (and interest, penalties or fines relating
------------
thereto) need be paid if being contested in good faith by appropriate
proceedings diligently instituted and conducted and if such reserve or other
appropriate provision, if any, as shall be required in conformity with Agreement
Accounting Principles shall have been made therefor.
(E) Insurance. Energizer shall maintain for itself and its Subsidiaries, or
---------
shall cause each of its Subsidiaries to maintain in full force and effect,
insurance policies and programs, with such deductibles or self-insurance amounts
as reflect coverage that is reasonably consistent with prudent industry practice
as determined by Energizer.
(F) Inspection of Property; Books and Records; Discussions. Energizer shall
------------------------------------------------------
permit and cause each of Energizer's Subsidiaries to permit, any authorized
representative(s) designated by either the Administrative Agent or any Lender to
visit and inspect any of the properties of Energizer or any of its Subsidiaries,
to examine their respective financial and accounting records and other material
data relating to their respective businesses or the transactions contemplated
hereby (including, without limitation, in connection with environmental
compliance, hazard or liability), and to discuss their affairs, finances and
accounts with their officers and independent certified public accountants, all
upon reasonable notice and at such reasonable times during normal business
hours, as often as may be reasonably requested (provided that an officer of
Energizer or any of its Subsidiaries may, if it so desires, be present at and
participate in any such discussion). Energizer shall keep and maintain, and
cause each of Energizer's Subsidiaries to keep and maintain, in all material
respects, proper books of record and account in which entries in conformity with
Agreement Accounting Principles shall be made of all dealings and transactions
in relation to their respective businesses and activities. If a Default has
occurred and is continuing, Energizer, upon the Administrative Agent's request,
shall turn over copies of any such records to the Administrative Agent or its
representatives.
(G) ERISA Compliance. Energizer shall, and shall cause each of Energizer's
-----------------
Subsidiaries to, establish, maintain and operate all Plans to comply in all
material respects with the provisions of ERISA and shall operate all Plans and
Non-ERISA Commitments to comply in all material respects with the applicable
provisions of the Code, all other applicable laws, and the regulations and
interpretations thereunder and the respective requirements of the governing
documents for such Plans and Non-ERISA Commitments, except for any noncompliance
which, individually or in the aggregate, could not reasonably be expected to
have a Material Adverse Effect.
(H) Maintenance of Property. Energizer shall cause all property necessary
-------------------------
for the conduct of its business or the business of any Subsidiary to be
maintained and kept in good condition, repair and working order and supplied
with all necessary equipment and shall cause to be made all necessary repairs,
renewals, replacements, betterments and improvements thereof, all as in the
judgment of Energizer may be necessary for the conduct of its business;
provided, however, that nothing in this Section 7.2(H) shall prevent Energizer
------- --------------
from discontinuing the operation or maintenance of any of such property if such
discontinuance is, in the judgment of Energizer, desirable in the conduct of its
business or the business of any Subsidiary and not disadvantageous in any
material respect to the Administrative Agent or the Lenders.
(I) Environmental Compliance. (a) Energizer and its Subsidiaries shall
-------------------------
comply with all Environmental, Health or Safety Requirements of Law, except
where noncompliance will not have or is not reasonably likely to subject
Energizer or any of its Subsidiaries, individually or in the aggregate, to
liability in excess of $25,000,000.
(J) Use of Proceeds. (a) Prior to the consummation of the Debt Assumption,
----------------
Ralston shall use the proceeds of the Loans for its working capital needs and
other general corporate purposes of Ralston and its Subsidiaries, and (b) from
and after the consummation of the Debt Assumption, Energizer shall use the
proceeds of any subsequent Loans for the general corporate purposes of Energizer
and its Subsidiaries, including, without limitation, to finance Permitted
Acquisitions.
(K) Addition of Subsidiary Guarantors. (a) New Subsidiaries. Energizer
------------------------------------ ----------------
shall cause each New Subsidiary that is, at any time, a Material Domestic
Subsidiary (other than a SPV) to deliver to the Administrative Agent an executed
Supplement to become a Subsidiary Guarantor under the Subsidiary Guaranty in the
form of Exhibit I attached hereto (a "SUPPLEMENT") and appropriate corporate
----------
resolutions, opinions and other documentation in form and substance reasonably
satisfactory to the Administrative Agent, such Supplement and other
documentation to be delivered to the Administrative Agent as promptly as
possible upon the creation, acquisition of or capitalization thereof or if
otherwise necessary to remain in compliance with Section 7.3(R), but in any
--------------
event within thirty (30) days of such creation, acquisition or capitalization.
(b) Additional Material Domestic Subsidiaries. If any consolidated
--------------------------------------------
Subsidiary of Energizer (other than a New Subsidiary to the extent addressed in
Section 7.2(K)(a) or a SPV) becomes a Material Domestic Subsidiary, Energizer
- ------------------
shall cause any such Material Domestic Subsidiary to deliver to the
Administrative Agent an executed Supplement to become a Subsidiary Guarantor
and appropriate corporate resolutions, opinions and other documentation in form
and substance reasonably satisfactory to the Administrative Agent in connection
therewith, such Supplement and other documentation to be delivered to the
Administrative Agent as promptly as possible but in any event within thirty (30)
days following the date on which such consolidated Subsidiary became a Material
Domestic Subsidiary.
(c) Additional Subsidiary Guarantors. (i) If at any time an Authorized
----------------------------------
Officer of Energizer has actual knowledge that the aggregate assets of all of
Energizer's domestic consolidated Subsidiaries (other than SPVs) which are not
Subsidiary Guarantors exceed ten percent (10%) of Consolidated Assets of
Energizer and its consolidated Subsidiaries (other than the SPVs), as calculated
by Energizer, Energizer shall cause such domestic consolidated Subsidiaries as
are necessary to reduce such aggregate assets to or below ten percent (10%) of
such Consolidated Assets to deliver to the Administrative Agent executed
Supplements to become Subsidiary Guarantors and appropriate corporate
resolutions, opinions and other documentation in form and substance reasonably
satisfactory to the Administrative Agent in connection therewith, such
Supplements and other documentation to be delivered to the Administrative Agent
as promptly as possible but in any event within thirty (30) days following the
initial date on which such aggregate assets exceed ten percent (10%) of such
Consolidated Assets.
(ii) If at any time any domestic Subsidiary of Energizer which is not
a Subsidiary Guarantor guaranties any Indebtedness of Energizer other than the
Indebtedness hereunder or under the 364-Day Agreement, Energizer shall cause
such Subsidiary to deliver to the Administrative Agent an executed Supplement to
become a Subsidiary Guarantor and appropriate corporate resolutions, opinions
and other documentation in form and substance reasonably satisfactory to the
Administrative Agent in connection therewith, such Supplement and other
documentation to be delivered to the Administrative Agent concurrently with the
delivery of the guaranty of such other Indebtedness.
7.3 Negative Covenants.
-------------------
(A) Subsidiary Indebtedness.(A) Subsidiary Indebtedness Energizer shall
------------------------
not permit any of its Subsidiaries directly or indirectly to create, incur,
assume or otherwise become or remain directly or indirectly liable with respect
to any Indebtedness, except:
(i) Indebtedness of the Subsidiaries under the Subsidiary Guaranty;
(ii) Indebtedness in respect of guaranties executed by any Subsidiary
Guarantor with respect to any Indebtedness of Energizer, provided such
--------
Indebtedness is not incurred by Energizer in violation of this Agreement;
(iii) Indebtedness in respect of obligations secured by Customary Permitted
Liens;
(iv) Indebtedness constituting Contingent Obligations permitted by Section
-------
7.3(E);
-----
(v) Indebtedness arising from loans (a) from any Subsidiary to any
wholly-owned Subsidiary or (b) from Energizer to any wholly-owned Subsidiary;
provided, that if any Subsidiary Guarantor is the obligor on such Indebtedness,
- --------
such Indebtedness shall be expressly subordinate to the payment in full in cash
of the Obligations on terms satisfactory to the Administrative Agent;
(vi) Indebtedness in respect of Hedging Obligations permitted under Section
-------
7.3(O);
- ------
(vii) Indebtedness with respect to surety, appeal and performance bonds
obtained by any of Energizer's Subsidiaries in the ordinary course of business;
(viii) Indebtedness incurred in connection with the Receivables Purchase
Documents, provided, that Receivables Facility Attributed Indebtedness incurred
--------
in connection therewith does not exceed $250,000,000 in the aggregate at any
time; and
(ix) Other Indebtedness in addition to that referred to elsewhere in this
Section 7.3(A) incurred by Energizer's Subsidiaries; provided that no Default or
------------ --------
Unmatured Default shall have occurred and be continuing at the date of such
incurrence or would result therefrom; and provided further that the aggregate
-------- -------
outstanding amount of all Indebtedness incurred by Energizer's Subsidiaries
(other than Indebtedness incurred pursuant to clauses (i), (ii), (v), (vi) and
----------- ---- --- ----
(viii) of this Section 7.3(A)) shall not at any time exceed $250,000,000.
----- --------------
(B) Sales of Assets. Neither Energizer nor any of its Subsidiaries shall
-----------------
sell, assign, transfer, lease, convey or otherwise dispose of any property,
whether now owned or hereafter acquired, or any income or profits therefrom, or
enter into any agreement to do so, except:
(i) sales of Inventory in the ordinary course of business;
(ii) the disposition in the ordinary course of business of Equipment that is
obsolete, excess or no longer used or useful in Energizer's or its Subsidiaries'
businesses;
(iii) any transfer of an interest in Receivables, Receivables Related
Security, accounts or notes receivable on a limited recourse basis under the
Receivables Purchase Documents, provided that such transfer qualifies as a legal
--------
sale and as a sale under Agreement Accounting Principles and that the amount of
Receivables Facility Attributed Indebtedness does not exceed $250,000,000 at any
one time outstanding; and
(iv) sales, assignments, transfers, leases, conveyances or other
dispositions of other assets (other than pursuant to clauses (i), (ii) and (iii)
----------- ---- -----
above) if such transaction (a) is for not less than fair market value, and (b)
when combined with all such other transactions (each such transaction being
valued at book value) during the period from the Closing Date, to the date of
such proposed transaction, represents the disposition of not greater than twenty
percent (20%) of Energizer's Consolidated Assets (such Consolidated Assets being
calculated for the end of the fiscal year immediately preceding that in which
such transaction is proposed to be entered into).
(C) Liens. Neither Energizer nor any of its Subsidiaries shall directly or
-----
indirectly create, incur, assume or permit to exist any Lien on or with respect
to any of their respective property or assets except:
(i) Liens, if any, created by the Loan Documents or otherwise securing the
Obligations, or Liens created by the "Loan Documents" under and as defined in
the 364-Day Credit Agreement or otherwise Securing the "Obligations" (as such
terms are defined in the 364-Day Credit Agreement;
(ii) Customary Permitted Liens;
(iii) Liens arising under the Receivables Purchase Documents; and
(iv) other Liens, including Permitted Existing Liens, (a) securing
Indebtedness of Energizer and/or (b) securing Indebtedness of Energizer's
Subsidiaries as permitted pursuant to Section 7.3(A) and in an aggregate
---------------
outstanding amount not to exceed five percent (5%) of Consolidated Assets at any
time.
In addition, neither Energizer nor any of its Subsidiaries shall become a party
to any agreement, note, indenture or other instrument, or take any other action,
which would prohibit the creation of a Lien on any of its properties or other
assets in favor of the Administrative Agent for the benefit of itself and the
Holders of Obligations, as collateral for the Obligations; provided, that any
--------
agreement, note, indenture or other instrument in connection with purchase money
indebtedness (including Capitalized Leases) may prohibit the creation of a Lien
in favor of the Administrative Agent for the benefit of itself and the Holders
of Obligations on the items of property obtained with the proceeds of such
purchase money indebtedness; provided, further, that (a) the Note Purchase
-------- -------
Agreement in connection with the Senior Notes may prohibit the creation of a
Lien in favor of the Administrative Agent for the benefit of itself and the
Holders of Obligations, as collateral for the Obligations unless the holders of
the Senior Notes shall be provided with an equal and ratable Lien and (b) the
Receivables Purchase Documents may prohibit the creation of a Lien with respect
to all of the assets of the SPV and with respect to the Receivables and Related
Security of any of the Originators in favor of the Administrative Agent for the
benefit of itself and the Holders of Obligations, as collateral for the
Obligations.
(D) Investments. Except to the extent permitted pursuant to paragraph (G)
----------- -------------
below, neither Energizer nor any of its Subsidiaries shall directly or
indirectly make or own any Investment except:
(i) Investments in cash and Cash Equivalents;
(ii) Permitted Existing Investments in an amount not greater than the amount
thereof on the Closing Date;
(iii) Investments in trade receivables or received in connection with the
bankruptcy or reorganization of suppliers and customers and in settlement of
delinquent obligations of, and other disputes with, customers and suppliers
arising in the ordinary course of business;
(iv) Investments consisting of deposit accounts maintained by Energizer and
its Subsidiaries;
(v) Investments consisting of non-cash consideration from a sale,
assignment, transfer, lease, conveyance or other disposition of property
permitted by Section 7.3(B);
---------------
(vi) Investments in any consolidated Subsidiaries (other than joint
ventures);
(vii) Investments in joint ventures and nonconsolidated Subsidiaries in an
aggregate amount not to exceed $50,000,000;
(viii) Investments constituting Permitted Acquisitions;
(ix) Investments constituting Indebtedness permitted by Section 7.3(A) or
--------------
Contingent Obligations permitted by Section 7.3(E);
---------------
(x) Investments in the SPVs (a) required in connection with the Receivables
Purchase Documents and (b) resulting from the transfers permitted by Section
-------
7.3(B)(iii); and
--------
(xi) Investments in addition to those referred to elsewhere in this Section
-------
7.3(D) in an aggregate amount not to exceed $50,000,000.
- ------
(E) Contingent Obligations. None of Energizer's Subsidiaries shall directly
----------------------
or indirectly create or become or be liable with respect to any Contingent
Obligation, except: (i) recourse obligations resulting from endorsement of
negotiable instruments for collection in the ordinary course of business; (ii)
Permitted Existing Contingent Obligations; (iii) obligations, warranties, and
indemnities, not relating to Indebtedness of any Person, which have been or are
undertaken or made in the ordinary course of business and not for the benefit of
or in favor of an Affiliate of Energizer or such Subsidiary; (iv) Contingent
Obligations with respect to surety, appeal and performance bonds obtained by
Energizer or any Subsidiary in the ordinary course of business; (v) Contingent
Obligations of the Subsidiary Guarantors under the Subsidiary Guaranty; (vi)
Contingent Obligations of Subsidiaries which are guarantors under a guaranty of
the Indebtedness evidenced by the Senior Notes and the Note Purchase Agreements;
(vii) Contingent Obligations of Energizer or any of its Subsidiaries arising
under the Receivables Purchase Documents and (viii) Contingent Obligations
incurred in the ordinary course of business by any of Energizer's Subsidiaries
in respect of obligations of any Subsidiary.
(F) Conduct of Business; New Subsidiaries; Acquisitions. Except as
--------------------------------------------------------
expressly provided in clause (c) in the definition of "Permitted Acquisition"
----------
below, neither Energizer nor any of its Subsidiaries shall engage in any
business other than the businesses engaged in by Energizer and its Subsidiaries
on the date of such transaction and any business or activities which are
substantially similar, related or incidental thereto. Energizer may create,
acquire in a Permitted Acquisition or capitalize any Subsidiary (a "NEW
SUBSIDIARY") after the date hereof if (i) no Default or Unmatured Default shall
have occurred and be continuing or would result therefrom; (ii) after such
creation, acquisition or capitalization, all of the representations and
warranties contained herein shall be true and correct; and (iii) after such
creation, acquisition or capitalization Energizer shall be in compliance with
the terms of Sections 7.2(K) and 7.3(R).
---------------- -------
Without in any way limiting the foregoing, Energizer shall not make any
Acquisitions, other than Acquisitions meeting the following requirements or
otherwise approved by the Required Lenders (each such Acquisition constituting a
"PERMITTED ACQUISITION"):
(a) no Default or Unmatured Default shall have occurred and be continuing or
would result from such Acquisition or the incurrence of any Indebtedness in
connection therewith, and all of the representations and warranties contained
herein shall be true and correct on and as of the date such Acquisition with the
same effect as though made on and as of such date;
(b) the purchase is consummated pursuant to a negotiated acquisition
agreement on a non-hostile basis pursuant to an acquisition agreement approved
by the board of directors or other applicable governing body of the Seller prior
to the commencement thereof;
(c) the businesses being acquired shall be consumer product companies or
other businesses that are substantially similar, related or incidental to the
businesses or activities engaged in by Energizer and its Subsidiaries as of the
consummation of the Debt Assumption or such future business or activities
engaged in by Energizer and its Subsidiaries, as well as suppliers to or
distributors of products similar to those of Energizer and its Subsidiaries;
provided, however, that Energizer and its Subsidiaries shall be permitted to
- -------- -------
acquire businesses that do not satisfy the foregoing criteria in this clause (c)
----------
so long as the aggregate purchase price for all such acquisitions does not
exceed five percent (5%) of Energizer's consolidated tangible net assets (on a
pro forma basis) as of the date of the consummation of such Acquisition; and
(d) prior to each such Acquisition, Energizer shall determine that after
giving effect to such Acquisition and the incurrence of any Indebtedness by
Energizer or any of its Subsidiaries, to the extent permitted by Section 7.3(A),
--------------
in connection therewith, on a pro forma basis using historical audited and
--- -----
reviewed unaudited financial statements obtained from the seller, broken down by
fiscal quarter in Energizer's reasonable judgment, as if the Acquisition and
such incurrence of Indebtedness had occurred on the first day of the
twelve-month period ending on the last day of Energizer's most recently
completed fiscal quarter, Energizer would have been in compliance with the
financial covenants in Section 7.4 and not otherwise in Default.
------------
(G) Transactions with Ralston's Shareholders and Affiliates. Except for (a)
-------------------------------------------------------
the transactions set forth on Schedule 7.3(G), (b) Permitted Receivables
---------------
Transfers and (c) Investments permitted by Section 7.3(D), neither Energizer nor
--------------
any of its Subsidiaries shall directly or indirectly enter into or permit to
exist any transaction (including, without limitation, the purchase, sale, lease
or exchange of any property or the rendering of any service) with Ralston, any
holder or holders of any of the Equity Interests of Energizer, or with any
Affiliate of Energizer which is not its Subsidiary, on terms that are less
favorable to Energizer or any of its Subsidiaries, as applicable, than those
that might be obtained in an arm's length transaction at the time from Persons
who are not such a holder or Affiliate.
(H) Restriction on Fundamental Changes. Neither Energizer nor any of its
-------------------------------------
Subsidiaries shall enter into any merger or consolidation, or liquidate, wind-up
or dissolve (or suffer any liquidation or dissolution), or convey, lease, sell,
transfer or otherwise dispose of, in one transaction or series of transactions,
all or substantially all of Energizer's or any such Subsidiary's business or
property, whether now or hereafter acquired, except (i) transactions permitted
under Sections 7.3(B) or 7.3(F), and (ii) a Subsidiary of Energizer may be
---------------- ------
merged into, liquidated into or consolidated with Energizer (in which case
Energizer shall be the surviving corporation) or any wholly-owned Subsidiary of
Energizer, provided if a Subsidiary Guarantor is merged into, liquidated into or
--------
consolidated with another Subsidiary of Energizer, the surviving Subsidiary
shall also be or shall become a Subsidiary Guarantor.
(I) Sales and Leasebacks. Neither Energizer nor any of its Subsidiaries
----------------------
shall become liable, directly, by assumption or by Contingent Obligation, with
respect to any lease, whether an operating lease or a Capitalized Lease, of any
property (whether real or personal or mixed), (i) which it or one of its
Subsidiaries sold or transferred or is to sell or transfer to any other Person,
or (ii) which it or one of its Subsidiaries intends to use for substantially the
same purposes as any other property which has been or is to be sold or
transferred by it or one of its Subsidiaries to any other Person in connection
with such lease, unless in either case the sale involved is not prohibited under
Section 7.3(B) and the lease involved is not prohibited under Section 7.3(A).
- --------------- --------------
(J) Margin Regulations. Neither Energizer nor any of its Subsidiaries,
-------------------
shall use all or any portion of the proceeds of any credit extended under this
Agreement to purchase or carry Margin Stock.
(K) ERISA. Energizer shall not:
-----
(i) permit to exist any accumulated funding deficiency (as defined in
Sections 302 of ERISA and 412 of the Code), with respect to any Benefit Plan,
whether or not waived;
(ii) terminate, or permit any Controlled Group member to terminate, any
Benefit Plan which would result in liability of Energizer or any Controlled
Group member under Title IV of ERISA;
(iii) fail, or permit any Controlled Group member to fail, to pay any
required installment or any other payment required under Section 412 of the Code
on or before the due date for such installment or other payment; or
(iv) permit any unfunded liabilities with respect to any Foreign Pension
Plan;
except where such transactions, events, circumstances, or failures are not,
individually or in the aggregate, reasonably expected to result in liability
individually or in the aggregate in excess of $25,000,000 or have a Material
Adverse Effect.
(L) Corporate Documents. Neither Energizer nor any of its Subsidiaries
--------------------
shall amend, modify or otherwise change any of the terms or provisions in any of
their respective constituent documents as in effect on the date hereof in
any manner adverse to the interests of the Lenders, without the prior written
consent of the Required Lenders.
(M) Fiscal Year. Neither Energizer nor any of its consolidated Subsidiaries
-----------
shall change its fiscal year for accounting or tax purposes from a twelve-month
period ending September 30 of each year.
(N) Subsidiary Covenants. Energizer will not, and will not permit any
---------------------
Subsidiary to, create or otherwise cause to become effective any consensual
encumbrance or restriction of any kind on the ability of any Subsidiary to pay
dividends or make any other distribution on its stock, redeem or repurchase its
stock, make any other similar payment or distribution, pay any Indebtedness or
other Obligation owed to Energizer or any other Subsidiary, make loans or
advances or other Investments in Energizer or any other Subsidiary, to sell,
transfer or otherwise convey any of its property to Energizer or any other
Subsidiary or merge, consolidate with or liquidate into Energizer or any other
Subsidiary other than pursuant to the Receivables Purchase Documents.
(O) Hedging Obligations. Energizer shall not and shall not permit any of
--------------------
its Subsidiaries to enter into any Hedging Arrangements other than Hedging
Arrangements entered into by Energizer or its Subsidiaries pursuant to which
Energizer or such Subsidiary has hedged its or its Subsidiaries' reasonably
estimated interest rate, foreign currency or commodity exposure and which are of
a non-speculative nature. Such permitted Hedging Arrangements entered into by
Energizer and any Lender or any affiliate of any Lender are sometimes referred
to herein as "HEDGING AGREEMENTS."
(P) Issuance of Disqualified Stock. From and after the Closing Date,
---------------------------------
neither Energizer, nor any of its Subsidiaries shall issue any Disqualified
Stock. All issued and outstanding Disqualified Stock shall be treated as
Indebtedness for borrowed money for all purposes of this Agreement, and the
amount of such deemed Indebtedness shall be the aggregate amount of the
liquidation preference of such Disqualified Stock.
(Q) Non-Guarantor Subsidiaries. Energizer will not at any time permit the
---------------------------
aggregate assets of all of Energizer's domestic consolidated Subsidiaries (other
than the SPVs) which are not Subsidiary Guarantors to exceed ten percent (10%)
of Consolidated Assets of Energizer and its consolidated Subsidiaries (other
than the SPVs). Energizer shall not permit any of its Subsidiaries to guaranty
any Indebtedness of Energizer other than the Indebtedness hereunder or under the
364-Day Agreement unless each such Subsidiary is a Subsidiary Guarantor under
the Subsidiary Guaranty.
(R) Tax Ruling. Notwithstanding anything herein to the contrary, neither
------------
Energizer nor any of its Subsidiaries shall engage in any transaction (i)
described in Section 8.01(b) of the Reorganization Agreement for the time
----------------
periods specified therein unless Energizer or such Subsidiary shall have
obtained and/or delivered such documentation as may be required by Section
-------
8.01(a) thereof, or (ii) that would otherwise adversely affect the Tax Ruling.
7.4 Financial Covenants. Energizer shall comply with the following:
--------------------
(A) Maximum Leverage Ratio. Energizer shall not permit the ratio (the
------------------------
"LEVERAGE RATIO") of (i) the sum of (a) all Indebtedness of Energizer and its
Subsidiaries to (ii) EBITDA at any time to be greater than 3.00 to 1.00. The
Leverage Ratio shall be calculated, in each case, determined as of the last day
of each fiscal quarter based upon (a) for Indebtedness, Indebtedness as of the
last day of each such fiscal quarter; and (b) for EBITDA, the actual amount for
the four-quarter period ending on such day, calculated, with respect to
Permitted Acquisitions, on a pro forma basis using unadjusted historical audited
--- -----
and reviewed unaudited financial statements obtained from the seller (with
the EBITDA component thereof broken down by fiscal quarter in Energizer's
reasonable judgment).
(B) Minimum Interest Expense Coverage Ratio. Energizer shall maintain a
-------------------------------------------
ratio (the "INTEREST EXPENSE COVERAGE RATIO") for any applicable period of (a)
EBIT for such period to (b) Interest Expense for such period of greater than
3.00 to 1.00 for each fiscal quarter. The Interest Expense Coverage Ratio shall
be calculated as of the last day of each fiscal quarter for the four-quarter
period ending on such day; provided, that (i) for the fiscal quarter ending June
--------
30, 2000, the Interest Expense Coverage Ratio shall be calculated using EBIT and
Interest Expense for the fiscal quarter ending June 30, 2000, (b) for the fiscal
quarter ending September 30, 2000, the Interest Expense Coverage Ratio shall be
calculated using EBIT and Interest Expense for the two fiscal quarter period
ending September 30, 2000, and (iii) for the fiscal quarter ending December 31,
2000, the Interest Expense Coverage Ratio shall be calculated using such items
for Energizer and its consolidated Subsidiaries for the three fiscal quarter
period ending December 31, 2000.
ARTICLE VIII: DEFAULTS
- -------------- --------
8.1 Defaults. Each of the following occurrences shall constitute a Default
--------
under this Agreement:
(A) Failure to Make Payments When Due. The Borrower shall (i) fail to pay
-----------------------------------
when due any of the Obligations consisting of principal with respect to the
Loans or (ii) shall fail to pay within five (5) Business Days of the date when
due any of the other Obligations under this Agreement or the other Loan
Documents.
(B) Breach of Certain Covenants. The Borrower shall fail duly and
------------------------------
punctually to perform or observe any agreement, covenant or obligation binding
-
on the Borrower or there shall otherwise be a breach of any covenant under:
(i) Sections 7.1 or 7.2 and such failure or breach shall continue unremedied
------------ ---
for thirty (30) days after the earlier to occur of (a) the date on which
written notice from the Administrative Agent or any Lender is received by the
Borrower of such breach and (b) the date on which a member of the Senior
Management Team of the Borrower or any Subsidiary Guarantor had knowledge of the
existence of such breach or should have known of the existence of such breach;
or
(ii) Sections 7.3 or 7.4.
------------- ---
(C) Breach of Representation or Warranty. Any representation or warranty
---------------------------------------
made or deemed made by the Borrower to the Administrative Agent or any Lender
herein or by the Borrower or any of its Subsidiaries in any of the other Loan
Documents or in any statement or certificate at any time given by any such
Person pursuant to any of the Loan Documents shall be false or misleading in any
material respect on the date as of which made (or deemed made).
(D) Other Defaults. The Borrower shall default in the performance of or
---------------
compliance with any term contained in this Agreement (other than as covered by
paragraphs (A) or (B) of this Section 8.1), or the Borrower or any of its
-------------- --- ------------
Subsidiaries shall default in the performance of or compliance with any term
contained in any of the other Loan Documents, and such default shall continue
for thirty (30) days after the earlier to occur of (a) the date on which written
notice from the Administrative Agent or any Lender is received by the Borrower
of such breach and (b) the date on which a member of the Senior Management Team
of the Borrower or any Subsidiary Guarantor had knowledge of the existence of
such breach or should have known of the existence of such breach.
(E) Default as to Other Indebtedness. The Borrower or any of its
------------------------------------
Subsidiaries shall fail to make any payment when due (whether by scheduled
maturity, required prepayment, acceleration, demand or otherwise), beyond any
period of grace provided, with respect to (i) any Indebtedness incurred pursuant
to the 364-Day Credit Agreement or (ii) any other Indebtedness (other than
Indebtedness hereunder) which individually or together with other such
Indebtedness as to which any such failure exists (other than hereunder or under
the 364-Day Credit Agreement) constitutes Material Indebtedness; or any breach,
default or event of default (including any "Amortization Event" or event of like
import in connection with the Receivables Purchase Facility) shall occur, or any
other condition shall exist under any instrument, agreement or indenture
pertaining to any such Indebtedness under the 364-Day Credit Agreement or
Material Indebtedness having such aggregate outstanding principal amount, beyond
any period of grace, if any, provided with respect thereto, if the effect
thereof is to cause an acceleration, mandatory redemption, a requirement that
the Borrower offer to purchase such Indebtedness under the 364-Day Credit
Agreement or Material Indebtedness or other required repurchase of such
Indebtedness under the 364-Day Credit Agreement or Material Indebtedness, or
permit the holder(s) of such Indebtedness under the 364-Day Credit Agreement or
Material Indebtedness to accelerate the maturity of any such Indebtedness under
the 364-Day Credit Agreement or Material Indebtedness or require a redemption or
other repurchase of such Indebtedness under the 364-Day Credit Agreement or
Material Indebtedness; or any such Indebtedness under the 364-Day Credit
Agreement or Material Indebtedness shall be otherwise declared to be due and
payable (by acceleration or otherwise) or required to be prepaid, redeemed or
otherwise repurchased by the Borrower or any of its Subsidiaries (other than by
a regularly scheduled required prepayment) prior to the stated maturity thereof.
(F) Involuntary Bankruptcy; Appointment of Receiver, Etc.
(i) An involuntary case shall be commenced against the Borrower or any of
the Borrower's Material Subsidiaries and the petition shall not be dismissed,
stayed, bonded or discharged within sixty (60) days after commencement of the
case; or a court having jurisdiction in the premises shall enter a decree or
order for relief in respect of the Borrower or any of the Borrower's Material
Subsidiaries in an involuntary case, under any applicable bankruptcy, insolvency
or other similar law now or hereinafter in effect; or any other similar
relief shall be granted under any applicable federal, state, local or foreign
law.
(ii) A decree or order of a court having jurisdiction in the premises for
the appointment of a receiver, liquidator, sequestrator, trustee, custodian or
other officer having similar powers over the Borrower or any of the Borrower's
Material Subsidiaries or over all or a substantial part of the property of the
Borrower or any of the Borrower's Material Subsidiaries shall be entered; or an
interim receiver, trustee or other custodian of the Borrower or any of the
Borrower's Material Subsidiaries or of all or a substantial part of the property
of the Borrower or any of the Borrower's Material Subsidiaries shall be
appointed or a warrant of attachment, execution or similar process against any
substantial part of the property of the Borrower or any of the Borrower's
Material Subsidiaries shall be issued and any such event shall not be stayed,
dismissed, bonded or discharged within sixty (60) days after entry, appointment
or issuance.
(G) Voluntary Bankruptcy; Appointment of Receiver, Etc. The Borrower or any
---------------------------------------------------
of the Borrower's Material Subsidiaries shall (i) commence a voluntary case
under any applicable bankruptcy, insolvency or other similar law now or
hereafter in effect, (ii) consent to the entry of an order for relief in an
involuntary case, or to the conversion of an involuntary case to a voluntary
case, under any such law, (iii) consent to the appointment of or taking
possession by a receiver, trustee or other custodian for all or a substantial
part of its property, (iv) make any assignment for the benefit of creditors, (v)
take any corporate action to authorize any of the foregoing or (vi) is
generally not paying, or admits in writing its inability to pay, its debts as
they become due.
(H) Judgments and Attachments. Any money judgment(s) (other than a money
---------------------------
judgment covered by insurance as to which the insurance company has not
disclaimed or reserved the right to disclaim coverage), writ or warrant of
attachment, or similar process against the Borrower or any of its Subsidiaries
or any of their respective assets involving in any single case or in the
aggregate an amount in excess of $30,000,000 is or are entered and shall remain
undischarged, unvacated, unbonded or unstayed for a period of sixty (60) days or
in any event later than fifteen (15) days prior to the date of any proposed sale
thereunder.
(I) Dissolution. Any order, judgment or decree shall be entered against the
-----------
Borrower decreeing its involuntary dissolution or split up and such order shall
remain undischarged and unstayed for a period in excess of sixty (60) days; or
the Borrower shall otherwise dissolve or cease to exist except as specifically
permitted by this Agreement.
(J) Loan Documents. At any time, for any reason, any Loan Document as a
---------------
whole that materially affects the ability of the Administrative Agent, or any of
the Lenders to enforce the Obligations ceases to be in full force and effect or
the Borrower or any of the Borrower's Subsidiaries party thereto seeks to
repudiate its obligations under any Loan Document.
(K) Termination Event. Any Termination Event occurs which the Required
------------------
Lenders believe is reasonably likely to subject either the Borrower or any of
its Subsidiaries to liability individually or in the aggregate in excess of
$25,000,000.
(L) Waiver of Minimum Funding Standard. If the plan administrator of any
-------------------------------------
Plan applies under Section 412(d) of the Code for a waiver of the minimum
funding standards of Section 412(a) of the Code and the Required Lenders believe
the substantial business hardship upon which the application for the waiver is
based could reasonably be expected to subject either the Borrower or any of its
Subsidiaries to liability individually or in the aggregate in excess of
$25,000,000.
(M) Change of Control. A Change of Control shall occur.
-------------------
(N) Hedging Agreements. Nonpayment by the Borrower of any material
-------------------
obligation under any Hedging Agreement or the breach by the Borrower of any
material term, provision or condition contained in any such Hedging Agreement.
(O) Environmental Matters. The Borrower or any of its Subsidiaries shall be
---------------------
the subject of any proceeding or investigation pertaining to (i) the Release by
the Borrower or any of its Subsidiaries of any Contaminant into the environment,
(ii) the liability of the Borrower or any of its Subsidiaries arising from the
Release by any other Person of any Contaminant into the environment, or (iii)
any violation of any Environmental, Health or Safety Requirements of Law which
by the Borrower or any of its Subsidiaries, which, in any case, has or is
reasonably likely to subject either the Borrower or its Subsidiaries to
liability individually or in the aggregate in excess of $25,000,000.
(P) Subsidiary Guarantor Revocation. Any Subsidiary Guarantor shall
---------------------------------
terminate or revoke any of its obligations under the Subsidiary Guaranty or
breach any of the material terms of such Subsidiary Guaranty.
(Q) Receivables Purchase Document Events. Other than at the request of
---------------------------------------
Energizer, the "Amortization Date" or an event of like import resulting in the
termination of the reinvestment of collections or proceeds of Receivables and
Related Security shall occur under any Receivables Purchase Document.
A Default shall be deemed "continuing" until cured or until waived in
writing in accordance with Section 9.3.
------------
ARTICLE IX: ACCELERATION, DEFAULTING LENDERS; WAIVERS, AMENDMENTS AND
- ------------ --------------------------------------------------------------
REMEDIES
- --------
9.1 Termination of Revolving Loan Commitments; Acceleration. If any Default
-------------------------------------------------------
described in Section 8.1(F), (G) or (I) occurs with respect to the
--------------- --- ---
Borrower, the obligations of the Lenders to make Loans hereunder and the
obligation of the Issuing Banks to issue Letters of Credit hereunder shall
automatically terminate and the Obligations shall immediately become due and
payable without any election or action on the part of the Administrative Agent
or any Lender. If any other Default occurs, the Required Lenders may terminate
or suspend the obligations of the Lenders to make Loans hereunder and the
obligation of the Issuing Banks to issue Letters of Credit hereunder, or declare
the Obligations to be due and payable, or both, whereupon the Obligations shall
become immediately due and payable, without presentment, demand, protest or
notice of any kind, all of which the Borrower expressly waives.
9.2 Defaulting Lender. In the event that any Lender fails to fund its Pro
------------------
Rata Share of any Advance requested or deemed requested by the Borrower (or an
Advance to repay Swing Line Loans to the Swing Line Bank or Reimbursement
Obligations to the Issuing Banks), which such Lender is obligated to fund under
the terms of this Agreement (the funded portion of such Advance being
hereinafter referred to as a "NON PRO RATA LOAN"), until the earlier of such
Lender's cure of such failure and the termination of the Revolving Loan
Commitments, the proceeds of all amounts thereafter repaid to the Administrative
Agent by the Borrower and otherwise required to be applied to such Lender's
share of all other Obligations pursuant to the terms of this Agreement shall be
advanced to the Borrower by the Administrative Agent on behalf of such Lender to
cure, in full or in part, such failure by such Lender, but shall nevertheless be
deemed to have been paid to such Lender in satisfaction of such other
Obligations. Notwithstanding anything in this Agreement to the contrary:
(i) the foregoing provisions of this Section 9.2 shall apply only with
------------
respect to the proceeds of payments of Obligations and shall not affect the
conversion or continuation of Loans pursuant to Section 2.9;
------------
(ii) any such Lender shall be deemed to have cured its failure to fund its
Pro Rata Share, of any Advance at such time as an amount equal to such Lender's
original Pro Rata Share of the requested principal portion of such Advance is
fully funded to the Borrower, whether made by such Lender itself or by operation
of the terms of this Section 9.2, and whether or not the Non Pro Rata Loan with
-----------
respect thereto has been repaid, converted or continued;
(iii) amounts advanced to the Borrower to cure, in full or in part, any such
Lender's failure to fund its Pro Rata Share of any Advance ("CURE LOANS") shall
bear interest at the rate applicable to Floating Rate Loans in effect from time
to time, and for all other purposes of this Agreement shall be treated as if
they were Floating Rate Loans;
(iv) regardless of whether or not a Default has occurred or is continuing,
and notwithstanding the instructions of the Borrower as to its desired
application, all repayments of principal which, in accordance with the other
terms of this Agreement, would be applied to the outstanding Floating Rate Loans
shall be applied first, ratably to all Floating Rate Loans constituting Non Pro
-----
Rata Loans, second, ratably to Floating Rate Loans other than those constituting
------
Non Pro Rata Loans or Cure Loans and, third, ratably to Floating Rate Loans
-----
constituting Cure Loans;
(v) for so long as and until the earlier of any such Lender's cure of the
failure to fund its Pro Rata Share of any Advance and the termination of the
Revolving Loan Commitments, the term "Required Lenders" for purposes of this
Agreement shall mean Lenders (excluding all Lenders whose failure to fund their
respective Pro Rata Share of such Advance have not been so cured) whose Pro Rata
Shares represent greater than fifty percent (50%) of the aggregate Pro Rata
Shares of such Lenders; and
(vi) for so long as and until any such Lender's failure to fund its Pro Rata
Share of any Advance is cured in accordance with Section 9.2(ii), (A) such
---------------
Lender shall not be entitled to any Facility Fees with respect to its Revolving
Loan Commitment and (B) such Lender shall not be entitled to any letter of
credit fees, which Facility Fees and letter of credit fees shall accrue in favor
of the Lenders which have funded their respective Pro Rata Share of such
requested Advance, shall be allocated among such performing Lenders ratably
based upon their relative Revolving Loan Commitments, and shall be calculated
based upon the average amount by which the aggregate Revolving Loan Commitments
of such performing Lenders exceeds the sum of (I) the outstanding principal
amount of the Loans owing to such performing Lenders, plus (II) the outstanding
----
Reimbursement Obligations owing to such performing Lenders, plus (III) the
----
aggregate participation interests of such performing Lenders arising pursuant to
Section 3.6 with respect to undrawn and outstanding Letters of Credit.
- ------------
9.3 Amendments. Subject to the provisions of this Article IX, the Required
---------- ----------
Lenders (or the Administrative Agent with the consent in writing of the Required
Lenders) and the Borrower may enter into agreements supplemental hereto for
the purpose of adding or modifying any provisions to the Loan Documents or
changing in any manner the rights of the Lenders or the Borrower hereunder or
waiving any Default hereunder; provided, however, that no such supplemental
-------- -------
agreement shall, without the consent of each Lender (which is not a defaulting
Lender under the provisions of Section 9.2) affected thereby:
------------
(i) Postpone or extend the Revolving Loan Termination Date or any other date
fixed for any payment of principal of, or interest on, the Loans, the
Reimbursement Obligations or any fees or other amounts payable to such Lender
(other than any modifications of the provisions relating to amounts, timing or
application of prepayments of the Loans and other Obligations, which
modifications shall require the approval only of the Required Lenders).
(ii) Reduce the principal amount of any Loans or L/C Obligations, or reduce
the rate or extend the time of payment of interest or fees thereon (other than
(a) a waiver of the application of the default rate of interest pursuant to
Section 2.10 hereof and (b) as a result of a change in the definition of
- -------------
Leverage Ratio or any of the components thereof or the method of calculation
thereof).
(iii) Reduce the percentage specified in the definition of Required Lenders
or any other percentage of Lenders specified to be the applicable percentage in
this Agreement to act on specified matters or amend the definitions of "Required
Lenders" or "Pro Rata Share".
(iv) Increase the amount of the Revolving Loan Commitment of such Lender
hereunder or increase such Lender's Pro Rata Share.
(v) Permit the Borrower to assign its rights under this Agreement, other
than pursuant to the Debt Assumption.
(vi) other than pursuant to a transaction permitted by the terms of this
Agreement, release any guarantor from its obligations under the Subsidiary
Guaranty.
(vii) Amend this Section 9.3.
------------
No amendment of any provision of this Agreement relating to (a) the
Administrative Agent shall be effective without the written consent of the
Administrative Agent, (b) Swing Line Loans shall be effective without the
written consent of the Swing Line Bank and (c) any Issuing Bank shall be
effective without the written consent of such Issuing Bank. The Administrative
Agent may waive payment of the fee required under Section 13.3(B) without
---------------
obtaining the consent of any of the Lenders.
9.4 Preservation of Rights. No delay or omission of the Lenders or the
------------------------
Administrative Agent to exercise any right under the Loan Documents shall impair
such right or be construed to be a waiver of any Default or an acquiescence
therein, and the making of a Loan or the issuance of a Letter of Credit
notwithstanding the existence of a Default or the inability of the Borrower to
satisfy the conditions precedent to such Loan or issuance of such Letter of
Credit shall not constitute any waiver or acquiescence. Any single or partial
exercise of any such right shall not preclude other or further exercise thereof
or the exercise of any other right, and no waiver, amendment or other variation
of the terms, conditions or provisions of the Loan Documents whatsoever shall be
valid unless in writing signed by the Lenders required pursuant to Section 9.3,
-----------
and then only to the extent in such writing specifically set forth. All
remedies contained in the Loan Documents or by law afforded shall be cumulative
and all shall be available to the Administrative Agent and the Lenders until all
of the Obligations (other than contingent indemnity obligations) shall have been
fully and indefeasibly paid and satisfied in cash, all financing arrangements
among the Borrower and the Lenders shall have been terminated and all of the
Letters of Credit shall have expired, been canceled or terminated.
ARTICLE X: GENERAL PROVISIONS
- ----------- -------------------
10.1 Survival of Representations. All representations and warranties of the
---------------------------
Borrower contained in this Agreement shall survive delivery of this
Agreement and the making of the Loans herein contemplated.
10.2 Governmental Regulation. Anything contained in this Agreement to the
------------------------
contrary notwithstanding, no Lender shall be obligated to extend credit to the
Borrower in violation of any limitation or prohibition provided by any
applicable statute or regulation.
10.3 Performance of Obligations. The Borrower agrees that after the
----------------------------
occurrence and during the continuance of a Default, the Administrative Agent
may, but shall have no obligation to, make any payment or perform any act
required of the Borrower under any Loan Document to the extent the
Administrative Agent determines that such action shall be necessary or advisable
in order to protect or preserve the rights of the Lenders and Issuing Banks
hereunder. The Administrative Agent shall use its reasonable efforts to give
the Borrower notice of any action taken under this Section 10.3 prior to the
------------
taking of such action or promptly thereafter provided the failure to give such
notice shall not affect the Borrower's obligations in respect thereof. The
Borrower agrees to pay the Administrative Agent, upon demand, the principal
amount of all funds advanced by the Administrative Agent under this Section
-------
10.3, together with interest thereon at the rate from time to time applicable to
Floating Rate Loans from the date of such advance until the outstanding
principal balance thereof is paid in full. If the Borrower fails to make
payment in respect of any such advance under this Section 10.3 within one (1)
------------
Business Day after the date the Borrower receives written demand therefor from
the Administrative Agent, the Administrative Agent shall promptly notify each
Lender and each Lender agrees that it shall thereupon make available to the
Administrative Agent, in Dollars in immediately available funds, the amount
equal to such Lender's Pro Rata Share of such advance. If such funds are not
made available to the Administrative Agent by such Lender within one (1)
Business Day after the Administrative Agent's demand therefor, the
Administrative Agent will be entitled to recover any such amount from such
Lender together with interest thereon at the Federal Funds Effective Rate for
each day during the period commencing on the date of such demand and ending on
the date such amount is received. The failure of any Lender to make available
to the Administrative Agent its Pro Rata Share of any such unreimbursed advance
under this Section 10.3 shall neither relieve any other Lender of its obligation
------------
hereunder to make available to the Administrative Agent such other Lender's Pro
Rata Share of such advance on the date such payment is to be made nor increase
the obligation of any other Lender to make such payment to the Administrative
Agent. All outstanding principal of, and interest on, advances made under this
Section 10.3 shall constitute Obligations subject to the terms of this Agreement
- ------------
until paid in full by the Borrower.
10.4 Headings. Section headings in the Loan Documents are for convenience
--------
of reference only, and shall not govern the interpretation of any of the
provisions of the Loan Documents.
10.5 Entire Agreement. The Loan Documents embody the entire agreement and
-----------------
understanding among the Borrower, the Administrative Agent and the Lenders and
supersede all prior agreements and understandings among the Borrower, the
Administrative Agent and the Lenders relating to the subject matter thereof.
10.6 Several Obligations; Benefits of this Agreement. The respective
----------------------------------------------------
obligations of the Lenders hereunder are several and not joint and no Lender
shall be the partner or agent of any other Lender (except to the extent to which
the Administrative Agent is authorized to act as such). The failure of any
Lender to perform any of its obligations hereunder shall not relieve any other
Lender from any of its obligations hereunder. This Agreement shall not be
construed so as to confer any right or benefit upon any Person other than the
parties to this Agreement and their respective successors and assigns.
10.7 Expenses; Indemnification.
--------------------------
(A) Expenses. The Borrower shall reimburse the Administrative Agent and the
--------
Arranger for any reasonable costs, internal charges and out-of-pocket
expenses (including reasonable attorneys' and paralegals' fees and time charges
of attorneys and paralegals for the Administrative Agent, which attorneys and
paralegals may be employees of the Administrative Agent) paid or incurred by the
Administrative Agent or the Arranger in connection with the preparation,
negotiation, execution, delivery, syndication, review, amendment modification
and, after the occurrence and during the continuance of a Default or an
Unmatured Default, administration of the Loan Documents. The Borrower also
agrees to reimburse the Administrative Agent and the Arranger and the Lenders
for any reasonable costs and out-of-pocket expenses (including reasonable
attorneys' and paralegals' fees and time charges of attorneys and paralegals for
the Administrative Agent and the Arranger and the Lenders, which attorneys and
paralegals may be employees of the Administrative Agent or the Arranger or the
Lenders) paid or incurred by the Administrative Agent or the Arranger or any
Lender in connection with the collection of the Obligations and enforcement of
the Loan Documents; provided, that after the occurrence and during the
--------
continuance of a Default, the Borrower agrees to reimburse the Administrative
Agent, the Arranger and the Lenders for all such costs and out-of-pocket
expenses, whether or not reasonable.
(B) Indemnity. The Borrower further agrees to defend, protect, indemnify,
---------
and hold harmless the Administrative Agent, the Arranger, the Syndication Agent,
the Documentation Agent and each and all of the Lenders and each of their
respective Affiliates, and each of such Administrative Agent's, Syndication
Agent's, Documentation Agent's, Arranger's, Lender's, or Affiliate's respective
officers, directors, trustees, investment advisors, employees, attorneys and
agents (including, without limitation, those retained in connection with the
satisfaction or attempted satisfaction of any of the conditions set forth in
Article V) (collectively, the "INDEMNITEES") from and against any and all
- ----------
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
claims, costs, expenses of any kind or nature whatsoever (including, without
limitation, the fees and disbursements of counsel for such Indemnitees in
connection with any investigative, administrative or judicial proceeding,
whether or not such Indemnitees shall be designated a party thereto), imposed
on, incurred by, or asserted against such Indemnitees in any manner relating to
or arising out of:
(i) this Agreement, the other Loan Documents or any of the Transaction
Documents, or any act, event or transaction related or attendant thereto or to
the Transactions, the making of the Loans, and the issuance of and participation
in Letters of Credit hereunder, the management of such Loans or Letters of
Credit, the use or intended use of the proceeds of the Loans or Letters of
Credit hereunder, or any of the other transactions contemplated by the
Transaction Documents; or
(ii) any liabilities, obligations, responsibilities, losses, damages,
personal injury, death, punitive damages, economic damages, consequential
damages, treble damages, intentional, willful or wanton injury, damage or threat
to the environment, natural resources or public health or welfare, costs and
expenses (including, without limitation, attorney, expert and consulting fees
and costs of investigation, feasibility or remedial action studies), fines,
penalties and monetary sanctions, interest, direct or indirect, known or
unknown, absolute or contingent, past, present or future relating to violation
of any Environmental, Health or Safety Requirements of Law arising from or in
connection with the past, present or future operations of the Borrower, its
Subsidiaries or any of their respective predecessors in interest, or, the past,
present or future environmental, health or safety condition of any respective
property of the Borrower or its Subsidiaries, the presence of
asbestos-containing materials at any respective property of the Borrower or its
Subsidiaries or the Release or threatened Release of any Contaminant into the
environment (collectively, the "INDEMNIFIED MATTERS");
provided, however, the Borrower shall have no obligation to an Indemnitee
- -------- -------
hereunder with respect to Indemnified Matters caused by or resulting from the
willful misconduct or gross negligence of such Indemnitee with respect to the
Loan Documents, as determined by the final non-appealed judgment of a court of
competent jurisdiction. If the undertaking to indemnify, pay and hold harmless
set forth in the preceding sentence may be unenforceable because it is violative
of any law or public policy, the Borrower shall contribute the maximum portion
which it is permitted to pay and satisfy under applicable law, to the payment
and satisfaction of all Indemnified Matters incurred by the Indemnitees.
Each Indemnitee, with respect to any action against it in respect of which
indemnity may be sought under this Section, shall give written notice of the
commencement of such action to the Borrower within a reasonable time after such
Indemnitee is made a party to such action. Upon receipt of any such notice by
the Borrower, unless such Indemnitee shall be advised by its counsel that there
are or may be legal defenses available to such Indemnitee that are different
from, in addition to, or in conflict with, the defenses available to the
Borrower or any of its Subsidiaries, the Borrower may participate with the
Indemnitee in the defense of such Indemnified Matter, including the employment
of counsel consented to by such Indemnitee (which consent shall not be
unreasonably withheld); provided, however, nothing provided herein shall entitle
-------- -------
(a) the Borrower or any of its Subsidiaries to assume the defense of such
Indemnified Matter or (b) any Indemnitee to effect any settlement in respect of
any indemnified matter without the Borrower's consent, such consent not to be
unreasonably withheld.
(C) Waiver of Certain Claims; Settlement of Claims. The Borrower further
-------------------------------------------------
agrees to assert no claim against any of the Indemnitees on any theory of
liability seeking consequential, special, indirect, exemplary or punitive
damages. No settlement of any claim asserted against or likely to be asserted
against an Indemnitee shall be entered into by the Borrower or any if its
Subsidiaries with respect to any claim, litigation, arbitration or other
proceeding relating to or arising out of the transactions evidenced by this
Agreement, the other Loan Documents or in connection with the Transactions
(whether or not the Administrative Agent or any Lender or any Indemnitee is a
party thereto) unless such settlement releases such Indemnitee from any and all
liability with respect thereto.
(D) Survival of Agreements. The obligations and agreements of the Borrower
-----------------------
under this Section 10.7 shall survive the termination of this Agreement.
-------------
10.8 Numbers of Documents. All statements, notices, closing documents, and
---------------------
requests hereunder shall be furnished to the Administrative Agent with
sufficient counterparts so that the Administrative Agent may furnish one to each
of the Lenders.
10.9 Accounting. Except as provided to the contrary herein, all accounting
----------
terms used herein shall be interpreted and all accounting determinations
hereunder shall be made in accordance with Agreement Accounting Principles. If
any changes in generally accepted accounting principles are hereafter required
or permitted and are adopted by the Borrower or any of its Subsidiaries with the
agreement of its independent certified public accountants and such changes
result in a change in the method of calculation of any of the financial
covenants, tests, restrictions or standards herein or in the related definitions
or terms used therein ("ACCOUNTING CHANGES"), the parties hereto agree, at the
Borrower's request, to enter into negotiations, in good faith, in order to amend
such provisions in a credit neutral manner so as to reflect equitably such
changes with the desired result that the criteria for evaluating the Borrower's
and its Subsidiaries' financial condition shall be the same after such changes
as if such changes had not been made; provided, however, until such provisions
-------- -------
are amended in a manner reasonably satisfactory to the Administrative Agent and
the Required Lenders, no Accounting Change shall be given effect in such
calculations and all financial statements and reports required to be delivered
hereunder shall be prepared in accordance with Agreement Accounting Principles
without taking into account such Accounting Changes. In the event such
amendment is entered into, all references in this Agreement to Agreement
Accounting Principles shall mean generally accepted accounting principles as of
the date of such amendment.
10.10 Severability of Provisions. Any provision in any Loan Document that
----------------------------
is held to be inoperative, unenforceable, or invalid in any jurisdiction shall,
as to that jurisdiction, be inoperative, unenforceable, or invalid without
affecting the remaining provisions in that jurisdiction or the operation,
enforceability, or validity of that provision in any other jurisdiction, and to
this end the provisions of all Loan Documents are declared to be severable.
10.11 Nonliability of Lenders. The relationship between the Borrower and
-------------------------
the Lenders and the Administrative Agent shall be solely that of borrower and
lender. Neither the Administrative Agent nor any Lender shall have any
fiduciary responsibilities to the Borrower. Neither the Administrative Agent
nor any Lender undertakes any responsibility to the Borrower to review or inform
the Borrower of any matter in connection with any phase of the Borrower's
business or operations.
10.12 GOVERNING LAW. THE ADMINISTRATIVE AGENT ACCEPTS THIS AGREEMENT, ON
--------------
BEHALF OF ITSELF AND THE LENDERS, AT CHICAGO, ILLINOIS BY ACKNOWLEDGING AND
AGREEING TO IT THERE. ANY DISPUTE BETWEEN THE BORROWER AND THE ADMINISTRATIVE
AGENT, ANY LENDER OR ANY OTHER HOLDER OF OBLIGATIONS ARISING OUT OF, CONNECTED
WITH, RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED BETWEEN THEM IN
CONNECTION WITH, THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS, AND WHETHER
ARISING IN CONTRACT, TORT, EQUITY, OR OTHERWISE, SHALL BE RESOLVED IN ACCORDANCE
WITH THE INTERNAL LAWS (INCLUDING 735 ILCS 105/5-1 ET SEQ. BUT OTHERWISE WITHOUT
REGARD TO THE CONFLICTS OF LAWS PROVISIONS) OF THE STATE OF ILLINOIS.
10.13 CONSENT TO JURISDICTION; JURY TRIAL.
---------------------------------------
(A) EXCLUSIVE JURISDICTION. EXCEPT AS PROVIDED IN SUBSECTION (B), EACH OF
----------------------- --------------
THE PARTIES HERETO AGREES THAT ALL DISPUTES AMONG THEM ARISING OUT OF, CONNECTED
WITH, RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED AMONG THEM
IN CONNECTION WITH, THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS WHETHER
ARISING IN CONTRACT, TORT, EQUITY, OR OTHERWISE, SHALL BE RESOLVED EXCLUSIVELY
BY STATE OR FEDERAL COURTS LOCATED IN CHICAGO, ILLINOIS, BUT THE PARTIES HERETO
ACKNOWLEDGE THAT ANY APPEALS FROM THOSE COURTS MAY HAVE TO BE HEARD BY A COURT
LOCATED OUTSIDE OF CHICAGO, ILLINOIS. EACH OF THE PARTIES HERETO WAIVES IN ALL
DISPUTES BROUGHT PURSUANT TO THIS SUBSECTION (A) ANY OBJECTION THAT IT MAY HAVE
--------------
TO THE LOCATION OF THE COURT CONSIDERING THE DISPUTE.
(B) OTHER JURISDICTIONS. THE BORROWER AGREES THAT THE ADMINISTRATIVE AGENT,
-------------------
ANY LENDER OR ANY OTHER HOLDER OF OBLIGATIONS SHALL HAVE THE RIGHT TO PROCEED
AGAINST THE BORROWER OR ITS PROPERTY IN A COURT IN ANY LOCATION TO ENABLE SUCH
PERSON TO (1) OBTAIN PERSONAL JURISDICTION OVER THE BORROWER OR (2) IN ORDER TO
ENFORCE A JUDGMENT OR OTHER COURT ORDER ENTERED IN FAVOR OF SUCH PERSON. THE
BORROWER AGREES THAT IT WILL NOT ASSERT ANY PERMISSIVE COUNTERCLAIMS IN ANY
PROCEEDING BROUGHT BY SUCH PERSON TO REALIZE ON ANY SECURITY FOR THE OBLIGATIONS
OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER IN FAVOR OF SUCH PERSON BUT SHALL
ONLY BE PERMITTED TO BRING ANY SUCH PERMISSIVE COUNTERCLAIM IN A PROCEEDING
BROUGHT PURSUANT TO CLAUSE (A). THE BORROWER WAIVES ANY OBJECTION THAT IT MAY
-----------
HAVE TO THE LOCATION OF THE COURT IN WHICH SUCH PERSON HAS COMMENCED A
PROCEEDING DESCRIBED IN THIS SUBSECTION (B).
---------------
(C) VENUE. THE BORROWER IRREVOCABLY WAIVES ANY OBJECTION (INCLUDING,
-----
WITHOUT LIMITATION, ANY OBJECTION OF THE LAYING OF VENUE OR BASED ON THE GROUNDS
OF FORUM NON CONVENIENS) WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF
----- --- ----------
ANY SUCH ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER
INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION HEREWITH
IN ANY JURISDICTION SET FORTH ABOVE.
(D) WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES ANY
--------------------
RIGHT TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER SOUNDING IN
CONTRACT, TORT, OR OTHERWISE, ARISING OUT OF, CONNECTED WITH, RELATED TO OR
INCIDENTAL TO THE RELATIONSHIP ESTABLISHED AMONG THEM IN CONNECTION WITH THIS
AGREEMENT OR ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED
IN CONNECTION HEREWITH. EACH OF THE PARTIES HERETO AGREES AND CONSENTS THAT ANY
SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL
WITHOUT A JURY AND THAT ANY PARTY HERETO MAY FILE AN ORIGINAL COUNTERPART OR A
COPY OF THIS AGREEMENT WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE
PARTIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.
(E) ADVICE OF COUNSEL. EACH OF THE PARTIES REPRESENTS TO EACH OTHER PARTY
-------------------
HERETO THAT IT HAS DISCUSSED THIS AGREEMENT AND, SPECIFICALLY, THE PROVISIONS OF
SECTION 10.7 AND THIS SECTION 10.13, WITH ITS COUNSEL.
- ------------- --------------
10.14 Subordination of Intercompany Indebtedness. The Borrower agrees that
-------------------------------------------
any and all claims of the Borrower against any of its Subsidiaries that is a
Subsidiary Guarantor with respect to any "Intercompany Indebtedness" (as
hereinafter defined), any endorser, obligor or any other guarantor of all or any
part of the Obligations, or against any of its properties shall be
subordinate and subject in right of payment to the prior payment, in full and in
cash, of all Obligations and Hedging Obligations under Hedging Agreements;
provided that, and not in contravention of the foregoing, so long as no Default
has occurred and is continuing the Borrower may make loans to and receive
payments in the ordinary course with respect to such Intercompany Indebtedness
from each such Subsidiary Guarantor to the extent permitted by the terms of this
Agreement and the other Loan Documents. Notwithstanding any right of the
Borrower to ask, demand, sue for, take or receive any payment from any
Subsidiary Guarantor, all rights, liens and security interests of the Borrower,
whether now or hereafter arising and howsoever existing, in any assets of any
Subsidiary Guarantor shall be and are subordinated to the rights of the holders
of the Obligations and the Administrative Agent in those assets. The Borrower
shall have no right to possession of any such asset or to foreclose upon any
such asset, whether by judicial action or otherwise, unless and until all of the
Obligations (other than contingent indemnity obligations) and the Hedging
Obligations under Hedging Agreements shall have been fully paid and satisfied
(in cash) and all financing arrangements pursuant to any Loan Document or
Hedging Agreement among the Borrower and the holders of the Obligations (or any
affiliate thereof) have been terminated. If all or any part of the assets of
any Subsidiary Guarantor, or the proceeds thereof, are subject to any
distribution, division or application to the creditors of such Subsidiary
Guarantor, whether partial or complete, voluntary or involuntary, and whether by
reason of liquidation, bankruptcy, arrangement, receivership, assignment for the
benefit of creditors or any other action or proceeding, or if the business of
any such Subsidiary Guarantor is dissolved or if substantially all of the assets
of any such Subsidiary Guarantor are sold, then, and in any such event (such
events being herein referred to as an "INSOLVENCY EVENT"), any payment or
distribution of any kind or character, either in cash, securities or other
property, which shall be payable or deliverable upon or with respect to any
indebtedness of any Subsidiary Guarantor to the Borrower ("INTERCOMPANY
INDEBTEDNESS") shall be paid or delivered directly to the Administrative Agent
for application on any of the Obligations and Hedging Obligations under the
Hedging Agreements, due or to become due, until such Obligations and Hedging
Obligations (other than contingent indemnity obligations) shall have first been
fully paid and satisfied (in cash). Should any payment, distribution, security
or instrument or proceeds thereof be received by the Borrower upon or with
respect to the Intercompany Indebtedness after an Insolvency Event prior to the
satisfaction of all of the Obligations (other than contingent indemnity
obligations) and Hedging Obligations under Hedging Agreements and the
termination of all financing arrangements pursuant to any Loan Document or
Hedging Agreement among the Borrower and the holders of Obligations (and their
affiliates), the Borrower shall receive and hold the same in trust, as trustee,
for the benefit of the holders of the Obligations and such Hedging Obligations
and shall forthwith deliver the same to the Administrative Agent, for the
benefit of such Persons, in precisely the form received (except for the
endorsement or assignment of the Borrower where necessary), for application to
any of the Obligations and such Hedging Obligations, due or not due, and, until
so delivered, the same shall be held in trust by the Borrower as the property of
the holders of the Obligations and such Hedging Obligations. If the Borrower
fails to make any such endorsement or assignment to the Administrative Agent,
the Administrative Agent or any of its officers or employees are irrevocably
authorized to make the same. The Borrower agrees that until the Obligations
(other than the contingent indemnity obligations) and such Hedging Obligations
have been paid in full (in cash) and satisfied and all financing arrangements
pursuant to any Loan Document or Hedging Agreement among the Borrower and the
holders of the Obligations (and their affiliates) have been terminated, the
Borrower will not assign or transfer to any Person (other than the
Administrative Agent) any claim the Borrower has or may have against any
Subsidiary Guarantor.
ARTICLE XI: THE ADMINISTRATIVE AGENT
- ------------ --------------------------
11.1 Appointment; Nature of Relationship. Bank One, NA, having its
---------------------------------------
principal office in Chicago, Illinois is appointed by the Lenders as the
Administrative Agent hereunder and under each other Loan Document, and each of
the Lenders irrevocably authorizes the Administrative Agent to act as the
contractual representative of such Lender with the rights and duties expressly
set forth herein and in the other Loan Documents. The Administrative Agent
agrees to act as such contractual representative upon the express conditions
contained in this Article XI. Notwithstanding the use of the defined term
-----------
"Administrative Agent," it is expressly understood and agreed that the
Administrative Agent shall not have any fiduciary responsibilities to any Holder
of Obligations by reason of this Agreement and that the Administrative
Agent is merely acting as the representative of the Lenders with only those
duties as are expressly set forth in this Agreement and the other Loan
Documents. In its capacity as the Lenders' contractual representative, the
Administrative Agent (i) does not assume any fiduciary duties to any of the
Holders of Obligations, (ii) is a "representative" of the Holders of Obligations
within the meaning of Section 9-105 of the Uniform Commercial Code and (iii) is
acting as an independent contractor, the rights and duties of which are limited
to those expressly set forth in this Agreement and the other Loan Documents.
Each of the Lenders, for itself and on behalf of its affiliates as Holders of
Obligations, agrees to assert no claim against the Administrative Agent on any
agency theory or any other theory of liability for breach of fiduciary duty, all
of which claims each Holder of Obligations waives.
11.2 Powers. The Administrative Agent shall have and may exercise such
------
powers under the Loan Documents as are specifically delegated to the
Administrative Agent by the terms of each thereof, together with such powers as
are reasonably incidental thereto. The Administrative Agent shall have no
implied duties or fiduciary duties to the Lenders, or any obligation to the
Lenders to take any action hereunder or under any of the other Loan Documents
except any action specifically provided by the Loan Documents required to be
taken by the Administrative Agent.
11.3 General Immunity. Neither the Administrative Agent nor any of its
-----------------
directors, officers, agents or employees shall be liable to the Borrower, the
Lenders or any Lender for any action taken or omitted to be taken by it or them
hereunder or under any other Loan Document or in connection herewith or
therewith except to the extent such action or inaction is found in a final
judgment by a court of competent jurisdiction to have arisen solely from the
gross negligence or willful misconduct of such Person.
11.4 No Responsibility for Loans, Creditworthiness, Recitals, Etc. Neither
-------------------------------------------------------------
the Administrative Agent nor any of its directors, officers, agents or employees
shall be responsible for or have any duty to ascertain, inquire into, or verify
(i) any statement, warranty or representation made in connection with any Loan
Document or any borrowing hereunder; (ii) the performance or observance of any
of the covenants or agreements of any obligor under any Loan Document; (iii) the
satisfaction of any condition specified in Article V, except receipt of items
---------
required to be delivered solely to the Administrative Agent; (iv) the existence
or possible existence of any Default or (v) the validity, effectiveness or
genuineness of any Loan Document or any other instrument or writing furnished in
connection therewith. The Administrative Agent shall not be responsible to any
Lender for any recitals, statements, representations or warranties herein or in
any of the other Loan Documents, for the perfection or priority of the Liens on
collateral, if any, or for the execution, effectiveness, genuineness, validity,
legality, enforceability, collectibility, or sufficiency of this Agreement or
any of the other Loan Documents or the transactions contemplated thereby, or for
the financial condition of any guarantor of any or all of the Obligations, the
Borrower or any of its Subsidiaries.
11.5 Action on Instructions of Lenders. The Administrative Agent shall in
-----------------------------------
all cases be fully protected in acting, or in refraining from acting, hereunder
and under any other Loan Document in accordance with written instructions signed
by the Required Lenders (or all of the Lenders in the event that and to the
extent that this Agreement expressly requires such), and such instructions and
any action taken or failure to act pursuant thereto shall be binding on all of
the Lenders and on all owners of Loans and on all Holders of Obligations. The
Administrative Agent shall be fully justified in failing or refusing to take any
action hereunder and under any other Loan Document unless it shall first be
indemnified to its satisfaction by the Lenders pro rata against any and all
liability, cost and expense that it may incur by reason of taking or continuing
to take any such action.
11.6 Employment of Administrative Agents and Counsel. The Administrative
--------------------------------------------------
Agent may execute any of its duties as the Administrative Agent hereunder and
under any other Loan Document by or through employees, agents, and
attorney-in-fact and shall not be answerable to the Lenders, except as to money
or securities received by it or its authorized agents, for the default or
misconduct of any such agents or attorneys-in-fact selected by it with
reasonable care. The Administrative Agent shall be entitled to advice of
counsel concerning the contractual arrangement between the Administrative Agent
and the Lenders and all matters pertaining to the Administrative Agent's duties
hereunder and under any other Loan Document.
11.7 Reliance on Documents; Counsel. The Administrative Agent shall be
---------------------------------
entitled to rely upon any notice, consent, certificate, affidavit, letter,
telegram, statement, paper or document believed by it to be genuine and correct
and to have been signed or sent by the proper person or persons, and, in respect
to legal matters, upon the opinion of counsel selected by the Administrative
Agent, which counsel may be employees of the Administrative Agent.
11.8 The Administrative Agent's Reimbursement and Indemnification. The
-----------------------------------------------------------------
Lenders agree to reimburse and indemnify the Administrative Agent ratably in
proportion to their respective Pro Rata Shares (i) for any amounts not
reimbursed by the Borrower for which the Administrative Agent is entitled to
reimbursement by the Borrower under the Loan Documents, (ii) for any other
expenses incurred by the Administrative Agent on behalf of the Lenders, in
connection with the preparation, execution, delivery, administration and
enforcement of the Loan Documents and (iii) for any liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind and nature whatsoever which may be imposed on,
incurred by or asserted against the Administrative Agent in any way relating to
or arising out of the Loan Documents or any other document delivered in
connection therewith or the transactions contemplated thereby, or the
enforcement of any of the terms thereof or of any such other documents, provided
--------
that no Lender shall be liable for any of the foregoing to the extent any of the
foregoing is found in a final non-appealable judgment by a court of competent
jurisdiction to have arisen solely from the gross negligence or willful
misconduct of the Administrative Agent.
11.9 Rights as a Lender. With respect to its Revolving Loan Commitment,
---------------------
Loans made by it, and Letters of Credit issued by it, the Administrative Agent
shall have the same rights and powers hereunder and under any other Loan
Document as any Lender or Issuing Bank and may exercise the same as though it
were not the Administrative Agent, and the term "Lender" or "Lenders" or
"Issuing Bank" or "Issuing Banks" shall, unless the context otherwise indicates,
include the Administrative Agent in its individual capacity. The Administrative
Agent may accept deposits from, lend money to, and generally engage in any kind
of trust, debt, equity or other transaction, in addition to those contemplated
by this Agreement or any other Loan Document, with the Borrower or any of its
Subsidiaries in which such Person is not prohibited hereby from engaging with
any other Person.
11.10 Lender Credit Decision. Each Lender acknowledges that it has,
------------------------
independently and without reliance upon the Administrative Agent, the Arranger
or any other Lender and based on the financial statements prepared by the
Borrower and such other documents and information as it has deemed appropriate,
made its own credit analysis and decision to enter into this Agreement and the
other Loan Documents. Each Lender also acknowledges that it will, independently
and without reliance upon the Administrative Agent, the Arranger 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 decisions in taking or not taking
action under this Agreement and the other Loan Documents.
11.11 Successor Administrative Agent. The Administrative Agent may resign
--------------------------------
at any time by giving written notice thereof to the Lenders and the Borrower.
Upon any such resignation, the Required Lenders shall have the right to appoint,
on behalf of the Borrower and the Lenders, a successor Administrative Agent. If
no successor Administrative Agent shall have been so appointed by the Required
Lenders and shall have accepted such appointment within thirty days after the
retiring Administrative Agent's giving notice of resignation, then the retiring
Administrative Agent may appoint, on behalf of the Borrower and the Lenders, a
successor Administrative Agent. Notwithstanding anything herein to the
contrary, so long as no Default has occurred and is continuing, each such
successor Administrative Agent shall be subject to approval by the Borrower,
which approval shall not be unreasonably withheld. Such successor
Administrative Agent shall be a commercial bank having capital and retained
earnings of at least $500,000,000. Upon the acceptance of any appointment as
the Administrative Agent hereunder by a successor Administrative Agent, such
successor Administrative Agent shall thereupon succeed to and become vested with
all the rights, powers, privileges and duties of the retiring Administrative
Agent, and the retiring Administrative Agent shall be discharged from its duties
and obligations hereunder and under the other Loan Documents. After any
retiring Administrative Agent's resignation hereunder as Administrative Agent,
the provisions of this Article XI shall continue in effect for its benefit in
----------
respect of any actions taken or omitted to be taken by it while it was acting as
the Administrative Agent hereunder and under the other Loan Documents.
11.12 No Duties Imposed Upon Syndication Agent, Documentation Agent or
-----------------------------------------------------------------
Arranger. None of the Persons identified on the cover page to this Agreement,
- --------
the signature pages to this Agreement or otherwise in this Agreement as a
"Syndication Agent" or "Documentation Agent" or "Arranger" shall have any right,
power, obligation, liability, responsibility or duty under this Agreement other
than if such Person is a Lender, those applicable to all Lenders as such.
Without limiting the foregoing, none of the Persons identified on the cover page
to this Agreement, the signature pages to this Agreement or otherwise in this
Agreement as a "Syndication Agent" or "Documentation Agent" or "Arranger" shall
have or be deemed to have any fiduciary duty to or fiduciary relationship with
any Lender. In addition to the agreement set forth in Section 11.10, each of
-------------
the Lenders acknowledges that it has not relied, and will not rely, on any of
the Persons so identified in deciding to enter into this Agreement or in taking
or not taking action hereunder.
ARTICLE XII: SETOFF; RATABLE PAYMENTS
- ------------- --------------------------
12.1 Setoff. In addition to, and without limitation of, any rights of the
------
Lenders under applicable law, if any Default occurs and is continuing, any
indebtedness from any Lender to the Borrower (including all account balances,
whether provisional or final and whether or not collected or available) may be
offset and applied toward the payment of the Obligations owing to such Lender,
whether or not the Obligations, or any part hereof, shall then be due.
12.2 Ratable Payments. If any Lender, whether by setoff or otherwise, has
-----------------
payment made to it upon its Loans (other than payments received pursuant to
Sections 4.1, 4.2 or 4.4) in a greater proportion than that received by any
--------- --- ---
other Lender, such Lender agrees, promptly upon demand, to purchase a portion of
the Loans held by the other Lenders so that after such purchase each Lender will
hold its ratable proportion of Loans. If any Lender, whether in connection with
setoff or amounts which might be subject to setoff or otherwise, receives
collateral or other protection for its Obligation or such amounts which may be
subject to setoff, such Lender agrees, promptly upon demand, to take such action
necessary such that all Lenders share in the benefits of such collateral ratably
in proportion to the obligations owing to them. In case any such payment is
disturbed by legal process, or otherwise, appropriate further adjustments shall
be made.
12.3 Application of Payments. Subject to the provisions of Section 9.2, the
----------------------- -----------
Administrative Agent shall, unless otherwise specified at the direction of the
Required Lenders which direction shall be consistent with the last sentence of
this Section 12.3, apply all payments and prepayments in respect of any
-------------
Obligations received after the occurrence and during the continuance of a
Default or Unmatured Default in the following order:
(A) first, to pay interest on and then principal of any portion of the Loans
which the Administrative Agent may have advanced on behalf of any Lender
for which the Administrative Agent has not then been reimbursed by such Lender
or the Borrower;
(B) second, to pay interest on and then principal of any advance made under
Section 10.3 for which the Administrative Agent has not then been paid by the
- -------------
Borrower or reimbursed by the Lenders;
(C) third, to pay Obligations in respect of any fees, expenses,
reimbursements or indemnities then due to the Administrative Agent;
(D) fourth, to pay Obligations in respect of any fees, expenses,
reimbursements or indemnities then due to the Lenders and the issuer(s) of
Letters of Credit;
(E) fifth, to pay interest due in respect of Swing Line Loans;
(F) sixth, to pay interest due in respect of Loans (other than Swing Line
Loans) and L/C Obligations;
(G) seventh, to the ratable payment or prepayment of principal outstanding
on Swing Line Loans;
(H) eighth, to the ratable payment or prepayment of principal outstanding on
Loans (other than Swing Line Loans), Reimbursement Obligations and Hedging
Obligations under Hedging Agreements in such order as the Administrative Agent
may determine in its sole discretion;
(I) ninth, to provide required cash collateral, if required pursuant to
Section 3.11; and
---------
(J) tenth, to the ratable payment of all other Obligations.
Unless otherwise designated (which designation shall only be applicable prior to
the occurrence of a Default) by the Borrower, all principal payments in respect
of Loans (other than Swing Line Loans) shall be applied to the outstanding
Revolving Loans first, to repay outstanding Floating Rate Loans, and then to
----
repay outstanding Eurodollar Rate Loans with those Eurodollar Rate Loans which
have earlier expiring Interest Periods being repaid prior to those which have
later expiring Interest Periods. The order of priority set forth in this
Section 12.3 and the related provisions of this Agreement are set forth solely
-------
to determine the rights and priorities of the Administrative Agent, the Lenders,
the Swing Line Bank and the issuer(s) of Letters of Credit as among themselves.
The order of priority set forth in clauses (D) through (J) of this Section 12.3
----------- --- ------------
may at any time and from time to time be changed by the Required Lenders without
necessity of notice to or consent of or approval by the Borrower, or any other
Person; provided, that the order of priority of payments in respect of Swing
--------
Line Loans may be changed only with the prior written consent of the Swing Line
Bank. The order of priority set forth in clauses (A) through (C) of this
----------- ---
Section 12.3 may be changed only with the prior written consent of the
Administrative Agent.
12.4 Relations Among Lenders.
-------------------------
(A) Except with respect to the exercise of set-off rights of any Lender in
accordance with Section 12.1, the proceeds of which are applied in accordance
-------------
with this Agreement, and except as set forth in the following sentence, each
Lender agrees that it will not take any action, nor institute any actions or
proceedings, against the Borrower or any other obligor hereunder or with respect
to any Loan Document, without the prior written consent of the Required
Lenders or, as may be provided in this Agreement or the other Loan Documents, at
the direction of the Administrative Agent.
(B) The Lenders are not partners or co-venturers, and no Lender shall be
liable for the acts or omissions of, or (except as otherwise set forth herein in
case of the Administrative Agent) authorized to act for, any other Lender. The
Administrative Agent shall have the exclusive right on behalf of the Lenders, at
the direction of the Required Lenders, to enforce on the payment of the
principal of and interest on any Loan after the date such principal or interest
has become due and payable pursuant to the terms of this Agreement.
12.5 Representations and Covenants Among Lenders. Each Lender represents
----------------------------------------------
and covenants for the benefit of all other Lenders and the Administrative Agent
that such Lender is not satisfying and shall not satisfy any of its obligations
pursuant to this Agreement with any assets considered for any purposes of ERISA
or Section 4975 of the Code to be assets of or on behalf of any "plan" as
defined in section 3(3) of ERISA or section 4975 of the Code, regardless of
whether subject to ERISA or Section 4975 of the Code.
ARTICLE XIII: BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS
- -------------- -----------------------------------------------------
13.1 Successors and Assigns. The terms and provisions of the Loan Documents
----------------------
shall be binding upon and inure to the benefit of the Borrower and the
Lenders and their respective successors and assigns, except that (i) without the
consent of all of the Lenders, (a) Ralston shall not have the right to assign
its rights or obligations under the Loan Documents other than pursuant to the
Debt Assumption and only if the Net Worth Condition and all other conditions to
the Debt Assumption have been satisfied, and (b) Energizer shall not have the
right to assign its rights or obligations under the Loan Documents, and any such
assignment in violation of this Section 13.1(i) shall be null and void, and (ii)
---------------
any assignment by any Lender must be made in compliance with Section 13.3
------------
hereof. Notwithstanding clause (ii) of this Section 13.1 or Section 13.3, (i)
------------ ------------ ------------
any Lender may at any time, without the consent of the Borrower or the
Administrative Agent, assign all or any portion of its rights under this
Agreement to a Federal Reserve Bank and (ii) any Lender which is a fund or
commingled investment vehicle that invests in commercial loans in the ordinary
course of its business may at any time, without the consent of the Borrower or
the Administrative Agent, pledge or assign all or any part of its rights under
this Agreement to a trustee or other representative of holders of obligations
owed or securities issued by such Lender as collateral to secure such
obligations or securities; provided, however, that no such assignment or pledge
-------- -------
shall release the transferor Lender from its obligations hereunder. The
Administrative Agent may treat each Lender as the owner of the Loans made by
such Lender hereunder for all purposes hereof unless and until such Lender
complies with Section 13.3 hereof in the case of an assignment thereof or, in
-------------
the case of any other transfer, a written notice of the transfer is filed with
the Administrative Agent. Any assignee or transferee of a Loan, Revolving Loan
Commitment, L/C Interest or any other interest of a lender under the Loan
Documents agrees by acceptance thereof to be bound by all the terms and
provisions of the Loan Documents. Any request, authority or consent of any
Person, who at the time of making such request or giving such authority or
consent is the owner of any Loan, shall be conclusive and binding on any
subsequent owner, transferee or assignee of such Loan.
13.2 Participations.
--------------
(A) Permitted Participants; Effect. Subject to the terms set forth in this
-------------------------------
Section 13.2, any Lender may, in the ordinary course of its business and in
- -------------
accordance with applicable law, at any time sell to one or more banks or other
entities ("PARTICIPANTS") participating interests in any Loan owing to such
Lender, any Revolving Loan Commitment of such Lender, any L/C Interest of such
Lender or any other interest of such Lender under the Loan Documents on a pro
rata or non-pro rata basis. Notice of such participation to the Borrower and
the Administrative Agent shall be required prior to any participation becoming
effective with respect to a Participant which is not a Lender or an Affiliate
thereof. In the event of any such sale by a Lender of participating interests
to a Participant, such Lender's obligations under the Loan Documents shall
remain unchanged, such Lender shall remain solely responsible to the other
parties hereto for the performance of such obligations, such Lender shall remain
the owner of all Loans made by it for all purposes under the Loan
Documents, all amounts payable by the Borrower under this Agreement shall be
determined as if such Lender had not sold such participating interests, 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
the Loan Documents except that, for purposes of Article IV hereof, the
-----------
Participants shall be entitled to the same rights as if they were Lenders.
(B) Voting Rights. Each Lender shall retain the sole right to approve,
--------------
without the consent of any Participant, any amendment, modification or waiver of
any provision of the Loan Documents other than any amendment, modification or
waiver with respect to any Loan, Letter of Credit or Revolving Loan Commitment
in which such Participant has an interest which forgives principal, interest or
fees or reduces the interest rate or fees payable pursuant to the terms of this
Agreement with respect to any such Loan or Revolving Loan Commitment, postpones
any date fixed for any regularly-scheduled payment of principal of, or interest
or fees on, any such Loan or Revolving Loan Commitment, releases any Subsidiary
Guarantor from its obligations under the Subsidiary Guaranty, or releases all or
substantially all of the collateral, if any, securing any such Loan or Letter of
Credit.
(C) Benefit of Setoff. The Borrower agrees that each Participant shall be
-------------------
deemed to have the right of setoff provided in Section 12.1 hereof in respect to
------------
its participating interest in amounts owing under the Loan Documents to the same
extent as if the amount of its participating interest were owing directly to it
as a Lender under the Loan Documents, provided that each Lender shall retain the
--------
right of setoff provided in Section 12.1 hereof with respect to the amount of
------------
participating interests sold to each Participant except to the extent such
Participant exercises its right of setoff. The Lenders agree to share with each
Participant, and each Participant, by exercising the right of setoff provided in
Section 12.1 hereof, agrees to share with each Lender, any amount received
- -------------
pursuant to the exercise of its right of setoff, such amounts to be shared in
accordance with Section 12.2 as if each Participant were a Lender.
-------------
13.3 Assignments.
-----------
(A) Permitted Assignments. Any Lender may, in the ordinary course of its
----------------------
business and in accordance with applicable law, at any time assign to one or
more banks or other entities ("PURCHASERS") all or a portion of its rights and
obligations under this Agreement (including, without limitation, its Revolving
Loan Commitment, all Loans owing to it, all of its participation interests in
existing Letters of Credit, and its obligation to participate in additional
Letters of Credit hereunder) in accordance with the provisions of this Section
-------
13.3. Each assignment shall be of a constant, and not a varying, ratable
percentage of all of the assigning Lender's rights and obligations under this
Agreement. Such assignment shall be substantially in the form of Exhibit D
---------
hereto and shall not be permitted hereunder unless such assignment is either for
all of such Lender's rights and obligations under the Loan Documents or,
without the prior written consent of the Administrative Agent and (if no Default
or Unmatured Default has occurred or is continuing) the Borrower, involves loans
and commitments in an aggregate amount of at least $5,000,000 (which minimum
amount shall not apply to any assignment between Lenders, or to an Affiliate of
any Lender). Other than with respect to any assignment to another Lender or an
Affiliate or successor entity of such Lender, the consent of the Administrative
Agent, and, prior to the occurrence and continuance of a Default or Unmatured
Default, the Borrower (which consent, in each such case, shall not be
unreasonably withheld) shall be required prior to an assignment becoming
effective.
(B) Effect; Effective Date. Upon (i) delivery to the Administrative Agent
------------------------
of a notice of assignment, substantially in the form attached as Appendix I to
----------
Exhibit D hereto (a "NOTICE OF ASSIGNMENT"), together with any consent required
---------
by Section 13.3(A) hereof, and (ii) payment of a $3,500 fee by the assignee or
----------------
the assignor (as agreed) to the Administrative Agent for processing such
assignment (provided no such fee shall be required in connection with an
assignment to an Affiliate or successor entity of an assignor Lender), such
assignment shall become effective on the effective date specified in such Notice
of Assignment. The Notice of Assignment shall contain a representation by the
Purchaser to the effect that none of the consideration used to make the purchase
of the Revolving Loan Commitment, Loans and L/C Obligations under the applicable
Assignment Agreement constitute for any purpose of ERISA or Section 4975 of the
Code assets of any "plan" as defined in Section 3(3) of ERISA or Section 4975 of
the Code and that the rights and interests of the Purchaser in and under the
Loan Documents will not constitute such "plan assets". On and after the
effective date of such assignment, such Purchaser, if not already a Lender,
shall for all purposes be a Lender party to this Agreement and any other Loan
Documents executed by the Lenders and shall have all the rights and obligations
of a Lender under the Loan Documents, to the same extent as if it were an
original party hereto, and no further consent or action by the Borrower, the
Lenders or the Administrative Agent shall be required to release the transferor
Lender with respect to the percentage of the Aggregate Revolving Loan
Commitment, Loans and Letter of Credit participations assigned to such
Purchaser. Upon the consummation of any assignment to a Purchaser pursuant to
this Section 13.3(B), the transferor Lender, the Administrative Agent and the
----------------
Borrower shall make appropriate arrangements so that, to the extent notes have
been issued to evidence any of the transferred Loans, replacement notes are
issued to such transferor Lender and new notes or, as appropriate, replacement
notes, are issued to such Purchaser, in each case in principal amounts
reflecting their Revolving Loan Commitment, as adjusted pursuant to such
assignment.
(C) The Register. The Administrative Agent shall maintain at its address
-------------
referred to in Section 14.1 a copy of each assignment delivered to and accepted
------------
by it pursuant to this Section 13.3 and a register (the "REGISTER") for the
------------
recordation of the names and addresses of the Lenders and the Revolving Loan
Commitment of and principal amount of the Loans owing to, each Lender from time
to time and whether such Lender is an original Lender or the assignee of another
Lender pursuant to an assignment under this Section 13.3. The entries in the
------------
Register shall be conclusive and binding for all purposes, absent manifest
error, and the Borrower and each of its Subsidiaries, the Administrative Agent
and the Lenders may treat each Person whose name is recorded in the Register as
a Lender hereunder for all purposes of this Agreement. The Register shall be
available for inspection by the Borrower or any Lender at any reasonable time
and from time to time upon reasonable prior notice.
13.4 Confidentiality. Subject to Section 13.5, the Administrative Agent and
--------------- ------------
the Lenders and their respective representatives shall hold all nonpublic
information obtained pursuant to the requirements of this Agreement and
identified as such by the Borrower in accordance with such Person's customary
procedures for handling confidential information of this nature and in
accordance with safe and sound commercial lending or investment practices and in
any event may make disclosure reasonably required by a prospective Transferee in
connection with the contemplated participation or assignment or as required or
requested by any Governmental Authority or any securities exchange or similar
self-regulatory organization or representative thereof or pursuant to a
regulatory examination or legal process, or to any direct or indirect
contractual counterparty in swap agreements or such contractual counterparty's
professional advisor, and shall require any such Transferee to agree (and
require any of its Transferees to agree) to comply with this Section 13.4. In
------------
no event shall the Administrative Agent or any Lender be obligated or required
to return any materials furnished by the Borrower; provided, however, each
-------- -------
prospective Transferee shall be required to agree that if it does not become a
participant or assignee it shall return all materials furnished to it by or on
behalf of the Borrower in connection with this Agreement.
13.5 Dissemination of Information. The Borrower authorizes each Lender to
------------------------------
disclose to any Participant or Purchaser or any other Person acquiring an
interest in the Loan Documents by operation of law (each a "TRANSFEREE") and any
prospective Transferee any and all information in such Lender's possession
concerning the Borrower and its Subsidiaries; provided that prior to any such
--------
disclosure, such prospective Transferee shall agree to preserve in accordance
with Section 13.4 the confidentiality of any confidential information described
------------
therein.
ARTICLE XIV: NOTICES
- ------------- -------
14.1 Giving Notice. Except as otherwise permitted by Section 2.13 with
-------------- ------------
respect to Borrowing/Election Notices, all notices and other communications
provided to any party hereto under this Agreement or any other Loan Documents
shall be in writing or by telex or by facsimile and addressed or delivered to
such party at its address set forth below its signature hereto or at such other
address as may be designated by such party in a notice to the other parties. Any
notice, if mailed and properly addressed with postage prepaid, shall be
deemed given three (3) Business Days after mailed; any notice, if transmitted by
telex or facsimile, shall be deemed given when transmitted (answerback confirmed
in the case of telexes); or, any notice, if transmitted by courier, one (1)
Business Day after deposit with a reputable overnight carrier services, with all
charges paid.
14.2 Change of Address. The Borrower, the Administrative Agent and any
-------------------
Lender may each change the address for service of notice upon it by a notice in
writing to the other parties hereto.
ARTICLE XV: COUNTERPARTS
- ------------ ------------
This Agreement may be executed in any number of counterparts, all of which
taken together shall constitute one agreement, and any of the parties hereto may
execute this Agreement by signing any such counterpart. This Agreement shall be
effective when it has been executed by the Borrower, the Administrative Agent
and the Lenders and each party has notified the Administrative Agent by telex or
telephone, that it has taken such action.
[Remainder of This Page Intentionally Blank]
<PAGE>
IN WITNESS WHEREOF, the Borrower, the Lenders and the Administrative Agent
have executed this Agreement as of the date first above written.
RALSTON PURINA COMPANY, as the Borrower
By: /s/ James R. Elsesser
---------------------------
Name: James R. Elsesser
Title: Chief Financial Officer
Address:
Checkerboard Square
St. Louis, MO 63164
Attention: Chief Financial Officer
Phone: (314) 982-2353
Fax: (314) 982-1092
E-Mail: [email protected]
<PAGE>
BANK ONE, NA (Main Office Chicago), as Administrative Agent, an Issuing
Lender, the Swing Line Bank and as a Lender
By: /s/ BANK ONE, NA
Name:
Title:
Address:
1 Bank One Plaza
Suite IL1-0088
14th Floor
Chicago, Illinois 60670
Attention: William J. Oleferchik
Telephone No.: (312) 732-2947
Facsimile No.: (312) 732-1117
<PAGE>
BANK OF AMERICA, N.A., as Syndication Agent and as a Lender
By: /s/ Suzanne B. Smith
--------------------------
Name: Suzanne B. Smith
Title: Managing Director
Address:
901 Main Street
67th Floor
Dallas, TX 75202-3714
Attention: Suzanne B. Smith
Phone: (214) 209-0280
Fax: (214) 209-0980
E-Mail: [email protected]
<PAGE>
WACHOVIA BANK, N.A., as Documentation Agent and as a Lender
By: /s/ Walter R. Gillikin
-----------------------------
Name: Walter R. Gillikin
Title: Senior Vice President
Address:
191 Peachtree Street, MC-GA370
Atlanta, GA 30303
Attention: Walter R. Gillikin
Phone: (404) 332-5747
Fax: (404) 332-6898
E-Mail: [email protected]
<PAGE>
THE NORTHERN TRUST COMPANY,
as a Lender
By: Lisa M. Taylor
---------------------
Name: Lisa M. Taylor
Title: Second Vice President
Address:
50 South LaSalle
11th Floor
Chicago, IL 60675
Attention: Lisa Taylor
Phone: (312) 444-4196
Fax: (312) 444-5055
E-Mail: [email protected]
<PAGE>
STANDARD CHARTERED BANK,
as a Lender
By: /s/ Andrew Ng
--------------------
Name: Andrew Ng
Title: Vice President
By: Marianne R. Murray
-------------------------
Name: Marianne R. Murray
Title: Senior Vice President
Address:
7 World Trade Center
27th Floor
New York, NY 10048
Attention: Marianne R. Murray
Phone: (212) 667-0505
Fax: (212) 667-0225
E-Mail: [email protected]
<PAGE>
THE BANK OF TOKYO-MITSUBISHI, LTD., CHICAGO BRANCH, as a Lender
By: /s/ Hisashi Miyashiro
----------------------------
Name: Hisashi Miyashiro
Title: Deputy General Manager
Address:
227 West Monroe Street
Suite 2300
Chicago, IL 60606
Attention: Alex Lam
Phone: (312) 696-4662
Fax: (312) 696-4535
E-mail: [email protected]
<PAGE>
BANK OF NEW YORK, as a Lender
By: /s/ John-Paul Marotta
----------------------------
Name: John-Paul Marotta
Title: Vice President
Address:
One Wall Street
New York, NY 10286
Attention: David Shedd
Phone: (212) 635-8448
Fax: (212) 635-1208
<PAGE>
BANCA COMMERCIALE ITALIANA, CHICAGO BRANCH, as a Lender
By: /s/ Charles Dougherty
----------------------------
Name: Mr. Charles Dougherty
Title: Vice President
By: /s/ Edward Bermant
-------------------------
Name: Mr. Edward Bermant
Title: First Vice President
Deputy Manager
Address:
One William Street
New York, NY 10004
Attention: Mr. Charles Dougherty
Phone: (212) 607-3656
Fax: (212) 809-2124
<PAGE>
BANCA NAZIONALE DEL LAVORO S.P.A.-NEW YORK BRANCH, as a Lender
By: /s/ Giulio Giovine
--------------------------
Name: Giulio Giovine
Title: Vice President
By: /s/ Leonardo Valentini
---------------------------
Name: Leonardo Valentini
Title: First Vice President
Address:
25 West 51st Street
New York, NY 10019
Attention: Giulio Giovine
Phone: (212) 314-0239
Fax: (212) 765-2978
E-mail: [email protected]
<PAGE>
BANQUE NATIONALE DE PARIS,
as a Lender
By: Arnaud Collin du Bocage
---------------------------------
Name: Arnaud Collin du Bocage
Title: Executive Vice President
and General Manager
Address:
209 South LaSalle Street
Chicago, IL 60604
Attention: Ms. Kristin Howatt
Phone: (312) 977-1383
Fax: (312) 977-1380
<PAGE>
DG BANK DEUTSCHE GENOSSENSCHAFTSBANK AG, as a Lender
By:/s/ DG BANK DEUTSCHE GENOSSENSCHAFTSBANK AG
Name:
Title:
By:/s/ DG BANK DEUTSCHE GENOSSENSCHAFTSBANK AG
Name:
Title:
Address:
609 Fifth Avenue
New York, NY 10017-1021
Attention: Craig Anderson, Vice President
Phone: (212) 745-1583
Fax: (212) 745-1556/1550
<PAGE>
THE DAI-ICHI KANGYO BANK, LTD.,
as a Lender
By: /s/ Nobuyasu Fukatsu
---------------------------
Name: Nobuyasu Fukatsu
Title: General Manager
Address:
10 South Wacker Drive
26th Floor
Chicago, IL 60606
Attention: Brian Riley
Phone: (312) 876-8600
Fax: (312) 876-2011
E-Mail: [email protected]
<PAGE>
MERCANTILE BANK NATIONAL ASSOCIATION, as a Lender
By: /s/ David F. Higbee
-----------------------------
Name: David F. Higbee
Title: Vice President
Address:
One Mercantile Center
Tram 001/1001/12-3
St. Louis, MO 63101
Attention: David F. Hibgee
Phone: (314) 418-1967
Fax: (314) 418-2203
E-Mail: [email protected]
<PAGE>
SANPAOLO IMI S.P.A., as a Lender
By: /s/ Luca Sacchi
------------------------
Name: Luca Sacchi
Title: Vice President
By: /s/ Carlo Persico
-------------------------
Name: Carlo Persico
Title: Deputy General Manager
Address:
245 Park Avenue
New York, NY 10167
Attention: Luca Sacchi
Phone: (212) 692-3130
Fax: (212) 692-3178
E-Mail: [email protected]
<PAGE>
SUNTRUST BANK, as a Lender
By: /s/ Linda L. Dash
-------------------------
Name: Linda L. Dash
Title: Vice President
Address:
303 Peachtree Street, N.E.
Mail Code 1928, 3rd Floor
Atlanta, GA 30308
Attention: Linda L. Dash
Phone: (404) 658-4923
Fax: (404) 658-4905
<PAGE>
WESTPAC BANKING CORPORATION,
as a Lender
By: /s/ Lewis Love
-----------------------
Name: Lewis Love
Title: Head of Legal & Compliance
Europe & Americas
Address:
575 Fifth Avenue
New York, NY 10017
Attention: Ms. Kate Perry
Phone: (212) 551-1808
Fax: (212) 551-1995
E-Mail: [email protected]
<PAGE>
Effective as of April 1, 2000,
assigned to and assumed pursuant
to the terms of that certain Debt
Assignment, Assumption
and Release Agreement
dated as of April 1, 2000
among Ralston, Energizer and the
Administrative Agent
ENERGIZER HOLDINGS, INC.
/s/ Daniel E. Corbin
---------------------------
Name: Daniel E. Corbin
Title: Executive Vice President - Finance and Control
Address:
Checkerboard Square
800 Chouteau Avenue
St. Louis, MO 63102
Attention: Daniel Corbin
Phone: (314) 982-1801
Fax: (314) 982-1180
E-mail: [email protected]
<PAGE>
xix
<TABLE>
<CAPTION>
EXHIBITS
<S> <C> <C>
EXHIBIT A -- Revolving Loan Commitments (Definitions)
EXHIBIT B -- Form of Borrowing/Election Notice (Section 2.2 and Section 2.7
and Section 2.9)
EXHIBIT C -- Form of Request for Letter of Credit (Section 3.4)
EXHIBIT D -- Form of Assignment and Acceptance Agreement (Sections 2.19
and 13.3)
EXHIBIT E -- Form of Borrower's Counsel's Opinion (Section 5.1)
EXHIBIT F -- List of Closing Documents (Section 5.1)
EXHIBIT G -- Form of Officer's Certificate (Sections 5.2 and 7.1(A)(iii))
EXHIBIT H -- Form of Compliance Certificate (Sections 5.2 and 7.1(A)(iii))
EXHIBIT I -- Form of Supplement to Subsidiary Guaranty (Definitions)
EXHIBIT J -- Form of Debt Assumption Agreement (Definitions)
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
SCHEDULES
<S> <C> <C>
Schedule 1.1.1 -- Permitted Existing Investments (Definitions)
Schedule 1.1.2 -- Permitted Existing Liens (Definitions)
Schedule 1.1.3 -- Permitted Existing Contingent Obligations (Definitions)
Schedule 6.3 -- Ralston Conflicts; Ralston Governmental Consents (Section 6.3)
Schedule 6.6 -- Energizer Conflicts; Energizer Governmental Consents (Section 6.6)
Schedule 6.7 -- Pro Forma Financial Statements (Section 6.7(A))
Schedule 6.10 -- Litigation; Loss Contingencies (Section 6.10)
Schedule 6.11 -- Subsidiaries (Section 6.11)
Schedule 6.21 -- Outstanding Spin-Off Conditions (Section 6.21, Section 5.1(7))
Schedule 6.21(iv) -- Committed Financing Facilities (Section 6.21(iv), Section 5.1(7)(iv))
Schedule 6.22 -- Environmental Matters (Section 6.22)
Schedule 7.3(G) -- Transactions with Ralston's Shareholders and Affiliates (Section 7.3(G))
</TABLE>
<PAGE>
Table of Contents
-----------------
Page
----
<TABLE>
<CAPTION>
<S> <C>
ARTICLE I: DEFINITIONS
1.1 Certain Defined Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.2 References. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
ARTICLE II: THE REVOLVING LOAN FACILITY
2.1 Revolving Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
2.2 Swing Line Loans. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
2.3 Rate Options for all Advances; Maximum Interest Periods . . . . . . . . . . . 24
2.4 Optional Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
2.5 Reduction of Revolving Loan Commitments . . . . . . . . . . . . . . . . . . . 24
2.6 Method of Borrowing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
2.7 Method of Selecting Types and Interest Periods for Advances . . . . . . . . . 25
2.8 Minimum Amount of Each Advance. . . . . . . . . . . . . . . . . . . . . . . . 25
2.9 Method of Selecting Types and Interest Periods for Conversion and
Continuation of Advances.. . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
2.10 Default Rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
2.11 Method of Payment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
2.12 Evidence of Debt.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
2.13 Telephonic Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
2.14 Promise to Pay; Interest and Facility Fees; Interest Payment Dates; Interest
and Fee Basis; Loan and Control Accounts.. . . . . . . . . . . . . . . . . . . . 27
1.15 Notification of Advances, Interest Rates, Prepayments and Aggregate
Revolving Loan Commitment Reductions . . . . . . . . . . . . . . . . . . . . . . 29
1.16 Lending Installations. . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
1.17 Non-Receipt of Funds by the Administrative Agent . . . . . . . . . . . . . . 30
1.18 Termination Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
1.19 Replacement of Certain Lenders . . . . . . . . . . . . . . . . . . . . . . . 30
ARTICLE III: THE LETTER OF CREDIT FACILITY
3.1 Obligation to Issue Letters of Credit . . . . . . . . . . . . . . . . . . . . 31
3.2 [Reserved]. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
3.3 Types and Amounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
3.4 Conditions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
3.5 Procedure for Issuance of Letters of Credit . . . . . . . . . . . . . . . . . 32
3.6 Letter of Credit Participation. . . . . . . . . . . . . . . . . . . . . . . . 32
3.7 Reimbursement Obligation. . . . . . . . . . . . . . . . . . . . . . . . . . . 33
3.8 Letter of Credit Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
3.9 Issuing Bank Reporting Requirements . . . . . . . . . . . . . . . . . . . . . 34
3.10 Indemnification; Exoneration . . . . . . . . . . . . . . . . . . . . . . . . 34
3.11 Cash Collateral. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
ARTICLE IV: YIELD PROTECTION; TAXES
4.1 Yield Protection. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
4.2 Changes in Capital Adequacy Regulations . . . . . . . . . . . . . . . . . . . 36
4.3 Availability of Types of Advances . . . . . . . . . . . . . . . . . . . . . . 36
4.4 Funding Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
4.5 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
4.6 Lender Statements; Survival of Indemnity. . . . . . . . . . . . . . . . . . . 1
ARTICLE V: CONDITIONS PRECEDENT
5.1 Initial Advances and Letters of Credit. . . . . . . . . . . . . . . . . . . . 2
5.2 Each Advance and Letter of Credit . . . . . . . . . . . . . . . . . . . . . . 3
ARTICLE VI: REPRESENTATIONS AND WARRANTIES
6.1 Organization; Corporate Powers of Ralston . . . . . . . . . . . . . . . . . . 4
6.2 Authority of Ralston. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
6.3 No Conflict; Governmental Consents for Ralston. . . . . . . . . . . . . . . . 5
6.4 Organization; Corporate Powers of Energizer . . . . . . . . . . . . . . . . . 6
6.5 Authority of Energizer. . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
6.6 No Conflict; Governmental Consents for Energizer. . . . . . . . . . . . . . . 6
6.7 Financial Statements. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
6.8 No Material Adverse Change. . . . . . . . . . . . . . . . . . . . . . . . . . 8
6.9 Taxes.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
6.10 Litigation; Loss Contingencies and Violations. . . . . . . . . . . . . . . . 9
6.11 Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
6.12 ERISA. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
6.13 Accuracy of Information. . . . . . . . . . . . . . . . . . . . . . . . . . . 10
6.14 Securities Activities. . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
6.15 Material Agreements. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
6.16 Compliance with Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
6.17 Assets and Properties. . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
6.18 Statutory Indebtedness Restrictions. . . . . . . . . . . . . . . . . . . . . 11
6.19 Insurance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
6.20 Labor Matters. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
6.21 Spin-Off Transactions. . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
6.22 Environmental Matters. . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
6.23 Solvency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
6.24 Net Worth Condition. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
6.25 Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
ARTICLE VII: COVENANTS
7.1 Reporting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
7.2 Affirmative Covenants.. . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
7.3 Negative Covenants. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
7.4 Financial Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
ARTICLE VIII: DEFAULTS
8.1 Defaults. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
ARTICLE IX: ACCELERATION, DEFAULTING LENDERS; WAIVERS, AMENDMENTS AND REMEDIES
9.1 Termination of Revolving Loan Commitments; Acceleration . . . . . . . . . . . 28
9.2 Defaulting Lender . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
9.3 Amendments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
9.4 Preservation of Rights. . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
ARTICLE X: GENERAL PROVISIONS
10.1 Survival of Representations. . . . . . . . . . . . . . . . . . . . . . . . . 30
10.2 Governmental Regulation. . . . . . . . . . . . . . . . . . . . . . . . . . . 30
10.3 Performance of Obligations . . . . . . . . . . . . . . . . . . . . . . . . . 30
10.4 Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
10.5 Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
10.6 Several Obligations; Benefits of this Agreement. . . . . . . . . . . . . . . 31
10.7 Expenses; Indemnification. . . . . . . . . . . . . . . . . . . . . . . . . . 31
10.8 Numbers of Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
10.9 Accounting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
10.10 Severability of Provisions. . . . . . . . . . . . . . . . . . . . . . . . . 34
10.11 Nonliability of Lenders . . . . . . . . . . . . . . . . . . . . . . . . . . 34
10.12 GOVERNING LAW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
10.13 CONSENT TO JURISDICTION; JURY TRIAL.. . . . . . . . . . . . . . . . . . . . 34
10.14 Subordination of Intercompany Indebtedness. . . . . . . . . . . . . . . . . 35
ARTICLE XI: THE ADMINISTRATIVE AGENT
11.1 Appointment; Nature of Relationship. . . . . . . . . . . . . . . . . . . . . 36
11.2 Powers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
11.3 General Immunity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
11.4 No Responsibility for Loans, Creditworthiness, Recitals, Etc . . . . . . . . 37
11.5 Action on Instructions of Lenders. . . . . . . . . . . . . . . . . . . . . . 37
11.6 Employment of Administrative Agents and Counsel. . . . . . . . . . . . . . . 38
11.7 Reliance on Documents; Counsel . . . . . . . . . . . . . . . . . . . . . . . 38
11.8 The Administrative Agent's Reimbursement and Indemnification . . . . . . . . 38
11.9 Rights as a Lender . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
11.10 Lender Credit Decision. . . . . . . . . . . . . . . . . . . . . . . . . . . 38
11.11 Successor Administrative Agent. . . . . . . . . . . . . . . . . . . . . . . 39
11.12 No Duties Imposed Upon Syndication Agent, Documentation Agent or
Arranger . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
ARTICLE XII: SETOFF; RATABLE PAYMENTS
12.1 Setoff . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
12.2 Ratable Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
12.3 Application of Payments. . . . . . . . . . . . . . . . . . . . . . . . . . . 40
12.4 Relations Among Lenders. . . . . . . . . . . . . . . . . . . . . . . . . . . 41
12.5 Representations and Covenants Among Lenders. . . . . . . . . . . . . . . . . 41
ARTICLE XIII: BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS
13.1 Successors and Assigns . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
13.2 Participations.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
13.3 Assignments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
13.4 Confidentiality. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
13.5 Dissemination of Information . . . . . . . . . . . . . . . . . . . . . . . . 44
ARTICLE XIV: NOTICES
14.1 Giving Notice. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
14.2 Change of Address. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
ARTICLE XV: COUNTERPARTS 45
</TABLE>
ENERGIZER HOLDINGS, INC.
$300,000,000
Senior Notes Issuable In Series
$15,000,000
7.78% Senior Notes, Series 2000-A, Tranche 1,
due April 1, 2003
$110,000,000
7.86% Senior Notes, Series 2000-A, Tranche 2,
due April 1, 2005
$25,000,000
7.91% Senior Notes, Series 2000-A, Tranche 3,
due April 1, 2007
$25,000,000
7.96% Senior Notes, Series 2000-A, Tranche 4,
due April 1, 2010
_________
NOTE PURCHASE AGREEMENT
_________
Dated as of April 1, 2000
Tranche 1 PPN: 29266R A* 9
Tranche 2 PPN: 29266R A@ 7
Tranche 3 PPN: 29266R A# 5
Tranche 4 PPN: 29266R B* 8
<PAGE>
<TABLE>
<CAPTION>
TABLE OF CONTENTS
<S> <C> <C>
Section Page
- ------- -------------------------------------------------------------------
1.. . . AUTHORIZATION OF NOTES 1
1.1.. . Amount; Establishment of Series 1
1.2.. . The Series 2000-A Notes. 2
2.. . . SALE AND PURCHASE OF SERIES 2000-A NOTES. 3
3.. . . CLOSING 3
4.. . . CONDITIONS TO CLOSING 3
4.1.. . Representations and Warranties 3
4.2.. . Performance; No Default 4
4.3.. . Compliance Certificates 4
4.4.. . Opinions of Counsel 4
4.5.. . Purchase Permitted By Applicable Law, etc 4
4.6.. . Sale of Other Notes 5
4.7.. . Payment of Special Counsel Fees 5
4.8.. . Private Placement Number 5
4.9.. . Changes in Corporate Structure 5
4.10. . Subsidiary Guaranty 5
4.11. . Proceedings and Documents. 5
5.. . . REPRESENTATIONS AND WARRANTIES OF THE COMPANY 5
5.1.. . Organization; Power and Authority 6
5.2.. . Authorization, etc 6
5.3.. . Disclosure 6
5.4.. . Organization and Ownership of Shares of Subsidiaries 7
5.5.. . Financial Statements 7
5.6.. . Compliance with Laws, Other Instruments, etc 7
5.7.. . Governmental Authorizations, etc. 8
5.8.. . Litigation; Observance of Statutes and Orders 8
5.9.. . Taxes 9
5.10. . Title to Property; Leases 9
5.11. . Licenses, Permits, etc 9
5.12. . Compliance with ERISA 9
5.13. . Private Offering by the Company 10
5.14. . Use of Proceeds; Margin Regulations 11
5.15. . Existing Indebtedness 11
5.16. . Foreign Assets Control Regulations, etc 11
5.17. . Status under Certain Statutes 11
5.18. . Solvency of Subsidiary Guarantors 12
5.19. . Year 2000 12
5.20. . Environmental Matters 12
6.. . . REPRESENTATIONS OF THE PURCHASERS. 13
6.1.. . Purchase for Investment 13
6.2.. . Source of Funds 13
7.. . . INFORMATION AS TO COMPANY 14
7.1.. . Financial and Business Information 14
7.2.. . Officer's Certificate 17
7.3.. . Inspection 17
8.. . . PREPAYMENT OF THE NOTES. 18
8.1.. . No Scheduled Prepayments 18
8.2.. . Optional Prepayments with Make-Whole Amount 18
8.3.. . Allocation of Partial Prepayments 18
8.4.. . Maturity; Surrender, etc 19
8.5.. . Purchase of Notes 19
8.6.. . Make-Whole Amount 19
9.. . . AFFIRMATIVE COVENANTS 21
9.1.. . Compliance with Law 21
9.2.. . Insurance 21
9.3.. . Maintenance of Properties 21
9.4.. . Payment of Taxes and Claims 21
9.5.. . Corporate Existence, etc 22
10. . . NEGATIVE COVENANTS 22
10.1. . Consolidated Indebtedness; Indebtedness of Restricted Subsidiaries. 22
10.2. . Liens. 23
10.3. . Sale of Assets. 24
10.4. . Mergers, Consolidations, etc. 25
10.5. . Disposition of Stock of Restricted Subsidiaries. 26
10.6. . Designation of Restricted and Unrestricted Subsidiaries. 26
10.7. . Restricted Subsidiary Guaranties 26
10.8. . Nature of Business. 26
10.9. . Transactions with Affiliates 27
11. . . EVENTS OF DEFAULT 27
12. . . REMEDIES ON DEFAULT, ETC 29
12.1. . Acceleration 29
12.2. . Other Remedies 30
12.3. . Rescission 30
12.4. . No Waivers or Election of Remedies, Expenses, etc 31
13. . . REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES 31
13.1. . Registration of Notes 31
13.2. . Transfer and Exchange of Notes 31
13.3. . Replacement of Notes 32
14. . . PAYMENTS ON NOTES. 32
14.1. . Place of Payment 32
14.2. . Home Office Payment 32
15. . . EXPENSES, ETC 33
15.1. . Transaction Expenses 33
15.2. . Survival 33
16. . . SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE
AGREEMENT 33
17. . . AMENDMENT AND WAIVER 34
17.1. . Requirements 34
17.2. . Solicitation of Holders of Notes 34
17.3. . Binding Effect, etc 35
17.4. . Notes held by Company, etc 35
18. . . NOTICES 35
19. . . REPRODUCTION OF DOCUMENTS 36
20. . . CONFIDENTIAL INFORMATION 36
21. . . SUBSTITUTION OF PURCHASER 37
22. . . RELEASE OF SUBSIDIARY GUARANTOR 37
23. . . MISCELLANEOUS 38
23.1. . Successors and Assigns 38
23.2. . Payments Due on Non-Business Days 38
23.3. . Severability 38
23.4. . Construction 38
23.5. . Counterparts 38
23.6. . Governing Law 39
</TABLE>
<PAGE>
SCHEDULE A -- Information Relating to Purchasers
SCHEDULE B -- Defined Terms
SCHEDULE B-1 -- Investments
SCHEDULE 4.9 -- Changes in Corporate Structure
SCHEDULE 5.3 -- Disclosure Materials
SCHEDULE 5.4 -- Subsidiaries of the Company and Ownership of Subsidiary
Stock
SCHEDULE 5.5 -- Financial Statements
SCHEDULE 5.11 -- Licenses, Permits, etc.
SCHEDULE 5.14 -- Use of Proceeds
SCHEDULE 5.15 -- Indebtedness
SCHEDULE 10.2 -- Liens
EXHIBIT 1.1(a) -- Form of Senior Note
EXHIBIT 1.1(b) -- Form of Subsidiary Guaranty
EXHIBIT 1.1(c) -- Form of Supplement
EXHIBIT 1.2(a) -- Form of Series 2000-A, Tranche 1, Senior Note
EXHIBIT 1.2(b) -- Form of Series 2000-A, Tranche 2, Senior Note
EXHIBIT 1.2(c) -- Form of Series 2000-A, Tranche 3, Senior Note
EXHIBIT 1.2(d) -- Form of Series 2000-A, Tranche 4, Senior Note
EXHIBIT 4.4(a) -- Form of Opinion of Counsel for the Company
EXHIBIT 4.4(b) -- Form of Opinion of Special Counsel for the Purchasers
<PAGE>
ENERGIZER HOLDINGS, INC.
800 Chouteau Avenue
St. Louis, MO 63102
(314) 982-2970
Fax: (314) 982-1334
$300,000,000
Senior Notes Issuable In Series
$15,000,000 7.78% Senior Notes, Series 2000-A, Tranche 1, due April 1, 2003
$110,000,000 7.86% Senior Notes, Series 2000-A, Tranche 2, due April 1, 2005
$25,000,000 7.91% Senior Notes, Series 2000-A, Tranche 3, due April 1, 2007
$25,000,000 7.96% Senior Notes, Series 2000-A, Tranche 4, due April 1, 2010
Dated as of April 1, 2000
TO EACH OF THE PURCHASERS LISTED IN
THE ATTACHED SCHEDULE A:
Ladies and Gentlemen:
ENERGIZER HOLDINGS, INC., a Missouri corporation (the "Company"),
agrees with you as follows:
1. AUTHORIZATION OF NOTES.
1.1. AMOUNT; ESTABLISHMENT OF SERIES.
The Company is contemplating the issue and sale of up to $300,000,000
aggregate principal amount of its Senior Notes issuable in series (the "Notes",
such term to include any such Notes issued in substitution therefor pursuant to
Section 13 of this Agreement). The Notes will be substantially in the form set
out in Exhibit 1.1(a), with such changes therefrom, if any, as may be approved
by the purchasers of such Notes, or series thereof, and the Company. Certain
capitalized terms used in this Agreement are defined in Schedule B; references
to a "Schedule" or an "Exhibit" are, unless otherwise specified, to a Schedule
or an Exhibit attached to this Agreement. The Notes may be issued in one or
more series. Subject to Section 22, the Notes will be guaranteed by each
Subsidiary that is now or in the future becomes a signatory to the Bank
Guarantees (individually, a "Subsidiary Guarantor" and collectively, the
"Subsidiary Guarantors") pursuant to a guaranty in substantially the form of
Exhibit 1.1(b) (the "Subsidiary Guaranty"). Each series of Notes, other than
the initial series, will be issued pursuant to a supplement to this Agreement (a
"Supplement") in substantially the form of Exhibit 1.1(c), and will be subject
to the following terms and conditions:
(a) the designation of each series of Notes shall distinguish the Notes of
one series from the Notes of all other series;
(b) the Notes of each series shall rank pari passu with the Notes of all
other series, the Credit Agreement and the Company's other outstanding unsecured
senior Indebtedness;
(c) each series of Notes shall be dated the date of issue, bear interest at
such rate or rates, mature on such date or dates, be subject to such mandatory
prepayments on the dates and with the Make-Whole Amounts, if any, as are
provided in the Supplement under which such Notes are issued, and shall have
such additional or different conditions precedent to closing and such additional
or different representations and warranties or, subject to Section 1.1(d), other
terms and provisions as shall be specified in such Supplement;
(d) any additional covenants, Defaults, Events of Default, rights or similar
provisions that are added by a Supplement for the benefit of the series of Notes
to be issued pursuant to such Supplement shall apply to all outstanding Notes,
whether or not the Supplement so provides; and
(e) except to the extent provided in foregoing clause (c), all of the
provisions of this Agreement shall apply to the Notes of each series.
The Purchasers of the Series 2000-A Notes need not purchase subsequent series of
Notes.
1.2. THE SERIES 2000-A NOTES.
The Company has authorized, as the initial series of Notes hereunder,
the issue and sale of $175,000,000 aggregate principal amount of Notes to be
designated as its "Series 2000-A Notes" (such term to include any such Notes
issued in substitution therefor pursuant to Section 13 of this Agreement). The
Series 2000-A Notes will consist of $15,000,000 aggregate principal amount of
7.78% Senior Notes, Series 2000-A, Tranche 1, due April 1, 2003 (the "Series
2000-A, Tranche 1, Notes"), $110,000,000 aggregate principal amount of 7.86%
Senior Notes, Series 2000-A, Tranche 2, due April 1, 2005 (the "Series 2000-A,
Tranche 2, Notes"), $25,000,000 aggregate principal amount of 7.91% Senior
Notes, Series 2000-A, Tranche 3, due April 1, 2007 (the "Series 2000-A, Tranche
3, Notes") and $25,000,000 aggregate principal amount of 7.96% Senior Notes,
Series 2000-A, Tranche 4, due April 1, 2010 (the "Series 2000-A, Tranche 4,
Notes"). The Series 2000-A Notes shall be substantially in the forms set out in
Exhibits 1.2(a), (b), (c) and (d), as appropriate, with such changes therefrom,
if any, as may be approved by you and the Company.
2. SALE AND PURCHASE OF SERIES 2000-A NOTES.
Subject to the terms and conditions of this Agreement, the Company
will issue and sell to you and each of the other purchasers named in Schedule A
(the "Other Purchasers"), and you and the Other Purchasers will purchase from
the Company, at the Closing provided for in Section 3, Series 2000-A Notes in
the principal amount specified opposite your names in Schedule A at the purchase
price of 100% of the principal amount thereof. Your obligation hereunder and
the obligations of the Other Purchasers are several and not joint obligations
and you shall have no liability to any Person for the performance or
non-performance by any Other Purchaser hereunder.
3. CLOSING.
The sale and purchase of the Series 2000-A Notes to be purchased by
you and the Other Purchasers shall occur at the offices of Gardner, Carton &
Douglas, Quaker Tower, Suite 3400, 321 North Clark Street, Chicago, Illinois
60610 at 9:00 a.m., Chicago time, at a closing (the "Closing") on April 4, 2000
or on such other Business Day thereafter on or prior to April 30, 2000 as may be
agreed upon by the Company and you and the Other Purchasers. At the Closing the
Company will deliver to you the Series 2000-A Notes to be purchased by you in
the form of a single Series 2000-A Note (or such greater number of Series 2000-A
Notes in denominations of at least $500,000 as you may request) dated the date
of the Closing and registered in your name (or in the name of your nominee),
against delivery by you to the Company or its order of immediately available
funds in the amount of the purchase price therefor by wire transfer of
immediately available funds for the account of the Company to account number
12331-33027 at Bank of America, San Francisco, California, ABA No. 121000358,
Swift Code BOFAUS6S. If at the Closing the Company fails to tender such Series
2000-A Notes to you as provided above in this Section 3, or any of the
conditions specified in Section 4 shall not have been fulfilled to your
satisfaction, you shall, at your election, be relieved of all further
obligations under this Agreement, without thereby waiving any rights you may
have by reason of such failure or such nonfulfillment.
4. CONDITIONS TO CLOSING.
Your obligation to purchase and pay for the Series 2000-A Notes to be
sold to you at the Closing is subject to the fulfillment to your satisfaction,
prior to or at the Closing, of the following conditions:
4.1. REPRESENTATIONS AND WARRANTIES.
The representations and warranties of the Company in this Agreement
shall be correct when made and correct in all material respects at the time of
the Closing.
4.2. PERFORMANCE; NO DEFAULT.
The Company shall have performed and complied with all agreements and
conditions contained in this Agreement required to be performed or complied with
by it prior to or at the Closing and after giving effect to the issue and sale
of the Series 2000-A Notes (and the application of the proceeds thereof as
contemplated by Schedule 5.14) no Default or Event of Default shall have
occurred and be continuing.
4.3. COMPLIANCE CERTIFICATES.
(a) Officer's Certificate. The Company shall have delivered to you an
----------------------
Officer's Certificate, dated the date of the Closing, certifying that the
conditions specified in Sections 4.1, 4.2 and 4.9 have been fulfilled.
(b) Secretary's Certificate. The Company shall have delivered to you a
------------------------
certificate certifying as to the resolutions attached thereto and other
corporate proceedings relating to the authorization, execution and delivery of
the Series 2000-A Notes and the Agreement.
4.4. OPINIONS OF COUNSEL.
You shall have received opinions in form and substance satisfactory to
you, dated the date of the Closing (a) from Bryan Cave LLP, covering the matters
set forth in Exhibit 4.4(a) and covering such other matters incident to the
transactions contemplated hereby as you or your counsel may reasonably request
(and the Company instructs its counsel to deliver such opinion to you) and (b)
from Gardner, Carton & Douglas, your special counsel in connection with such
transactions, substantially in the form set forth in Exhibit 4.4(b) and covering
such other matters incident to such transactions as you may reasonably request.
4.5. PURCHASE PERMITTED BY APPLICABLE LAW, ETC.
On the date of the Closing your purchase of Series 2000-A Notes shall
(i) be permitted by the laws and regulations of each jurisdiction to which you
are subject, without recourse to provisions (such as Section 1405(a)(8) of the
New York Insurance Law) permitting limited investments by insurance companies
without restriction as to the character of the particular investment, (ii) not
violate any applicable law or regulation (including, without limitation,
Regulation U, T or X of the Board of Governors of the Federal Reserve System)
and (iii) not subject you to any tax, penalty or liability under or pursuant to
any applicable law or regulation, which law or regulation was not in effect on
the date hereof. If requested by you, you shall have received an Officer's
Certificate certifying as to such matters of fact as you may reasonably specify
to enable you to determine whether such purchase is so permitted.
4.6. SALE OF OTHER NOTES.
Contemporaneously with the Closing the Company shall sell to the Other
Purchasers and the Other Purchasers shall purchase the Series 2000-A Notes to be
purchased by them at the Closing as specified in Schedule A.
4.7. PAYMENT OF SPECIAL COUNSEL FEES.
Without limiting the provisions of Section 15.1, the Company shall
have paid on or before the Closing the fees, charges and disbursements of your
special counsel referred to in Section 4.4, to the extent reflected in a
statement of such counsel rendered to the Company at least one Business Day
prior to the Closing.
4.8. PRIVATE PLACEMENT NUMBER.
Private Placement Numbers issued by Standard & Poor's CUSIP Service
Bureau (in cooperation with the Securities Valuation Office of the National
Association of Insurance Commissioners) shall have been obtained by Gardner,
Carton & Douglas for each tranche of the Series 2000-A Notes.
4.9. CHANGES IN CORPORATE STRUCTURE.
Except as specified in Schedule 4.9 and except for the Spinoff
Transactions, the Company shall not have changed its jurisdiction of
incorporation or been a party to any merger or consolidation and shall not have
succeeded to all or any substantial part of the liabilities of any other entity,
at any time following the date of the most recent financial statements referred
to in Schedule 5.5.
4.10. SUBSIDIARY GUARANTY.
Each Subsidiary Guarantor shall have executed and delivered the
Subsidiary Guaranty in favor of you and the Other Purchasers.
4.11. PROCEEDINGS AND DOCUMENTS.
All corporate and other proceedings in connection with the
transactions contemplated by this Agreement and all documents and instruments
incident to such transactions shall be satisfactory to you and your special
counsel, and you and your special counsel shall have received all such
counterpart originals or certified or other copies of such documents as you or
they may reasonably request.
5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
The Company represents and warrants to you that:
5.1. ORGANIZATION; POWER AND AUTHORITY.
The Company is a corporation duly organized, validly existing and in
good standing under the laws of its jurisdiction of incorporation, and is duly
qualified as a foreign corporation and is in good standing in each jurisdiction
in which such qualification is required by law, other than those jurisdictions
as to which the failure to be so qualified or in good standing would not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect. The Company has the corporate power and authority to own or
hold under lease the properties it purports to own or hold under lease, to
transact the business it transacts and proposes to transact, to execute and
deliver this Agreement and the Series 2000-A Notes and to perform the provisions
hereof and thereof.
5.2. AUTHORIZATION, ETC.
This Agreement and the Series 2000-A Notes have been duly authorized
by all necessary corporate action on the part of the Company, and this Agreement
constitutes, and upon execution and delivery thereof each Series 2000-A Note
will constitute, a legal, valid and binding obligation of the Company
enforceable against the Company in accordance with its terms, except as such
enforceability may be limited by (i) applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the enforcement of
creditors' rights generally and (ii) general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at law).
The Subsidiary Guaranty has been duly authorized by all necessary
corporate action on the part of each Subsidiary Guarantor and upon execution and
delivery thereof will constitute the legal, valid and binding obligation of each
Subsidiary Guarantor, enforceable against each Subsidiary Guarantor in
accordance with its terms, except as such enforceability may be limited by (i)
applicable bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting the enforcement of creditors' rights generally and (ii) general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law).
5.3. DISCLOSURE.
The Company, through its agent, Banc of America Securities, Inc., has
delivered to you and each Other Purchaser a copy of a Private Placement
Memorandum, dated March 2000 (the "Memorandum"), relating to the transactions
contemplated hereby, and a copy of Amendment No. 2 to the Company's Registration
Statement on Form 10 (Registration No. 1-15401), in the form filed with the
Securities and Exchange Commission on February 23, 2000 (the "Registration
Statement"). Except as disclosed in Schedule 5.3, this Agreement, the
Memorandum, the Registration Statement, the documents, certificates or other
writings identified in Schedule 5.3 and the financial statements listed in
Schedule 5.5, taken as a whole, do not contain any untrue statement of a
material fact or omit to state any material fact necessary to make the
statements therein not misleading in light of the circumstances under which they
were made. Except as disclosed in the Memorandum or the Registration Statement
or as expressly described in Schedule 5.3, or in one of the documents,
certificates or other writings identified therein, or in the financial
statements listed in Schedule 5.5, since September 30, 1999, there has been no
change in the financial condition, operations, business or properties of the
Company or any Subsidiary except changes that individually or in the aggregate
would not reasonably be expected to have a Material Adverse Effect.
5.4. ORGANIZATION AND OWNERSHIP OF SHARES OF SUBSIDIARIES.
(a) Schedule 5.4 is (except as noted therein) a complete and correct list of
the Company's Subsidiaries, showing, as to each Subsidiary, the correct
name thereof, the jurisdiction of its organization, and the percentage of shares
of each class of its capital stock or similar equity interests outstanding owned
by the Company and each other Subsidiary.
(b) All of the outstanding shares of capital stock or similar equity
interests of each Subsidiary shown in Schedule 5.4 as being owned by the Company
and its Subsidiaries have been validly issued, are fully paid and nonassessable
and are owned by the Company or another Subsidiary free and clear of any Lien
(except as otherwise disclosed in Schedule 5.4).
(c) Each Subsidiary identified in Schedule 5.4 is a corporation or other
legal entity duly organized, validly existing and in good standing under the
laws of its jurisdiction of organization, and is duly qualified as a foreign
corporation or other legal entity and is in good standing in each jurisdiction
in which such qualification is required by law, other than those jurisdictions
as to which the failure to be so qualified or in good standing would not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect. Each such Subsidiary has the corporate or other power and
authority to own or hold under lease the properties it purports to own or hold
under lease and to transact the business it transacts and proposes to transact.
5.5. FINANCIAL STATEMENTS.
The Company has delivered to you and each Other Purchaser copies of
the financial statements of the Company and its Subsidiaries listed on Schedule
5.5. All of said financial statements (including in each case the related
schedules and notes) fairly present in all material respects the consolidated
financial condition of the Company and its Subsidiaries as of the respective
dates specified in such Schedule and the consolidated results of their
operations and cash flows for the respective periods so specified and have been
prepared in accordance with GAAP consistently applied throughout the periods
involved except as set forth in the notes thereto (subject, in the case of any
interim financial statements, to normal year-end adjustments).
5.6. COMPLIANCE WITH LAWS, OTHER INSTRUMENTS, ETC.
The execution, delivery and performance by the Company of this
Agreement and the Series 2000-A Notes will not (i) contravene, result in any
breach of, or constitute a default under, or result in the creation of any Lien
in respect of any property of the Company or any Restricted Subsidiary under,
any Material agreement, or corporate charter or By-Laws, to which the Company or
any Restricted Subsidiary is bound or by which the Company or any Restricted
Subsidiary or any of their respective properties may be bound or affected, (ii)
conflict with or result in a breach of any of the terms, conditions or
provisions of any order, judgment, decree, or ruling of any court, arbitrator or
Governmental Authority applicable to the Company or any Restricted Subsidiary or
(iii) violate any provision of any statute or other rule or regulation of any
Governmental Authority applicable to the Company or any Restricted Subsidiary.
The execution, delivery and performance by each Subsidiary Guarantor
of the Subsidiary Guaranty will not (i) contravene, result in any breach of, or
constitute a default under, or result in the creation of any Lien in respect of
any property of such Subsidiary Guarantor under, any agreement, or corporate
charter or by-laws, to which such Subsidiary Guarantor is bound or by which such
Subsidiary Guarantor or any of its properties may be bound or affected, (ii)
conflict with or result in a breach of any of the terms, conditions or
provisions of any order, judgment, decree, or ruling of any court, arbitrator or
Governmental Authority applicable to such Subsidiary Guarantor or (iii) violate
any provision of any statute or other rule or regulation of any Governmental
Authority applicable to such Subsidiary Guarantor.
5.7. GOVERNMENTAL AUTHORIZATIONS, ETC.
No consent, approval or authorization of, or registration, filing or
declaration with, any Governmental Authority is required in connection with the
execution, delivery or performance by the Company of this Agreement or the Notes
or the execution, delivery or performance by each Subsidiary Guarantor of the
Subsidiary Guaranty.
5.8. LITIGATION; OBSERVANCE OF STATUTES AND ORDERS.
(a) Except as disclosed under the heading "Business and Properties-Legal
Proceedings" in the Registration Statement, there are no actions, suits or
proceedings pending or, to the knowledge of the Company, threatened against or
affecting the Company or any Subsidiary or any property of the Company or any
Subsidiary in any court or before any arbitrator of any kind or before or by any
Governmental Authority that, individually or in the aggregate, would
reasonably be expected to have a Material Adverse Effect.
(b) Neither the Company nor any Subsidiary is in default under any order,
judgment, decree or ruling of any court, arbitrator or Governmental Authority or
is in violation of any applicable law, ordinance, rule or regulation (including
without limitation Environmental Laws) of any Governmental Authority, which
default or violation, individually or in the aggregate, would reasonably be
expected to have a Material Adverse Effect.
5.9. TAXES.
The Company and its Subsidiaries have filed all income tax returns
that are required to have been filed in any jurisdiction, and have paid all
taxes, to the extent such taxes are payable by them, to the extent such taxes
and assessments have become due and payable and before they have become
delinquent, except for any taxes and assessments (i) the amount of which is not
individually or in the aggregate Material or (ii) the amount, applicability or
validity of which is currently being contested in good faith by appropriate
proceedings and with respect to which the Company or a Subsidiary, as the case
may be, has established adequate reserves in accordance with GAAP. The Federal
income tax liabilities of the Company and its Subsidiaries have been determined
by the Internal Revenue Service and paid for all fiscal years up to and
including the fiscal year ended September 30, 1992.
5.10. TITLE TO PROPERTY; LEASES.
The Company and its Subsidiaries have good and sufficient title to
their respective Material properties, including all such properties reflected in
the most recent audited balance sheet referred to in Section 5.5 or purported to
have been acquired by the Company or any Subsidiary after said date (except as
sold or otherwise disposed of in the ordinary course of business), in each case
free and clear of Liens prohibited by this Agreement, except for those defects
in title and Liens that, individually or in the aggregate, would not have a
Material Adverse Effect. All Material leases are valid and subsisting and are
in full force and effect in all material respects.
5.11. LICENSES, PERMITS, ETC.
Except as disclosed in Schedule 5.11, the Company and its Subsidiaries
own or possess all licenses, permits, franchises, authorizations, patents,
copyrights, service marks, trademarks and trade names, or rights thereto, that
are Material, without known conflict with the rights of others, except for those
conflicts that, individually or in the aggregate, would not have a Material
Adverse Effect.
5.12. COMPLIANCE WITH ERISA.
(a) The Company and each ERISA Affiliate have operated and administered each
Plan in compliance with all applicable laws except for such instances of
noncompliance as have not resulted in and would not reasonably be expected to
result in a Material Adverse Effect. Neither the Company nor any ERISA
Affiliate has incurred any liability pursuant to Title I or IV of ERISA or the
penalty or excise tax provisions of the Code relating to employee benefit plans
(as defined in Section 3 of ERISA), and no event, transaction or condition has
occurred or exists that would reasonably be expected to result in the incurrence
of any such liability by the Company or any ERISA Affiliate, or in the
imposition of any Lien on any of the rights, properties or assets of the Company
or any ERISA Affiliate, in either case pursuant to Title I or IV of ERISA or to
such penalty or excise tax provisions or to Section 401(a)(29) or 412 of the
Code, other than such liabilities or Liens as would not be individually or in
the aggregate Material.
(b) The present value of the aggregate benefit liabilities under each of the
Plans (other than Multiemployer Plans) that is a defined benefit pension plan
qualified under Code Section 401(a), determined as of the end of such Plan's
most recently ended plan year on the basis of the actuarial assumptions
specified for funding purposes in such Plan's most recent actuarial valuation
report, did not exceed the aggregate current value of the assets of such Plan
allocable to such benefit liabilities. The term "benefit liabilities" has the
meaning specified in section 4001 of ERISA and the terms "current value" and
"present value" have the meaning specified in section 3 of ERISA.
(c) The Company and its ERISA Affiliates have not incurred withdrawal
liabilities (and are not subject to contingent withdrawal liabilities) under
section 4201 or 4204 of ERISA in respect of Multiemployer Plans that
individually or in the aggregate are Material.
(d) The expected postretirement benefit obligation (determined as of the
last day of the Company's most recently ended fiscal year in accordance with
Financial Accounting Standards Board Statement No. 106, without regard to
liabilities attributable to continuation coverage mandated by section 4980B of
the Code) of the Company and its Subsidiaries is not Material or has been
disclosed in the most recent audited consolidated financial statements of the
Company and its Subsidiaries.
(e) The execution and delivery of this Agreement and the issuance and sale
of the Notes hereunder will not involve any transaction that is subject to the
prohibitions of section 406 of ERISA or in connection with which a tax would be
imposed pursuant to section 4975(c)(1)(A)-(D) of the Code. The representation
by the Company in the first sentence of this Section 5.12(e) is made in reliance
upon and subject to the accuracy of your representation in Section 6.2 as to the
sources of the funds used to pay the purchase price of the Notes to be purchased
by you.
5.13. PRIVATE OFFERING BY THE COMPANY.
Neither the Company nor anyone acting on its behalf has offered the
Series 2000-A Notes, the Subsidiary Guaranty or any similar securities for sale
to, or solicited any offer to buy any of the same from, or otherwise approached
or negotiated in respect thereof with, any person other than you, the Other
Purchasers and not more than 40 other Institutional Investors, each of which has
been offered the Series 2000-A Notes at a private sale for investment. Neither
the Company nor anyone acting on its behalf has taken, or will take, any action
that would subject the issuance or sale of the Series 2000-A Notes or the
execution and delivery of the Subsidiary Guaranty to the registration
requirements of Section 5 of the Securities Act.
5.14. USE OF PROCEEDS; MARGIN REGULATIONS.
The Company will apply the proceeds of the sale of the Series 2000-A
Notes for general corporate purposes, including repayment of Indebtedness as set
forth in Schedule 5.14. No part of the proceeds from the sale of the Notes will
be used, directly or indirectly, for the purpose of buying or carrying any
margin stock within the meaning of Regulation U of the Board of Governors of the
Federal Reserve System (12 CFR 221), or for the purpose of buying or carrying or
trading in any securities under such circumstances as to involve the Company in
a violation of Regulation X of said Board (12 CFR 224) or to involve any broker
or dealer in a violation of Regulation T of said Board (12 CFR 220). Margin
stock does not constitute more than 5% of the value of the consolidated assets
of the Company and its Subsidiaries and the Company does not have any present
intention that margin stock will constitute more than 5% of the value of such
assets. As used in this Section, the terms "margin stock" and "purpose of
buying or carrying" shall have the meanings assigned to them in said Regulation
U.
5.15. EXISTING INDEBTEDNESS.
Except as described therein, Schedule 5.15 sets forth a complete and
correct list of all outstanding Indebtedness of the Company and its Subsidiaries
as of February 29, 2000 (except as otherwise indicated), since which date there
has been no Material change in the amounts, interest rates, sinking funds,
installment payments or maturities of the Indebtedness of the Company or its
Subsidiaries. Neither the Company nor any Restricted Subsidiary is in default
and no waiver of default is currently in effect, in the payment of any principal
or interest on any Indebtedness of the Company or such Restricted Subsidiary
that is outstanding in an aggregate principal amount in excess of $5,000,000 and
no event or condition exists with respect to any Indebtedness of the Company or
any Restricted Subsidiary that is outstanding in an aggregate principal amount
in excess of $5,000,000 and that would permit (or that with notice or the lapse
of time, or both, would permit) one or more Persons to cause such Indebtedness
to become due and payable before its stated maturity or before its regularly
scheduled dates of payment.
5.16. FOREIGN ASSETS CONTROL REGULATIONS, ETC.
Neither the sale of the Notes by the Company hereunder nor its use of
the proceeds thereof will violate the Trading with the Enemy Act, as amended, or
any of the foreign assets control regulations of the United States Treasury
Department (31 CFR, Subtitle B, Chapter V, as amended) or any enabling
legislation or executive order relating thereto.
5.17. STATUS UNDER CERTAIN STATUTES.
Neither the Company nor any Restricted Subsidiary is subject to
regulation under the Investment Company Act of 1940, as amended, the Public
Utility Holding Company Act of 1935, as amended, the Interstate Commerce Act, as
amended by the ICC Termination Act, as amended, or the Federal Power Act, as
amended.
5.18. SOLVENCY OF SUBSIDIARY GUARANTORS.
After giving effect to the transactions contemplated herein, (i) the
present fair salable value of the assets of each Subsidiary Guarantor is in
excess of the amount that will be required to pay its probable liability on its
existing debts as said debts become absolute and matured, (ii) each Subsidiary
Guarantor has received reasonably equivalent value for executing and delivering
the Subsidiary Guaranty, (iii) the property remaining in the hands of each
Subsidiary Guarantor is not an unreasonably small capital, and (iv) each
Subsidiary Guarantor is able to pay its debts as they mature.
5.19. YEAR 2000.
The Company has conducted a review and assessment of its computer
applications and inquired of its material suppliers, vendors and customers
regarding the "Year 2000 Problem" (i.e., the risk that computer applications may
be unable to recognize and perform properly date-sensitive functions involving
certain dates prior to and any date after December 31, 1999). The Year 2000
Problem has not and, based upon such review, assessment and inquiry, the Company
believes that the Year 2000 Problem will not, have a Material Adverse Effect.
5.20. ENVIRONMENTAL MATTERS.
Neither the Company nor any Subsidiary has knowledge of any claim or
has received any notice of any claim, and no proceeding has been instituted
raising any claim against the Company or any of its Subsidiaries or any of their
respective real properties now or formerly owned, leased or operated by any of
them or other assets, alleging any damage to the environment or violation of any
Environmental Laws, except, in each case, such as could not reasonably be
expected to result in a Material Adverse Effect. Except as otherwise disclosed
to you in writing,
(a) neither the Company nor any Subsidiary has knowledge of any facts which
would give rise to any claim, public or private, of violation of Environmental
Laws or damage to the environment emanating from, occurring on or in any way
related to real properties now or formerly owned, leased or operated by any of
them or to other assets or their use, except, in each case, such as could not
reasonably be expected to result in a Material Adverse Effect;
(b) neither the Company nor any of its Subsidiaries has stored any Hazardous
Materials on real properties now or formerly owned, leased or operated by any of
them and has not disposed of any Hazardous Materials in a manner contrary to any
Environmental Laws in each case in any manner that could reasonably be expected
to result in a Material Adverse Effect; and
(c) all buildings on all real properties now owned, leased or operated by
the Company or any of its Subsidiaries are in compliance with applicable
Environmental Laws, except where failure to comply could not reasonably be
expected to result in a Material Adverse Effect.
6. REPRESENTATIONS OF THE PURCHASERS.
6.1. PURCHASE FOR INVESTMENT.
You represent that you are purchasing the Series 2000-A Notes for your
own account or for one or more separate accounts maintained by you or for the
account of one or more pension or trust funds and not with a view to the
distribution thereof, provided that the disposition of your or their property
shall at all times be within your or their control. You understand that the
Series 2000-A Notes have not been registered under the Securities Act and may be
resold only if registered pursuant to the provisions of the Securities Act or if
an exemption from registration is available, except under circumstances where
neither such registration nor such an exemption is required by law, and that the
Company is not required to register the Notes.
6.2. SOURCE OF FUNDS.
You represent that at least one of the following statements is an
accurate representation as to each source of funds (a "Source") to be used by
you to pay the purchase price of the Series 2000-A Notes to be purchased by you
hereunder:
(a) the Source is an "insurance company general account" as such term is
defined in the Department of Labor Prohibited Transaction Exemption ("PTE")
95-60 (issued July 12, 1995) ("PTE 95-60") and as of the date of this Agreement
there is no "employee benefit plan" with respect to which the aggregate amount
of such general account's reserves and liabilities for the contracts held by or
on behalf of such employee benefit plan and all other employee benefit plans
maintained by the same employer (and affiliates thereof as defined in Section
V(a)(1) of PTE 95-60) or by the same employee organization (in each case
determined in accordance with the provisions of PTE 95-60) exceeds 10% of the
total reserves and liabilities of such general account (as determined under PTE
95-60) (exclusive of separate account liabilities) plus surplus as set forth in
the National Association of Insurance Commissioners Annual Statement filed with
your state of domicile; or
(b) the Source is either (i) an insurance company pooled separate account,
within the meaning of PTE 90-1 (issued January 29, 1990), or (ii) a bank
collective investment fund, within the meaning of PTE 91-38 (issued July 12,
1991) and, except as you have disclosed to the Company in writing pursuant to
this paragraph (b), no employee benefit plan or group of plans maintained by the
same employer or employee organization beneficially owns more than 10% of all
assets allocated to such pooled separate account or collective investment fund;
or
(c) the Source constitutes assets of an "investment fund" (within the
meaning of Part V of the QPAM Exemption) managed by a "qualified professional
asset manager" or "QPAM" (within the meaning of Part V of the QPAM Exemption),
no employee benefit plan's assets that are included in such investment fund,
when combined with the assets of all other employee benefit plans established or
maintained by the same employer or by an affiliate (within the meaning of
Section V(c)(1) of the QPAM Exemption) of such employer or by the same employee
organization and managed by such QPAM, exceed 20% of the total client assets
managed by such QPAM, the conditions of Part I(c) and (g) of the QPAM Exemption
are satisfied, neither the QPAM nor a person controlling or controlled by the
QPAM (applying the definition of "control" in Section V(e) of the QPAM
Exemption) owns a 5% or more interest in the Company and (i) the identity of
such QPAM and (ii) the names of all employee benefit plans whose assets are
included in such investment fund have been disclosed to the Company in writing
pursuant to this paragraph (c); or
(d) the Source is a governmental plan; or
(e) the Source is one or more employee benefit plans, or a separate account
or trust fund comprised of one or more employee benefit plans, each of which has
been identified to the Company in writing pursuant to this paragraph (e); or
(f) the Source is the assets of one or more employee benefit plans that are
managed by an "in-house asset manager," as that term is defined in PTE 96-23 and
such purchase and holding of the Notes is exempt under PTE 96-23; or
(g) the Source does not include assets of any employee benefit plan, other
than a plan exempt from the coverage of ERISA.
As used in this Section 6.2, the terms "employee benefit plan", "governmental
plan" and "separate account" shall have the respective meanings assigned to such
terms in Section 3 of ERISA.
7. INFORMATION AS TO COMPANY.
7.1. FINANCIAL AND BUSINESS INFORMATION
The Company will deliver to each holder of Notes that is an
Institutional Investor:
(a) Quarterly Statements -- within 60 days after the end of each quarterly
---------------------
fiscal period in each fiscal year of the Company (other than the last quarterly
fiscal period of each such fiscal year), duplicate copies of,
(i) a consolidated balance sheet of the Company and its Subsidiaries as at
the end of such quarter, and
(ii) consolidated statements of income, changes in stockholders' equity and
cash flows of the Company and its Subsidiaries, for such quarter and (in the
case of the second and third quarters) for the portion of the fiscal year ending
with such quarter,
setting forth in each case in comparative form the figures for the corresponding
periods in the previous fiscal year, all in reasonable detail, prepared in
accordance with GAAP applicable to quarterly financial statements generally, and
certified by a Senior Financial Officer as fairly presenting, in all material
respects, the financial condition of the companies being reported on and their
results of operations and cash flows, subject to changes resulting from year-end
adjustments, provided that delivery within the time period specified above of
copies of the Company's Quarterly Report on Form 10-Q prepared in compliance
with the requirements therefor and filed with the Securities and Exchange
Commission shall be deemed to satisfy the requirements of this Section 7.1(a);
(b) Annual Statements -- within 105 days after the end of each fiscal year
------------------
of the Company, duplicate copies of,
(i) a consolidated balance sheet of the Company and its Subsidiaries, as at
the end of such year, and
(ii) consolidated statements of income, changes in stockholders' equity and
cash flows of the Company and its Subsidiaries, for such year,
setting forth in each case in comparative form the figures for the previous
fiscal year, all in reasonable detail, prepared in accordance with GAAP, and
accompanied by an opinion thereon of independent certified public accountants of
recognized national standing, which opinion shall state that such financial
statements present fairly, in all material respects, the financial condition of
the companies being reported upon and their results of operations and cash flows
and have been prepared in conformity with GAAP, and that the examination of such
accountants in connection with such financial statements has been made in
accordance with generally accepted auditing standards, and that such audit
provides a reasonable basis for such opinion in the circumstances, provided that
the delivery within the time period specified above of the Company's Annual
Report on Form 10-K for such fiscal year (together with the Company's annual
report to shareholders, if any, prepared pursuant to Rule 14a-3 under the
Exchange Act) prepared in accordance with the requirements therefor and filed
with the Securities and Exchange Commission shall be deemed to satisfy the
requirements of this Section 7.1(b);
(c) Unrestricted Subsidiaries -- if, at the time of delivery of any
--------------------------
financial statements pursuant to Section 7.1(a) or (b), Unrestricted
Subsidiaries account for more than 10% of (i) the consolidated total assets of
the Company and its Subsidiaries reflected in the balance sheet included in such
financial statements or (ii) the consolidated revenues of the Company and
its Subsidiaries reflected in the consolidated statement of income included in
such financial statements, an unaudited balance sheet for all Unrestricted
Subsidiaries taken as whole as at the end of the fiscal period included in such
financial statements and the related unaudited statements of income,
stockholders' equity and cash flows for such Unrestricted Subsidiaries for such
period, together with consolidating statements reflecting all eliminations or
adjustments necessary to reconcile such group financial statements to the
consolidated financial statements of the Company and its Subsidiaries;
(d) SEC and Other Reports -- promptly upon their becoming available, one
------------------------
copy of (i) each financial statement, report, notice or proxy statement sent by
the Company or any Restricted Subsidiary to public securities holders generally,
and (ii) each regular or periodic report, each registration statement (other
than a Registration Statement on Form S-8) that shall have become effective
(without exhibits except as expressly requested by such holder), and each final
prospectus and all amendments (other than one relating sole to employee benefit
plans) thereto filed by the Company or any Restricted Subsidiary with the
Securities and Exchange Commission;
(e) Notice of Default or Event of Default -- promptly, and in any event
------------------------------------------
within five Business Days after a Responsible Officer obtains actual knowledge
of the existence of any Default or Event of Default, a written notice specifying
the nature and period of existence thereof and what action the Company is taking
or proposes to take with respect thereto;
(f) ERISA Matters -- promptly, and in any event within five days after a
--------------
Responsible Officer becoming aware of any of the following, a written notice
setting forth the nature thereof and the action, if any, that the Company or an
ERISA Affiliate proposes to take with respect thereto:
(i) with respect to any Plan, any reportable event, as defined in section
4043(b) of ERISA and the regulations thereunder, for which notice thereof has
not been waived pursuant to such regulations as in effect on the date hereof; or
(ii) the taking by the PBGC of steps to institute, or the threatening by the
PBGC of the institution of, proceedings under section 4042 of ERISA for the
termination of, or the appointment of a trustee to administer, any Plan, or the
receipt by the Company or any ERISA Affiliate of a notice from a Multiemployer
Plan that such action has been taken by the PBGC with respect to such
Multiemployer Plan; or
(iii) any event, transaction or condition that would result in the
incurrence of any liability by the Company or any ERISA Affiliate pursuant to
Title I or IV of ERISA or the penalty or excise tax provisions of the Code
relating to employee benefit plans, or in the imposition of any Lien on any of
the rights, properties or assets of the Company or any ERISA Affiliate pursuant
to Title I or IV of ERISA or such penalty or excise tax provisions, if such
liability or Lien, taken together with any other such liabilities or Liens then
existing, would reasonably be expected to have a Material Adverse Effect;
(g) Requested Information -- with reasonable promptness, such other data and
---------------------
information relating to the business, operations, affairs, financial
condition, assets or properties of the Company or any of its Subsidiaries or
relating to the ability of the Company to perform its obligations hereunder and
under the Notes as from time to time may be reasonably requested by any such
holder of Notes; and
(h) Supplements to Agreement -- in the event an additional series of Notes
--------------------------
is, or is proposed to be, issued under this Agreement, promptly, and in any
event within 10 Business Days after execution and delivery thereof, a true copy
of the Supplement pursuant to which such Notes are to be, or were, issued.
7.2. OFFICER'S CERTIFICATE.
Each set of financial statements delivered to a holder of Notes
pursuant to Section 7.1(a) or (b) shall be accompanied by a certificate of a
Senior Financial Officer setting forth:
(a) Covenant Compliance -- the information (including detailed calculations)
-------------------
required in order to establish whether the Company was in compliance with
the requirements of Section 10.1 through Section 10.9, inclusive, during the
quarterly or annual period covered by the statements then being furnished
(including with respect to each such Section, where applicable, the calculations
of the maximum or minimum amount, ratio or percentage, as the case may be,
permissible under the terms of such Sections, and the calculation of the amount,
ratio or percentage then in existence); and
(b) Event of Default -- a statement that such officer has reviewed the
------------------
relevant terms hereof and has made, or caused to be made, under his or her
supervision, a review of the transactions and conditions of the Company and its
Restricted Subsidiaries from the beginning of the quarterly or annual period
covered by the statements then being furnished to the date of the certificate
and that such review shall not have disclosed the existence during such period
of any condition or event that constitutes a Default or an Event of Default or,
if any such condition or event existed or exists (including any such event or
condition resulting from the failure of the Company or any Restricted Subsidiary
to comply with any Environmental Law), specifying the nature and period of
existence thereof and what action the Company shall have taken or proposes to
take with respect thereto.
7.3. INSPECTION.
The Company will permit the representatives of each holder of Notes
that is an Institutional Investor:
(a) No Default -- if no Default or Event of Default then exists, at the
-----------
expense of such holder and upon reasonable prior notice to the Company, to visit
the principal executive office of the Company, to discuss the affairs,
finances and accounts of the Company and its Subsidiaries with the Company's
officers, and, with the consent of the Company (which consent will not be
unreasonably withheld), to visit the other offices and properties of the Company
and each Restricted Subsidiary, all at such reasonable times and as often as may
be reasonably requested in writing; and
(b) Default -- if a Default or Event of Default then exists, at the expense
-------
of the Company, to visit and inspect any of the offices or properties of the
Company or any Subsidiary, to examine all their respective books of account,
records, reports and other papers, to make copies and extracts therefrom, and to
discuss their respective affairs, finances, and accounts with their respective
officers and independent public accountants (and by this provision the Company
authorizes said accountants to discuss the affairs, finances and accounts of the
Company and its Subsidiaries), all at such times and as often as may be
requested.
8. PREPAYMENT OF THE NOTES.
8.1. NO SCHEDULED PREPAYMENTS.
No regularly scheduled prepayments are due on the Series 2000-A Notes
prior to their stated maturity.
8.2. OPTIONAL PREPAYMENTS WITH MAKE-WHOLE AMOUNT.
The Company may, at its option, upon notice as provided below, prepay
at any time all, or from time to time any part of, the Notes of any series,
including the Series 2000-A Notes, in an amount not less than $2,000,000 in the
aggregate in the case of a partial prepayment, at 100% of the principal amount
so prepaid, plus the Make-Whole Amount determined for the prepayment date with
respect to such principal amount. The Company will give each holder of Notes of
the series to be prepaid written notice of each optional prepayment under this
Section 8.2 not less than 30 days and not more than 60 days prior to the date
fixed for such prepayment. Each such notice shall specify such date, the
aggregate principal amount of the Notes to be prepaid on such date, the
principal amount of each Note held by such holder to be prepaid (determined in
accordance with Section 8.3), and the interest to be paid on the prepayment date
with respect to such principal amount being prepaid, and shall be accompanied by
a certificate of a Senior Financial Officer as to the estimated Make-Whole
Amount due in connection with such prepayment (calculated as if the date of such
notice were the date of the prepayment), setting forth the details of such
computation. Two Business Days prior to such prepayment, the Company shall
deliver to each holder of Notes a certificate of a Senior Financial Officer
specifying the calculation of such Make-Whole Amount as of the specified
prepayment date.
8.3. ALLOCATION OF PARTIAL PREPAYMENTS.
In the case of each partial prepayment of the Notes of a series, the
principal amount of the Notes of such series to be prepaid shall be allocated
among all of the Notes of such series at the time outstanding in proportion, as
nearly as practicable, to the respective unpaid principal amounts thereof not
theretofore called for prepayment.
8.4. MATURITY; SURRENDER, ETC.
In the case of each prepayment of Notes pursuant to this Section 8,
the principal amount of each Note to be prepaid shall mature and become due and
payable on the date fixed for such prepayment, together with interest on such
principal amount accrued to such date and the applicable Make-Whole Amount, if
any. From and after such date, unless the Company shall fail to pay such
principal amount when so due and payable, together with the interest and
Make-Whole Amount, if any, as aforesaid, interest on such principal amount shall
cease to accrue. Any Note paid or prepaid in full shall be surrendered to the
Company and canceled and shall not be reissued, and no Note shall be issued in
lieu of any prepaid principal amount of any Note.
8.5. PURCHASE OF NOTES.
The Company will not and will not permit any Affiliate to purchase, redeem,
prepay or otherwise acquire, directly or indirectly, any of the outstanding
Notes except (a) upon the payment or prepayment of the Notes in accordance with
the terms of this Agreement and the Notes or (b) pursuant to an offer to
purchase made by the Company or an Affiliate pro rata to the holders of all
Notes at the time outstanding upon the same terms and conditions. Any such
offer shall provide each holder with sufficient information to enable it to make
an informed decision with respect to such offer, and shall remain open for at
least 30 Business Days. If the holders of more than 25% of the principal amount
of the Notes then outstanding accept such offer, the Company shall promptly
notify the remaining holders of such fact and the expiration date for the
acceptance by holders of Notes of such offer shall be extended by the number of
days necessary to give each such remaining holder at least ten Business Days
from its receipt of such notice to accept such offer. The Company will promptly
cancel all Notes acquired by it or any Affiliate pursuant to any payment,
prepayment or purchase of Notes pursuant to any provision of this Agreement and
no Notes may be issued in substitution or exchange for any such Notes.
8.6. MAKE-WHOLE AMOUNT.
The term "MAKE-WHOLE AMOUNT" means, with respect to any Note, an
amount equal to the excess, if any, of the Discounted Value of the Remaining
Scheduled Payments with respect to the Called Principal of such Note over the
amount of such Called Principal, provided that the Make-Whole Amount may in no
event be less than zero. For the purposes of determining the Make-Whole Amount,
the following terms have the following meanings:
"CALLED PRINCIPAL" means, with respect to any Note, the principal of
such Note that is to be prepaid pursuant to Section 8.2 or has become or is
declared to be immediately due and payable pursuant to Section 12.1, as the
context requires.
"DISCOUNTED VALUE" means, with respect to the Called Principal of any
Note, the amount obtained by discounting all Remaining Scheduled Payments with
respect to such Called Principal from their respective scheduled due dates to
the Settlement Date with respect to such Called Principal, in accordance with
accepted financial practice and at a discount factor (applied on the same
periodic basis as that on which interest on the Notes is payable) equal to the
Reinvestment Yield with respect to such Called Principal.
"REINVESTMENT YIELD" means, with respect to the Called Principal of
any Note, .50% over the yield to maturity implied by (i) the yields reported, as
of 10:00 A.M. (New York City time) on the second Business Day preceding the
Settlement Date with respect to such Called Principal, on the display designated
as the "PX Screen" on the Bloomberg Financial Market Service (or such other
display as may replace the PX Screen on Bloomberg Financial Market Service) for
actively traded U.S. Treasury securities having a maturity equal to the
Remaining Average Life of such Called Principal as of such Settlement Date, or
(ii) if such yields are not reported as of such time or the yields reported as
of such time are not ascertainable, the Treasury Constant Maturity Series Yields
reported, for the latest day for which such yields have been so reported as of
the second Business Day preceding the Settlement Date with respect to such
Called Principal, in Federal Reserve Statistical Release H.15 (519) (or any
comparable successor publication) for actively traded U.S. Treasury securities
having a constant maturity equal to the Remaining Average Life of such Called
Principal as of such Settlement Date. Such implied yield will be determined, if
necessary, by (a) converting U.S. Treasury bill quotations to bond-equivalent
yields in accordance with accepted financial practice and (b) interpolating
linearly between (1) the actively traded U.S. Treasury security with the
maturity closest to and greater than the Remaining Average Life and (2) the
actively traded U.S. Treasury security with the maturity closest to and less
than the Remaining Average Life.
"REMAINING AVERAGE LIFE" means, with respect to any Called Principal,
the number of years (calculated to the nearest one-twelfth year) obtained by
dividing (i) such Called Principal into (ii) the sum of the products obtained by
multiplying (a) the principal component of each Remaining Scheduled Payment with
respect to such Called Principal by (b) the number of years (calculated to the
nearest one-twelfth year) that will elapse between the Settlement Date with
respect to such Called Principal and the scheduled due date of such Remaining
Scheduled Payment.
"REMAINING SCHEDULED PAYMENTS" means, with respect to the Called
Principal of any Note, all payments of such Called Principal and interest
thereon that would be due after the Settlement Date with respect to such Called
Principal if no payment of such Called Principal were made prior to its
scheduled due date, provided that if such Settlement Date is not a date on which
interest payments are due to be made under the terms of the Notes, then the
amount of the next succeeding scheduled interest payment will be reduced by the
amount of interest accrued to such Settlement Date and required to be paid on
such Settlement Date pursuant to Section 8.2 or 12.1.
"SETTLEMENT DATE" means, with respect to the Called Principal of any
Note, the date on which such Called Principal is to be prepaid pursuant to
Section 8.2 or has become or is declared to be immediately due and payable
pursuant to Section 12.1, as the context requires.
9. AFFIRMATIVE COVENANTS.
The Company covenants that so long as any of the Notes are
outstanding:
9.1. COMPLIANCE WITH LAW.
The Company will, and will cause each Subsidiary to, comply with all
laws, ordinances or governmental rules or regulations to which each of them is
subject, including, without limitation, Environmental Laws, and will obtain and
maintain in effect all licenses, certificates, permits, franchises and other
governmental authorizations necessary to the ownership of their respective
properties or to the conduct of their respective businesses, in each case to the
extent necessary to ensure that non-compliance with such laws, ordinances or
governmental rules or regulations or failures to obtain or maintain in effect
such licenses, certificates, permits, franchises and other governmental
authorizations would not, individually or in the aggregate, reasonably be
expected to have a materially adverse effect on the business, operations,
affairs, financial condition, properties or assets of the Company and its
Subsidiaries taken as a whole.
9.2. INSURANCE.
The Company will, and will cause each Restricted Subsidiary to,
maintain, with financially sound and reputable insurers, insurance with respect
to their respective properties and businesses against such casualties and
contingencies, of such types, on such terms and in such amounts (including
deductibles, co-insurance and self-insurance, if adequate reserves are
maintained with respect thereto) as is customary in the case of entities of
established reputations engaged in the same or a similar business and similarly
situated.
9.3. MAINTENANCE OF PROPERTIES.
The Company will and will cause each Restricted Subsidiary to maintain
and keep, or cause to be maintained and kept, their respective properties in
good repair, working order and condition (other than ordinary wear and tear), so
that the business carried on in connection therewith may be properly conducted
at all times, provided that this Section shall not prevent the Company or any
Restricted Subsidiary from discontinuing the operation and the maintenance of
any of its properties if such discontinuance is desirable in the conduct of its
business and the Company has concluded that such discontinuance would not,
individually or in the aggregate, reasonably be expected to have a materially
adverse effect on the business, operations, affairs, financial condition,
properties or assets of the Company and its Restricted Subsidiaries taken as a
whole.
9.4. PAYMENT OF TAXES AND CLAIMS.
The Company will, and will cause each Subsidiary to, file all income
tax or similar tax returns required to be filed in any jurisdiction and to pay
and discharge all taxes shown to be due and payable on such returns and all
other taxes, assessments, governmental charges, or levies payable by any of
them, to the extent such taxes and assessments have become due and payable and
before they have become delinquent, provided that neither the Company nor any
Subsidiary need pay any such tax or assessment or claims if (i) the amount,
applicability or validity thereof is contested by the Company or such Subsidiary
on a timely basis in good faith and in appropriate proceedings, and the Company
or a Subsidiary has established adequate reserves therefor in accordance with
GAAP on the books of the Company or such Subsidiary or (ii) the nonpayment of
all such taxes and assessments in the aggregate could not reasonably be expected
to have a materially adverse effect on the business, operations, affairs,
financial condition, properties or assets of the Company and its Subsidiaries
taken as a whole.
9.5. CORPORATE EXISTENCE, ETC.
The Company will at all times preserve and keep in full force and
effect its corporate existence. Subject to Sections 10.3 and 10.4, the Company
will at all times preserve and keep in full force and effect the corporate
existence of each of its Restricted Subsidiaries (unless merged into the Company
or a Wholly-Owned Restricted Subsidiary) and all rights and franchises of the
Company and its Restricted Subsidiaries unless, in the good faith judgment of
the Company, the termination of or failure to preserve and keep in full force
and effect a particular corporate existence, right or franchise could not,
individually or in the aggregate, have a materially adverse effect on the
business, operations, affairs, financial condition, properties or assets of the
Company and its Restricted Subsidiaries taken as a whole.
10. NEGATIVE COVENANTS.
The Company covenants that so long as any of the Notes are
outstanding:
10.1. CONSOLIDATED INDEBTEDNESS; INDEBTEDNESS OF RESTRICTED SUBSIDIARIES.
The Company will not permit:
(a) the ratio of Consolidated Indebtedness (as of the date of determination)
to EBITDA (for the Company's then most recently completed four fiscal
quarters) to be greater than 3.0 to 1.0 at any time; and
(b) any Restricted Subsidiary to incur any Indebtedness if, after giving
effect thereto and to the application of the proceeds therefrom, Priority Debt
outstanding would exceed 20% of Consolidated Total Capitalization. For purposes
of this Section 10.1(b), any unsecured Indebtedness of a Restricted Subsidiary
that is a Subsidiary Guarantor shall be deemed to have been incurred by such
Subsidiary at the time it ceases to be a Subsidiary Guarantor.
10.2. LIENS.
The Company will not, and will not permit any Restricted Subsidiary
to, permit to exist, create, assume or incur, directly or indirectly, any Lien
on its properties or assets, whether now owned or hereafter acquired, except:
(a) Liens existing on property or assets of the Company or any Restricted
Subsidiary as of the date of this Agreement that are described in Schedule 10.2;
(b) Liens for taxes, assessments or governmental charges not then due and
delinquent or the nonpayment of which is permitted by Section 9.4;
(c) encumbrances in the nature of leases, subleases, zoning restrictions,
easements, rights of way and other rights and restrictions of record on the use
of real property and defects in title arising or incurred in the ordinary course
of business, which, individually and in the aggregate, do not materially impair
the use or value of the property or assets subject thereto or which relate only
to assets that in the aggregate are not material;
(d) Liens incidental to the conduct of business or the ownership of
properties and assets (including landlords', lessors', carriers',
warehousemen's, mechanics', materialmen's and other similar liens) and Liens to
secure the performance of bids, tenders, leases or trade contracts, or to secure
statutory obligations (including obligations under workers compensation,
unemployment insurance and other social security legislation), surety or appeal
bonds or other Liens of like general nature incurred in the ordinary course of
business and not in connection with the borrowing of money;
(e) any attachment or judgment Lien, unless the judgment it secures has not,
within 60 days after the entry thereof, been discharged or execution thereof
stayed pending appeal, or has not been discharged within 60 days after the
expiration of any such stay;
(f) Liens securing Indebtedness of a Restricted Subsidiary to the Company or
to another Restricted Subsidiary and Liens securing Indebtedness of the Company
to a Restricted Subsidiary;
(g) Liens (i) existing on property at the time of its acquisition by the
Company or a Restricted Subsidiary and not created in contemplation thereof,
whether or not the Indebtedness secured by such Lien is assumed by the Company
or a Restricted Subsidiary; or (ii) on property created contemporaneously with
its acquisition or within 180 days of the acquisition or completion of
construction thereof to secure or provide for all or a portion of the purchase
price or cost of construction of such property after the date of Closing; or
(iii) existing on property of a Person at the time such Person is merged or
consolidated with, or becomes a Restricted Subsidiary of, or substantially all
of its assets are acquired by, the Company or a Restricted Subsidiary and not
created in contemplation thereof; provided that in the case of clauses (i), (ii)
and (iii) such Liens do not extend to additional property of the Company or any
Restricted Subsidiary (other than property that is an improvement to or is
acquired for specific use in connection with the subject property) and, in the
case of clause (ii) only, that the aggregate principal amount of Indebtedness
secured by each such Lien does not exceed the lesser of the fair market value
(determined in good faith by one or more officers of the Company to whom
authority to enter into such transaction has been delegated by the board of
directors of the Company) or cost of acquisition or construction of the property
subject thereto;
(h) Liens incurred in connection with Asset Securitization Transactions;
(i) Liens resulting from extensions, renewals or replacements of Liens
permitted by paragraphs (a), (f), (g) and (h), provided that (i) there is no
increase in the principal amount or decrease in maturity of the Indebtedness
secured thereby at the time of such extension, renewal or replacement, (ii) any
new Lien attaches only to the same property theretofore subject to such earlier
Lien and (iii) immediately after such extension, renewal or replacement no
Default or Event of Default would exist; and
(j) Liens securing Indebtedness not otherwise permitted by paragraphs (a)
through (h) above, provided that, at the time of creation, assumption or
incurrence thereof and immediately after giving effect thereto and to the
application of the proceeds therefrom, Priority Debt outstanding does not exceed
20% of Consolidated Total Capitalization.
10.3. SALE OF ASSETS.
Except as permitted by Section 10.4, the Company will not, and will
not permit any Restricted Subsidiary to, sell, lease, transfer or otherwise
dispose of, including by way of merger (collectively a "Disposition"), any
assets, including capital stock of Restricted Subsidiaries, in one or a series
of transactions, to any Person, other than (a) Dispositions in the ordinary
course of business, (b) Dispositions by the Company to a Restricted Subsidiary
or by a Restricted Subsidiary to the Company or another Restricted Subsidiary or
(c) Dispositions not otherwise permitted by clauses (a) or (b) of this Section
10.3, provided that the aggregate net book value of all assets so disposed of in
any fiscal year pursuant to this Section 10.3(c) does not exceed 15% of
Consolidated Total Assets as of the end of the immediately preceding fiscal
year. Notwithstanding the foregoing, the Company may, or may permit any
Restricted Subsidiary to, make a Disposition (including the sale of receivables
in an Asset Securitization Transaction) and the assets subject to such
Disposition shall not be subject to or included in the foregoing limitation and
computation contained in clause (c) of the preceding sentence to the extent that
(i) such assets were acquired (other than in connection with the Spinoff
Transaction) or constructed not more than 180 days prior to the date of Closing
and are leased back by the Company or any Restricted Subsidiary, as lessee,
within 180 days of the acquisition or construction thereof, or (ii) the net
proceeds from such Disposition are within one year of such Disposition (A)
reinvested in productive assets by the Company or a Restricted Subsidiary or (B)
applied to the payment or prepayment of any outstanding Indebtedness of the
Company or any Restricted Subsidiary that is not subordinated to the Notes. Any
prepayment of Notes pursuant to this Section 10.3 shall be in accordance with
Sections 8.2 and 8.3, without regard to the minimum prepayment requirements of
Section 8.2.
10.4. MERGERS, CONSOLIDATIONS, ETC.
The Company will not, and will not permit any Restricted Subsidiary
to, consolidate with or merge with any other Person or convey, transfer, sell or
lease all or substantially all of its assets in a single transaction or series
of transactions to any Person except that:
(a) the Company may consolidate or merge with any other Person or convey,
transfer, sell or lease all or substantially all of its assets in a single
transaction or series of transactions to any Person, provided that:
(i) the successor formed by such consolidation or the survivor of such
merger or the Person that acquires by conveyance, transfer, sale or lease all or
substantially all of the assets of the Company as an entirety, as the case
may be, is a solvent corporation organized and existing under the laws of the
United States or any state thereof (including the District of Columbia), and, if
the Company is not such corporation, such corporation (y) shall have executed
and delivered to each holder of any Notes its assumption of the due and punctual
performance and observance of each covenant and condition of this Agreement and
the Notes and (z) shall have caused to be delivered to each holder of any Notes
an opinion of independent counsel reasonably satisfactory to the Required
Holders, to the effect that all agreements or instruments effecting such
assumption are enforceable in accordance with their terms and comply with the
terms hereof; and
(ii) immediately before and after giving effect to such transaction, no
Default or Event of Default shall exist; and
(b) Any Restricted Subsidiary may (x) merge into the Company (provided that
the Company is the surviving corporation) or another Wholly Owned Restricted
Subsidiary or (y) sell, transfer or lease all or any part of its assets to the
Company or another Wholly Owned Restricted Subsidiary, or (z) merge or
consolidate with, or sell, transfer or lease all or substantially all of its
assets to, any Person in a transaction that is permitted by Section 10.3 or, as
a result of which, such Person becomes a Restricted Subsidiary; provided in each
instance set forth in clauses (x) through (z) that, immediately before and
after giving effect thereto, there shall exist no Default or Event of Default;
No such conveyance, transfer, sale or lease of all or substantially all of the
assets of the Company shall have the effect of releasing the Company or any
successor corporation that shall theretofore have become such in the manner
prescribed in this Section 10.4 from its liability under this Agreement or the
Notes.
10.5. DISPOSITION OF STOCK OF RESTRICTED SUBSIDIARIES.
The Company (i) will not permit any Restricted Subsidiary to issue its
capital stock, or any warrants, rights or options to purchase, or securities
convertible into or exchangeable for, such capital stock, to any Person other
than the Company or another Restricted Subsidiary (other than directors'
qualifying shares, shares satisfying local ownership requirements or shares for
any similar statutory purposes) and (ii) will not, and will not permit any
Restricted Subsidiary to, sell, transfer or otherwise dispose of any shares of
capital stock of a Restricted Subsidiary if such sale would be prohibited by
Section 10.3. If a Restricted Subsidiary at any time ceases to be such as a
result of a sale or issuance of its capital stock, any Liens on property of the
Company or any other Restricted Subsidiary securing Indebtedness owed to such
Restricted Subsidiary, which is not contemporaneously repaid, together with such
Indebtedness, shall be deemed to have been incurred by the Company or such other
Restricted Subsidiary, as the case may be, at the time such Restricted
Subsidiary ceases to be a Restricted Subsidiary.
10.6. DESIGNATION OF RESTRICTED AND UNRESTRICTED SUBSIDIARIES.
The Company may designate any Restricted Subsidiary as an Unrestricted
Subsidiary and any Unrestricted Subsidiary as a Restricted Subsidiary; provided
that, (a) if such Subsidiary initially is designated a Restricted Subsidiary,
then such Restricted Subsidiary may be subsequently designated as an
Unrestricted Subsidiary and such Unrestricted Subsidiary may be subsequently
designated as a Restricted Subsidiary, but no further changes in designation may
be made, (b) if such Subsidiary initially is designated an Unrestricted
Subsidiary, then such Unrestricted Subsidiary may be subsequently designated as
a Restricted Subsidiary and such Restricted Subsidiary may be subsequently
designated as an Unrestricted Subsidiary, but no further changes in designation
may be made, (c) immediately before and after designation of a Restricted
Subsidiary as an Unrestricted Subsidiary there exists no Default or Event of
Default and (d) a Subsidiary Guarantor may not be designated an Unrestricted
Subsidiary. If a Restricted Subsidiary at any time ceases to be such as a
result of a redesignation, any Liens on property of the Company or any other
Restricted Subsidiary securing Indebtedness owed to such Restricted Subsidiary
that is not contemporaneously repaid, together with such Indebtedness, shall be
deemed to have been incurred by the Company or such other Restricted Subsidiary,
as the case may be, at the time such Restricted Subsidiary ceases to be a
Restricted Subsidiary.
10.7. RESTRICTED SUBSIDIARY GUARANTIES.
The Company will not permit any Restricted Subsidiary to become a
party to the Bank Guarantees or to directly or indirectly guarantee any of the
Company's Indebtedness or other obligations under the Credit Agreement unless
such Restricted Subsidiary is, or concurrently therewith becomes, a party to the
Subsidiary Guaranty.
10.8. NATURE OF BUSINESS.
The Company will not, and will not permit any Restricted Subsidiary
to, engage in any business if, as a result, the general nature of the business
in which the Company and its Restricted Subsidiaries, taken as a whole, would
then be engaged would be substantially changed from the general nature of the
business in which the Company and its Restricted Subsidiaries, taken as a whole,
are engaged on the date of this Agreement as described in the Memorandum;
provided, that the foregoing shall not be deemed to prohibit acquisitions by the
Company or its Restricted Subsidiaries as long as the acquired companies are
consumer products companies or other companies operating in businesses similar
to or related to the current and future businesses conducted by the Company and
its Subsidiaries, as well as suppliers to or distributors of products similar to
those of the Company and its Subsidiaries.
10.9. TRANSACTIONS WITH AFFILIATES.
The Company will not and will not permit any Restricted Subsidiary to
enter into directly or indirectly any Material transaction or Material group of
related transactions (including without limitation the purchase, lease, sale or
exchange of properties of any kind or the rendering of any service) with any
Affiliate (other than the Company or another Restricted Subsidiary), except upon
fair and reasonable terms no less favorable to the Company or such Restricted
Subsidiary than would be obtainable in a comparable arm's-length transaction
with a Person not an Affiliate; provided, that the foregoing limitation shall
not apply to the transactions between the Company and Ralston described in the
Registration Statement under "Agreements between Ralston and Energizer-Agreement
and Plan of Reorganization," "-Tax Sharing Agreement," "-Bridging Agreement,"
"-Lease Agreement," "-Foreign Distribution Agreement" and "-Joint Aircraft
Ownership Agreement," as long as such transactions are carried out substantially
in accordance with the descriptions thereof set forth under such headings.
11. EVENTS OF DEFAULT.
An "Event of Default" shall exist if any of the following conditions
or events shall occur and be continuing:
(a) the Company defaults in the payment of any principal or Make-Whole
Amount, if any, on any Note when the same becomes due and payable, whether at
maturity or at a date fixed for prepayment or by declaration or otherwise; or
(b) the Company defaults in the payment of any interest on any Note for more
than five Business Days after the same becomes due and payable; or
(c) the Company defaults in the performance of or compliance with any term
contained in or Sections 10.1 through 10.9; or
(d) the Company defaults in the performance of or compliance with any term
contained herein (other than those referred to in paragraphs (a), (b) and (c) of
this Section 11) and such default is not remedied within 30 days after the
earlier of (i) a Responsible Officer obtaining actual knowledge of such default
and (ii) the Company receiving written notice of such default from any holder of
a Note; or
(e) any representation or warranty made in writing by or on behalf of the
Company or by any officer of the Company in this Agreement or in any writing
furnished in connection with the transactions contemplated hereby proves to have
been false or incorrect in any material respect on the date as of which made; or
(f) (i) the Company or any Significant Restricted Subsidiary is in default
(as principal or as guarantor or other surety) in the payment of any principal
of or premium or make-whole amount or interest on any Indebtedness that is
outstanding in an aggregate principal amount in excess of $30,000,000 beyond any
period of grace provided with respect thereto, or (ii) the Company or any
Significant Restricted Subsidiary is in default in the performance of or
compliance with any term of any evidence of any Indebtedness that is outstanding
in an aggregate principal amount in excess of $30,000,000 or of any mortgage,
indenture or other agreement relating thereto or any other condition exists, and
as a consequence of such default or condition such Indebtedness has become, or
has been declared, due and payable before its stated maturity or before its
regularly scheduled dates of payment; or
(g) the Company or any Significant Restricted Subsidiary (i) is generally
not paying, or admits in writing its inability to pay, its debts as they become
due, (ii) files, or consents by answer or otherwise to the filing against it of,
a petition for relief or reorganization or arrangement or any other petition in
bankruptcy, for liquidation or to take advantage of any bankruptcy, insolvency,
reorganization, moratorium or other similar law of any jurisdiction, (iii) makes
an assignment for the benefit of its creditors, (iv) consents to the appointment
of a custodian, receiver, trustee or other officer with similar powers with
respect to it or with respect to any substantial part of its property, (v) is
adjudicated as insolvent or to be liquidated, or (vi) takes corporate action for
the purpose of any of the foregoing; or
(h) a court or governmental authority of competent jurisdiction enters an
order appointing, without consent by the Company or any Significant Restricted
Subsidiary, a custodian, receiver, trustee or other officer with similar powers
with respect to it or with respect to any substantial part of its property, or
constituting an order for relief or approving a petition for relief or
reorganization or any other petition in bankruptcy or for liquidation or to take
advantage of any bankruptcy or insolvency law of any jurisdiction, or ordering
the dissolution, winding-up or liquidation of the Company or any Significant
Restricted Subsidiary, or any such petition shall be filed against the Company
or any Significant Restricted Subsidiary and such petition shall not be
dismissed within 60 days; or
(i) a final judgment or judgments for the payment of money aggregating in
excess of $30,000,000 are rendered against one or more of the Company and its
Significant Restricted Subsidiaries, which judgments are not, within 60 days
after entry thereof, bonded, discharged or stayed pending appeal, or are not
discharged within 60 days after the expiration of such stay; or
(j) if (i) any Plan shall fail to satisfy the minimum funding standards of
ERISA or the Code for any plan year or part thereof or a waiver of such
standards or extension of any amortization period is sought or granted under
section 412 of the Code, (ii) a notice of intent to terminate any Plan shall
have been or is reasonably expected to be filed with the PBGC or the PBGC shall
have instituted proceedings under ERISA section 4042 to terminate or appoint a
trustee to administer any Plan or the PBGC shall have notified the Company or
any ERISA Affiliate that a Plan may become a subject of any such proceedings,
(iii) the aggregate "amount of unfunded benefit liabilities" (within the meaning
of section 4001(a)(18) of ERISA) under all Plans determined in accordance with
Title IV of ERISA, shall exceed $30,000,000, (iv) the Company or any ERISA
Affiliate shall have incurred or is reasonably expected to incur any liability
pursuant to Title I or IV of ERISA or the penalty or excise tax provisions of
the Code relating to employee benefit plans, (v) the Company or any ERISA
Affiliate withdraws from any Multiemployer Plan, or (vi) the Company or any
Subsidiary establishes or amends any employee welfare benefit plan that provides
post-employment welfare benefits in a manner that would increase the liability
of the Company or any Subsidiary thereunder; and any such event or events
described in clauses (i) through (vi) above, either individually or together
with any other such event or events, would reasonably be expected to have a
Material Adverse Effect; or
(k) any Guarantor that is a Significant Restricted Subsidiary defaults in
the performance of or compliance with any term contained in the Subsidiary
Guaranty or the Subsidiary Guaranty ceases to be in full force and effect as a
result of acts taken by the Company or any Subsidiary Guarantor, except as
provided in Section 22, or is declared to be null and void in whole or in
material part by a court or other governmental or regulatory authority having
jurisdiction or the validity or enforceability thereof shall be contested by any
of the Company or any Subsidiary Guarantor or any of them renounces any of the
same or denies that it has any or further liability thereunder.
As used in Section 11(j), the terms "employee benefit plan" and "employee
welfare benefit plan" shall have the respective meanings assigned to such terms
in Section 3 of ERISA.
12. REMEDIES ON DEFAULT, ETC.
12.1. ACCELERATION.
(a) If an Event of Default with respect to the Company described in
paragraph (g) or (h) of Section 11 (other than an Event of Default described in
clause (i) of paragraph (g) or described in clause (vi) of paragraph (g) by
virtue of the fact that such clause encompasses clause (i) of paragraph (g)) has
occurred, all the Notes then outstanding shall automatically become
immediately due and payable.
(b) If any other Event of Default has occurred and is continuing, any holder
or holders of a majority or more in principal amount of the Notes at the time
outstanding may at any time at its or their option, by notice or notices to the
Company, declare all the Notes then outstanding to be immediately due and
payable.
(c) If any Event of Default described in paragraph (a) or (b) of Section 11
has occurred and is continuing, any holder or holders of Notes at the time
outstanding affected by such Event of Default may at any time, at its or their
option, by notice or notices to the Company, declare all the Notes held by it or
them to be immediately due and payable.
Upon any Notes becoming due and payable under this Section 12.1,
whether automatically or by declaration, such Notes will forthwith mature and
the entire unpaid principal amount of such Notes, plus (x) all accrued and
unpaid interest thereon and (y) the Make-Whole Amount determined in respect of
such principal amount (to the full extent permitted by applicable law), shall
all be immediately due and payable, in each and every case without presentment,
demand, protest or further notice, all of which are hereby waived. The Company
acknowledges, and the parties hereto agree, that each holder of a Note has the
right to maintain its investment in the Notes free from repayment by the Company
(except as herein specifically provided for) and that the provision for payment
of a Make-Whole Amount by the Company in the event that the Notes are prepaid or
are accelerated as a result of an Event of Default, is intended to provide
compensation for the deprivation of such right under such circumstances.
12.2. OTHER REMEDIES.
If any Default or Event of Default has occurred and is continuing, and
irrespective of whether any Notes have become or have been declared immediately
due and payable under Section 12.1, the holder of any Note at the time
outstanding may proceed to protect and enforce the rights of such holder by an
action at law, suit in equity or other appropriate proceeding, whether for the
specific performance of any agreement contained herein or in any Note, or for an
injunction against a violation of any of the terms hereof or thereof, or in aid
of the exercise of any power granted hereby or thereby or by law or otherwise.
12.3. RESCISSION.
At any time after any Notes have been declared due and payable
pursuant to clause (b) or (c) of Section 12.1, the holders of not less than 67%
in principal amount of the Notes then outstanding, by written notice to the
Company, may rescind and annul any such declaration and its consequences if (a)
the Company has paid all overdue interest on the Notes, all principal of and
Make-Whole Amount, if any, on any Notes that are due and payable and are unpaid
other than by reason of such declaration, and all interest on such overdue
principal and Make-Whole Amount, if any, and (to the extent permitted by
applicable law) any overdue interest in respect of the Notes, at the Default
Rate, (b) all Events of Default and Defaults, other than non-payment of amounts
that have become due solely by reason of such declaration, have been cured or
have been waived pursuant to Section 17, and (c) no judgment or decree has been
entered for the payment of any monies due pursuant hereto or to the Notes. No
rescission and annulment under this Section 12.3 will extend to or affect any
subsequent Event of Default or Default or impair any right consequent thereon.
12.4. NO WAIVERS OR ELECTION OF REMEDIES, EXPENSES, ETC.
No course of dealing and no delay on the part of any holder of any
Note in exercising any right, power or remedy shall operate as a waiver thereof
or otherwise prejudice such holder's rights, powers or remedies. No right,
power or remedy conferred by this Agreement or by any Note upon any holder
thereof shall be exclusive of any other right, power or remedy referred to
herein or therein or now or hereafter available at law, in equity, by statute or
otherwise. Without limiting the obligations of the Company under Section 15,
the Company will pay to the holder of each Note on demand such further amount as
shall be sufficient to cover all costs and expenses of such holder incurred in
any enforcement or collection under this Section 12, including, without
limitation, reasonable attorneys' fees, expenses and disbursements.
13. REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES.
13.1. REGISTRATION OF NOTES.
The Company shall keep at its principal executive office a register
for the registration and registration of transfers of Notes. The name and
address of each holder of one or more Notes, each transfer thereof and the name
and address of each transferee of one or more Notes shall be registered in such
register. Prior to due presentment for registration of transfer, the Person in
whose name any Note shall be registered shall be deemed and treated as the owner
and holder thereof for all purposes hereof, and the Company shall not be
affected by any notice or knowledge to the contrary. The Company shall give to
any holder of a Note that is an Institutional Investor, promptly upon request
therefor, a complete and correct copy of the names and addresses of all
registered holders of Notes.
13.2. TRANSFER AND EXCHANGE OF NOTES.
Upon surrender of any Note at the principal executive office of the
Company for registration of transfer or exchange (and in the case of a surrender
for registration of transfer, duly endorsed or accompanied by a written
instrument of transfer duly executed by the registered holder of such Note or
his attorney duly authorized in writing and accompanied by the address for
notices of each transferee of such Note or part thereof), the Company shall
execute and deliver, at the Company's expense (except as provided below), one or
more new Notes (as requested by the holder thereof) of the same series and
tranche in exchange therefor, in an aggregate principal amount equal to the
unpaid principal amount of the surrendered Note. Each such new Note shall be
payable to such Person as such holder may request and shall be substantially in
the form of Note established for such series and tranche. Each such new Note
shall be dated and bear interest from the date to which interest shall have been
paid on the surrendered Note or dated the date of the surrendered Note if no
interest shall have been paid thereon. The Company may require payment of a sum
sufficient to cover any stamp tax or governmental charge imposed in respect of
any such transfer of Notes. Notes shall not be transferred in denominations of
less than $500,000, provided that if necessary to enable the registration of
transfer by a holder of its entire holding of Notes, one Note may be in a
denomination of less than $500,000. Any transferee, by its acceptance of a Note
registered in its name (or the name of its nominee), shall be deemed to have
made the representation set forth in Section 6.2.
13.3. REPLACEMENT OF NOTES.
Upon receipt by the Company of evidence reasonably satisfactory to it
of the ownership of and the loss, theft, destruction or mutilation of any Note
(which evidence shall be, in the case of an Institutional Investor, notice from
such Institutional Investor of such ownership and such loss, theft, destruction
or mutilation), and
(a) in the case of loss, theft or destruction, of indemnity reasonably
satisfactory to it (provided that if the holder of such Note is, or is a nominee
for, an original Purchaser or another Institutional Investor holder of a
Note with a minimum net worth of at least $50,000,000, such Person's own
unsecured agreement of indemnity shall be deemed to be satisfactory), or
(b) in the case of mutilation, upon surrender and cancellation thereof,
the Company at its own expense shall execute and deliver, in lieu thereof, a new
Note of the same series, dated and bearing interest from the date to which
interest shall have been paid on such lost, stolen, destroyed or mutilated Note
or dated the date of such lost, stolen, destroyed or mutilated Note if no
interest shall have been paid thereon.
14. PAYMENTS ON NOTES.
14.1. PLACE OF PAYMENT.
Subject to Section 14.2, payments of principal, Make-Whole Amount, if
any, and interest becoming due and payable on the Notes shall be made in
Chicago, Illinois at the principal office of Bank of America in such
jurisdiction. The Company may at any time, by notice to each holder of a Note,
change the place of payment of the Notes so long as such place of payment shall
be either the principal office of the Company in such jurisdiction or the
principal office of a bank or trust company in such jurisdiction.
14.2. HOME OFFICE PAYMENT.
So long as you or your nominee shall be the holder of any Note, and
notwithstanding anything contained in Section 14.1 or in such Note to the
contrary, the Company will pay all sums becoming due on such Note for principal,
Make-Whole Amount, if any, and interest by the method and at the address
specified for such purpose below your name in Schedule A, or by such other
method or at such other address as you shall have from time to time specified to
the Company in writing for such purpose, without the presentation or surrender
of such Note or the making of any notation thereon, except that upon written
request of the Company made concurrently with or reasonably promptly after
payment or prepayment in full of any Note, you shall surrender such Note for
cancellation, reasonably promptly after any such request, to the Company at its
principal executive office or at the place of payment most recently designated
by the Company pursuant to Section 14.1. Prior to any sale or other disposition
of any Note held by you or your nominee you will, at your election, either
endorse thereon the amount of principal paid thereon and the last date to which
interest has been paid thereon or surrender such Note to the Company in exchange
for a new Note or Notes pursuant to Section 13.2. The Company will afford the
benefits of this Section 14.2 to any Institutional Investor that is the direct
or indirect transferee of any Note purchased by you under this Agreement and
that has made the same agreement relating to such Note as you have made in this
Section 14.2.
15. EXPENSES, ETC.
15.1. TRANSACTION EXPENSES.
Whether or not the transactions contemplated hereby are consummated,
the Company will pay all costs and expenses (including reasonable attorneys'
fees of one special counsel for you and the Other Purchasers collectively and,
if reasonably required, local or other counsel) incurred by you and each Other
Purchaser or holder of a Note in connection with such transactions and in
connection with any amendments, waivers or consents under or in respect of this
Agreement or the Notes (whether or not such amendment, waiver or consent becomes
effective), including, without limitation: (a) the reasonable costs and expenses
incurred in enforcing or defending (or determining whether or how to enforce or
defend) any rights under this Agreement or the Notes or in responding to any
subpoena or other legal process or informal investigative demand issued in
connection with this Agreement or the Notes, or by reason of being a holder of
any Note, and (b) the costs and expenses, including financial advisors' fees,
incurred in connection with the insolvency or bankruptcy of the Company or any
Subsidiary or in connection with any work-out or restructuring of the
transactions contemplated hereby and by the Notes. The Company will pay, and
will save you and each other holder of a Note harmless from, all claims in
respect of any fees, costs or expenses if any, of brokers and finders (other
than those retained by you).
15.2. SURVIVAL.
The obligations of the Company under this Section 15 will survive the
payment or transfer of any Note, the enforcement, amendment or waiver of any
provision of this Agreement or the Notes, and the termination of this Agreement.
16. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT.
All representations and warranties contained herein shall survive the
execution and delivery of this Agreement and the Notes, the purchase or transfer
by you of any Note or portion thereof or interest therein and the payment of any
Note, and may be relied upon by any subsequent holder of a Note, regardless of
any investigation made at any time by or on behalf of you or any other holder of
a Note. All statements contained in any certificate or other instrument
delivered by or on behalf of the Company pursuant to this Agreement shall be
deemed representations and warranties of the Company under this Agreement.
Subject to the preceding sentence, this Agreement and the Notes embody the
entire agreement and understanding between you and the Company and supersede all
prior agreements and understandings relating to the subject matter hereof.
17. AMENDMENT AND WAIVER.
17.1. REQUIREMENTS.
This Agreement, the Notes and the Subsidiary Guaranty may be amended,
and the observance of any term hereof or of the Notes may be waived (either
retroactively or prospectively), with (and only with) the written consent of the
Company and the Required Holders, except that (a) no amendment or waiver of any
of the provisions of Section 1, 2, 3, 4, 5, 6 or 21 hereof, or any defined term
(as it is used therein), will be effective as to you unless consented to by you
in writing, and (b) no such amendment or waiver may, without the written consent
of the holder of each Note at the time outstanding affected thereby, (i) subject
to the provisions of Section 12 relating to acceleration or rescission, change
the amount or time of any prepayment or payment of principal of, or reduce the
rate or change the time of payment or method of computation of interest or of
the Make-Whole Amount on, the Notes, (ii) change the percentage of the principal
amount of the Notes the holders of which are required to consent to any such
amendment or waiver, or (iii) amend any of Sections 8, 11(a), 11(b), 12, 17 or
20.
17.2. SOLICITATION OF HOLDERS OF NOTES.
(a) Solicitation. The Company will provide each holder of the Notes
------------
(irrespective of the amount of Notes then owned by it) with sufficient
information, sufficiently far in advance of the date a decision is required, to
enable such holder to make an informed and considered decision with respect to
any proposed amendment, waiver or consent in respect of any of the provisions
hereof or of the Notes. The Company will deliver executed or true and correct
copies of each amendment, waiver or consent effected pursuant to the provisions
of this Section 17 to each holder of outstanding Notes promptly following the
date on which it is executed and delivered by, or receives the consent or
approval of, the requisite holders of Notes.
(b) Payment. The Company will not directly or indirectly pay or cause to be
-------
paid any remuneration, whether by way of supplemental or additional interest,
fee or otherwise, or grant any security, to any holder of Notes as consideration
for or as an inducement to the entering into by any holder of Notes or any
waiver or amendment of any of the terms and provisions hereof unless such
remuneration is concurrently paid, or security is concurrently granted, on the
same terms, ratably to each holder of Notes then outstanding even if such holder
did not consent to such waiver or amendment.
(c) Consent in Contemplation of Transfer. Any consent made pursuant to this
------------------------------------
Section 17 by a holder of Notes that has transferred or has agreed to transfer
its Notes to the Company, any Subsidiary or any Affiliate of the Company and has
provided or has agreed to provide such written consent as a condition to such
transfer shall be void and of no force or effect except solely as to such
holder, and any amendments effected or waivers granted or to be effected or
granted that would not have been or would not be so effected or granted but for
such consent (and the consents of other holders of Notes that were acquired
under the same or similar conditions) shall be void and of no force or effect
except solely as to such holder.
17.3. BINDING EFFECT, ETC.
Any amendment or waiver consented to as provided in this Section 17
applies equally to all holders of Notes and is binding upon them and upon each
future holder of any Note and upon the Company without regard to whether such
Note has been marked to indicate such amendment or waiver. No such amendment or
waiver will extend to or affect any obligation, covenant, agreement, Default or
Event of Default not expressly amended or waived or impair any right consequent
thereon. No course of dealing between the Company and the holder of any Note
nor any delay in exercising any rights hereunder or under any Note shall operate
as a waiver of any rights of any holder of such Note. As used herein, the term
"this Agreement" or "the Agreement" and references thereto shall mean this
Agreement as it may from time to time be amended or supplemented.
17.4. NOTES HELD BY COMPANY, ETC.
Solely for the purpose of determining whether the holders of the
requisite percentage of the aggregate principal amount of Notes then outstanding
approved or consented to any amendment, waiver or consent to be given under this
Agreement or the Notes, or have directed the taking of any action provided
herein or in the Notes to be taken upon the direction of the holders of a
specified percentage of the aggregate principal amount of Notes then
outstanding, Notes directly or indirectly owned by the Company or any of its
Affiliates shall be deemed not to be outstanding.
18. NOTICES.
All notices and communications provided for hereunder shall be in
writing and sent (a) by telecopy if the sender on the same day sends a
confirming copy of such notice by a recognized overnight delivery service
(charges prepaid), or (b) by registered or certified mail with return receipt
requested (postage prepaid), or (c) by a recognized overnight delivery service
(with charges prepaid). Any such notice must be sent:
(i) if to you or your nominee, to you or it at the address specified for
such communications in Schedule A, or at such other address as you or it shall
have specified to the Company in writing,
(ii) if to any other holder of any Note, to such holder at such address as
such other holder shall have specified to the Company in writing, or
(iii) if to the Company, to the Company at its address set forth at the
beginning hereof to the attention of the Office of the Treasurer, or at such
other address as the Company shall have specified to the holder of each Note in
writing.
Notices under this Section 18 will be deemed given only when actually received.
19. REPRODUCTION OF DOCUMENTS.
This Agreement and all documents relating thereto, including, without
limitation, (a) consents, waivers and modifications that may hereafter be
executed, (b) documents received by you at the Closing (except the Notes
themselves), and (c) financial statements, certificates and other information
previously or hereafter furnished to you, may be reproduced by you by any
photographic, photostatic, microfilm, microcard, miniature photographic or other
similar process and you may destroy any original document so reproduced. The
Company agrees and stipulates that, to the extent permitted by applicable law,
any such reproduction shall be admissible in evidence as the original itself in
any judicial or administrative proceeding (whether or not the original is in
existence and whether or not such reproduction was made by you in the regular
course of business) and any enlargement, facsimile or further reproduction of
such reproduction shall likewise be admissible in evidence. This Section 19
shall not prohibit the Company or any other holder of Notes from contesting any
such reproduction to the same extent that it would contest the original, or from
introducing evidence to demonstrate the inaccuracy of any such reproduction.
20. CONFIDENTIAL INFORMATION.
For the purposes of this Section 20, "Confidential Information" means
information delivered to you by or on behalf of the Company or any Subsidiary in
connection with the transactions contemplated by or otherwise pursuant to this
Agreement that is proprietary in nature and that was clearly marked or labeled
or otherwise adequately identified in writing when received by you as being
confidential information of the Company or such Subsidiary, provided that such
term does not include information that (a) was publicly known or otherwise known
to you prior to the time of such disclosure, (b) subsequently becomes publicly
known through no act or omission by you or any person acting on your behalf, (c)
otherwise becomes known to you other than through disclosure by the Company or
any Subsidiary or (d) constitutes financial statements delivered to you under
Section 7.1 that are otherwise publicly available. You will maintain the
confidentiality of such Confidential Information in accordance with procedures
adopted by you in good faith to protect confidential information of third
parties delivered to you, provided that you may deliver or disclose Confidential
Information to (i) your directors, trustees officers, employees, agents,
attorneys and affiliates (to the extent such disclosure reasonably relates to
the administration of the investment represented by your Notes), (ii) your
financial advisors and other professional advisors who agree to hold
confidential the Confidential Information substantially in accordance with the
terms of this Section 20, (iii) any other holder of any Note, (iv) any
Institutional Investor to which you sell or offer to sell such Note or any part
thereof or any participation therein (if such Person has agreed in writing prior
to its receipt of such Confidential Information to be bound by the provisions of
this Section 20), (v) any Person from which you offer to purchase any security
of the Company (if such Person has agreed in writing prior to its receipt of
such Confidential Information to be bound by the provisions of this Section 20),
(vi) any federal or state regulatory authority having jurisdiction over you,
(vii) the National Association of Insurance Commissioners or any similar
organization, or any nationally recognized rating agency that requires access to
information about your investment portfolio or (viii) any other Person to which
such delivery or disclosure may be necessary or appropriate (w) to effect
compliance with any law, rule, regulation or order applicable to you, (x) in
response to any subpoena or other legal process, (y) in connection with any
litigation to which you are a party or (z) if an Event of Default has occurred
and is continuing, to the extent you may reasonably determine such delivery and
disclosure to be necessary or appropriate in the enforcement or for the
protection of the rights and remedies under your Notes and this Agreement. Each
holder of a Note, by its acceptance of a Note, will be deemed to have agreed to
be bound by and to be entitled to the benefits of this Section 20 as though it
were a party to this Agreement. On reasonable request by the Company in
connection with the delivery to any holder of a Note of information required to
be delivered to such holder under this Agreement or requested by such holder
(other than a holder that is a party to this Agreement or its nominee), such
holder will enter into an agreement with the Company embodying the provisions of
this Section 20.
21. SUBSTITUTION OF PURCHASER.
You shall have the right to substitute any one of your Affiliates as
the purchaser of the Notes that you have agreed to purchase hereunder, by
written notice to the Company, which notice shall be signed by both you and such
Affiliate, shall contain such Affiliate's agreement to be bound by this
Agreement and shall contain a confirmation by such Affiliate of the accuracy
with respect to it of the representations set forth in Section 6. Upon receipt
of such notice, wherever the word "you" is used in this Agreement (other than in
this Section 21), such word shall be deemed to refer to such Affiliate in lieu
of you. In the event that such Affiliate is so substituted as a purchaser
hereunder and such Affiliate thereafter transfers to you all of the Notes then
held by such Affiliate, upon receipt by the Company of notice of such transfer,
wherever the word "you" is used in this Agreement (other than in this Section
21), such word shall no longer be deemed to refer to such Affiliate, but shall
refer to you, and you shall have all the rights of an original holder of the
Notes under this Agreement.
22. RELEASE OF SUBSIDIARY GUARANTOR.
You and each subsequent holder of a Note agree to release any
Subsidiary Guarantor from the Subsidiary Guaranty (i) if such Subsidiary
Guarantor ceases to be such as a result of a Disposition permitted by Section
10.3 or (ii) at such time as the banks party to the Credit Agreement release
such Subsidiary from the Bank Guarantees; provided, however, that you and each
subsequent holder will not be required to release a Subsidiary Guarantor from
the Subsidiary Guaranty upon such Subsidiary's release from the Bank Guarantees
if (A) a Default or Event of Default has occurred and is continuing, (B) such
Subsidiary Guarantor is to become a borrower under the Credit Agreement or (C)
such release is part of a plan of financing that contemplates such Subsidiary
Guarantor guaranteeing any other Indebtedness of the Company. Your obligation
to release a Subsidiary Guarantor from the Subsidiary Guaranty is conditioned
upon your prior receipt of a certificate from a Senior Financial Officer of the
Company stating that none of the circumstances described in clauses (A), (B) and
(C) above are true.
23. MISCELLANEOUS.
23.1. SUCCESSORS AND ASSIGNS.
All covenants and other agreements contained in this Agreement by or
on behalf of any of the parties hereto bind and inure to the benefit of their
respective successors and assigns (including, without limitation, any subsequent
holder of a Note) whether so expressed or not.
23.2. PAYMENTS DUE ON NON-BUSINESS DAYS.
Anything in this Agreement or the Notes to the contrary
notwithstanding, any payment of principal of or Make-Whole Amount or interest on
any Note that is due on a date other than a Business Day shall be made on the
next succeeding Business Day without including the additional days elapsed in
the computation of the interest payable on such next succeeding Business Day.
23.3. 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 (to the full extent permitted by law) not invalidate or
render unenforceable such provision in any other jurisdiction.
23.4. CONSTRUCTION.
Each covenant contained herein shall be construed (absent express
provision to the contrary) as being independent of each other covenant contained
herein, so that compliance with any one covenant shall not (absent such an
express contrary provision) be deemed to excuse compliance with any other
covenant. Where any provision herein refers to action to be taken by any
Person, or which such Person is prohibited from taking, such provision shall be
applicable whether such action is taken directly or indirectly by such Person.
23.5. COUNTERPARTS.
This Agreement may be executed in any number of counterparts, each of
which shall be an original but all of which together shall constitute one
instrument. Each counterpart may consist of a number of copies hereof, each
signed by less than all, but together signed by all, of the parties hereto.
23.6. GOVERNING LAW.
This Agreement shall be construed and enforced in accordance with, and
the rights of the parties shall be governed by, the law of the State of Illinois
excluding choice-of-law principles of the law of such State that would require
the application of the laws of a jurisdiction other than such State.
* * * * *
<PAGE>
If you are in agreement with the foregoing, please sign the form of
agreement on the accompanying counterpart of this Agreement and return it to the
Company, whereupon the foregoing shall become a binding agreement between you
and the Company.
Very truly yours,
ENERGIZER HOLDINGS, INC.
By: /s/ Daniel E. Corbin, Jr.
Name: Daniel E. Corbin, Jr.
Title: Executive Vice President, Finance and Control
RECEIVABLES PURCHASE AGREEMENT
dated as of April 4, 2000
Among
ENERGIZER RECEIVABLES FUNDING CORPORATION, as Seller,
EVEREADY BATTERY COMPANY, INC., as Servicer,
FALCON ASSET SECURITIZATION CORPORATION
and
BANK ONE, NA (MAIN OFFICE CHICAGO)
as Agent
<PAGE>
RECEIVABLES PURCHASE AGREEMENT
This Receivables Purchase Agreement dated as of April 4, 2000 is among
ENERGIZER RECEIVABLES FUNDING CORPORATION, a Delaware corporation ("Seller"),
------
EVEREADY BATTERY COMPANY, INC., a Delaware corporation ("Eveready"), as initial
--------
Servicer (the Servicer together with Seller, the "Seller Parties" and each a
--------------
"Seller Party"), the entities listed on Schedule A to this Agreement (together
----------- ----------
with any of their respective successors and assigns hereunder, the "Financial
---------
Institutions"), FALCON ASSET SECURITIZATION CORPORATION ("Conduit") and BANK
---------- -------
ONE, NA (MAIN OFFICE CHICAGO), as agent for the Purchasers hereunder or any
-
successor agent hereunder (together with its successors and assigns hereunder,
-
the "Agent"). Unless defined elsewhere herein, capitalized terms used in this
-----
Agreement shall have the meanings assigned to such terms in Exhibit I.
---------
PRELIMINARY STATEMENTS
Seller desires to transfer and assign Purchaser Interests to the Purchasers
from time to time.
Conduit may, in its absolute and sole discretion, purchase Purchaser
Interests from Seller from time to time.
In the event that Conduit declines to make any purchase, the Financial
Institutions shall, at the request of Seller, purchase Purchaser Interests from
time to time. In addition, the Financial Institutions have agreed to provide a
liquidity facility to Conduit in accordance with the terms hereof.
Bank One, NA (Main Office Chicago) has been requested and is willing to act
as Agent on behalf of Conduit and the Financial Institutions in accordance with
the terms hereof.
ARTICLE I
PURCHASE ARRANGEMENTS
Section 1.1 Purchase Facility. Upon the terms and subject to the
------------------
conditions hereof, Seller may, at its option, sell and assign Purchaser
Interests to the Agent for the benefit of one or more of the Purchasers. In
accordance with the terms and conditions set forth herein, Conduit may, at its
option, instruct the Agent to purchase on behalf of Conduit, or if Conduit shall
decline to purchase, the Agent shall purchase, on behalf of the Financial
Institutions, Purchaser Interests from time to time in an aggregate amount not
to exceed at such time the lesser of (i) the Purchase Limit and (ii) the
aggregate amount of the Commitments during the period from the date hereof to
but not including the Facility Termination Date.
Section 1.2 Increases.
---------
<PAGE>
Seller shall provide the Agent with at least one Business Days' prior
notice in a form set forth as Exhibit II hereto of each Incremental Purchase (a
----------
"Purchase Notice"). Each Purchase Notice shall be subject to Section 6.2 hereof
--------------- -----------
and, except as set forth below, shall be irrevocable and shall specify the
requested Purchase Price (which shall be at least $1,000,000 and integral
multiples of $100,000 in excess thereof) and date of purchase and, in the case
of an Incremental Purchase to be funded by the Financial Institutions, the
requested Discount Rate and Tranche Period. Following receipt of a Purchase
Notice, the Agent will determine whether Conduit agrees to make the purchase.
Without the prior approval of Conduit, Seller shall not request more than three
proposed purchases in any calendar month and, unless approved by Conduit in its
sole discretion, any such requests in excess of three in any calendar month
shall be void. If Conduit declines to make a proposed purchase, Seller may
cancel the Purchase Notice or, in the absence of such a cancellation, the
Incremental Purchase of the Purchaser Interest will be made by the Financial
Institutions. On the date of each Incremental Purchase, upon satisfaction of
the applicable conditions precedent set forth in Article VI, Conduit or the
----------
Financial Institutions, as applicable, shall deposit to the Facility Account, in
immediately available funds, no later than 12:00 noon (Chicago time), an amount
equal to (i) in the case of Conduit, the aggregate Purchase Price of the
Purchaser Interests Conduit is then purchasing or (ii) in the case of a
Financial Institution, such Financial Institution's Pro Rata Share of the
aggregate Purchase Price of the Purchaser Interests the Financial Institutions
are purchasing.
Section 1.3 Decreases. Seller shall provide the Agent with prior
---------
written notice in conformity with the Required Notice Period (a "Reduction
---------
Notice") of any proposed reduction of Aggregate Capital from Collections. Such
--
Reduction Notice shall designate (i) the date (the "Proposed Reduction Date")
-----------------------
upon which any such reduction of Aggregate Capital shall occur (which date shall
give effect to the applicable Required Notice Period), and (ii) the amount of
Aggregate Capital to be reduced which shall be applied ratably to the Purchaser
Interests of Conduit and the Financial Institutions in accordance with the
amount of Capital (if any) owing to Conduit, on the one hand, and the amount of
Capital (if any) owing to the Financial Institutions (ratably, based on their
respective Pro Rata Shares), on the other hand (the "Aggregate Reduction").
-------------------
Only one (1) Reduction Notice shall be outstanding at any time. No Aggregate
Reduction will be made following the occurrence of the Amortization Date without
the consent of the Agent.
Section 1.4 Payment Requirements. All amounts to be paid or deposited
--------------------
by any Seller Party pursuant to any provision of this Agreement shall be paid or
deposited in accordance with the terms hereof no later than 11:00 a.m. (Chicago
time) on the day when due in immediately available funds, and if not received
before 11:00 a.m. (Chicago time) shall be deemed to be received on the next
succeeding Business Day. If such amounts are payable to a Purchaser they shall
be paid to the Agent, for the account of such Purchaser, at 1 Bank One Plaza,
Chicago, Illinois 60670 until the applicable Seller Party is otherwise notified
in writing by the Agent. Upon notice to Seller, the Agent may debit the
Facility Account for all amounts due and payable hereunder. All computations of
Yield, per annum fees calculated as part of any CP Costs, per annum fees
hereunder and per annum fees under the Fee Letter shall be made on the basis of
a year of 360 days for the actual number of days elapsed. If any amount
hereunder shall be payable on a day which is not a Business Day, such amount
shall be payable on the next succeeding Business Day.
ARTICLE II
PAYMENTS AND COLLECTIONS
<PAGE>
Section 2.1 Payments. Notwithstanding any limitation on recourse
--------
contained in this Agreement, Seller shall immediately pay to the Agent when due,
for the account of the relevant Purchaser or Purchasers on a full recourse
basis, (i) such fees as set forth in the Fee Letter (which fees shall be
sufficient to pay all fees owing to the Financial Institutions), (ii) all CP
Costs, (iii) all amounts payable as Yield, (iv) all amounts payable as Deemed
Collections (which shall be immediately due and payable by Seller and applied to
reduce outstanding Aggregate Capital hereunder in accordance with Sections 2.2
------------
and 2.3 hereof), (v) all amounts payable to reduce the Purchaser Interest, if
---
required, pursuant to Section 2.6, (vi) all amounts payable pursuant to Article
----------- -------
X, if any, (vii) all Servicer costs and expenses, including the Servicing Fee,
in connection with servicing, administering and collecting the Receivables,
(viii) all Broken Funding Costs and (ix) all Default Fees (collectively, the
"Obliga-tions"). If any Person fails to pay any of the Obligations when due,
----------
such Person agrees to pay, on demand, the Default Fee in respect thereof until
paid. Notwithstanding the foregoing, no provision of this Agreement or the Fee
Letter shall require the payment or permit the collection of any amounts
hereunder in excess of the maximum permitted by applicable law. If at any time
Seller receives any Collections or is deemed to receive any Collections, Seller
shall immediately pay such Collections or Deemed Collections to the Servicer for
application in accordance with the terms and conditions hereof and, at all times
prior to such payment, such Collections or Deemed Collections shall be held in
trust by Seller for the exclusive benefit of the Purchasers and the Agent.
Section 2.2 Collections Prior to Amortization. Prior to the
----------------------------------
Amortization Date, any Collections and/or Deemed Collections received by the
Servicer shall be set aside and held in trust by the Servicer for the payment of
any accrued and unpaid Aggregate Unpaids or for a Reinvestment as provided in
this Section 2.2. If at any time any Collections and/or Deemed Collections are
-----------
received by the Servicer prior to the Amortization Date, (i) the Servicer shall
set aside the Termination Percentage (hereinafter defined) of Collections
evidenced by the Purchaser Interests of each Terminat-ing Financial Institution
and (ii) Seller hereby requests and the Purchasers (other than any Terminating
Financial Institutions) hereby agree to make, simultaneously with such receipt,
a reinvestment (each a "Reinvestment") with that portion of the balance of each
------------
and every Collection and Deemed Collection received by the Servicer that is part
of any Purchaser Interest (other than any Purchaser Interests of Terminating
Financial Institutions), such that after giving effect to such Reinvestment, the
amount of Capital of such Purchaser Interest immediately after such receipt and
corresponding Reinvestment shall be equal to the amount of Capital immediately
prior to such receipt. On each Settlement Date prior to the occurrence of the
Amortization Date, the Servicer shall remit to the Agent's account the amounts
set aside during the preceding Settlement Period that have not been subject to a
Reinvestment and apply such amounts (if not previously paid in accordance with
Section 2.1) first, to reduce unpaid Obligations and second, to reduce the
----------- ----- ------
Capital of all Purchaser Interests of Terminating Financial Institutions,
----
applied ratably to each Terminating Financial Institution according to its
----
respective Termination Percentage. If such Capital and Obligations shall be
----
reduced to zero, any additional Collections received by the Servicer (i) if
--
applicable, shall be remitted to the Agent's account no later than 11:00 a.m.
--
(Chicago time) to the extent required to fund any Aggregate Reduction on such
-
Settlement Date and (ii) any balance remaining thereafter shall be remitted from
-
the Servicer to Seller on such Settlement Date. Each Terminating Financial
Institution shall be allocated a ratable portion of Collections from the date of
any assignment by Conduit pursuant to Section 13.6 (the "Termination Date")
----------------
until such Terminating Financing Institution's Capital shall be paid in full.
This ratable portion shall be calculated on the Termination Date of each
Terminating Financial Institution as a percentage equal to (i) Capital of such
Terminating Financial Institution outstanding on its Termination Date, divided
-------
by (ii) the Aggregate Capital outstanding on such Termination Date (the
-
"Termination Percentage"). Each Terminating Financial Institution's Termination
-
Percentage shall remain constant prior to the Amortization Date. On and after
the Amortization Date, each Termination Percentage shall be disregarded, and
each Terminating Financial Institution's Capital shall be reduced ratably with
all Financial Institutions in accordance with Section 2.3.
------------
Section 2.3 Collections Following Amortization. On the Amortization
-------------------------------------
Date and on each day thereafter, the Servicer shall set aside and hold in trust,
for the holder of each Purchaser Interest, all Collections received on such day
and an additional amount, from Seller's assets, for the payment of any accrued
and unpaid Obligations owed by Seller and not previously paid by Seller in
accordance with Section 2.1. On and after the Amortization Date, the Servicer
-----------
shall, at any time upon the request from time to time by (or pursuant to
standing instructions from) the Agent (i) remit to the Agent's account the
amounts set aside pursuant to the preceding sentence, and (ii) apply such
amounts to reduce the Capital associated with each such Purchaser Interest and
any other Aggregate Unpaids.
Section 2.4 Application of Collections. If there shall be insufficient
---------------------------
funds on deposit for the Servicer to distribute funds in payment in full of the
aforementioned amounts pursuant to Section 2.2 or 2.3 (as applicable), the
------------ ---
Servicer shall distribute such funds:
<PAGE>
first, to the payment of the Servicer's reasonable out-of-pocket costs and
-----
expenses in connection with servicing, administering and collecting the
Receivables , including the Servicing Fee, if Seller or one of its Affiliates is
not then acting as the Servicer,
second, to the reimbursement of the Agent's costs of collection and
------
enforcement of this Agreement,
--
third, (to the extent applicable) to the ratable reduction of the Aggregate
-----
Capital (without regard to any Termination Percentage),
fourth, for the ratable payment of all other unpaid Obligations, provided
------ --------
that to the extent such Obligations relate to the payment of Servicer costs and
expenses, including the Servicing Fee, when Seller or one of its Affiliates is
acting as the Servicer, such costs and expenses will not be paid until after the
payment in full of all other Obligations, and
fifth, after the Aggregate Unpaids have been indefeasibly reduced to zero,
-----
to Seller.
Collections applied to the payment of Aggregate Unpaids shall be
distributed in accordance with the aforementioned provisions, and, giving effect
to each of the priorities set forth in Section 2.4 above, shall be shared
-----------
ratably (within each priority) among the Agent and the Purchasers in accordance
with the amount of such Aggregate Unpaids owing to each of them in respect of
each such priority.
Section 2.5 Payment Recission. No payment of any of the Aggregate
------------------
Unpaids shall be considered paid or applied hereunder to the extent that, at any
time, all or any portion of such payment or application is rescinded by
application of law or judicial authority, or must otherwise be returned or
refunded for any reason. Seller shall remain obligated for the amount of any
payment or application so rescinded, returned or refunded, and shall promptly
pay to the Agent (for application to the Person or Persons who suffered such
recission, return or refund) the full amount thereof, plus the Default Fee from
the date of any such recission, return or refunding.
Section 2.6 Maximum Purchaser Interests. Seller shall ensure that the
---------------------------
Purchaser Interests of the Purchasers shall at no time exceed in the aggregate
100%. If the aggregate of the Purchaser Interests of the Purchasers exceeds
100%, Seller shall pay to the Agent within three (3) Business Days an amount to
be applied to reduce the Aggregate Capital (as allocated by the Agent), such
that after giving effect to such payment the aggregate of the Purchaser
Interests equals or is less than 100%.
Section 2.7 Clean Up Call. In addition to Seller's rights
---------------
pursuant to Section 1.3, Seller shall have the right (after providing written
------------
notice to the Agent in accordance with the Required Notice Period), at any time
following the reduction of the Aggregate Capital to a level that is less than
10.0% of the original Purchase Limit, to repurchase from the Purchasers all, but
not less than all, of the then outstanding Purchaser Interests. The purchase
price in respect thereof shall be an amount equal to the Aggregate Unpaids
through the date of such repurchase, payable in immediately available funds.
Such repurchase shall be without representation, warranty or recourse of any
kind by, on the part of, or against any Purchaser or the Agent.
<PAGE>
ARTICLE III
CONDUIT FUNDING
Section 3.1 CP Costs. Seller shall pay CP Costs with respect to the
---------
Capital associated with each Purchaser Interest of Conduit for each day that any
Capital in respect of such Purchaser Interest is outstanding. Each Purchaser
Interest funded substantially with Pooled Commer-cial Paper will accrue CP Costs
each day on a pro rata basis, based upon the percentage share the Capital in
respect of such Purchaser Interest represents in relation to all assets held by
Conduit and funded substantially with Pooled Commercial Paper.
Section 3.2 CP Costs Payments. On each Settlement Date, Seller shall
------------------
pay to the Agent (for the benefit of Conduit) an aggregate amount equal to all
accrued and unpaid CP Costs in respect of the Capital associated with all
Purchaser Interests of Conduit for the immediately preceding Accrual Period in
accordance with Article II.
-----------
Section 3.3 Calculation of CP Costs. On the tenth calendar day of each
-----------------------
month or, if such day is not a Business Day, on the next succeeding Business
Day, Conduit shall calculate the aggregate amount of CP Costs for the applicable
Accrual Period and shall notify Seller of such aggregate amount.
ARTICLE IV
FINANCIAL INSTITUTION FUNDING
Section 4.1 Financial Institution Funding. Each Purchaser Interest of
-----------------------------
the Financial Institutions shall accrue Yield for each day during its Tranche
Period at either the LIBO Rate or the Prime Rate in accordance with the terms
and conditions hereof. Until Seller gives notice to the Agent of another
Discount Rate in accordance with Section 4.4, the initial Discount Rate for any
-----------
Purchaser Interest transferred to the Financial Institutions pursuant to the
terms and conditions hereof shall be the Prime Rate. If the Financial
Institutions acquire by assignment from Conduit any Purchaser Interest pursuant
to Article XIII, each Purchaser Interest so assigned shall each be deemed to
-------------
have a new Tranche Period commencing on the date of any such assignment.
Section 4.2 Yield Payments. On the Settlement Date for each Purchaser
--------------
Interest of the Financial Institutions, Seller shall pay to the Agent (for the
benefit of the Financial Institutions) an aggregate amount equal to the accrued
and unpaid Yield for the entire Tranche Period of each such Purchaser Interest
in accordance with Article II.
-----------
Section 4.3 Selection and Continuation of Tranche Periods.
--------------------------------------------------
(a) With consultation from (and approval by) the Agent, Seller shall
from time to time request Tranche Periods for the Purchaser Interests of the
Financial Institutions, provided that, if at any time the Financial Institutions
shall have a Purchaser Interest, Seller shall always request Tranche Periods
such that at least one Tranche Period shall end on the date specified in clause
(A) of the definition of Settlement Date.
<PAGE>
(b) Seller or the Agent, upon notice to and consent by the other
received at least three (3) Business Days prior to the end of a Tranche Period
(the "Terminating Tranche") for any Purchaser Interest, may, effective on the
--------------------
last day of the Terminating Tranche: (i) divide any such Purchaser Interest
into multiple Purchaser Interests, (ii) combine any such Purchaser Interest with
one or more other Purchaser Interests that have a Terminating Tranche ending on
the same day as such Terminating Tranche or (iii) combine any such Purchaser
Interest with a new Purchaser Interests to be purchased on the day such
Terminating Tranche ends, provided, that in no event may a Purchaser Interest of
--------
Conduit be combined with a Purchaser Interest of the Financial Institutions.
Section 4.4 Financial Institution Discount Rates. Seller may select
---------------------------------------
the LIBO Rate or the Prime Rate for each Purchaser Interest of the Financial
Institutions. Seller shall by 11:00 a.m. (Chicago time): (i) at least three (3)
Business Days prior to the expiration of any Terminating Tranche with respect to
which the LIBO Rate is being requested as a new Discount Rate and (ii) at least
one (1) Business Day prior to the expiration of any Terminating Tranche with
respect to which the Prime Rate is being requested as a new Discount Rate, give
the Agent irrevocable notice of the new Discount Rate for the Purchaser Interest
associated with such Terminating Tranche. Until Seller gives notice to the
Agent of another Discount Rate, the initial Discount Rate for any Purchaser
Interest transferred to the Financial Institutions pursuant to the terms and
conditions hereof shall be the Prime Rate.
Section 4.5 Suspension of the LIBO Rate. (a) If any Financial
-------------------------------
Institution notifies the Agent that it has determined that funding its Pro Rata
Share of the Purchaser Interests of the Financial Institutions at a LIBO Rate
would violate any applicable law, rule, regulation or directive of any
governmental or regulatory authority, whether or not having the force of law, or
that (i) deposits of a type and maturity appropriate to match fund its Purchaser
Interests at such LIBO Rate are not available or (ii) such LIBO Rate does not
accurately reflect the cost of acquiring or maintaining a Purchaser Interest at
such LIBO Rate, then the Agent shall suspend the availability of such LIBO Rate
and require Seller to select the Prime Rate for any Purchaser Interest accruing
Yield at such LIBO Rate.
(b) If less than all of the Financial Institutions give a
notice to the Agent pursuant to Section 4.5(a), each Financial Institution which
--------------
gave such a notice shall be obliged, at the request of Seller, Conduit or the
Agent, to assign all of its rights and obligations hereunder to (i) another
Financial Institution or (ii) another funding entity nominated by Seller or the
Agent that is acceptable to Conduit and willing to participate in this Agreement
through the Liquidity Termination Date in the place of such notifying Financial
Institution; provided that (i) the notifying Financial Institution receives
--------
payment in full, pursuant to an Assignment Agreement, of an amount equal to such
notifying Financial Institution's Pro Rata Share of the Capital and Yield owing
to all of the Financial Institutions and all accrued but unpaid fees and other
costs and expenses payable in respect of its Pro Rata Share of the Purchaser
Interests of the Financial Institutions, and (ii) the replacement Financial
Institution otherwise satisfies the requirements of Section 12.1(b).
----------------
ARTICLE V
REPRESENTATIONS AND WARRANTIES
Section 5.1 Representations and Warranties of The Seller Parties. Each
----------------------------------------------------
Seller Party hereby represents and warrants to the Agent and the Purchasers, as
to itself, as of the date hereof and as of the date of each Incremental Purchase
and the date of each Reinvestment that:
(a) Corporate Existence and Power. Such Seller Party is a corpora-tion
----------------------------
duly organized, validly existing and in good standing under the laws of its
state of incorporation. Such Seller Party is duly qualified to do business and
is in good standing as a foreign corporation, and has and holds all corporate
power and all governmental licenses, authorizations, consents and approvals
required to carry on its business in each jurisdiction in which its business is
conducted, except where the failure to so qualify or so hold could not
reasonably be expected to have a Material Adverse Effect.
<PAGE>
(b) Power and Authority; Due Authorization, Execution and Delivery.
------------------------------------------------------------------
The execution and delivery by such Seller Party of this Agreement and each other
Transaction Document to which it is a party, and the performance of its
obligations hereunder and thereunder and, in the case of Seller, Seller's use of
the proceeds of purchases made hereunder, are within its corporate powers and
authority and have been duly authorized by all necessary corporate action on its
part. This Agreement and each other Transaction Document to which such Seller
Party is a party has been duly executed and delivered by such Seller Party.
(c) No Conflict. The execution and delivery by such Seller Party of
------------
this Agreement and each other Transaction Document to which it is a party, and
the performance of its obligations hereunder and thereunder do not contravene or
violate (i) its certificate or articles of incorporation or by-laws, (ii) any
law, rule or regulation applicable to it, (iii) any restrictions under any
agreement, contract or instrument to which it is a party or by which it or any
of its property is bound, or (iv) any order, writ, judgment, award, injunction
or decree binding on or affecting it or its property, and do not result in the
creation or imposition of any Adverse Claim on assets of such Seller Party or
its Subsidiaries (except as created hereunder), except, in any case, where such
contravention or violation could not reasonably be expected to have a Material
Adverse Effect; and no transaction contemplated hereby requires compliance with
any bulk sales act or similar law.
(d) Governmental Authorization. Other than the filing of the financing
--------------------------
statements required hereunder, no authorization or approval or other action by,
and no notice to or filing with, any governmental authority or regulatory body
is required for the due execution and delivery by such Seller Party of this
Agreement and each other Transaction Document to which it is a party and the
performance of its obligations hereunder and thereunder.
(e) Actions, Suits. There are no actions, suits or proceedings
---------------
pending, or to the best of such Seller Party's knowledge, threatened, against or
affecting such Seller Party, or any of its properties, in or before any court,
arbitrator or other body, that could reasonably be expected to have a Material
Adverse Effect. Such Seller Party is not in default with respect to any order
of any court, arbitrator or governmental body, which default, individually or in
the aggregate, could reasonably be expected to have a Material Adverse Effect.
(f) Binding Effect. This Agreement and each other Transaction Document
--------------
to which such Seller Party is a party constitute the legal, valid and binding
obligations of such Seller Party enforceable against such Seller Party in
accordance with their respective terms, except as such enforcement may be
limited by applicable bankruptcy, insolvency, reorganization or other similar
laws relating to or limiting creditors' rights generally and by general
principles of equity (regardless of whether enforcement is sought in a
proceeding in equity or at law).
(g) Accuracy of Information. All information heretofore furnished by
-------------------------
such Seller Party or any of its Affiliates to the Agent or the Purchasers for
purposes of or in connec-tion with this Agreement, any of the other Transaction
Documents or any transaction contemplated hereby or thereby is, and all such
information hereafter furnished by such Seller Party or any of its Affiliates to
the Agent or the Purchasers will be, true and accurate in every material respect
on the date such information is stated or certified and does not and will not
contain any material misstatement of fact or omit to state a material fact or
any fact necessary to make the statements contained therein not misleading.
(h) Use of Proceeds. No proceeds of any purchase hereunder will be
-----------------
used (i) for a purpose that violates, or would be inconsistent with, Regulation
T, U or X promulgated by the Board of Governors of the Federal Reserve System
from time to time or (ii) to acquire any security in any transaction which is
subject to Section 12, 13 or 14 of the Securities Exchange Act of 1934, as
amended.
<PAGE>
(i) Good Title. Immediately prior to each purchase hereunder, Seller
-----------
shall be the legal and beneficial owner of the Receivables and Related Security
with respect thereto, free and clear of any Adverse Claim, except as created by
the Transaction Documents. There have been duly filed all financing statements
or other similar instruments or documents necessary under the UCC (or any
comparable law) of all appropriate jurisdictions to perfect Seller's ownership
interest in each Receivable, its Collections and the Related Security.
(j) Perfection. This Agreement, together with the filing of the
----------
financing statements contemplated hereby, is effective to, and shall, upon each
purchase hereunder, transfer to the Agent for the benefit of the relevant
Purchaser or Purchasers (and the Agent for the benefit of such Purchaser or
Purchasers shall acquire from Seller) a valid and perfected first priority
undivided percentage ownership or security interest in each Receivable existing
or hereafter arising and in the Related Security and Collections with respect
thereto, free and clear of any Adverse Claim, except as created by the
Transactions Documents. There have been duly filed all financing statements or
other similar instruments or documents necessary under the UCC (or any
comparable law) of all appropriate jurisdictions to perfect the Agent's (on
behalf of the Purchasers) ownership or security interest in the Receivables, the
Related Security and the Collections.
(k) Places of Business and Locations of Records. The principal places
--------------------------------------------
of business and chief executive office of such Seller Party and the offices
where it keeps all of its Records are located at the address(es) listed on
Exhibit III or such other locations of which the Agent has been notified in
-------
accordance with Section 7.2(a) in jurisdictions where all action required by
---------------
Section 14.4(a) has been taken and completed. Seller's Federal Employer
-------------
Identification Number is correctly set forth on Exhibit III.
---- ------------
(l) Collections. The conditions and requirements set forth in Section
----------- -------
7.1(j) and Section 8.2 have at all times been satisfied and duly performed. The
- ------ -----------
names and addresses of all Collection Banks, together with the account numbers
of the Collection Accounts of Seller at each Collection Bank and the post office
box number of each Lock-Box, are listed on Exhibit IV. Seller has not granted
----------
any Person, other than the Agent as contemplated by this Agreement, dominion and
control of any Lock-Box or Collection Account, or the right to take dominion and
control of any such Lock-Box or Collection Account at a future time or upon the
occurrence of a future event.
(m) Material Adverse Effect. (i) The initial Servicer represents and
-------------------------
warrants that since December 31, 1999, no event has occurred that would have a
material adverse effect on the financial condition or operations of the initial
Servicer and its Subsidiaries or the ability of the initial Servicer to perform
its obligations under this Agreement, and (ii) Seller represents and warrants
that since the date of this Agreement, no event has occurred that would have a
material adverse effect on (A) the financial condition or operations of Seller,
(B) the ability of Seller to perform its obligations under the Transaction
Documents, or (C) the collectibility of the Receivables generally or any
material portion of the Receivables.
(n) Names. In the past five (5) years, Seller has not used any
-----
corporate names, trade names or assumed names other than the name in which it
has executed this Agreement.
(o) Ownership of Seller. Originator owns, directly or indirectly, 100%
-------------------
of the issued and outstanding capital stock of Seller, free and clear of any
Adverse Claim. Such capital stock is validly issued, fully paid and
nonassessable, and there are no options, warrants or other rights to acquire
securities of Seller.
(p) Not a Holding Company or an Investment Company. Such Seller Party
-----------------------------------------------
is not a "holding company" or a "subsidiary holding company" of a "holding
company" within the meaning of the Public Utility Holding Company Act of 1935,
as amended, or any successor statute. Such Seller Party is not an "invest-ment
compa-ny" within the mean-ing of the Invest-ment Compa-ny Act of 1940, as
amended, or any successor statute.
<PAGE>
(q) Compliance with Law. Such Seller Party has complied in all
---------------------
respects with all applicable laws, rules, regulations, orders, writs, judgments,
injunctions, decrees or awards to which it may be subject, except where the
failure to so comply could not reasonably be expected to have a Material Adverse
Effect. Each Receiv-able, together with the Contract related thereto, does not
contravene any laws, rules or regula-tions applicable thereto (in-cluding,
----------
without limitation, laws, rules and regulations relating to truth in lending,
--------------
fair credit billing, fair credit reporting, equal credit opportunity, fair debt
collection practices and privacy), and no part of such Contract is in violation
of any such law, rule or regu-lation, except where such contravention or
violation could not reasonably be expected to have a Material Adverse Effect.
(r) Compliance with Credit and Collection Policy. Such Seller Party
-----------------------------------------------
has complied in all material respects with the Credit and Collection Policy with
regard to each Receivable and the related Contract, and has not made any change
to such Credit and Collection Policy, except such material change as to which
the Agent has been notified in accordance with Section 7.1(a)(vii).
--------------------
(s) Payments to Originator. With respect to each Receivable
------------------------
transferred to Seller under the Receivables Sale Agreement, Seller has given
reasonably equivalent value to Originator in consideration therefor and such
transfer was not made for or on account of an antecedent debt. No transfer by
Originator of any Receivable under the Receivables Sale Agreement is or may be
voidable under any section of the Bankruptcy Reform Act of 1978 (11 U.S.C.
101 et seq.), as amended.
--------
(t) Enforceability of Contracts. Each Contract -with respect to each
-----------------------------
Receivable is effective to create, and has created, a legal, valid and binding
obligation of the related Obligor to pay the Outstanding Balance of the
Receivable created thereunder and any accrued interest thereon, enforce-able
against the Obligor in accordance with its terms, except as such enforcement may
be limited by applicable bankruptcy, insolvency, reorganization or other similar
laws relating to or limiting creditors' rights generally and by general
principles of equity (regardless of whether enforce-ment is sought in a
proceeding in equity or at law).
(u) Eligible Receivables. Each Receivable included in the Net
---------------------
Receivables Balance as an Eligible Receivable on the date of its purchase under
the Receivables Sale Agreement was an Eligible Receivable on such purchase date.
(v) Net Receivables Balance. Seller has determined that, immediately
-------------------------
after giving effect to each purchase hereunder, the Net Receivables Balance is
at least equal to the sum of (i) the Aggregate Capital, plus (ii) the Aggregate
----
Reserves.
(w) Accounting. The manner in which such Seller Party accounts for the
----------
transactions contemplated by this Agreement and the Receivables Sale Agreement
does not jeopardize the true sale analysis.
Section 5.2 Financial Institution Representations and Warranties. Each
----------------------------------------------------
Financial Institution hereby represents and warrants to the Agent and Conduit
that:
(a) Existence and Power. Such Financial Institution is a corporation
---------------------
or a banking association duly organized, validly existing and in good standing
under the laws of its jurisdiction of incorporation or organization, and has all
corporate power to perform its obligations hereunder.
<PAGE>
(b) No Conflict. The execution and delivery by such Financial
------------
Institution of this Agreement and the performance of its obligations hereunder
are within its corporate powers, have been duly authorized by all necessary
corporate action, do not contravene or violate (i) its certificate or articles
of incorporation or association or by-laws, (ii) any law, rule or regulation
applicable to it, (iii) any restrictions under any agreement, contract or
instrument to which it is a party or any of its property is bound, or (iv) any
order, writ, judgment, award, injunction or decree binding on or affecting it or
its property, and do not result in the creation or imposition of any Adverse
Claim on its assets. This Agreement has been duly authorized, executed and
delivered by such Financial Institution.
(c) Governmental Authorization. No authorization or approval or other
---------------------------
action by, and no notice to or filing with, any governmental authority or
regulatory body is required for the due execution and delivery by such Financial
Institution of this Agreement and the performance of its obligations hereunder.
(d) Binding Effect. This Agreement constitutes the legal, valid and
---------------
binding obligation of such Financial Institution enforceable against such
Financial Institution in accordance with its terms, except as such enforcement
may be limited by applicable bankruptcy, insolvency, reorganization or other
similar laws relating to or limiting creditors' rights generally and by general
principles of equity (regardless of whether such enforcement is sought in a
proceeding in equity or at law).
ARTICLE VI
CONDITIONS OF PURCHASES
Section 6.1 Conditions Precedent to Initial Incremental Purchase. The
-----------------------------------------------------
initial Incremental Purchase of a Purchaser Interest under this Agreement is
subject to the conditions precedent that (a) the Agent shall have received on or
before the date of such purchase those documents listed on Schedule B and (b)
----------
the Agent shall have received all fees and expenses required to be paid on such
date pursuant to the terms of this Agreement and the Fee Letter.
Section 6.2 Conditions Precedent to All Purchases and Reinvestments.
----------------------------------------------------------
Each purchase of a Purchaser Interest (other than pursuant to Section 13.1) and
------------
each Reinvestment shall be subject to the further conditions precedent that (a)
in the case of each such purchase or Reinvestment: (i) the Servicer shall have
delivered to the Agent on or prior to the date of such purchase, in form and
substance satisfactory to the Agent, all Monthly Reports as and when due under
Section 8.5 and (ii) upon the Agent's request, the Servicer shall have delivered
----------
to the Agent at least three (3) days prior to such purchase or Reinvestment an
interim Monthly Report showing the amount of Eligible Receivables; (b) the
Facility Termination Date shall not have occurred; (c) the Agent shall have
received such other approvals, opinions or documents as it may reasonably
request and (d) on the date of each such Incremental Purchase or Reinvestment,
the following statements shall be true (and acceptance of the proceeds of such
Incremental Purchase or Reinvestment shall be deemed a representation and
warranty by Seller that such statements are then true):
(i) the representations and warranties set forth in Section 5.1 are
-----------
true and correct in all material respects on and as of the date of such
Incremental Purchase or Reinvestment as though made on and as of such date;
(ii) no event has occurred and is continuing, or would result from such
Incremental Purchase or Reinvestment, that would constitute an Amortization
Event or a Potential Amortization Event; and
(iii) the Aggregate Capital does not exceed the Purchase Limit and the
aggregate Purchaser Interests do not exceed 100%.
<PAGE>
It is expressly understood that each Reinvestment shall, unless otherwise
directed by the Agent or any Purchaser, occur automatically on each day that the
Servicer shall receive any Collections without the requirement that any further
action be taken on the part of any Person and notwithstanding the failure of
Seller to satisfy any of the foregoing conditions precedent in respect of such
Reinvestment. The failure of Seller to satisfy any of the foregoing conditions
precedent in respect of any Reinvestment shall give rise to a right of the
Agent, which right may be exercised at any time on demand of the Agent, to
rescind the related purchase and direct Seller to pay to the Agent for the
benefit of the Purchasers an amount equal to the Collections prior to the
Amortization Date that shall have been applied to the affected Reinvestment.
ARTICLE VII
COVENANTS
Section 7.1 Affirmative Covenants of The Seller Parties. Until the
----------------------------------------------
date on which the Aggregate Unpaids have been indefeasibly paid in full and this
Agreement terminates in accordance with its terms, each Seller Party hereby
covenants, as to itself, as set forth below:
(a) Financial Reporting. Such Seller Party will maintain, for itself
--------------------
and each of its Subsidiaries, a system of accounting established and
administered in accordance with GAAP, and furnish or cause to be furnished to
the Agent:
(i) Annual Reporting. Within 90 days after the
----------------
close of each of its respective fiscal years, audited financial statements
(which shall include balance sheets, statements of income and retained earnings
and a statement of cash flows) for such Seller Party and Provider for such
fiscal year, together with an unqualified audit report (in form satisfactory to
the Agent) on such financial statements of, and certified in a manner acceptable
to the Agent by, PricewaterhouseCoopers LLP or other independent public
accountants reasonably acceptable to the Agent.
(ii) Quarterly Reporting. Within 45 days after the close of the first
--------------------
three (3) quarterly periods of each of its respective fiscal years, balance
sheets of each of Originator, Provider and the Servicer as at the close of each
such period and statements of income and retained earnings and a statement of
cash flows for each such Person for the period from the beginning of such fiscal
year to the end of such quarter, all certified by its respective chief financial
officer on behalf of such Person.
(iii) Compliance Certificate. Together with the financial statements
-----------------------
required hereunder, a compliance certificate in substantially the form of
Exhibit V signed by such Seller Party's or Provider's, as applicable, Authorized
---
Officer on behalf of such Person and dated the date of such annual financial
statement or such quarterly financial statement, as the case may be.
(iv) Shareholders Statements and Reports. Promptly upon the furnishing
-----------------------------------
thereof to the shareholders of such Seller Party or Provider copies of all
financial statements, reports and proxy statements so fur-nished.
<PAGE>
(v) S.E.C. Filings. Promptly upon the filing thereof, copies of all
---------------
registration statements (other than registration statements on Form S-8) and
annual, quarterly or other reports which Originator, Provider or any of their
respective Subsidiaries files with the Securities and Exchange Commission.
(vi) Copies of Notices. Promptly upon its receipt of any notice,
-------------------
request for consent, financial statements, certification, report or other
communication under or in connection with any Transaction Document from any
Person other than the Agent or Conduit, copies of the same.
(vii) Change in Credit and Collection Policy. At least thirty (30)
------------------------------------------
days prior to the effectiveness of any material change in or material amendment
to the Credit and Collection Policy, a copy of the Credit and Collection Policy
then in effect and a notice (A) indicating such change or amend-ment, and (B) if
such proposed change or amendment would be reasonably likely to adversely affect
the collectibility of the Receivables or decrease the credit quality of any
newly created Receivables, requesting the Agent's consent thereto; provided that
--------
if such change or amendment was required pursuant to any change in any
applicable law, rule or regulation, such Seller Party shall only be required to
give prompt notice of such change or amendment and shall not be required to
request the consent of the Agent.
(viii) Other Information. Promptly, from time to time, such other
------------------
information, documents, records or reports relating to the Receivables or the
condition or operations, financial or otherwise, of such Seller Party or
Provider as the Agent may from time to time reasonably request in order to
protect the interests of the Agent and the Purchasers under or as contemplated
by this Agreement.
(b) Notices. Such Seller Party will notify the Agent in writing of any
-------
of the following promptly upon becoming aware of the occurrence thereof,
describing the same and, if applicable, the steps being taken with respect
thereto:
(i) Amortization Events or Potential Amortization Events. The
---------------------------------------------------------
occurrence of each Amortization Event and each Poten-tial Amortization Event, by
a statement of an Authorized Officer on behalf of such Seller Party.
(ii) Judgment and Proceedings. (A) (1) The entry of any judgment or
--------------------------
decree against the Servicer or any of its respective Subsidiaries if the
aggregate amount of all judgments and decrees then outstanding against the
Servicer and its Subsidiaries exceeds $10,000,000 and (2) the institution of any
material litigation, arbitration proceeding or governmental proceeding against
the Servicer; and (B) the entry of any judgment or decree or the institution of
any litigation, arbitration proceeding or governmental proceeding against
Seller.
(iii) Material Adverse Effect. The occur-rence of any event or
-------------------------
condition that has had, or could reasonably be expected to have, a Material
Adverse Effect.
(iv) Termination Date. The occurrence of the "Termination Date" under
-----------------
and as defined in the Receivables Sale Agreement.
<PAGE>
(v) Defaults Under Other Agree-ments. (A) The occurrence of a default
---------------------------------
or an event of default under any other financing arrange-ment pursuant to which
Seller is a debtor or an obligor and (B) the occurrence of any default or event
of default under any other financing arrangement or arrange-ments governing
Indebtedness, individually or in the aggregate, greater than or equal to
$30,000,000 pursuant to which Servicer is a debtor or an obligor.
(vi) Downgrade of Originator or Provider. Any
---------------------------------------
downgrade in the rating of any Indebtedness of Originator or Provider by
Standard & Poor's Ratings Group or by Moody's Investors Service, Inc., setting
forth the Indebtedness affected and the nature of such change.
(c) Compliance with Laws and Preservation of Corporate Existence. Such
------------------------------------------------------------
Seller Party will comply in all respects with all applicable laws, rules,
regulations, orders, writs, judgments, injunctions, decrees or awards to which
it may be subject, except where the failure to so comply could not reasonably be
expected to have a Material Adverse Effect. Such Seller Party will preserve and
maintain its corporate existence, rights, franchises and privileges in the
jurisdiction of its incorporation, and qualify and remain qualified in good
standing as a foreign corporation in each jurisdiction where its business is
conducted, except where the failure to so preserve and maintain or qualify could
not reasonably be expected to have a Material Adverse Effect.
(d) Audits. Such Seller Party will furnish to the Agent from time to
------
time such information with respect to it and the Receivables as the Agent may
reasonably request. Such Seller Party will, from time to time during regular
business hours as requested by the Agent upon reasonable notice and at the sole
cost of such Seller Party, permit the Agent, or its agents or represen-tatives,
(i) to examine and make copies of and abstracts from all Records in the
possession or under the control of such Person relating to the Receivables and
the Related Security, including, without limitation, the related Contracts, and
(ii) to visit the offices and properties of such Person for the purpose of
examining such materials described in clause (i) above, and to discuss matters
relating to such Person's financial condition or the Receivables and the Related
Security or any Person's performance under any of the Transaction Documents or
any Person's performance under the Contracts and, in each case, with any of the
Authorized Officers or financial officers of Seller or the Servicer having
knowledge of such matters. So long as no Potential Amortization Event or
Amortiza-tion Event exists, the visits under this Section 7.1(d) that are at the
--------------
sole cost of the applicable Seller Party shall be limited to once a calendar
year; and upon the occurrence and during the continuance of a Potential
Amortization Event or an Amortization Event, any and all visits shall be at the
sole cost of the applicable Seller Party.
(e) Keeping and Marking of Records and Books.
----------------------------------------------
(i) The Servicer will maintain and implement administrative and
operating procedures (including, without limitation, an ability to recreate
records evidencing Receivables in the event of the destruction of the originals
thereof), and keep and maintain all documents, books, records and other
information reasonably necessary or advisable for the collection of all
Receiv-ables (including, without limitation, records adequate to permit the
immediate identification of each new Receivable and all Collections of and
adjustments to each existing Receivable). The Servicer will give the Agent
notice of any material change in the administrative and operating procedures
referred to in the previous sentence.
<PAGE>
(ii) Such Seller Party will (A) on or prior to the date hereof, mark
its master data processing records and other books and records relating to the
Purchaser Interests with a legend, acceptable to the Agent, describing the
Purchaser Interests and (B) upon the request of the Agent (x) mark each Contract
with a legend describing the Purchaser Interests and (y) at any time after the
occurrence of a Potential Amortization Event, deliver to the Agent all Contracts
(including, without limitation, all multiple originals of any such Contract)
relating to the Receivables.
(f) Compliance with Contracts and Credit and Collection Policy. Such
------------------------------------------------------------
Seller Party will timely and fully (i) perform and comply with all provisions,
covenants and other promises required to be observed by it under the Contracts
related to the Receivables and (ii) comply in all respects with the Credit and
Collection Policy in regard to each Receivable and the related Contract.
(g) Performance and Enforcement of Receivables Sale Agreement. Seller
----------------------------------------------------------
will, and will require Originator to, perform each of their respective
obligations and undertak-ings under and pursuant to the Receivables Sale
Agreement, will purchase Receivables thereunder in strict compliance with the
terms thereof and will vigorously enforce the rights and remedies accorded to
Seller under the Receivables Sale Agreement. Seller will take all actions to
perfect and enforce its rights and interests (and the rights and interests of
the Agent and the Purchasers as assignees of Seller) under the Receivables Sale
Agreement as the Agent may from time to time reasonably request, including,
---------
without limitation, making claims to which it may be entitled under any
---------------
indemnity, reimbursement or similar provision contained in the Receivables Sale
----
Agreement.
(h) Ownership. Seller will (or will cause Originator to) take all
---------
necessary action to (i) vest legal and equitable title to the Receivables, the
Related Security and the Collections purchased under the Receivables Sale
Agreement irrevocably in Seller, free and clear of any Adverse Claims other than
Adverse Claims in favor of the Agent and the Purchasers (including, without
--------- -------
limitation, the filing of all financing statements or other similar instruments
------
or documents necessary under the UCC (or any comparable law) of all appropriate
jurisdictions to perfect Seller's interest in such Receivables, Related Security
and Collections and such other action to perfect, protect or more fully evidence
the interest of Seller therein as the Agent may reasonably request), and (ii)
establish and maintain, in favor of the Agent, for the benefit of the
Purchasers, a valid and perfected first priority undivided percentage ownership
interest (or a valid and perfected first priority security interest) in all
Receivables, Related Security and Collections to the full extent contemplated
herein, free and clear of any Adverse Claims other than Adverse Claims in favor
of the Agent for the benefit of the Purchasers (including, without limitation,
--------- ------------------
the filing of all financing statements or other similar instruments or documents
necessary under the UCC (or any comparable law) of all appropriate jurisdictions
to perfect the Agent's (for the benefit of the Purchasers) interest in such
Receivables, Related Security and Collections and such other action to perfect,
protect or more fully evidence the interest of the Agent for the benefit of the
Purchasers as the Agent may reasonably request).
(i) Purchasers' Reliance. Seller acknowledges that the
---------------------
Purchasers are entering into the transactions contemplated by this Agreement in
reliance upon Seller's identity as a legal entity that is separate from
Originator. Therefore, from and after the date of execution and delivery of
this Agreement, Seller shall take all reasonable steps, including, without
limitation, all steps that the Agent or any Purchaser may from time to time
reasonably request, to maintain Seller's identity as a separate legal entity and
to make it manifest to third parties that Seller is an entity with assets and
liabilities distinct from those of Originator and any Affiliates thereof and not
just a division of Originator or any such Affiliate. Without limiting the
generality of the foregoing and in addition to the other covenants set forth
herein, Seller will:
(A) conduct its own business in its own name and require that all
full-time employees of Seller, if any, identify themselves as such and not as
employees of Originator (including, without limitation, by means of providing
appropriate employees with business or identification cards identifying such
employees as Seller's employees);
<PAGE>
(B) compensate all employees, consultants and agents directly, from
Seller's own funds, for services provided to Seller by such employees,
consultants and agents and, to the extent any employee, consultant or agent of
Seller is also an employee, consultant or agent of Originator or any Affiliate
thereof, allocate the compensation of such employee, consultant or agent between
Seller and Originator or such Affiliate, as applicable, on a basis that reflects
the services rendered to Seller and Originator or such Affiliate, as applicable;
(C) clearly identify its offices (by signage or otherwise) as its
offices and, if such office is located in the offices of Originator, Seller
shall lease such office at a fair market rent;
(D) have a separate telephone number, which will be answered only in
its name and separate stationery, invoices and checks in its own name;
(E) conduct all transactions with Originator and the Servicer
(including, without limitation, any delegation of its obligations hereunder as
Servicer) strictly on an arm's-length basis, allocate all overhead expenses
(including, without limitation, telephone and other utility charges) for items
shared between Seller and Originator on the basis of actual use to the extent
practicable and, to the extent such allocation is not practicable, on a basis
reasonably related to actual use;
(F) at all times have a Board of Directors consisting of three members,
at least one member of which is an Independent Director;
(G) observe all corporate formalities as a distinct entity, and ensure
that all corporate actions relating to (A) the selection, maintenance or
replacement of the Independent Director, (B) the dissolution or liquidation of
Seller or (C) the initiation of, participation in, acquiescence in or consent to
any bankruptcy, insolvency, reorganization or similar proceeding involving
Seller, are duly authorized by unanimous vote of its Board of Directors
(including the Independent Director);
(H) maintain Seller's books and records separate from those of
Originator and any Affiliate thereof and otherwise readily identifiable as its
own assets rather than assets of Originator and any Affiliate thereof;
(I) prepare its financial statements separately from those of
Originator and insure that any consolidated financial statements of Originator
or any Affiliate thereof that include Seller and that are filed with the
Securities and Exchange Commission or any other governmental agency have notes
clearly stating that Seller is a separate corporate entity and that its assets
will be available first and foremost to satisfy the claims of the creditors of
Seller;
(J) except as herein specifically otherwise provided, maintain the
funds or other assets of Seller separate from, and not com-mingled with, those
of Originator or any Affiliate thereof and only maintain bank accounts or other
depository accounts to which Seller alone is the account party;
<PAGE>
(K) pay all of Seller's operating expenses from Seller's own assets
(except for certain payments by Originator or other Persons pursuant to
allocation arrangements that comply with the requirements of this Section
-------
7.1(i));
(L) operate its business and activities such that: it does not engage
in any business or activity of any kind, or enter into any transaction or
indenture, mortgage, instrument, agreement, contract, lease or other
undertaking, other than the transactions contemplated and authorized by this
Agreement and the Receivables Sale Agreement; and does not create, incur,
guaran-tee, assume or suffer to exist any indebtedness or other liabilities,
whether direct or contingent, other than (1) as a result of the endorsement of
negotiable instruments for deposit or collection or similar transactions in the
ordinary course of business, (2) the incurrence of obligations under this
Agreement, (3) the incurrence of obligations, as expressly contemplated in the
Receivables Sale Agreement, to make payment to Originator thereunder for the
purchase of Receivables from Originator under the Receivables Sale Agreement,
and (4) the incurrence of operating expenses in the ordinary course of business
of the type otherwise contemplated by this Agreement;
(M) maintain its corporate charter in conformity with this Agreement,
such that it does not amend, restate, supplement or otherwise modify its
Certificate of Incorporation or By-Laws in any respect that would impair its
ability to comply with the terms or provisions of any of the Trans-action
Documents, including, without limitation, Section 7.1(i) of this Agreement;
---------------
(N) maintain the effectiveness of, and continue to perform under the
Receivables Sale Agreement and the Performance Undertaking, such that it does
not amend, restate, supplement, cancel, terminate or otherwise modify the
Receivables Sale Agreement or the Performance Undertaking, or give any consent,
waiver, directive or approval thereunder or waive any default, action, omission
or breach under the Receivables Sale Agreement or the Perfor-mance Undertaking
or otherwise grant any indulgence thereunder, without (in each case) the prior
written consent of the Agent;
(O) maintain its corporate separateness such that it does not merge or
consolidate with or into, or convey, transfer, lease or otherwise dispose of
(whether in one transaction or in a series of transactions, and except as
otherwise contemplated herein) all or substantially all of its assets (whether
now owned or hereafter acquired) to, or acquire all or substantially all of the
assets of, any Person, nor at any time create, have, acquire, maintain or hold
any interest in any Subsidiary.
(P) maintain at all times the Required Capital Amount (as defined in
the Receivables Sale Agreement) and refrain from making any dividend,
distribution, redemption of capital stock or payment of any subordinated
indebtedness which would cause the Required Capital Amount to cease to be so
maintained; and
<PAGE>
(Q) take such other actions as are necessary on its part to ensure that
the facts and assumptions set forth in the opinion issued by Bryan Cave LLP, as
counsel for Seller, in connection with the closing or initial Incremental
Purchase under this Agreement and relating to substantive consolidation issues,
and in the certificates accompanying such opinion, remain true and correct in
all material respects at all times.
(j) Collections. Such Seller Party will cause (1) all proceeds from
-----------
all Lock-Boxes to be directly deposited by a Collection Bank into a Collection
Account and (2) each Lock-Box and Collection Account to be subject at all times
to a Collection Account Agreement that is in full force and effect. In the
event any payments relating to Receivables are remitted directly to Seller or
any Affiliate of Seller, Seller will remit (or will cause all such payments to
be remitted) directly to a Collection Bank and deposited into a Collection
Account within two (2) Business Days following receipt thereof, and, at all
times prior to such remittance, Seller will itself hold or, if applicable, will
cause such payments to be held in trust for the exclusive benefit of the Agent
and the Purchasers. Seller will maintain exclusive ownership, dominion and
control (subject to the terms of this Agreement and the applicable Collection
Account Agreement) of each Lock-Box and Collection Account and shall not grant
the right to take dominion and control of any Lock-Box or Collection Account at
a future time or upon the occurrence of a future event to any Person, except to
the Agent as contemplated by this Agreement.
(k) Taxes. Such Seller Party will file all tax returns and reports
-----
required by law to be filed by it and will promptly pay all taxes and
governmental charges at any time owing by it. Seller will pay when due any
taxes payable in connection with the Receivables, exclusive of taxes on or
measured by income or gross receipts of Conduit, the Agent or any Financial
Institution.
(l) Insurance. Seller will maintain in effect, or cause to be
---------
maintained in effect, at Seller's own expense, such casualty and liability
insurance as Seller shall deem appropriate in its good faith business judgment.
The Agent, for the benefit of the Purchasers, shall be named as an additional
insured with respect to all such liability insurance maintained by Seller.
Seller will pay or cause to be paid, the premiums therefor and deliver to the
Agent evidence satisfactory to the Agent of such insurance coverage. Evidence
of each policy shall be furnished to the Agent and any Purchaser in certificated
form upon the Agent's or such Purchaser's request. The foregoing requirements
shall not be construed to negate, reduce or modify, and are in addition to,
Seller's obligations hereunder.
(m) Payment to Originator. With respect to any Receivable purchased by
---------------------
Seller from Originator, such sale shall be effected under, and in strict
compliance with the terms of, the Receivables Sale Agreement, including, without
--------- -------
limitation, the terms relating to the amount and timing of payments to be made
- ----------
to Originator in respect of the purchase price for such Receivable.
Section 7.2 Negative Covenants of The Seller Parties. Until the date
-----------------------------------------
on which the Aggregate Unpaids have been indefeasibly paid in full and this
Agreement terminates in accordance with its terms, each Seller Party hereby
covenants, as to itself, that:
(a) Name Change, Offices and Records. Such Seller Party will not
------------------------------------
change its name, identity or corporate structure (within the meaning of Section
9-402(7) of any applicable enactment of the UCC) or relocate its chief executive
office or any office where Records are kept unless it shall have: (i) given the
Agent at least thirty (30) days' prior written notice thereof and (ii) delivered
to the Agent all financing statements, instruments and other documents requested
by the Agent in connection with such change or relocation.
<PAGE>
(b) Change in Payment Instructions to Obligors. Except as may be
-----------------------------------------------
required by the Agent pursuant to Section 8.2(b), such Seller Party will not add
--------------
or terminate any bank as a Collection Bank, or make any change in the
instructions to Obligors regarding payments to be made to any Lock-Box or
Collection Account, unless the Agent shall have received, at least ten (10) days
before the proposed effective date therefor, (i) written notice of such
addition, termination or change and (ii) with respect to the addition of a
Collection Bank or a Collection Account or Lock-Box, an executed Collection
Account Agreement with respect to the new Collection Account or Lock-Box;
provided, however, that the Servicer may make changes in instructions to
-- -------
Obligors regarding payments if such new instructions require such Obligor to
-
make payments to another existing Collection Account.
(c) Modifications to Contracts and Credit and Collection Policy. Such
------------------------------------------------------------
Seller Party will not, and will not permit Originator to, make any change to the
Credit and Collection Policy that could adversely affect the collectibility of
the Receivables or decrease the credit quality of any newly created Receivables.
Except as provided in Section 8.2(d), the Servicer will not, and will not permit
--------------
Originator to, extend, amend or otherwise modify the terms of any Receivable or
any Contract related thereto other than in accordance with the Credit and
Collection Policy.
(d) Sales, Liens. Seller will not sell, assign (by operation of law or
------------
otherwise) or otherwise dispose of, or grant any option with respect to, or
create or suffer to exist any Adverse Claim upon (including, without limitation,
the filing of any financing statement) or with respect to, any Receivable,
Related Security or Collections, or upon or with respect to any Contract under
which any Receivable arises, or any Lock-Box or Collection Account, or assign
any right to receive income with respect thereto (other than, in each case, the
creation of the interests therein in favor of the Agent and the Purchasers
provided for herein), and Seller will defend the right, title and interest of
the Agent and the Purchasers in, to and under any of the foregoing property,
against all claims of third parties claiming through or under Seller or
Originator.
(e) Net Receivables Balance. At no time prior to the Amortization Date
-----------------------
shall Seller permit the Net Receivables Balance to be less than an amount equal
to the sum of (i) the Aggregate Capital plus (ii) the Aggregate Reserves.
----
(f) Termination Date Determination. Seller will not designate the
--------------------------------
Termination Date (as defined in the Receivables Sale Agreement), or send any
written notice to Originator in respect thereof, without the prior written
consent of the Agent, except with respect to the occurrence of such Termination
Date arising pursuant to Section 5.1(d) of the Receivables Sale Agreement.
(g) Restricted Junior Payments. From and after the occurrence of any
----------------------------
Amortization Event, Seller will not make any Restricted Junior Payment if, after
giving effect thereto, Seller would fail to meet its obligations set forth in
Section 7.2(e).
-------------
ARTICLE VIII
ADMINISTRATION AND COLLECTION
Section 8.1 Designation of Servicer. (a) The servicing,
-------------------------
administration and collection of the Receivables shall be conducted by such
Person (the "Servicer") so designated from time to time in accordance with this
--------
Section 8.1. Eveready is hereby designated as, and hereby agrees to perform
- ------------
the duties and obligations of, the Servicer pursuant to the terms of this
- --
Agreement. Upon the occurrence and during the continuance of a Potential
- --
Amortization Event or an Amortization Event, the Agent may designate as Servicer
- --
any Person to succeed Eveready or any successor Servicer as "Servicer"
hereunder. With the prior written consent of the Agent and upon the assumption
of all of the duties and obligations of "Servicer" hereunder by a successor
Servicer acceptable to the Agent, Eveready may resign as Servicer.
<PAGE>
(b) In the ordinary course of business and with the prior consent of
the Agent (which consent shall not be unreasonably withheld), the Servicer may
delegate any of its duties or responsibilities as Servicer to any Person who
agrees to conduct such duties or responsibilities in accordance with the
Contracts, the Credit and Collection Policy and this Agreement. The fees of any
Person to whom such duties or responsibilities are delegated shall be for the
sole account of the Servicer. Any delegation shall not relieve the Servicer of
its duties, responsibilities or liabilities hereunder and shall not constitute a
resignation under Section 8.1(a). Any Collections or other amounts due to the
--------------
Agent or Purchasers hereunder held by any such delegate shall, for the purposes
of this Agreement, be treated as held by the Servicer in trust for the holders
of the Purchaser Interests. Each agreement by which the Servicer delegates any
of its duties or responsibilities to any other Person (including, without
limitation, Seller) shall state that if at any time the Agent shall designate as
Servicer any Person other than such delegating Servicer, all duties and
responsibilities theretofore delegated by such Servicer to such Person may, at
the discretion of the Agent, be terminated forthwith on notice given by the
Agent to such delegating Servicer and such Person. If the Servicer shall
delegate any duties or responsibilities to Seller, Seller shall not be permitted
to further delegate to any other Person any of such duties or responsibilities.
(c) Notwithstanding the foregoing subsection (b), (i) the Servicer
shall be and remain primarily liable to the Agent and the Purchasers for the
full and prompt performance of all duties and responsibilities of the Servicer
hereunder and (ii) the Agent and the Purchasers shall be entitled to deal
exclusively with the Servicer in matters relating to the discharge by the
Servicer of its duties and responsibilities hereunder. The Agent and the
Purchasers shall not be required to give notice, demand or other communication
to any Person other than the Servicer in order for communication to the Servicer
and its sub-servicer or other delegate with respect thereto to be accomplished.
The Servicer shall be responsible for providing any sub-servicer or other
delegate of the Servicer with any notice given to the Servicer under this
Agreement.
Section 8.2 Duties of Servicer. (a) The Servicer shall take or cause
------------------
to be taken all such actions as may be necessary or advisable to collect each
Receivable from time to time, all in accordance with applicable laws, rules and
regulations, with reasonable care and diligence, and in accordance with the
Credit and Collection Policy.
(b) The Servicer will instruct all Obligors to pay all Collections
directly to a Lock-Box or Collection Account. The Servicer shall effect a
Collection Account Agreement substantially in the form of Exhibit VI with each
----------
bank maintaining a Collection Account at any time. In the case of any
remittances received in any Lock-Box or Collection Account that shall have been
identified, to the satisfaction of the Servicer, to not constitute Collections
or other proceeds of the Receivables or the Related Security, the Servicer shall
promptly remit such items to the Person identified to it as being the owner of
such remittances. From and after the date the Agent delivers to any Collection
Bank a Collection Notice pursuant to Section 8.3, the Agent may request that the
-----------
Servicer, and the Servicer thereupon promptly shall instruct all Obligors with
respect to the Receivables, to remit all payments thereon to a new depositary
account specified by the Agent and, at all times thereafter, Seller and the
Servicer shall not deposit or otherwise credit, and shall not permit any other
Person to deposit or otherwise credit to such new depositary account any cash or
payment item other than Collections.
(c) The Servicer shall administer the Collections in accordance with
the procedures described herein and in Article II. The Servicer shall set aside
----------
and hold in trust for the account of Seller and the Purchasers their respective
shares of the Collections in accordance with Article II. The Servicer shall,
----------
upon the request of the Agent, segregate, in a manner acceptable to the Agent,
all cash, checks and other instruments received by it from time to time
constituting Collections from the general funds of the Servicer or Seller prior
to the remittance thereof in accordance with Article II. If the Servicer shall
----------
be required to segregate Collections pursuant to the preceding sentence, the
Servicer shall segregate and deposit with a bank designated by the Agent such
allocable share of Collections of Receivables set aside for the Purchasers on
the first Business Day following receipt by the Servicer of such Collections,
duly endorsed or with duly executed instruments of transfer.
<PAGE>
(d) The Servicer may, in accordance with the Credit and Collection
Policy, extend the maturity of any Receivable or adjust the Outstanding Balance
of any Receivable as the Servicer determines to be appropriate to maximize
Collections thereof; provided, however, that such extension or adjustment shall
-------- -------
not alter the status of such Receivable as a Delinquent Receivable or
Charged-Off Receivable or limit the rights of the Agent or the Purchasers under
this Agreement. Notwithstanding anything to the contrary contained herein, the
Agent shall have the absolute and unlimited right to direct the Servicer to
commence or settle any legal action with respect to any Receivable or to
foreclose upon or repossess any Related Security.
(e) The Servicer shall hold in trust for Seller and the Purchasers all
Records that (i) evidence or relate to the Receivables, the related Contracts
and Related Security or (ii) are otherwise necessary or desirable to collect the
Receivables and shall, as soon as practicable upon demand of the Agent at any
time following a Potential Amortization Event, deliver or make available to the
Agent all such Records, at a place selected by the Agent. The Servicer shall,
as soon as practicable following receipt thereof turn over to Seller any cash
collections or other cash proceeds received with respect to Indebtedness not
constituting Receivables and belonging to Seller. The Servicer shall, from time
to time at the request of any Purchaser, furnish to the Purchasers (promptly
after any such request) a calculation of the amounts set aside for the
Purchasers pursuant to Article II.
-----------
(f) Any payment by an Obligor in respect of any indebtedness owed by it
to Originator or Seller shall, except as otherwise specified by such Obligor or
otherwise required by contract or law or unless otherwise permitted by the
Agent, be applied as a Collection of any Receivable of such Obligor (starting
with the oldest such Receivable) to the extent of any amounts then due and
payable thereunder before being applied to any other receivable or other
obligation of such Obligor.
Section 8.3 Collection Notices. The Agent is authorized, at any time
-------------------
during the continuance of a Potential Amortization Event, to date and to deliver
to the Collection Banks the Collection Notices. Seller hereby transfers to the
Agent for the benefit of the Purchasers, effective when the Agent delivers such
notice, the exclusive ownership and control of each Lock-Box and the Collection
Accounts. In case any authorized signatory of Seller whose signature appears on
a Collection Account Agreement shall cease to have such authority before the
delivery of such notice, such Collection Notice shall nevertheless be valid as
if such authority had remained in force. Seller hereby authorizes the Agent,
and agrees that the Agent shall be entitled to, following the delivery of the
Collection Notices, (i) endorse Seller's name on checks and other instruments
representing Collections, (ii) enforce the Receivables, the related Contracts
and the Related Security and (iii) take such action as shall be necessary or
desirable to cause all cash, checks and other instruments constituting
Collections of Receivables to come into the possession of the Agent rather than
Seller.
Section 8.4 Responsibilities of Seller. Anything herein to the
-----------------------------
contrary notwithstanding, the exercise by the Agent and the Purchasers of their
rights hereunder shall not release the Servicer, Originator or Seller from any
of their duties or obligations with respect to any Receivables or under the
related Contracts. The Purchasers shall have no obligation or liability with
respect to any Receivables or related Contracts, nor shall any of them be
obligated to perform the obligations of Seller.
Section 8.5 Reports. The Servicer shall prepare and forward to the
-------
Agent (i) on the tenth day of each month and at such times as the Agent shall
request, a Monthly Report and (ii) at such times as the Agent shall request, a
listing by Obligor of all Receivables together with an aging of such
Receivables.
<PAGE>
Section 8.6 Servicing Fees. In consideration of Eveready's agreement
---------------
to act as Servicer hereunder, the Purchasers hereby agree that, so long as
Eveready shall continue to perform as Servicer hereunder, Seller shall pay over
to Eveready, as compensation for its servicing activities, a fee (the "Servicing
---------
Fee") on the first calendar day of each month, in arrears for the immediately
- ---
preceding month, at such rate as Eveready and Seller shall agree upon from time
- --
to time on fair and reasonable basis and no less favorable to Eveready or Seller
than a rate Eveready or Seller could obtain in an arm's-length transaction for
servicing with a Person other than Eveready or Seller.
ARTICLE IX
AMORTIZATION EVENTS
Section 9.1 Amortization Events. The occurrence of any one or more of
-------------------
the following events shall constitute an Amortization Event:
(a) Any Seller Party shall fail (i) to make any payment or deposit
required hereunder when due, or (ii) to perform or observe any term, covenant or
agreement hereunder (other than as referred to in clause (i) of this paragraph
(a) and paragraph 9.1(e)) and such failure shall continue for three (3)
consecutive Business Days.
(b) Any representation, warranty, certification or statement made by
any Seller Party or Provider in this Agreement, any other Transaction Document
or in any other document delivered pursuant hereto or thereto shall prove to
have been incorrect when made or deemed made.
(c) Failure of Seller to pay any Indebtedness when due or the failure
of any other Seller Party or Provider to pay Indebtedness (other than
Indebtedness hereunder), which individually or together with other such
Indebtedness as to which any failure exists (other than Indebtedness hereunder)
has an aggregate outstanding principal amount equal to or greater than
$30,000,000, when due; or the default by any Seller Party in the performance of
any term, provision or condition contained in any agreement under which any such
Indebtedness was created or is governed, the effect of which is to cause, or to
permit the holder or holders of such Indebtedness to cause, such Indebtedness to
become due prior to its stated maturity; or any such Indebtedness of any Seller
Party or Provider shall be declared to be due and payable or required to be
prepaid (other than by a regularly scheduled payment) prior to the date of
maturity thereof.
(d) (i) Any Seller Party, any Subsidiary of Seller, Provider or any
Material Provider Subsidiary shall generally not pay its debts as such debts
become due or shall admit in writing its inability to pay its debts generally or
shall make a general assignment for the benefit of creditors; or (ii) any
proceeding shall be instituted by or against any Seller Party, any Subsidiary of
Seller, Provider or any Material Provider Subsidiary seeking to adjudicate it
bankrupt or insolvent, or seeking liquidation, winding up, reorganization,
arrangement, adjustment, protection, relief or composition of it or its debts
under any law relating to bankruptcy, insolvency or reorganization or relief of
debtors, or seeking the entry of an order for relief or the appointment of a
receiver, trustee or other similar official for it or any substantial part of
its property; provided that in the event any such proceeding shall have been
instituted against such Seller Party, Subsidiary of Seller, Provider or Material
Provider Subsidiary, such proceeding shall have continued undismissed, or
unstayed and in effet, for a period of 60 consecutive days or (iii) any Seller
Party, any Subsidiary of Seller, Provider or any Material Provider Subsidiary
shall take any corporate action to authorize any of the actions set forth in
clauses (i) or (ii) above in this subsection (d).
(e) Seller shall fail to comply with the terms of Section 2.6 hereof.
-----------
<PAGE>
(f) As at the end of any calendar month, (i) the three month rolling
average of the Delinquency Ratio shall exceed 6.25%, (ii) the three month
rolling average of the Loss-to-Liquidation Ratio shall exceed 3.5%, (iii) the
six month rolling average of the Dilution Ratio shall exceed 10.25% or (iv) the
Dilution Accrual Ratio shall be less than 85% of the six month rolling average
of the Dilution Accrual Ratio.
(g) A Change of Control with respect to Originator, Provider or any
Seller Party shall occur.
(h) (i) One or more final judgments for the payment of money shall be
entered against Seller or (ii) one or more final judgments for the payment of
money in an amount in excess of $30,000,000, individually or in the aggregate,
shall be entered against the Servicer on claims not covered by insurance or as
to which the insurance carrier has denied its responsibility, and such judgment
shall continue unsatisfied and in effect for fifteen (15) consecutive days
without a stay of execution.
(i) The "Termination Date" under and as defined in the Receivables Sale
Agreement shall occur under the Receivables Sale Agreement or Originator shall
for any reason cease to transfer, or cease to have the legal capacity to
transfer, or otherwise be incapable of transferring Receivables to Seller under
the Receivables Sale Agreement.
(j) This Agreement shall terminate in whole or in part (except in
accordance with its terms), or shall cease to be effective or to be the legally
valid, binding and enforceable obligation of Seller, or any Obligor shall
directly or indirectly contest in any manner such effectiveness, validity,
binding nature or enforceability, or the Agent for the benefit of the Purchasers
shall cease to have a valid and perfected first priority security interest in
the Receivables, the Related Security and the Collections with respect thereto
and the Collection Accounts.
(k) Provider shall fail to perform or observe any term, covenant or
agreement required to be performed by it under the Performance Undertaking, or
the Performance Undertaking shall cease to be effective or to be the legally
valid, binding and enforceable obligation of Provider, or Provider shall
directly or indirectly contest in any manner such effectiveness, validity,
binding nature or enforceability.
(l) Provider shall fail to perform or observe the covenants set forth
in Section 7.4 of the 5-Year Revolving Credit Agreement, dated as of March 30,
2000, as such revolving credit agreement may be amended, restated, supplemented
or otherwise modified from time to time, among Ralston Purina Company, Bank One,
NA, as agent, Bank of America, N.A., as syndication agent, and the financial
institutions parties thereto, which agreement has been assigned by Ralston
Purina Company to, and assumed by, Provider pursuant to the Debt Assignment,
Assumption and Release Agreement, dated as of April 1, 2000, among Ralston
Purina Company, Provider and Bank One, NA. For the purposes of this Agreement,
such covenants shall survive the termination of such revolving credit agreement
and any amendment, restatement, supplement or other modification thereof
occurring while Bank One is not the agent thereunder shall have no effect.
<PAGE>
Section 9.2 Remedies. Upon the occurrence and during the continuation
--------
of an Amortization Event, the Agent may, or upon the direction of the Required
Financial Institutions shall, take any of the following actions: (i) replace the
Person then acting as Servicer, (ii) declare the Amortization Date to have
occurred, whereupon the Amortization Date shall forthwith occur, without demand,
protest or further notice of any kind, all of which are hereby expressly waived
by each Seller Party; provided, however, that upon the occurrence of an
Amortization Event described in Section 9.1(d)(ii), or of an actual or deemed
------------------
entry of an order for relief with respect to any Seller Party under the Federal
Bankruptcy Code, the Amortization Date shall automatically occur, without
demand, protest or any notice of any kind, all of which are hereby expressly
waived by each Seller Party, (iii) to the fullest extent permitted by applicable
law, declare that the Default Fee shall accrue with respect to any of the
Aggregate Unpaids outstanding at such time, (iv) deliver the Collection Notices
to the Collection Banks, and (v) notify Obligors of the Purchasers' interest in
the Receivables. The aforementioned rights and remedies shall be without
limitation, and shall be in addition to all other rights and remedies of the
Agent and the Purchasers otherwise available under any other provision of this
Agreement, by operation of law, at equity or otherwise, all of which are hereby
expressly preserved, including, without limitation, all rights and remedies
provided under the UCC, all of which rights shall be cumulative.
ARTICLE X
INDEMNIFICATION
Section 10.1 Indemnities by The Seller Parties. Without limiting any
----------------------------------
other rights that the Agent or any Purchaser may have hereunder or under
applicable law, (A) Seller hereby agrees to indemnify (and pay upon demand to)
the Agent and each Purchaser and their respective assigns, officers, directors,
agents and employees (each an "Indemnified Party") from and against any and all
-----------------
damages, losses, claims, taxes, liabilities, costs, expenses and for all other
amounts payable, including reasonable attorneys' fees (which attorneys may be
employees of the Agent or such Purchaser) and disbursements (all of the
foregoing being collectively referred to as "Indemnified Amounts") awarded
-------------------
against or incurred by any of them arising out of or as a result of this
Agreement or the acquisition, either directly or indirectly, by a Purchaser of
an interest in the Receivables, and (B) the Servicer hereby agrees to indemnify
(and pay upon demand to) each Indemnified Party for Indemnified Amounts awarded
against or incurred by any of them arising out of the Servicer's activities as
Servicer hereunder excluding, however, in all of the foregoing instances under
the preceding clauses (A) and (B):
(i) Indemnified Amounts to the extent a final judgment of a court of
competent jurisdiction holds that such Indemnified Amounts resulted from gross
negligence or willful misconduct on the part of the Indemnified Party seeking
indemnification;
(ii) Indemnified Amounts to the extent the same includes losses in
respect of Receivables that are uncollectible on account of the insolvency,
bankruptcy or lack of creditworthiness of the related Obligor; or
(iii) taxes imposed by the jurisdiction in which such Indemnified
Party's principal executive office is located, on or measured by the overall net
income of such Indemnified Party to the extent that the computation of such
taxes is consistent with the characterization for income tax purposes of the
acquisition by the Purchasers of Purchaser Interests as a loan or loans by the
Purchasers to Seller secured by the Receivables, the Related Security, the
Collection Accounts and the Collections;
provided, however, that nothing contained in this sentence shall limit the
- --------- --------
liability of any Seller Party or limit the recourse of the Purchasers to any
- -----
Seller Party for amounts otherwise specifically provided to be paid by such
- ---
Seller Party under the terms of this Agreement. Without limiting the generality
- ---
of the foregoing indemnification, Seller shall indemnify each Indemnified Party
for Indemnified Amounts (including, without limitation, losses in respect of
uncollectible receivables, regardless of whether reimbursement therefor would
constitute recourse to Seller or the Servicer) relating to or resulting from:
(i) any representation or warranty made by any Seller Party, Provider
or Originator (or any officers of any such Person) under or in connection with
this Agreement, any other Transaction Document or any other information or
report delivered by any such Person pursuant hereto or thereto, which shall have
been false or incorrect when made or deemed made;
<PAGE>
(ii) the failure by Seller, the Servicer, Provider or Originator to
comply with any applicable law, rule or regulation with respect to any
Receivable or Contract related thereto, or the nonconformity of any Receivable
or Contract included therein with any such applicable law, rule or regulation or
any failure of Originator to keep or perform any of its obligations, express or
implied, with respect to any Contract;
(iii) any failure of Seller, the Servicer, Provider or Originator to
perform its duties, covenants or other obligations in accordance with the
provisions of this Agreement or any other Transaction Document;
(iv) any products liability, personal injury or damage suit, or other
similar claim arising out of or in connection with merchandise, insurance or
services that are the subject of any Contract or any Receivable;
(v) any dispute, claim, offset or defense (other than discharge in
bankruptcy of the Obligor) of the Obligor to the payment of any Receivable
(including, without limitation, a defense based on such Receivable or the
related Contract not being a legal, valid and binding obligation of such Obligor
enforceable against it in accordance with its terms), or any other claim
resulting from the sale of the merchandise or service related to such Receivable
or the furnishing or failure to furnish such merchandise or services;
(vi) the commingling of Collections of Receivables at any time with
other funds;
(vii) any investigation, litigation or proceeding related to or arising
from this Agreement or any other Transaction Document, the transactions
contemplated hereby, the use of the proceeds of an Incremental Purchase or a
Reinvestment, the ownership of the Purchaser Interests or any other
investigation, litigation or proceeding relating to Seller, the Servicer,
Provider or Originator in which any Indemnified Party becomes involved as a
result of any of the transactions contemplated hereby;
(viii) any inability to litigate any claim against any Obligor in
respect of any Receivable as a result of such Obligor being immune from civil
and commercial law and suit on the grounds of sovereignty or otherwise from any
legal action, suit or proceeding;
(ix) any Amortization Event described in Section 9.1(d);
---------------
(x) any failure of Seller to acquire and maintain legal and equitable
title to, and ownership of any Receivable and the Related Security and
Collections with respect thereto from Originator, free and clear of any Adverse
Claim (other than as created hereunder); or any failure of Seller to give
reasonably equivalent value to Originator under the Receivables Sale Agreement
in consideration of the transfer by Originator of any Receivable, or any attempt
by any Person to void such transfer under statutory provisions or common law or
equitable action;
<PAGE>
(xi) any failure to vest and maintain vested in the Agent for the
benefit of the Purchasers, or to transfer to the Agent for the benefit of the
Purchasers, legal and equitable title to, and ownership of, a first priority
perfected undivided percentage ownership interest (to the extent of the
Purchaser Interests contemplated hereunder) or security interest in the
Receivables, the Related Security and the Collections, free and clear of any
Adverse Claim (except as created by the Transaction Documents);
(xii) the failure to have filed, or any delay in filing, financing
statements or other similar instruments or documents under the UCC of any
applicable jurisdiction or other applicable laws with respect to any Receivable,
the Related Security and Collections with respect thereto, and the proceeds of
any thereof, whether at the time of any Incremental Purchase or Reinvestment or
at any subsequent time;
(xiii) any action or omission by any Seller Party or Provider which
reduces or impairs the rights of the Agent or the Purchasers with respect to any
Receivable or the value of any such Receivable;
(xiv) any attempt by any Person to void any Incremental Purchase or
Reinvestment hereunder under statutory provisions or common law or equitable
action; and
(xv) the failure of any Receivable included in the calculation of the
Net Receivables Balance as an Eligible Receivable to be an Eligible Receivable
at the time so included.
Section 10.2 Increased Cost and Reduced Return. If after the date
-------------------------------------
hereof, any Funding Source shall be charged any fee, expense or increased cost
on account of the adoption of any applicable law, rule or regulation (including
any applicable law, rule or regulation regarding capital adequacy) or any change
therein, or any change in the interpretation or administration thereof by any
governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance with any request or
directive (whether or not having the force of law) of any such authority,
central bank or comparable agency (a "Regulatory Change"): (i) that subjects
-----------------
any Funding Source to any charge or withholding on or with respect to any
Funding Agreement or a Funding Source's obligations under a Funding Agreement,
or on or with respect to the Receivables, or changes the basis of taxation of
payments to any Funding Source of any amounts payable under any Funding
Agreement (except for changes in the rate of tax on the overall net income of a
Funding Source or taxes excluded by Section 10.1) or (ii) that imposes, modifies
------------
or deems applicable any reserve, assessment, insurance charge, special deposit
or similar requirement against assets of, deposits with or for the account of a
Funding Source, or credit extended by a Funding Source pursuant to a Funding
Agreement or (iii) that imposes any other condition the result of which is to
increase the cost to a Funding Source of performing its obligations under a
Funding Agreement, or to reduce the rate of return on a Funding Source's capital
as a consequence of its obligations under a Funding Agreement, or to reduce the
amount of any sum received or receivable by a Funding Source under a Funding
Agreement or to require any payment calculated by reference to the amount of
interests or loans held or interest received by it, then, upon demand by the
Agent, Seller shall pay to the Agent, for the benefit of the relevant Funding
Source, such amounts charged to such Funding Source or such amounts to otherwise
compensate such Funding Source for such increased cost or such reduction.
<PAGE>
Section 10.3 Other Costs and Expenses. Seller shall pay to the Agent
-------------------------
and Conduit on demand all reasonable out-of-pocket costs and expenses in
connection with the preparation, execution, delivery and administration of this
Agreement, the transactions contemplated hereby and the other documents to be
delivered hereunder, including without limitation, the cost of Conduit's
auditors auditing the books, records and procedures of Seller, reasonable fees
and out-of-pocket expenses of legal counsel for Conduit and the Agent (which
such counsel may be employees of Conduit or the Agent) with respect thereto and
with respect to advising Conduit and the Agent as to their respective rights and
remedies under this Agreement. Seller shall pay to the Agent on demand any and
all costs and expenses of the Agent and the Purchasers, if any, including
reasonable counsel fees and expenses in connection with the enforcement of this
Agreement and the other documents delivered hereunder and in connection with any
restructuring or workout of this Agreement or such documents, or the
administration of this Agreement following an Amortization Event. Seller shall
reimburse Conduit on demand for all other costs and expenses incurred by Conduit
("Other Costs"), including, without limitation, the cost of auditing Conduit's
------------
books by certified public accountants, the cost of rating the Commercial Paper
by independent financial rating agencies, and the reasonable fees and
out-of-pocket expenses of counsel for Conduit or any counsel for any shareholder
of Conduit with respect to advising Conduit or such shareholder as to matters
relating to Conduit's operations.
Section 10.4 Allocations. Conduit shall allocate the liability for
-----------
Other Costs among Seller and other Persons with whom Conduit has entered into
agreements to purchase interests in receivables ("Other Sellers"). If any Other
-------------
Costs are attributable to Seller and not attributable to any Other Seller,
Seller shall be solely liable for such Other Costs. However, if Other Costs are
attributable to Other Sellers and not attributable to Seller, such Other Sellers
shall be solely liable for such Other Costs. All allocations to be made
pursuant to the foregoing provisions of this Article X shall be made by Conduit
---------
in its sole discretion on a reasonable basis and shall be binding on Seller and
the Servicer.
ARTICLE XI
THE AGENT
Section 11.1 Authorization and Action. Each Purchaser hereby
--------------------------
designates and appoints Bank One to act as its agent hereunder and under each
other Transaction Document, and authorizes the Agent to take such actions as
agent on its behalf and to exercise such powers as are delegated to the Agent by
the terms of this Agreement and the other Transaction Documents together with
such powers as are reasonably incidental thereto. The Agent shall not have any
duties or responsibilities, except those expressly set forth herein or in any
other Transaction Document, or any fiduciary relationship with any Purchaser,
and no implied covenants, functions, responsibilities, duties, obligations or
liabilities on the part of the Agent shall be read into this Agreement or any
other Transaction Document or otherwise exist for the Agent. In performing its
functions and duties hereunder and under the other Transaction Documents, the
Agent shall act solely as agent for the Purchasers and does not assume nor shall
be deemed to have assumed any obligation or relationship of trust or agency with
or for any Seller Party or any of such Seller Party's successors or assigns.
The Agent shall not be required to take any action that exposes the Agent to
personal liability or that is contrary to this Agreement, any other Transaction
Document or applicable law. The appointment and authority of the Agent
hereunder shall terminate upon the indefeasible payment in full of all Aggregate
Unpaids. Each Purchaser hereby authorizes the Agent to execute each of the
Uniform Commercial Code financing statements on behalf of such Purchaser (the
terms of which shall be binding on such Purchaser).
Section 11.2 Delegation of Duties. The Agent may execute any of its
----------------------
duties under this Agreement and each other Transaction Document by or through
agents or attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. The Agent shall not be
responsible for the negligence or misconduct of any agents or attorneys-in-fact
selected by it with reasonable care.
<PAGE>
Section 11.3 Exculpatory Provisions. Neither the Agent nor any of its
----------------------
directors, officers, agents or employees shall be (i) liable for any action
lawfully taken or omitted to be taken by it or them under or in connection with
this Agreement or any other Transaction Document (except for its, their or such
Person's own gross negligence or willful misconduct), or (ii) responsible in any
manner to any of the Purchasers for any recitals, statements, representations or
warranties made by any Seller Party or Provider contained in this Agreement, any
other Transaction Document or any certificate, report, statement or other
document referred to or provided for in, or received under or in connection
with, this Agreement, or any other Transaction Document or for the value,
validity, effectiveness, genuineness, enforceability or sufficiency of this
Agreement, or any other Transaction Document or any other document furnished in
connection herewith or therewith, or for any failure of any Seller Party or
Provider to perform its obligations hereunder or thereunder, or for the
satisfaction of any condition specified in Article VI, or for the perfection,
----------
priority, condition, value or sufficiency of any collateral pledged in
connection herewith. The Agent shall not be under any obligation to any
Purchaser to ascertain or to inquire as to the observance or performance of any
of the agreements or covenants contained in, or conditions of, this Agreement or
any other Transaction Document, or to inspect the properties, books or records
of the Seller Parties or Provider. The Agent shall not be deemed to have
knowledge of any Amortization Event or Potential Amortization Event unless the
Agent has received notice from Seller or a Purchaser.
Section 11.4 Reliance by Agent. The Agent shall in all cases be
-------------------
entitled to rely, and shall be fully protected in relying, upon any 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, without limitation, counsel to Seller), independent
accountants and other experts selected by the Agent. The Agent shall in all
cases be fully justified in failing or refusing to take any action under this
Agreement or any other Transaction Document unless it shall first receive such
advice or concurrence of Conduit or the Required Financial Institutions or all
of the Purchasers, as applicable, as it deems appropriate and it shall first be
indemnified to its satisfaction by the Purchasers, provided that unless and
--------
until the Agent shall have received such advice, the Agent may take or refrain
from taking any action, as the Agent shall deem advisable and in the best
interests of the Purchasers. The Agent shall in all cases be fully protected in
acting, or in refraining from acting, in accordance with a request of Conduit or
the Required Financial Institutions or all of the Purchasers, as applicable, and
such request and any action taken or failure to act pursuant thereto shall be
binding upon all the Purchasers.
Section 11.5 Non-Reliance on Agent and Other Purchasers. Each
-----------------------------------------------
Purchaser expressly acknowledges that neither the Agent, nor any of its
officers, directors, employees, agents, attorneys-in-fact or affiliates has made
any representations or warranties to it and that no act by the Agent hereafter
taken, including, without limitation, any review of the affairs of any Seller
Party or Provider, shall be deemed to constitute any representation or warranty
by the Agent. Each Purchaser represents and warrants to the Agent that it has
and will, independently and without reliance upon the Agent or any other
Purchaser and based on such documents and information as it has deemed
appropriate, made its own appraisal of and investigation into the business,
operations, property, prospects, financial and other conditions and
creditworthiness of Seller and made its own decision to enter into this
Agreement, the other Transaction Documents and all other documents related
hereto or thereto.
Section 11.6 Reimbursement and Indemnification. The Financial
-----------------------------------
Institutions agree to reimburse and indemnify the Agent and its officers,
directors, employees, representatives and agents ratably according to their Pro
Rata Shares, to the extent not paid or reimbursed by the Seller Parties (i) for
any amounts for which the Agent, acting in its capacity as Agent, is entitled to
reimbursement by the Seller Parties hereunder and (ii) for any other expenses
incurred by the Agent, in its capacity as Agent and acting on behalf of the
Purchasers, in connection with the administration and enforcement of this
Agreement and the other Transaction Documents.
<PAGE>
Section 11.7 Agent in its Individual Capacity. The Agent and its
------------------------------------
Affiliates may make loans to, accept deposits from and generally engage in any
kind of business with Seller or any Affiliate of Seller as though the Agent were
not the Agent hereunder. With respect to the acquisition of Purchaser Interests
pursuant to this Agreement, the Agent shall have the same rights and powers
under this Agreement in its individual capacity as any Purchaser and may
exercise the same as though it were not the Agent, and the terms "Financial
Institution," "Purchaser," "Financial Institutions" and "Purchasers" shall
include the Agent in its individual capacity.
Section 11.8 Successor Agent. The Agent may, upon thirty days' notice
---------------
to Seller and the Purchasers, and the Agent will, upon the direction of all of
the Purchasers (other than the Agent, in its individual capacity) resign as
Agent. If the Agent shall resign, then the Required Financial Institutions
during such thirty-day period shall appoint from among the Purchasers a
successor agent. If for any reason no successor Agent is appointed by the
Required Financial Institutions during such thirty-day period, then effective
upon the termination of such thirty-day period, the Purchasers shall perform all
of the duties of the Agent hereunder and under the other Transaction Documents
and Seller and the Servicer (as applicable) shall make all payments in respect
of the Aggregate Unpaids directly to the applicable Purchasers and for all
purposes shall deal directly with the Purchasers. After the effectiveness of
any retiring Agent's resignation hereunder as Agent, the retiring Agent shall be
discharged from its duties and obligations hereunder and under the other
Transaction Documents and the provisions of this Article XI and Article X shall
---------- ---------
continue in effect for its benefit with respect to any actions taken or omitted
to be taken by it while it was Agent under this Agreement and under the other
Transaction Documents.
ARTICLE XII
ASSIGNMENTS; PARTICIPATIONS
Section 12.1 Assignments. (a) Seller and each Financial Institution
-----------
hereby agree and consent to the complete or partial assignment by Conduit of all
or any portion of its rights under, interest in, title to and obligations under
this Agreement to the Financial Institutions pursuant to Section 13.1 or, with
------------
the consent of the Seller (which consent shall not be unreasonably withheld), to
any other Person, and upon such assignment, Conduit shall be released from its
obligations so assigned. Further, Seller and each Financial Institution hereby
agree that any assignee of Conduit of this Agreement or all or any of the
Purchaser Interests of Conduit shall have all of the rights and benefits under
this Agreement as if the term "Conduit" explicitly referred to such party, and
no such assignment shall in any way impair the rights and benefits of Conduit
hereunder. Neither Seller nor the Servicer shall have the right to assign its
rights or obligations under this Agreement.
<PAGE>
(b) Any Financial Institution may at any time and from time to time
assign to one or more Persons ("Purchasing Financial Institutions") all or any
---------------------------------
part of its rights and obligations under this Agreement pursuant to an
assignment agreement, substantially in the form set forth in Exhibit VII hereto
-----------
(the "Assignment Agreement") executed by such Purchasing Financial Institution
---------------------
and such selling Financial Institution. The consent of Conduit shall be
required prior to the effectiveness of any such assignment; and, in the event of
any such assignment by any Financial Institution, other than to an Affiliate of
such Financial Institution, another Financial Institution or an Affiliate of
another Financial Institution, the consent of Seller (which consent shall not be
unreasonably withheld) shall be required prior to the effectiveness of any such
assignment. Each assignee of a Financial Institution must (i) have a short-term
debt rating of A-1 or better by Standard & Poor's Ratings Group and P-1 by
Moody's Investor Service, Inc. and (ii) agree to deliver to the Agent, promptly
following any request therefor by the Agent or Conduit, an enforceability
opinion in form and substance satisfactory to the Agent and Conduit. Upon
delivery of the executed Assignment Agreement to the Agent, such selling
Financial Institution shall be released from its obligations hereunder to the
extent of such assignment. Thereafter the Purchasing Financial Institution
shall for all purposes be a Financial Institution party to this Agreement and
shall have all the rights and obligations of a Financial Institution under this
Agreement to the same extent as if it were an original party hereto and no
further consent or action by Seller, the Purchasers or the Agent shall be
required.
(c) Each of the Financial Institutions agrees that in the event that it
shall cease to have a short-term debt rating of A-1 or better by Standard &
Poor's Ratings Group and P-1 by Moody's Investor Service, Inc. (an "Affected
--------
Financial Institution"), such Affected Financial Institution shall be obliged,
-------------------
at the request of Conduit or the Agent, to assign all of its rights and
obligations hereunder to (x) another Financial Institution or (y) another
funding entity nominated by the Agent and acceptable to Conduit, and willing to
participate in this Agreement through the Liquidity Termination Date in the
place of such Affected Financial Institution; provided that the Affected
--------
Financial Institution receives payment in full, pursuant to an Assignment
Agreement, of an amount equal to such Financial Institution's Pro Rata Share of
the Aggregate Capital and Yield owing to the Financial Institutions and all
accrued but unpaid fees and other costs and expenses payable in respect of its
Pro Rata Share of the Purchaser Interests of the Financial Institutions.
Section 12.2 Participations. Any Financial Institution may, in the
--------------
ordinary course of its business at any time sell to one or more Persons (each a
"Participant") participating interests in its Pro Rata Share of the Purchaser
-----------
Interests of the Financial Institutions, its obligation to pay Conduit its
-
Acquisition Amounts or any other interest of such Financial Institution
-
hereunder. Notwithstanding any such sale by a Financial Institution of a
-
participating interest to a Participant, such Financial Institution's rights and
-
obligations under this Agreement shall remain unchanged, such Financial
Institution shall remain solely responsible for the performance of its
obligations hereunder, and Seller, Conduit and the Agent shall continue to deal
solely and directly with such Financial Institution in connection with such
Financial Institution's rights and obligations under this Agreement. Each
Financial Institution agrees that any agreement between such Financial
Institution and any such Participant in respect of such participating interest
shall not restrict such Financial Institution's right to agree to any amendment,
supplement, waiver or modification to this Agreement, except for any amendment,
supplement, waiver or modification described in Section 14.1(b)(i).
-------------------
ARTICLE XIII
LIQUIDITY FACILITY
Section 13.1 Transfer to Financial Institutions. Each Financial
-------------------------------------
Institution hereby agrees, subject to Section 13.4, that immediately upon
-------------
written notice from Conduit delivered on or prior to the Liquidity Termination
Date, it shall acquire by assignment from Conduit, without recourse or warranty,
its Pro Rata Share of one or more of the Purchaser Interests of Conduit as
specified by Conduit. Each such assignment by Conduit shall be made pro rata
among all of the Financial Institutions, except for pro rata assignments to one
or more Terminating Financial Institutions pursuant to Section 13.6. Each such
------------
Financial Institution shall, no later than 1:00 p.m. (Chicago time) on the date
of such assignment, pay in immediately available funds (unless another form of
payment is otherwise agreed between Conduit and any Financial Institution) to
the Agent at an account designated by the Agent, for the benefit of Conduit, its
Acquisition Amount. Unless a Financial Institution has notified the Agent that
it does not intend to pay its Acquisition Amount, the Agent may assume that such
payment has been made and may, but shall not be obligated to, make the amount of
such payment available to Conduit in reliance upon such assumption. Conduit
hereby sells and assigns to the Agent for the ratable benefit of the Financial
Institutions, and the Agent hereby purchases and assumes from Conduit, effective
upon the receipt by Conduit of the Conduit Transfer Price, the Purchaser
Interests of Conduit which are the subject of any transfer pursuant to this
Article XIII.
---------
<PAGE>
Section 13.2 Transfer Price Reduction Yield. If the Adjusted Funded
--------------------------------
Amount is included in the calculation of the Conduit Transfer Price for any
Purchaser Interest, each Financial Institution agrees that the Agent shall pay
to Conduit the Reduction Percentage of any Yield received by the Agent with
respect to such Purchaser Interest.
Section 13.3 Payments to Conduit. In consideration for the reduction
--------------------
of the Conduit Transfer Prices by the Conduit Transfer Price Reductions,
effective only at such time as the aggregate amount of the Capital of the
Purchaser Interests of the Financial Institutions equals the Conduit Residual,
each Financial Institution hereby agrees that the Agent shall not distribute to
the Financial Institutions and shall immediately remit to Conduit any Yield,
Collections or other payments received by it to be applied pursuant to the terms
hereof or otherwise to reduce the Capital of the Purchaser Interests of the
Financial Institutions.
Section 13.4 Limitation on Commitment to Purchase from Conduit.
-------------------------------------------------------
Notwithstanding anything to the contrary in this Agreement, no Financial
Institution shall have any obligation to purchase any Purchaser Interest from
Conduit, pursuant to Section 13.1 or otherwise, if:
-------------
(i) Conduit shall have voluntarily commenced any proceeding or filed
any petition under any bankruptcy, insolvency or similar law seeking the
dissolution, liquidation or reorganization of Conduit or taken any corporate
action for the purpose of effectuating any of the foregoing; or
(ii) involuntary proceedings or an involuntary petition shall have been
commenced or filed against Conduit by any Person under any bankruptcy,
insolvency or similar law seeking the dissolution, liquidation or reorganization
of Conduit and such proceeding or petition shall have not been dismissed.
Section 13.5 Defaulting Financial Institutions. If one or more
-----------------------------------
Financial Institutions defaults in its obligation to pay its Acquisition Amount
pursuant to Section 13.1 (each such Financial Institution shall be called a
-------------
"Defaulting Financial Institution" and the aggregate amount of such defaulted
-------------------------------
obligations being herein called the "Conduit Transfer Price Deficit"), then upon
------------------------------
notice from the Agent, each Financial Institution other than the Defaulting
Financial Institutions (a "Non-Defaulting Financial Institution") shall promptly
------------------------------------
pay to the Agent, in immediately available funds, an amount equal to the lesser
of (x) such Non-Defaulting Financial Institution's proportionate share (based
upon the relative Commitments of the Non-Defaulting Financial Institutions,
after excluding the Commitment of any Approved Unconditional Liquidity
Providers) of the Conduit Transfer Price Deficit and (y) the unused portion of
such Non-Defaulting Financial Institution's Commitment; provided, however, that
-------- -------
if an Approved Unconditional Liquidity Provider is the Defaulting Financial
Institution, the Non-Defaulting Financial Institutions shall have no obligation
to pay any amount to the Agent pursuant to this Section 13.5as a result of a
------------
default by such Approved Unconditional Liquidity Provider; provided, further,
-------- -------
that in no event shall any Approved Unconditional Liquidity Provider be required
to make any payment as a Non-Defaulting Financial Institution pursuant to this
Section 13.5. A Defaulting Financial Institution shall forthwith upon demand
------------
pay to the Agent for the account of the Non-Defaulting Financial Institutions
-
all amounts paid by each Non-Defaulting Financial Institution on behalf of such
-
Defaulting Financial Institution, together with interest thereon, for each day
from the date a payment was made by a Non-Defaulting Financial Institution until
the date such Non-Defaulting Financial Institution has been paid such amounts in
full, at a rate per annum equal to the Federal Funds Effective Rate plus two
percent (2%). In addition, without prejudice to any other rights that Conduit
may have under applicable law, each Defaulting Financial Institution shall pay
to Conduit forthwith upon demand, the difference between such Defaulting
Financial Institution's unpaid Acquisition Amount and the amount paid with
respect thereto by the Non-Defaulting Financial Institutions, together with
interest thereon, for each day from the date of the Agent's request for such
Defaulting Financial Institution's Acquisition Amount pursuant to Section 13.1
------------
until the date the requisite amount is paid to Conduit in full, at a rate per
annum equal to the Federal Funds Effective Rate plus two percent (2%).
<PAGE>
Section 13.6 Terminating Financial Institutions.
------------------------------------
(a) Each Financial Institution hereby agrees to deliver written notice
to the Agent not more than 30 Business Days and not less than 10 Business Days
prior to the Liquidity Termination Date indicating whether such Financial
Institution intends to renew its Commitment hereunder. If any Financial
Institution fails to deliver such notice on or prior to the date that is 10
Business Days prior to the Liquidity Termination Date, such Financial
Institution will be deemed to have declined to renew its Commitment (each
Financial Institution which has declined or has been deemed to have declined to
renew its Commitment hereunder, a "Non-Renewing Financial Institution"). The
----------------------------------
Agent shall promptly notify Conduit of each Non-Renewing Financial Institution
and Conduit, in its sole discretion, may (A) to the extent of Commitment
Availability, declare that such Non-Renewing Financial Institution's Commitment
shall, to such extent, automatically terminate on a date specified by Conduit on
or before the Liquidity Termination Date or (B) upon one (1) Business Days'
notice to such Non-Renewing Financial Institution assign to such Non-Renewing
Financial Institution on a date specified by Conduit its Pro Rata Share of the
aggregate Purchaser Interests then held by Conduit, subject to, and in
accordance with, Section 13.1. In addition, Conduit may, in its sole
-------------
discretion, at any time (x) to the extent of Commitment Availability, declare
that any Affected Financial Institution's Commitment shall automatically
terminate on a date specified by Conduit or (y) assign to any Affected Financial
Institution on a date specified by Conduit its Pro Rata Share of the aggregate
Purchaser Interests then held by Conduit, subject to, and in accordance with,
Section 13.1 (each Affected Financial Institution or each Non-Renewing Financial
----------
Institution is hereinafter referred to as a "Terminating Financial
----------------------
Institution"). The parties hereto expressly acknowledge that any declaration of
the termination of any Commitment, any assignment pursuant to this Section 13.6
------------
and the order of priority of any such termination or assignment among
Terminating Financial Institutions shall be made by Conduit in its sole and
absolute discretion.
(b) Upon any assignment to a Terminating Financial Institution as
provided in this Section 13.6, any remaining Commitment of such Terminating
-------------
Financial Institution shall automatically terminate. Upon reduction to zero of
the Capital of all of the Purchaser Interests of a Terminating Financial
Institution (after application of Collections thereto pursuant to Sections 2.2
------------
and 2.3) all rights and obligations of such Terminating Financial Institution
-------
hereunder shall be terminated and such Terminating Financial Institution shall
-
no longer be a "Financial Institution" hereunder; provided, however, that the
-------- -------
provisions of Article X shall continue in effect for its benefit with respect to
---------
Purchaser Interests held by such Terminating Financial Institution prior to its
termination as a Financial Institution.
ARTICLE XIV
MISCELLANEOUS
Section 14.1 Waivers and Amendments. (a) No failure or delay on the
-----------------------
part of the Agent or any Purchaser in exercising any power, right or remedy
under this Agreement shall operate as a waiver thereof, nor shall any single or
partial exercise of any such power, right or remedy preclude any other further
exercise thereof or the exercise of any other power, right or remedy. The
rights and remedies herein provided shall be cumulative and nonexclusive of any
rights or remedies provided by law. Any waiver of this Agreement shall be
effective only in the specific instance and for the specific purpose for which
given.
(b) No provision of this Agreement may be amended, supplemented,
modified or waived except in writing in accordance with the provisions of this
Section 14.1(b). Conduit, Seller and the Agent, at the direction of the
---------------
Required Financial Institutions, may enter into written modifications or waivers
------
of any provisions of this Agreement, provided, however, that no such
-------- -------
modification or waiver shall:
<PAGE>
(i) without the consent of each affected Purchaser, (A) extend the
Liquidity Termination Date or the date of any payment or deposit of Collections
by Seller or the Servicer, (B) reduce the rate or extend the time of payment of
Yield or any CP Costs (or any component of Yield or CP Costs), (C) reduce any
fee payable to the Agent for the benefit of the Purchasers, (D) except pursuant
to Article XII hereof, change the amount of the Capital of any Purchaser, any
------------
Financial Institution's Pro Rata Share (except pursuant to Sections 13.1 or
-------------
13.5) or any Financial Institution's Commitment, (E) amend, modify or waive any
provision of the definition of Required Financial Institutions or this Section
-------
14.1(b), (F) consent to or permit the assignment or transfer by Seller of any of
------
its rights and obligations under this Agreement, (G) change the definition of
"Eligible Receivable," "Loss Reserve," "Loss-to-Liquidation Ratio,"or "Loss
Percentage" or (H) amend or modify any defined term (or any defined term used
directly or indirectly in such defined term) used in clauses (A) through (G)
above in a manner that would circumvent the intention of the restrictions set
forth in such clauses;
(ii) without the written consent of the then Agent, amend, modify or
waive any provision of this Agreement if the effect thereof is to affect the
rights or duties of such Agent; or
(iii) without the written consent of the then Servicer, amend, modify
or waive any provision of Article VIII if the effect thereof is to affect the
------------
rights or duties of such Servicer.
Notwithstanding the foregoing, (i) without the consent of the Financial
Institutions, but with the consent of Seller, the Agent may amend this Agreement
solely to add additional Persons as Financial Institutions hereunder and (ii)
the Agent, the Required Financial Institutions and Conduit may enter into
amendments to modify any of the terms or provisions of Article XI, Article XII,
---------- -----------
Article XIII, Section 14.13 or any other provision of this Agreement without the
- ------------ -------------
consent of Seller, provided that such amendment has no negative impact upon
Seller. Any modification or waiver made in accordance with this Section 14.1
------------
shall apply to each of the Purchasers equally and shall be binding upon Seller,
the Purchasers and the Agent.
Section 14.2 Notices. Except as provided in this Section 14.2, all
------- ------------
communications and notices provided for hereunder shall be in writing (including
bank wire, telecopy or electronic facsimile transmission or similar writing) and
shall be given to the other parties hereto at their respective addresses or
telecopy numbers set forth on the signature pages hereof or at such other
address or telecopy number as such Person may hereafter specify for the purpose
of notice to each of the other parties hereto. Each such notice or other
communication shall be effective (i) if given by telecopy, upon the receipt
thereof, (ii) if given by mail, three (3) Business Days after the time such
communication is deposited in the mail with first class postage prepaid or (iii)
if given by any other means, when received at the address specified in this
Section 14.2. Seller hereby authorizes the Agent to effect purchases and
---------
Tranche Period and Discount Rate selections based on telephonic notices made by
--
any Person whom the Agent in good faith believes to be acting on behalf of
Seller. Seller agrees to deliver promptly to the Agent a written confirmation
of each telephonic notice signed by an authorized officer of Seller; provided,
--------
however, the absence of such confirmation shall not affect the validity of such
------
notice. If the written confirmation differs from the action taken by the Agent,
the records of the Agent shall govern absent manifest error.
<PAGE>
Section 14.3 Ratable Payments. If any Purchaser, whether by setoff or
----------------
otherwise, has payment made to it with respect to any portion of the Aggregate
Unpaids owing to such Purchaser (other than payments received pursuant to
Section 10.2 or 10.3) in a greater proportion than that received by any other
------- ----
Purchaser entitled to receive a ratable share of such Aggregate Unpaids, such
Purchaser agrees, promptly upon demand, to purchase for cash without recourse or
warranty a portion of such Aggregate Unpaids held by the other Purchasers so
that after such purchase each Purchaser will hold its ratable proportion of such
Aggregate Unpaids; provided that if all or any portion of such excess amount is
--------
thereafter recovered from such Purchaser, such purchase shall be rescinded and
the purchase price restored to the extent of such recovery, but without
interest.
Section 14.4 Protection of Ownership Interests of the Purchasers. (a)
---------------------------------------------------
Seller agrees that from time to time, at its expense, it will promptly execute
and deliver all instruments and documents, and take all actions, that may be
necessary or desirable, or that the Agent may request, to perfect, protect or
more fully evidence the Purchaser Interests, or to enable the Agent or the
Purchasers to exercise and enforce their rights and remedies hereunder. At any
time upon the occurrence and during the continuance of a Potential Amortization
Event, the Agent may, or the Agent may direct Seller or the Servicer to, notify
the Obligors of Receivables, at Seller's expense, of the ownership or security
interests of the Purchasers under this Agreement and may also direct that
payments of all amounts due or that become due under any or all Receivables be
made directly to the Agent or its designee. Seller or the Servicer (as
applicable) shall, at any Purchaser's request, withhold the identity of such
Purchaser in any such notification.
(b) If any Seller Party fails to perform any of its obligations
hereunder, the Agent or any Purchaser may (but shall not be required to)
perform, or cause performance of, such obligations, and the Agent's or such
Purchaser's reasonable costs and expenses incurred in connection therewith shall
be payable by Seller as provided in Section 10.3. Each Seller Party irrevocably
------------
authorizes the Agent at any time and from time to time in the sole discretion of
the Agent, and appoints the Agent as its attorney-in-fact, to act on behalf of
such Seller Party (i) to execute on behalf of Seller as debtor and to file
financing statements necessary or desirable in the Agent's sole discretion to
perfect and to maintain the perfection and priority of the interest of the
Purchasers in the Receivables and (ii) to file a carbon, photographic or other
reproduction of this Agreement or any financing statement with respect to the
Receivables as a financing statement in such offices as the Agent in its sole
discretion deems necessary or desirable to perfect and to maintain the
perfection and priority of the interests of the Purchasers in the Receivables.
This appointment is coupled with an interest and is irrevocable.
Section 14.5 Confidentiality. (a) Each Seller Party, the Agent and
---------------
each Purchaser shall maintain and shall cause each of its employees and officers
to maintain the confidentiality of the Transaction Documents and the other
confidential or proprietary information with respect to the other parties hereto
and their respective businesses obtained by it or them in connection with the
structuring, negotiating and execution of the transactions contemplated herein,
except that such Seller Party, the Agent and such Purchaser and its officers and
employees may disclose such information to such Person's external accountants
and attorneys and as required by any applicable law or order of any judicial or
administrative proceeding.
(b) Anything herein to the contrary notwithstanding, each Seller Party
hereby consents to the disclosure of any nonpublic information with respect to
it (i) to the Agent, the Financial Institutions or Conduit by each other, (ii)
by the Agent or the Purchasers to any prospective or actual assignee or
participant of any of them and (iii) by the Agent to any rating agency,
Commercial Paper dealer or provider of a surety, guaranty or credit or liquidity
enhancement to Conduit or any entity organized for the purpose of purchasing, or
making loans secured by, financial assets for which Bank One acts as the
administrative agent and to any officers, directors, employees, outside
accountants and attorneys of any of the foregoing. In addition, the Purchasers
and the Agent may disclose any such nonpublic information pursuant to any law,
rule, regulation, direction, request or order of any judicial, administrative or
regulatory authority or proceedings (whether or not having the force or effect
of law).
<PAGE>
Section 14.6 Bankruptcy Petition. Seller, the Servicer, the Agent and
-------------------
each Financial Institution hereby covenants and agrees that, prior to the date
that is one year and one day after the payment in full of all outstanding senior
indebtedness of Conduit or any Unconditional Liquidity Provider, it will not
institute against, or join any other Person in instituting against, Conduit or
any such entity any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceedings or other similar proceeding under the laws of the United
States or any state of the United States.
Section 14.7 Limitation of Liability. Except with respect to any claim
-----------------------
arising out of the willful misconduct or gross negligence of Conduit, the Agent
or any Financial Institution, no claim may be made by any Seller Party or any
other Person against Conduit, the Agent or any Financial Institution or their
respective Affiliates, directors, officers, employees, attorneys or agents for
any special, indirect, consequential or punitive damages in respect of any claim
for breach of contract or any other theory of liability arising out of or
related to the transactions contemplated by this Agreement, or any act, omission
or event occurring in connection therewith; and each Seller Party hereby waives,
releases, and agrees not to sue upon any claim for any such damages, whether or
not accrued and whether or not known or suspected to exist in its favor.
Section 14.8 CHOICE OF LAW. THIS AGREEMENT SHALL BE GOVERNED AND
---------------
CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS (AND NOT THE LAW OF CONFLICTS) OF
THE STATE OF ILLINOIS.
Section 14.9 CONSENT TO JURISDICTION. EACH SELLER PARTY HEREBY
-------------------------
IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES
FEDERAL OR ILLINOIS STATE COURT SITTING IN CHICAGO, ILLINOIS IN ANY ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY DOCUMENT EXECUTED
BY SUCH PERSON PURSUANT TO THIS AGREEMENT AND EACH SELLER PARTY HEREBY
IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY
BE HEARD AND DETERMINED IN ANY SUCH COURT AND IRREVOCABLY WAIVES ANY OBJECTION
IT MAY NOW OR HEREAFTER HAVE AS TO THE VENUE OF ANY SUCH SUIT, ACTION OR
PROCEEDING BROUGHT IN SUCH A COURT OR THAT SUCH COURT IS AN INCONVENIENT FORUM.
NOTHING HEREIN SHALL LIMIT THE RIGHT OF THE AGENT OR ANY PURCHASER TO BRING
PROCEEDINGS AGAINST ANY SELLER PARTY IN THE COURTS OF ANY OTHER JURISDICTION.
ANY JUDICIAL PROCEEDING BY ANY SELLER PARTY AGAINST THE AGENT OR ANY PURCHASER
OR ANY AFFILIATE OF THE AGENT OR ANY PURCHASER INVOLVING, DIRECTLY OR
INDIRECTLY, ANY MATTER IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH
THIS AGREEMENT OR ANY DOCUMENT EXECUTED BY SUCH SELLER PARTY PURSUANT TO THIS
AGREEMENT SHALL BE BROUGHT ONLY IN A COURT IN CHICAGO, ILLINOIS.
Section 14.10 WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES
----------------------
TRIAL BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY OR INDIRECTLY, ANY
MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT
OF, RELATED TO, OR CONNECTED WITH THIS AGREEMENT, ANY DOCUMENT EXECUTED BY ANY
SELLER PARTY PURSUANT TO THIS AGREEMENT OR THE RELATIONSHIP ESTABLISHED
HEREUNDER OR THEREUNDER.
Section 14.11 Integration; Binding Effect; Survival of Terms.
---------------------------------------------------
(a) This Agreement and each other Transaction Document contain the
final and complete integration of all prior expressions by the parties hereto
with respect to the subject matter hereof and shall constitute the entire
agreement among the parties hereto with respect to the subject matter hereof
superseding all prior oral or written understandings.
<PAGE>
(b) This Agree-ment shall be binding upon and inure to the benefit of
the parties hereto and their re-spec-tive suc-ces-sors and permitted as-signs
(including any trustee in bank-rupt-cy). This Agreement shall create and
consti-tute the continuing obliga-tions of the parties hereto in accor-dance
with its terms and shall remain in full force and effect until terminated in
accordance with its terms; provided, however, that the rights and reme-dies with
-------- -------
respect to (i) any breach of any repre-sen-tation and warranty made by any
Seller Party pursu-ant to Article V, (ii) the indemnifica-tion and payment
----------
provisions of Arti-cle X, and Sections 14.5 and 14.6 shall be continuing and
----------- ------------- ----
shall survive any termina-tion of this Agree-ment.
Section 14.12 Counterparts; Severability; Section References. This
-------------------------------------------------
Agreement may be executed in any number of counterparts and by different parties
hereto in separate counterparts, each of which when so executed shall be deemed
to be an original and all of which when taken together shall constitute one and
the same Agreement. Any provisions of this Agreement which are 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. Unless otherwise expressly indicated, all references herein
to "Article," "Section," "Schedule" or "Exhibit" shall mean articles and
sections of, and schedules and exhibits to, this Agreement.
Section 14.13 Bank One Roles. Each of the Financial Institutions
----------------
acknowledges that Bank One acts, or may in the future act, (i) as administrative
agent for Conduit or any Financial Institution, (ii) as issuing and paying agent
for the Commercial Paper, (iii) to provide credit or liquidity enhancement for
the timely payment for the Commercial Paper and (iv) to provide other services
from time to time for Conduit or any Financial Institution (collectively, the
"Bank One Roles"). Without limiting the generality of this Section 14.13, each
-------------- -------------
Financial Institution hereby acknowledges and consents to any and all Bank One
Roles and agrees that in connection with any Bank One Role, Bank One may take,
or refrain from taking, any action that it, in its discretion, deems
appropriate, including, without limitation, in its role as administrative agent
for Conduit, and the giving of notice to the Agent of a mandatory purchase
pursuant to Section 13.1.
-------------
Section 14.14 Characterization. (a) It is the intention of the parties
----------------
hereto that each purchase hereunder shall constitute and be treated as an
absolute and irrevocable sale, which purchase shall provide the applicable
Purchaser with the full benefits of ownership of the applicable Purchaser
Interest. Except as specifically provided in this Agreement, each sale of a
Purchaser Interest hereunder is made without recourse to Seller; provided,
--------
however, that (i) Seller shall be liable to each Purchaser and the Agent for all
--
representations, warranties, covenants and indemnities made by Seller pursuant
to the terms of this Agreement, and (ii) such sale does not constitute and is
not intended to result in an assumption by any Purchaser or the Agent or any
assignee thereof of any obligation of Seller or Originator or any other person
arising in connection with the Receivables, the Related Security, or the related
Contracts, or any other obligations of Seller or Originator.
(b) In addition to any ownership interest which the Agent may from time
to time acquire pursuant hereto, Seller hereby grants to the Agent for the
ratable benefit of the Purchasers a valid and perfected security interest in all
of Seller's right, title and interest in, to and under all Receivables now
existing or hereafter arising, the Collections, each Lock-Box, each Collection
Account, all Related Security, the Demand Note, all other rights and payments
relating to such Receivables and all proceeds of any thereof prior to all other
liens on and security interests therein to secure the prompt and complete
payment of the Aggregate Unpaids. The Agent and the Purchasers shall have, in
addition to the rights and remedies that they may have under this Agreement, all
other rights and remedies provided to a secured creditor under the UCC and other
applicable law, which rights and remedies shall be cumulative.
<PAGE>
Section 14.15 Withholding. Any Purchaser that is not incorporated
-----------
under the laws of the United States of America, or a state thereof, agrees to
deliver to the Agent (with copies to Seller) two duly completed copies of
United States Internal Revenue Service Forms W-8BEN or W-8ECI, certifying in
either case that such Purchaser is entitled to receive payments under this
Agreement without deduction or withholding of any United States federal income
taxes.
[SIGNATURE PAGES FOLLOW]
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered by their duly authorized officers as of the date hereof.
ENERGIZER RECEIVABLES FUNDING CORPORATION
By: /s/ Mark A. Schafale
Name: Mark A. Schafale
Title: President
Address: 800 Chouteau Avenue
St. Louis, Missouri 63102
EVEREADY BATTERY COMPANY, INC.
By: /s/ William C. Fox
Name: William C. Fox
Title: Vice President, Treasury
Address: 800 Chouteau Avenue
St. Louis, Missouri 63102
FALCON ASSET SECURITIZATION CORPORATION
By:
Authorized Signatory
Address: c/o Bank One, NA (Main Office Chicago), as Agent
Asset Backed Finance
Suite IL1-0079, 1-19
1 Bank One Plaza
Chicago, Illinois 60670-0079
Fax: (312) 732-1844
<PAGE>
BANK ONE, NA (MAIN OFFICE CHICAGO), as a Financial Institution and as Agent
By:
Name:
Title:
Address: Bank One, NA (Main Office Chicago)
Asset Backed Finance
Suite IL1-0596, 1-21
1 Bank One Plaza
Chicago, Illinois 60670-0596
Fax: (312) 732-4487
<PAGE>
March 30, 2000
Ralston Purina Company
Checkerboard Square
St. Louis, MO 63164-0001
Attention: James R. Elsesser
Chief Financial Officer
Energizer Holdings, Inc.
Checkerboard Square
St. Louis, MO 63164-0001
Attention: Daniel Corbin
Executive Vice President -
Finance and Control
Gentlemen:
Reference is hereby made to the 5-Year Credit Agreement dated as of March
30, 2000 among Ralston Purina Company, a corporation organized under the laws
of the State of Missouri ("Ralston") as the initial borrower prior to the
assignment to and assumption by Energizer Holdings, Inc., a corporation
organized under the laws of the State of Missouri (the "Borrower"), the
financial institutions parties thereto as lenders, Bank One, NA, in its capacity
as administrative agent, Bank of America, N.A., in its capacity as syndication
agent, and Wachovia Bank, N.A., in its capacity as documentation agent (the
"5-Year Credit Agreement"). Capitalized terms used herein and not defined
herein shall have the meanings given to them in the 5-Year Credit Agreement.
In connection with the consummation of the Transactions, Ralston has
requested a term loan from Bank of America, N.A. (the "Lender") in the
aggregate principal amount of $175,000,000 (the "Term Loan") which would be made
in a single advance on or prior to March 31, 2000 and would mature on the date
which is the earliest of (a) if the Spin-Off and Debt Assumption have not
occurred prior thereto, April 4, 2000; (b) the date of receipt by the Borrower
or any of its Subsidiaries of proceeds from the initial funding under the
$175,000,000 senior notes of the Borrower issued in three series due April 1,
2003, April 1, 2005 and April 1, 2007, respectively (the "Senior Notes"); and
(c) April 10, 2000.
Amounts repaid by Ralston or the Borrower may not be reborrowed.
The Lender is pleased to agree to make such Term Loan to Ralston, to be
assigned to and assumed by the Borrower pursuant to the Debt Assumption
Agreement in the form of Exhibit "A" hereto (the "Debt Assumption Agreement"),
subject to the terms and conditions of this letter.
<PAGE>
(a) The Term Loan will be evidenced and governed by the Lender's standard
form of master note (the "Note"), a copy of which is attached hereto as Exhibit
"B". The Term Loan or portions thereof ("Loans" under and as defined in the
Note) shall bear interest at a rate equal to the Lender's prime rate of interest
announced by the Lender from time to time minus 2.00%, changing when and as such
-----
prime rate changes, with interest payable on the Maturity Date, and on demand
thereafter.
(b) Interest and fees will be computed on the basis of actual days
elapsed on a 360-day year basis.
(c) Ralston will use the proceeds of the Term Loan for general
corporate purposes.
(d) Ralston and the Borrower will provide the Lender with each of the
following before the Term Loan is funded: (i) an appropriate corporate
resolution, (ii) an incumbency certificate, (iii) an opinion of counsel, (iv) an
officer's certificate from Ralston certifying that (A) each of the 5-Year Credit
Agreement and the 364-Day Credit Agreement has been executed by all parties
thereto (including Bank of America, N.A.) and all conditions to effectiveness
thereof have been met, (B) the letter agreement between Bank One, N.A. ("Bank
One") and Ralston providing for a term loan in an amount at least equal to
$60,000,000 by Bank One and all documents related thereto have been executed by
all parties thereto and all conditions to effectiveness thereof have been met,
and (C) there is at least $175,000,000 in aggregate borrowing capacity available
to Ralston under one or more committed credit facilities, and (v) Ralston and
the Borrower shall have executed the Debt Assumption Agreement.
(e) The Lender shall have no obligation to make the Term Loan hereunder
(and the Term Loan and all accrued and unpaid interest thereon, at the option of
the Lender, may be declared immediately due and payable without notice) if: (i)
there is any failure by Ralston or the Borrower to pay any principal, interest,
fees, or other obligations when due under this letter, the Note, or any other
agreement or arrangement with the Lender, (ii) there exists any default under
the Note, or any violation or failure to comply with any provision of this
letter or the Note, (iii) there occurs any material adverse change in the
condition or results of operations of the Borrower and its Subsidiaries, taken
as a whole, since the date of the quarterly financial statements most recently
delivered to the Lender prior to the date of this letter, (iv) any litigation is
pending or threatened against the Borrower or any Subsidiary which might have a
material adverse effect on the financial condition or results of operations of
the Borrower and its Subsidiaries, taken as a whole, or on the ability of
Ralston or the Borrower to consummate the Transactions; (v) there is a default
under any agreement governing indebtedness of the Borrower or any Subsidiary,
(vi) any petition is filed by or against Ralston, the Borrower or any Subsidiary
of the Borrower under the Federal Bankruptcy Code or similar state law, (vii)
Ralston, the Borrower or any Subsidiary of the Borrower becomes insolvent,
howsoever evidenced or (viii) other than as a result of the consummation of the
Spin-Off, Ralston shall cease to own, directly or indirectly, all of the
outstanding capital stock of the Borrower, (ix) prior to consummation of the
Spin-Off, there is less than $175,000,000 in aggregate borrowing capacity
available to Ralston under its committed credit facilities, (x) after
consummation of the Spin-Off, there is less than $175,000,000 in aggregate
borrowing capacity available under the 5-Year Credit Agreement and the 364-Day
Credit Agreement, or (xi) there shall have occurred an adverse change in the
market for private placement of senior debt or a disruption of, or an adverse
change in, financial, banking or capital market conditions, in each case as
determined by the Lender. "Subsidiary" means (i) any corporation of which more
than 50% of the outstanding securities having ordinary voting power is owned or
controlled, directly or indirectly, by the Borrower or by one or more of its
Subsidiaries, or (ii) any partnership, association, joint venture or similar
business organization of which more than 50% of the ownership interests having
ordinary voting power are so owned or controlled. The Lender may require a
certificate of compliance with these conditions from the Borrower's Chief
Financial Officer or Treasurer as a condition to making any loan hereunder.
(f) The Lender may make assignments and sell participations in the Term
Loan, and may disclose information pertaining to the Borrower to prospective
assignees and participants. Any such assignment may be made only with the
Borrower's consent (which consent will not unreasonably be withheld).
(g) This letter agreement shall be effective as of the date of this
letter when the Borrower has signed and returned to the Lender a copy of this
letter.
(h) This letter agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which shall
together constitute one and the same agreement.
(i) THIS LETTER AND THE NOTE SHALL BE GOVERNED BY THE INTERNAL LAWS OF THE
STATE OF TEXAS. BOTH PARTIES HERETO HEREBY WAIVE TRIAL BY JURY IN THE EVENT
THIS LETTER OR THE NOTE BECOMES THE SUBJECT OF A DISPUTE.
Very truly yours,
BANK OF AMERICA, N.A.
By: /s/ Bank of America, N.A.
Title:
Accepted and agreed:
RALSTON PURINA COMPANY
By: /s/ James R. Elsesser
Title: Chief Financial Officer
ENERGIZER HOLDINGS, INC.
By: /s/ Daniel E. Corbin, Jr.
Title: Executive Vice President, Finance and Control
March 30, 2000
Ralston Purina Company
Checkerboard Square
St. Louis, MO 63164-0001
Attention: James R. Elsesser
Chief Financial Officer
Energizer Holdings, Inc.
Checkerboard Square
St. Louis, MO 63164-0001
Attention: Daniel Corbin
Executive Vice President -
Finance and Control
Gentlemen:
Reference is hereby made to the 5-Year Credit Agreement dated as of March
30, 2000 among Ralston Purina Company, a corporation organized under the laws
of the State of Missouri (the "Ralston") as the initial borrower prior to the
assignment to and assumption by Energizer Holdings, Inc., a corporation
organized under the laws of the State of Missouri ("Borrower"), the financial
institutions parties thereto as lenders, Bank One, NA, in its capacity as
administrative agent, Bank of America, N.A., in its capacity as syndication
agent, and Wachovia Bank, N.A., in its capacity as documentation agent (the
"5-Year Credit Agreement"). Capitalized terms used herein and not defined
herein shall have the meanings given to them in the 5-Year Credit Agreement.
In connection with the consummation of the Transactions, Ralston has
requested a term loan in the aggregate principal amount of $67,000,000 (the
"Term Loan") which would be made in a single advance on March 30, 2000 and would
mature on the date which is the earliest of (1) if the Spin-Off and Debt
Assumption have not occurred prior thereto, April 4, 2000; (2) the date of
receipt by the Borrower or any of its Subsidiaries of proceeds from the initial
funding under the Receivables Purchase Documents; and (3) April 14, 2000.
Amounts repaid by Ralston or the Borrower with respect to the Term Loan may not
be reborrowed.
Bank One, NA (the "Lender") is pleased to agree to make such Term Loan to
Ralston, to be assigned to and assumed by the Borrower pursuant to the Debt
Assumption Agreement, subject to the terms and conditions of this letter.
(a) The Term Loan will be evidenced and governed by the Lender's
standard form of master note (the "Note"), a copy of which is attached hereto.
The Term Loan shall bear interest at a rate equal to the Lender's corporate base
rate of interest announced by the Lender from time to time minus 2.00%, changing
-----
when and as the corporate base rate changes, with interest payable on the
Maturity Date, and on demand thereafter.
(b) Interest and fees will be computed on the basis of actual days
elapsed on a 365-day year basis.
(c) Ralston will use the proceeds of the Term Loan for general
corporate purposes.
(d) Ralston and the Borrower will provide the Lender with each of the
following before the Term Loan is funded: (i) an appropriate corporate
resolution, (ii) an incumbency certificate, (iii) an opinion of counsel, (iv) an
officer's certificate from the Borrower certifying that the Receivables Purchase
Documents have been executed by all the parties thereto and all conditions to
effectiveness thereof and the initial purchase thereunder have been met other
than the consummation of the Spin-Off and (v) Ralston and the Borrower shall
have executed the Debt Assumption Agreement.
(e) The Lender shall have no obligation to make the Term Loan
hereunder (and the Term Loan and all accrued and unpaid interest thereon, at the
option of the Lender, may be declared immediately due and payable without
notice) if: (i) there is any failure by Ralston or the Borrower to pay any
principal, interest, fees, or other obligations when due under this letter, the
Note, or any other agreement or arrangement with the Lender, (ii) there exists
any default under the Note, or any violation or failure to comply with any
provision of this letter or the Note and such default or failure shall continue
unremedied for thirty (30) days after the earlier to occur of (a) the date on
which written notice from the Lender is received by the Borrower of such breach
and (b) the date on which a member of the Senior Management Team of the Borrower
had knowledge of the existence of such breach or should have known of the
existence of such breach, (iii) there occurs any material adverse change in the
condition or results of operations of the Borrower and its Subsidiaries, taken
as a whole, since the date of the quarterly financial statements most recently
delivered to the Lender prior to the date of this letter, (iv) any litigation is
pending or threatened against the Borrower or any Subsidiary which would
reasonably be expected to have a material adverse effect on the financial
condition or results of operations of the Borrower and its Subsidiaries, taken
as a whole, or on the ability of Ralston or the Borrower to consummate the
Transactions; (v) there is a material default under any agreement governing
indebtedness of the Borrower or any Subsidiary which individually or together
with such other indebtedness as to which any such failure or breach exists has
an aggregate outstanding principal amount equal to or greater than $30,000,00,
(vi) any petition is filed by or against Ralston, the Borrower or any Material
Subsidiary of the Borrower under the Federal Bankruptcy Code or similar state
law, (vii) Ralston, the Borrower or any Material Subsidiary of the Borrower
becomes insolvent, howsoever evidenced or (viii) other than as a result of the
consummation of the Spin-Off, Ralston shall cease to own, directly or
indirectly, all of the outstanding capital stock of the Borrower. The Lender
may require a certificate of compliance with these conditions from the
Borrower's Chief Financial Officer or Treasurer as a condition to making any
loan hereunder.
(f) From and after the Maturity Date, the Lender may make assignments and
sell participations in the Term Loan, and may disclose information pertaining to
the Borrower to prospective assignees and participants. Any such assignment may
be made only with the Borrower's consent (which consent will not unreasonably be
withheld).
(g) The Lender and any other person or entity with an interest in the Note
(a "Holder") shall hold all nonpublic information obtained in connection with
this Letter Agreement and identified as such by the Borrower in accordance with
such Holder's customary procedures for handling confidential information of this
nature and in accordance with safe and sound commercial lending or investment
practices and in any event may make disclosure reasonably required by a
prospective Holder in connection with a contemplated participation or assignment
permitted by the immediately prior paragraph or as required or requested by any
governmental authority or any securities exchange or similar self-regulatory
organization or representative thereof or pursuant to a regulatory examination
or legal process and shall require any such prospective Holder to agree (and
require any of its transferees to agree) to comply with the provisions hereof.
In no event shall the Lender or any Holder be obligated or required to return
any materials furnished by the Borrower; provided, however, each prospective
Holder shall be required to agree that if it does not become a participant or
assignee it shall return all materials furnished to it by or on behalf of the
Borrower in connection with this Letter Agreement.
(h) This letter agreement shall be effective as of the date of this
letter when the Borrower has signed and returned to the Lender a copy of this
letter.
<PAGE>
(i) THIS LETTER AND THE NOTE SHALL BE GOVERNED BY THE INTERNAL LAWS
OF THE STATE OF ILLINOIS. BOTH PARTIES HERETO HEREBY WAIVE TRIAL BY JURY IN THE
EVENT THIS LETTER OR THE NOTE BECOMES THE SUBJECT OF A DISPUTE.
Very truly yours,
BANK ONE, NA
(Main Office Chicago)
By: /s/ Bank One, N.A.
Title:
Accepted and agreed:
RALSTON PURINA COMPANY
By: /s/ James R. Elsesser
Title: Chief Financial Officer
ENERGIZER HOLDINGS, INC.
By: /s/ Daniel E. Corbin, Jr.
Title: Executive Vice President, Finance and Control
